APAC Procurement Business Module

Forecast-Based Planning Procedure Training Document

Local Group Companies

Submit Date, 23-Nov-04

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 Copyright @ 2003 Holcim Services (Asia) Ltd.
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Document Name Forecast-Based Planning Procedure Training Document
Author Ha Tran
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Created 23-Nov-04
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V 1.0 23-Nov-04 Ha Tran

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Table of Contents
FORECASTING IN FORECAST-BASED PLANNING ........................................................................ 4

NET REQUIREMENTS CALCULATION IN FORECAST-BASED PLANNING .................................. 5

SCHEDULING IN FORECAST-BASED PLANNING........................................................................... 5

BUSINESS PROCESS PROCEDURE................................................................................................. 6

1. EXTENSION OF MATERIAL MASTER DATA WITH FORECAST VIEW ........................................................ 6
2. EXECUTION OF FORECAST-BASED PLANNING ................................................................................. 12
VALIDATION OF FORECAST DATA/VALUE ............................................................................................. 12
3. RUN FORECAST-BASED PLANNING FOR THE MATERIAL .................................................................... 18

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Forecasting in Forecast-Based Planning

Forecast-based planning is oriented towards material consumption. Forecasting tools are used to
determine forecast values for future requirements based on past values. These forecast values form
the requirement values for the material requirements planning run.

The forecast calculation is executed at regular time intervals using the historical values for the
forecast of the future requirement. This is advantageous because the automatically determined
requirement is adjusted to the current consumption pattern. The forecast requirement is reduced by
material withdrawal. This ensures that the part of the predicted requirement that has already been
realized is not planned again.

The requirement values predicted by the system are copied in materials requirements planning and
net requirements calculation is executed. In net requirements calculation, every period is checked to
make sure that the forecast requirement is covered by the available warehouse stock or the fixed
dispatched receipts. If forecast requirements cannot be covered due to a material shortage, the
system will generate an order proposal.

The system uses the date of the forecast requirements as a basis for the requirement date. It is
assumed that the forecast requirement is at the start of the period. This means that the requirement
date is the first workday of the respective period.

It is enabled that the period pattern for the forecast can be specifically defined (day, week, month or
posting period) and the number of forecast periods for each material. However, it is possible that the
forecast’s period pattern is too vague for material requirements planning. In this case, the splitting
indicator can be well used to define for each material that the forecast requirement values for the
requirements planning are divided into a more precise period split. If the splitting indicator is being in
use, all period splits are reduced proportionally during the reduction of the forecast requirements.

It is also possible to define how many forecast periods are to be considered in material requirements
planning. The splitting indicator is defined in Customizing and assigned to the material in the
material master record.

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Net Requirements Calculation in Forecast-Based Planning

The system executes net requirements calculation during the planning run. It checks whether the
requirement is fulfilled by the existing warehouse stock and the fixed scheduled receipts. If there is
a requirement shortage, the system generates a procurement proposal.

In forecast-based planning, the system only regards forecasted requirement values as issues. The
shortage quantity is calculated by comparing the receipt elements (warehouse stock, order
proposals, purchase orders etc…) with the safety stock and the forecast requirement quantities.
Other issue elements, such as sales orders or reservations, are only displayed in forecast-based
planning; they are not taken into account in net requirements calculation.

Noted that in Customizing, it is possible to set dependently of the MRP group that part of the safety
stock or the entire safety stock is also included in the forecast-based planning stock in the MRP
calculation.

Scheduling in Forecast-Based Planning

For materials planned according to forecast-based planning, the future requirement date is known
before which the materials must be available. In scheduling, the release date is determined for
Purchasing, that is, the date when the material must be ordered so that it is available by the
requirement date. The system will, then, determine the release date of the purchase requisition (the
order start date of the planned order) backwards from the requirement date. This procedure is
called backward scheduling.

Starting from the requirement date, it is possible to calculate backwards to get the goods receipt
processing time in workdays (result: delivery date/order finish date), then the planned delivery time
in calendar days. Then the purchasing processing time in workdays is subtracted to determine the
release date (order start date of the planned order). For planned orders, the opening period is also
counted back from the order start date, in order to determine the opening date.

If backward scheduling determines a start date in the past, the system then automatically switches to
forward scheduling.

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Business Process Procedure

1. Extension of Material Master Data with Forecast View

1.1. Access transaction by

Via Menu Logistics Æ Materials Management Æ Material Master Æ Material Æ

Create (General) Æ Immediately

Via Transaction Code MM01

Key T-Code: MM01

Fig-01

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1.2. On “Create Material (Initial Screen)” screen, fill in the data as below:

Fig-02

Field Name Description R/O/C/D User Action and Values

Material Alphanumeric key uniquely R Enter the material number
identifying the material
Industry Sector Key that specifics the R Enter the industry sector
branch of industry to which
the material is assigned
Material type Key that assigns the R Enter the material type
material to a group of
materials such as raw
materials, operating
supplies or trading goods
Change number Number used to uniquely O Enter the change number
identify a change master
record
Number of the material R Enter the reference material
whose data you want the number
system to copy as default
values
Click on icon
Legend: R = Required, O = Optional, C = Conditional, D = Display

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1.3. On the pop up screen, select ‘Forecasting’ and click on icon:

Fig-03

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1.4. On the pop up screen, fill in the data as below:

Fig-04

Field Name Description R/O/C/D User Action and Values

Plant Key uniquely identifying a R Enter the plant number
plant
Copy from Plant of the reference R Enter the reference plant number
material whose data you
want the system to copy
Forecast prof. Key that allows you to O Enter the forecast profile
store forecast parameters
independently of a
material master record
Click on icon to extend the
Forecast View for the material
Legend: R = Required, O = Optional, C = Conditional, D = Display

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1.5. On “Create Material XXXXXXXXXXXX (HCM-Fuels)” screen, fill in the data as below:

Fig-05

Field Name Description R/O/C/D User Action and Values

Forecast model Indicator that defines on R Enter the indicator
which forecast model that
system bases its
calculation of future
requirements of the
material
Hist. periods The number of historical R Enter the number of historical
values the system uses for periods
the forecast
Forecast periods Number of period splits for R Enter the number of forecast
which a forecast should be periods
created
Optimization Specifies the increment by O Enter the optimization level
level which the system
optimizes the forecast
parameters
Click on icon to save the
extension of Forecast View for
your material.

Legend: R = Required, O = Optional, C = Conditional, D = Display

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Fig-06

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2. Execution of Forecast-Based Planning

Validation of Forecast Data/Value

2.1 Access transaction by

Via Menu Logistics Æ Materials Management Æ Material Master Æ Material Æ

Change Æ Immediately

Via Transaction Code MM02

Key T-Code: MM02

Fig-07

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2.2. On “Change Material (Initial Screen)” screen, fill in the data as below:

Fig-08

Field Name Description R/O/C/D User Action and Values

Material Alphanumeric key uniquely R Enter the material number
identifying the material
Change number Number used to uniquely O Enter the change number
identify a change master
record
Click on icon
Legend: R = Required, O = Optional, C = Conditional, D = Display

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2.3. On the pop up screen, select ‘Forecasting’ and click on icon:

Fig-09

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2.4. On the pop up screen, fill in the data as below:

Fig-10

Field Name Description R/O/C/D User Action and Values

Plant Key uniquely identifying a R Enter the plant number
plant
Click on icon

Legend: R = Required, O = Optional, C = Conditional, D = Display

2.5. On “Change Material XXXXXXXXXXXX (HCM-Fuels)” screen, click on

icon:

Fig-11

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2.6. On “Change Material XXXXXXXXXXXX (HCM-Fuels), click on tab

page:

Fig-12

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2.7. On “Change Material XXXXXXXXXXXX (HCM-Fuels) screen, make the proper validation of

the total consumption amount and appropriate adjustment (if any), then click on icon to
save the validation of the consumption data:

Fig-13

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3. Run Forecast-Based Planning for the material

3.1. Access transaction by

Via Menu Logistics Æ Materials Management Æ Material Master Æ Material Æ

Change Æ Immediately

Via Transaction Code MM02

Key T-Code: MM02

Fig-14

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3.2. On “Change Material (Initial Screen)” screen, fill in the data as below:

Fig-15

Field Name Description R/O/C/D User Action and Values

Material Alphanumeric key uniquely R Enter the material number
identifying the material
Change number Number used to uniquely O Enter the change number
identify a change master
record
Click on icon
Legend: R = Required, O = Optional, C = Conditional, D = Display

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3.3. On the pop up screen, select ‘Forecasting’ and click on icon:

Fig-16

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3.4. On the pop up screen, fill in the data as below:

Fig-17

Field Name Description R/O/C/D User Action and Values

Plant Key uniquely identifying a R Enter the plant number
plant
Click on icon

Legend: R = Required, O = Optional, C = Conditional, D = Display

3.5. On “Change Material XXXXXXXXXXXX (HCM-Fuels)” screen, click on

icon:

Fig-18

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3.6. On the pop up screen, select the forecast date and click on icon:

Fig-19

3.7. On the pop up screen, click on icon:

Fig-20

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3.8. On the pop up screen, click on icon again:

Fig-21

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3.9. On the pop up screen, maintain information as specified in the table below:

Fig-22

Field Name Description R/O/C/D User Action and Values

The Forecast value can be
manually adjusted and then fixed

by clicking on indicator. After

validation, click on icon
Legend: R = Required, O = Optional, C = Conditional, D = Display

3.10. On “Change Material XXXXXXXXXXXX (HCM-Fuels)” screen, click on icon:

Fig-23

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3.11. To view the Forecast based result, go to Transaction MD04 or follow the path – SAP
Menu Æ Logistics Æ Material Management Æ Inventory Management Æ Environment Æ
Stock Æ Stock/Requirements List:

Key T-Code: MD04

Fig-24

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3.12. On “Stock/Requirements List: Initial Screen” screen, fill in the data as below:

Fig-25

Field Name Description R/O/C/D User Action and Values

Material Alphanumeric key uniquely R Enter the material number
identifying the material
MRP area Number of the MRP area R Enter the number of MRP area
for which material
requirements planning
should be carried out
separately
Plant Key uniquely identifying a R Enter the plant number
plant
Press ‘ENTER’, then the system
will display the
Stock/Requirements List
Legend: R = Required, O = Optional, C = Conditional, D = Display

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Fig-26

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