S/4HANA Demand-Driven Replenishment (aka.

DDMRP)
Overview based on 1909 (On-Premise)
November 2019

PUBLIC
Legal Disclaimer

The information in this presentation is confidential and proprietary to SAP and may not be disclosed without the
permission of SAP. This presentation is not subject to your license agreement or any other service or subscription
agreement with SAP. SAP has no obligation to pursue any course of business outlined in this document or any related
presentation, or to develop or release any functionality mentioned therein. This document, or any related presentation
and SAP's strategy and possible future developments, products and or platforms directions and functionality are all
subject to change and may be changed by SAP at any time for any reason without notice. The information in this
document is not a commitment, promise or legal obligation to deliver any material, code or functionality. This
document is provided without a warranty of any kind, either express or implied, including but not limited to, the implied
warranties of merchantability, fitness for a particular purpose, or non-infringement. This document is for informational
purposes and may not be incorporated into a contract. SAP assumes no responsibility for errors or omissions in this
document, except if such damages were caused by SAP´s willful misconduct or gross negligence.

All forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ
materially from expectations. Readers are cautioned not to place undue reliance on these forward-looking statements,
which speak only as of their dates, and they should not be relied upon in making purchasing decisions.

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 2

2
Agenda

Major Context of S/4HANA Production Planning

Introduction to the Topic of DDMRP

Overview of the SAP Solution S/4HANA Demand-Driven Replenishment

Insights into Solution Details

More Information

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 3

Major Context of
S/4HANA Production Planning
S/4 HANA Production Planning
History, including Suite on HANA

2012 First Launch of Suite on HANA with MRP Cockpit Demo

2013 MRP live & MRP Cockpit in Suite on HANA

2014/15 Move to S/4HANA, continuation of MRP live & MRP Cockpit

2016 Embedded PPDS

2017 Initial scope of Demand-Driven MRP

2018 Basic Capacity Monitoring, continuation of DDMRP

2019 Predictive MRP, Pacemaker Scheduling, continuation of Capacity Monitoring, Planning Interfaces (APIs)

2020+ <see Roadmap>

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 5

Introduction to the Topic of DDMRP
Motivation
Typical Customer Statements

As-Is Situation
I have too little stock of the products I need.
I have too much stock of the products I don’t need.
Overall I have too much stock.
Nevertheless, I cannot fulfill my customer orders (in time and quantity)

What I want
Best possible customer service levels …
… at lowest possible (inventory) costs

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 7

Motivation
DDMRP Philosophy (as defined by the Demand Driven Institute)

Challenges
§ Short Sales Order Visibility Horizon, long end-to-end Lead Times
§ Demand Variability, Disruption in Supply

Work with Forecast, classic MRP – risk of Bullwhip effect Promote Material Flow
§ Buffer to decouple dependencies and to dampen variability
§ Plan only against real demand
§ Prioritize in execution by inventory (buffer) status
© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 8
SAP Solution Overview
SAP S/4HANA Demand-Driven Replenishment
Business scope and scenario

The topic of DDMRP is relevant for a broad range of industries.

It can be applied to different business scenarios.

Demand-driven replenishment
MTS finished products
(demand-driven replenishment into DCs)
Demand-driven Demand-driven replenishment
replenishment or KANBAN

Components Semifinished
(External procurement) (In-house or out-sourced) Demand-driven production
of individualized products
MTO finished products
(in-house, very high variety or configurable)

Key capabilities
§ Enable immediate production of highly variable products
§ Ensure highest service levels at lowest possible inventory along all BOM levels
§ Provide full demand transparency, well-founded decision support, and instant reaction and resolution of issues

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 10

SAP S/4HANA Demand-Driven Replenishment
The End-to-End Process Flow

Analytics Buffer Positioning Individualized

(including basis for feedback) (strategic)
DD with buffer

Average Daily Usage Ad hoc production

5 1
Lead time
Classification

4
Replenishment 2
Execution Buffer Sizing
(operational)
3
Stock/ Stock+ Propos e d
Material Stock Le ve l Orde re d orde r qty
FIO-NAV-0815 3 13 30
Average daily usage
FIO-PST-1501 6 16 15
Lead time
FIO-MST-3006 55 135 0 Replenishment
FIO-PRD-0807 22 56 0 …
FIO-NAV-0101 23 23 127 Planning
FIO-NAV-0404 44 44 26
FIO-MST-0821 25 25 0
FIO-PRD-0822 88 88 0

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 11

S/4HANA Demand-Driven Replenishment
Available in Cloud since Release 1708, for On-Premise since Release 1709

Certified as DDMRP compliant by the Demand-Driven Institute (Nov 2017)

SAP S/4HANA SAP S/4HANA

Cloud Edition On-Premise Edition

Quarterly innovation cycle Yearly innovation cycle

First Version + Overview + Time-Dependent + Buffer + Interactive + Forward- + Support + APIs for Buffer + rolling ADU <see
Page Buffer Levels Positioning Planning looking ADU “Override” Pos. & Sizing sup. by PMRP Roadmap>

1708 1711 1802 1805 1808 1811 1902 1905 1908 …

1709 1809 1909
DDI Certification and Press Release <today>

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 12

Selected Insights
Buffer Positioning
Analyze a potential Decoupling Point in Detail (Network Graph)

3
1 Toggle between tree table and network graphics

Graphic supports Buffer Analysis by …

2
Ÿ setting scope (longest path, full flow, BOM)
1 Ÿ highlight by selected attributes
2 Ÿ (partial) collapse and expand of network
Ÿ navigation into next product(s)

3 Take the action to (un-)buffer

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 14

Buffer Sizing
Worklist: Review and Adopt Buffer Level Proposals

Take action
here …

… or navigate
into details and
decide there

Buffer ID Proposed Change Drivers for Change

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 15

Demand-Driven Planning
Worklist: Monitor the Planning Priority and Net Flow Position, Option to Create Supply

Dynamically determined number of buffers

1 with planning status red or yellow

Navigate into the planning worklist

2
Buffers to be replenished,
sorted by Planning Priority:
Net Flow Position / Max Stock

4
… or navigate
into object page
for detailed
planning by
clicking on a line

3 Quick action to create supply here …

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 16

Demand-Driven Execution
Worklist: Monitor the On-Hand Buffer Status …

Dynamically determined number of buffers with

1 execution status red or yellow

Navigate into the execution worklist

Buffers with critical fill level, i.e.

2 physical stock below a certain
threshold, sorted by
On-Hand Buffer Status = 4
Physical Stock / Safety Stock
… or navigate
into object page
by clicking on a
line

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC

3 Quick action to expedite existing supply (orders) here …
17
More Information
Helpful Links regarding DDMRP

On the Topic
§ Website: http://www.demanddriveninstitute.com/
§ Book: https://www.amazon.com/Demand-Driven-Material-Requirements-Planning/dp/0831135980
§ Videos to motivate and introduce DDMRP: https://vimeo.com/208396607, https://vimeo.com/219437991

On the SAP Solution

§ SAP Help for S/4HANA Demand-Driven Replenishment
§ SAP Best Practices Explorer, Scenarios …
– Buffer Level Management (1Y2)
– Demand-Driven Replenishment Planning and Execution (2QI)
§ Get your own S/4HANA trial instance from the SAP Cloud Appliance Library and try out the Best Practices Scenarios
§ Roadmap

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 19

Thank you.
Follow us

www.sap.com/contactsap

© 2019 SAP SE or an SAP affiliate company. All rights reserved.

No part of this publication may be reproduced or transmitted in any form or for any purpose without the express permission of
SAP SE or an SAP affiliate company.
The information contained herein may be changed without prior notice. Some software products marketed by SAP SE and its
distributors contain proprietary software components of other software vendors. National product specifications may vary.
These materials are provided by SAP SE or an SAP affiliate company for informational purposes only, without representation or
warranty of any kind, and SAP or its affiliated companies shall not be liable for errors or omissions with respect to the materials.
The only warranties for SAP or SAP affiliate company products and services are those that are set forth in the express warranty
statements accompanying such products and services, if any. Nothing herein should be construed as constituting an additional
warranty.
In particular, SAP SE or its affiliated companies have no obligation to pursue any course of business outlined in this document or
any related presentation, or to develop or release any functionality mentioned therein. This document, or any related presentation,
and SAP SE’s or its affiliated companies’ strategy and possible future developments, products, and/or platforms, directions, and
functionality are all subject to change and may be changed by SAP SE or its affiliated companies at any time for any reason
without notice. The information in this document is not a commitment, promise, or legal obligation to deliver any material, code, or
functionality. All forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ
materially from expectations. Readers are cautioned not to place undue reliance on these forward-looking statements, and they
should not be relied upon in making purchasing decisions.
SAP and other SAP products and services mentioned herein as well as their respective logos are trademarks or registered
trademarks of SAP SE (or an SAP affiliate company) in Germany and other countries. All other product and service names
mentioned are the trademarks of their respective companies.
See www.sap.com/copyright for additional trademark information and notices.