SAP ERP

Operations: Manufacturing -- Production Planning

Business Scenario Maps

•   Discrete Industry: Make to Order

•   Discrete Industry: Make to Stock

•   Discrete Industry: Planning at Assembly Level

•   Manufacturing Execution

SAP ERP uses MRP techniques to create un-constraint production plans in form of production orders or planned orders. If further different techniques and algorithms than the ones described above shall be used, please check the scope of the SAP SCM - an application which is seamlessly integrated with SAP ERP.

Further Information

Please visit the SAP Service Marketplace to get further information on Production Planning within SAP ERP. To get a detailed view on production planning processes in SAP ERP, please have a look at the solution map for SAP Manufacturing .

The following business goals and objectives can be achieved through the implementation of these processes:

Lowering Working Capital

•   Improve capacity utilization

•   Reduce inventory carrying costs

Improving Customer Service

•   Improve customer satisfaction

•   Improve on-time delivery

Reducing Operating Costs & Increasing Efficiency

•   Deliver efficient operations

•   Reduce manufacturing cost

•   Reduce manufacturing cycle time

•   Reduce operating cost

•   Reduce total and unit manufacturing cost

SAP ERP uses MRP (Material Requirements Planning) techniques to create un-constraint production plans for discrete and process manufacturers.

The main function of MRP is to guarantee material availability, that is, it is used to procure or produce the requirement quantities on time both for internal purposes and for sales and distribution. This process involves the monitoring of stocks and, in particular, the automatic creation of procurement proposals for purchasing and production in form of production orders or planned orders.

In doing so, MRP tries to strike the best balance possible between

• optimizing the service level and
• minimizing costs and capital lockup.

Multiple monitors are available to evaluate the planning results.

Lean Manufacturing Planning (Discrete Industries)

SAP Lean solutions support advanced planning and material flow concepts and, in addition to providing a common database for design, engineering, production planning and costing, and providing high flexibility and responsiveness via rapid planning capabilities, line design, takt based scheduling, line balancing, Heijunka Scheduling and Kanban sizing, Kanban based execution and Summarized Just-In-Time (JIT) Sequence.

The key components of Lean Planning supported are:

• Line design supports depiction of individual production lines, linear networks, and highly complex networks with alternative lines, enabling line balancing of interlinked assembly lines, and optimization of individual line segments' work content. It is suitable for repetitive or flow manufacturing with takts where workstations are linked in place and time.
• Kanban Sizing at various stages of the operation based on various factors such as demand variability, supply reliability, material pull and replenishment intervals.The solution makes recommendations of the Kanban sizing for each part and provides the flexibility of overriding by the planner.

Production Planning for Process Industries (PP-PI)

Production Planning for Process Industries (PP-PI) provides integrated planning for batch-oriented process manufacturing. It is primarily designed for the chemical, pharmaceutical, food and beverage industries as well as the batch-oriented electronics industry.

The component PP-PI supports:

• The integrated planning of production, waste disposal, and transport activities within a plant
• The integration of plants within the company:Vertically by means of an information flow, ranging from central business applications down to process control and horizontally by the coordination of planning between production plants, recycling and waste disposal facilities, and production laboratories.

Production Planning for Discrete Industries (PP)

Production Planning for Discrete Industries (PP) addresses discrete manufacturers like the consumer products industry, machine construction, metal and paper production, automotive suppliers, and the electronics industry.

Compared to the process industry process here a production order is used to plan material requirements across all BOM levels, based on the customer requirements for the finished products and components. These orders represent receipt elements for in-house production and external procurement.

The business process includes analysis, planning according to MRP logic, and evaluation of the planning results. Extensive planning steps such as material requirements planning usually run in the background, although they may also be planned manually.The following production environments are supported:

• Engineer-to-order (ETO)
• Make-to-order (MTO)
• Make-to-stock (MTS)
• Configure-to-order (CTO)

Production Planning for Repetitive Manufacturing (PP-REM)

The main aims of Repetitive Manufacturing are to evenly distribute use of production lines and to simplify order processing in production and reduce setup times. It is possible to harmonize the material flow between the low level codes.

The business process is designed to meet the requirements of discrete industries. This includes the machine construction and automotive industries, the electronics industry, and the component supplier industries.

The production planning process includes analysis, planning according to MRP logic, and evaluation of the planning results. Extensive planning steps such as material requirements planning usually run in the background, although they may also be planned manually.

Various planning tools are available to you, such as the planning table and sequencing, which you can use separately or in combination, depending on your business requirements.

You can use Repetitive Manufacturing in the following production environments:

• Configure-to-order (CTO)
• Make-to-order (MTO)
• Make-to-stock (MTS)
  

SAP SCM – which can be integrated seamlessly - offers more sophisticated planning techniques and algorithms.

Configuration Variants

 The economic use of resources is an objective for many areas of a company. Capacity planning supports planning in all its phases:

• long-term rough-cut planning
• medium-term planning
• short-term detailed planning

Capacity planning comprises the following partial components:

• Capacity Evaluation

In the capacity evaluation, available capacity and capacity requirements are determined and compared with each other in lists or graphics.

• Capacity leveling

The objectives of capacity leveling are optimal capacity commitment and the selection of appropriate resources

Graphical as well as tabular planning tables are available to display the capacity situation and to carry out capacity leveling.

Interactive Capacity Planning (Discrete Industries)

SAP solutions support multiple facets of capacity planning for Lean Manufacturing.   

The resource capacity planning is computed by matching the demand takt to the capability of the resources.   

The resource capacity is determined by the calendar of shifts and the number of workers allocated during the shifts.

The solution provides visibility of overloads and provides interactive capability to manage the capacity by controling the shift calendar or the number of workers.  

Lean Manufacturing Planning (Discrete Industries)

SAP Lean solutions support advanced planning and material flow concepts and, in addition to providing a common database for design, engineering, production planning and costing, and providing high flexibility and responsiveness via rapid planning capabilities, line design, takt based scheduling, line balancing, Heijunka Scheduling and Kanban sizing, Kanban based execution and Summarized Just-In-Time (JIT) Sequence.

The key process steps of Lean Planning supported are:

• Line design supports depiction of individual production lines, linear networks, and highly complex networks with alternative lines, enabling line balancing of interlinked assembly lines, and optimization of individual line segments' work content. It is suitable for repetitive or flow manufacturing with takts where workstations are linked in place and time.
• Kanban Sizing at various stages of the operation based on various factors such as demand variability, supply reliability, material pull and replenishment intervals. The solution makes recommendations of the Kanban sizing for each part and provides the flexibility of overriding by the planner. 

The key components of Lean Planning supported are:

• Heijunka Planning: matches the demand to the capacity and produces a level supply to meet the demand and inventory requirements. Heijunka levels the capacity and the mix and determines the optimum batch size that would meet the capacity as well as maintain a high count of Every part Every Interval (EPEI)
• Line balancing: reconciles time requirements and capacity. Activities are assigned to line segments in a manner enabling activities to be completed within the pre-determined takt-time.
• What-if-Planning:  allows the planner to do what if analysis to create multiple scenarios with changing capacity while providing the visibility on the impact on the inventory levels and customer service levels.