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SAP PP Overview 1
Course Contents
Introduction
Organizational Structure
Production
# Master Data
Planning
# Planning Levels
Control
# Production Orders
Integration with other modules
SAP PP Overview 2
Target Group
SAP PP Overview 3
Manufacturing Methods / Manufacturing
Strategies
Methods of Manufacturing
Repetitive Manufacturing
Discrete Manufacturing
Process Manufacturing
Projects
Manufacturing Strategies
Engineer to Order
Make to Order
Assemble to Order
Make to Stock
SAP PP Overview 4
Lead Times for Manufacturing Strategies
DLT
DLT
SAP PP Overview 5
Organization structure
Company - SSML
SAP PP Overview 6
Production Planning and Control
Master Data
SAP PP Overview 7
Master Data in PP
Material Master
Bill of Material
Work Center
Routing
Production Resources and Tools
SAP PP Overview 8
Master Data in PP
Material Master
SAP PP Overview 9
Material Master
SAP PP Overview 10
User departments
SAP PP Overview 11
Material Types in Standard SAP
SAP PP Overview 12
MRP Views
MRP 1 contains data relating to MRP Type, Lot Size and MRP Controller.
MRP 2 contains data relating to Procurement Type, Special Procurement
Type, Lead Time and Scheduling Margin Key.
MRP 3 contains data relating to Planning Strategy, Consumption Mode and
Availability Check.
MRP 4 contains data relating to Production Versions, BOM Selection Method
during MRP run and Repetitive Manufacturing.
Work Scheduling contains data related to Set-up Time, Processing Time,
Delivery Tolerances, etc.
Forecasting contains data as to how the material consumption took place
during the last few periods and on the basis of certain formulae, projections
for the future are made.
SAP PP Overview 13
Material Master MRP Key Fields
Basic, General, and Lot Size Data
SAP PP Overview 14
Material Master MRP Key Fields
Scheduling Parameters
Planning Time Fence: defines a period during which MRP/MPS will
not automatically add or reschedule orders
Scheduling Margin Key: controls the release period, opening period
for a material and scheduling floats for production
Release period is the number of working days taken to release a
production order
Opening period is the number of working days taken to convert
a planned order into a production order
Order floats allows for safety margin before and after production
Planned Delivery Time: lead-time for purchased material
In-house Production Time: lead-time for manufactured material
GR Processing Time: goods receipt processing time
Example: dock-to-stock time
SAP PP Overview 15
Material Master MRP Key Fields
SAP PP Overview 16
Master Data in PP
Bill Of Materials (BOM)
SAP PP Overview 17
Bill of Materials
The material for which the BOM is created is called the header and
it can contain one or more items below it.
SAP PP Overview 18
BOM Structure
BOM Items
Component 1 Component 2 Component 3
(assembly)
SAP PP Overview 19
BOM Technical Types
Variant BOM
Simple BOM
Alternative 1
Alternative 2
Multiple BOM
SAP PP Overview 28
Variant BOM
Bike color T Shirt
Red Collar
Dyed yarn
Black Collar
SAP PP Overview 29
Multiple BOM
Buttons Gassed
Labels Mercerized fabric
Plain Fabric
alternative 2
SAP PP Overview 30
Master Data in PP
Work Centers
SAP PP Overview 31
Work Centers
Work centers are used in task list operations (routings) and integrated with
Human Resource Management System .
SAP PP Overview 32
Work Center Category
Machine
Person
Processing Unit
Production Line
Machine Group
Station
SAP PP Overview 33
Work Center Views
Name and description
Basic Data Standard value key
Performance efficiency rate
Capacity category
Scheduling Data Interoperation times
Formula key
Available capacity
Capacity Data Formula key
Utilization
SAP PP Overview 35
Master Data in PP
Routings
SAP PP Overview 37
Routings
Definition:
A routing describes the processing steps required
to produce a material or provide a service .
Routings are also called task lists.
A routing is always created with reference to
material and a plant.
Examples:
Work steps - Op 10 - Pre-Assembly ...
Op 20 - Assembly ...
Op 30 - Inspection ...
Op 40 - Packaging ...
Op 50 - Delivery ...
SAP PP Overview 38
Routing Structure
The header contains data that are valid for the whole routing.
Operations describe individual process steps, which are carried out during
production.
SAP PP Overview 39
Operations in a Routing
Material
Operation 20
Routing Operation 10
Group
Work center
Routing Texts
Control data
Times
Material
Components
PRTs
SAP PP Overview 40
Use of Routings
Production/Assembly Scheduling
Order Times
Control data
RTG.
Texts 10 20 .... N
BOM Op 10
PRTs
Material t
Quality Start date Finish date
Cost
Center
Activity
Type Formula
Costs
SAP PP Overview 43
Production Planning and Control
Planning Levels
SAP PP Overview 46
Planning Levels in SAP R/3
SAP PP Overview 47
Planning Levels
Sales and Operations Planning
SAP PP Overview 48
Sales and Operations Planning
SOP specifies sales quantities for the long and intermediate term to roughly
assess the feasibility of sales and operation plans
The data from SOP is then disaggregated and then transferred to the next
planning level i.e. Demand Management
SAP PP Overview 49
Planning Levels
Demand Management
SAP PP Overview 50
Demand Management
MRP/MPS
SAP PP Overview 51
Demand and Supply Elements
Safety Stock
Demand Elements are also called requirements or issues, while Supply Elements
are also called receipts.
SAP PP Overview 52
Requirement Types
Independent Requirements
Planned Independent Requirements:
Are used for the anonymous (Non-order-specific) planning
of production or procurement (E.g. demand forecast)
Customer Independent Requirements:
Are sales orders on the system. Sales Orders are generally
copied directly into the PP system from the SD system, but
they can also be entered manually
Dependent Requirements
Are directly related to or derived from the BOM structure for
other items or end products. They are automatically
generated during MRP
SAP PP Overview 53
Planning Strategy Make-to-Stock
Make product for stock in expectation of customer sales.
Plan using planned independent requirements for anonymous
make-to-stock production.
SAP PP Overview 54
Strategy: Make-To-Stock Production
Production Push
SAP PP Overview 55
Planning Strategy Make-to-Order
Production
Sales orders trigger the production process.
Produced quantities for each sales order are managed individually.
Production and procurement costs are settled either to a sales order or a
project.
SAP PP Overview 56
Strategy: Make-To-Order Production
Example: New machinery
SAP PP Overview 57
Consumption Logic
Customer requirements consume planned independent requirements directly before or after it.
Consumption mode is either determined in the material master record or
in the configuration menu of demand management
Consumption mode determines either --
Backward consumption requirements directly before the sales order
Forward consumption requirements directly after the sales order
Both types are allowed the system looks for the next closest planning requirements
If no consumption periods exist, then you can only consume requirements planned
on the same day.
Example -- Forward Consumption
01/07 01/14 01/21 01/28
Planned Requirements 0 0 0 100
Customer Requirements 25 -------^
SAP PP Overview 58
Planning Levels
Material Requirements Planning
SAP PP Overview 59
Functions of MRP
SAP PP Overview 60
MRP Controller
SAP PP Overview 61
MRP Types
VB Manual Reorder Point Planning:
MRP produces order proposals when stock falls below a reorder point.
The reorder point and safety stock levels are entered manually
PD Deterministic Planning
MRP produces order proposal(s) to match the exact quantity of the
requirements based on independent and dependent demands
SAP PP Overview 62
MRP: Reorder Point Planning
Stock
Reorder Point
Safety Stock
Time
Order Date Delivery Date
SAP PP Overview 63
Lot Sizing
Fixed Lot size Weekly Lot size Least unit cost procedure
SAP PP Overview 64
Planning File
The planning file contains a list of all materials relevant to the planning run.
This means that as soon as a material master record is created with MRP
data and a valid MRP type, this material is then automatically included in the
planning file.
Before running MRP, the MRP controller has to ensure that the planning file
has been set up and includes all materials relevant to MRP.
SAP PP Overview 65
MRP Prerequisites
SAP PP Overview 66
MRP Features
Net requirements
calculation
Lot sizing
SAP PP Overview 67
MRP Control Parameters
Whether an MRP list will be created or not after the MRP run.
Whether the planning data will be adopted or whether the BOM will
be re-exploded.
SAP PP Overview 70
The MRP Run
Independent Requirements: BOM explosion
Sales Orders & Planned Dependent Requirements:
Independent Requirements From BOM explosion
Order Proposal
Stock Requirements
List / MRP List
SAP PP Overview 71
MRP List
MRP Order Proposals
Group of Materials and Planner Messages
Controllers MRP
MRP Controller for which controller from MRP Planning run.
Listing
is responsible
Planner can drill down
to review material
movement activity
SAP PP Overview 72
Production Planning and Control
Production Orders
SAP PP Overview 73
Production Order - Definition
SAP PP Overview 74
Functions of a Production Order
SAP PP Overview 75
The Production Cycle
1. Order Request
2. Order Creation
3. Availability Check
4. Machine Reservation
5. Order Release
6. Print Shop Floor Papers
7. Material Staging
8. Order Processing
9. Confirmations
10. Goods Receipt
11. Calculate Variances
12. Order Settlement
13. Archiving / Deletion
SAP PP Overview 76
Production Order Creation
Manual Order Proposal
Order Creation MRP Conversion
Determine
Order Type
SAP PP Overview 78
Backward Scheduling for In-house
Production
MRP determines the basic scheduling dates using backward scheduling
If the release date lies in the past, the system automatically
switches to forward scheduling
Order Order Order
Release Start Finish
Date Date Date
Future
MRP Planning MRP Planning Lead Time Requirement
Date -- today Date
SAP PP Overview 79
Production Order Release
Production Order Order release is carried out manually
Ready for Release
Material Availability
Check Uses checking rules defined in configuration
Order or
Operation Release
Material
Withdrawals Possible
SAP PP Overview 80
Material Availability Check
Net
Available 150 100 300 100
Requirement
for 50 Units
are Available
SAP PP Overview 81
Goods Movement for a Production
Order
Reservation
Material 2
Goods
Consumption of receipt of
Material 1 and 2 Material 3
Goods Issue
SAP PP Overview 82
Back flushing
SAP PP Overview 83
Backflushing (cont..)
SAP PP Overview 84
Confirmation Data
Yield
Scrap Quantity
Quantity
Scrap Reason
Start date
Dates Finish date
Work Center
Labor Personnel Number
Qualification
Wage Group
Wage Type
SAP PP Overview 87
Production Order Status
CRT REL CNF DLV COMP
. BOM and RTG . Completion Conf- .. Actual Production . Goods Receipt . Actual costs
selected irmation possible usage and time delivered settled to
captured cost objects
. Lead Time . Shop paper printed
Scheduling .Milestone operation
(MILE)
. Reservations . Availability Check
created for possible, at or
components before release
. Planned Order
costs created (PRC)
. Settlement Rule
Determined (SETC)
SAP PP Overview 88
Order Settlement
When a production order is settled, the actual costs incurred for the order are
settled to one or more receiver cost-objects (for example, to the account for
the material produced or to a sales order). Offsetting entries are generated
automatically to credit the production order:
If the costs for the production order are settled to a material account, the
order is credited each time material is delivered to stock. The material
stock account is debited accordingly.
If the costs for the production order are settled to another receiver (for
example to a sales order), the order is credited automatically at the time
of settlement. The cost-objects are debited accordingly.
SAP PP Overview 89
Production Planning Summary
SAP PP Overview 90
Integration with other modules
SAP PP Overview 91
Integration of PP with other modules
Material Availability Check
Sales Order
Customer Shipment Sales & Transfer of Requirements
Credit Limit
Distribution Goods Issue to SO
Invoice
Sales Forecast / Plan
Production Order
Production Production Order Receipt
Materials
Planning Management
Production Cost Accounting Document
Inspection
Purchase Order
Invoice Receipt
Goods Receipt
Quality
Quality
Management
SAP PP Overview 92