Module : PP (Production

Planning)

Organizational Elements

The SAP PP business processes uses the following organizational

elements:
Client
Company Code

Plant
Storage Location

Organizational Elements
Client

A Highest

Hierarchical Level in SAP (e.g. a corporation)

Used

to Differentiate between a Development, Quality Assurance, and

Production System within SAP R/3
Common

Set of Rules

Common Tables
Common Master Files
Common Data Bases

Standardized

data across the client

A vendor number and name is common across the client

A customer is common across the client
A material number and description is common across the client

Organizational Elements
Company Code

A company code represents an independent balancing/legal

accounting entity, for example, a company within a corporate
group.
Balance sheets and profit & loss statements, required by law, can
be created at the company code level.

Company Code ****

BALANCING / (LEGAL)
ENTITY

Assets Liabilities Revenues

- Expenses
Profit/Loss

Organizational Elements
Plant

Usually a manufacturing facility, a warehouse, or a location that stocks

, manages, and valuates inventory

May be a physical site with multiple manufacturing/production lines

May be multiple manufacturing/production lines at one physical site

Can be a physical location (cost centers may or may not be

associated to a plant i.e. Administrative vs. Manufacturing cost
centers)

Links to production (PP), materials management (MM), and sales and

distribution (SD)

A plant is assigned to a company code

Purchasing organization are assigned to plants.

Organizational Elements
Storage Locations
A

storage location is the place where stock is physically

kept within a plant
A storage location has the following attributes:

There may be one or more storage locations within a plant.

Stocks are managed only on a quantity basis and not on a value
basis at storage location level.
Physical inventories are carried out at storage location level.
Storage locations are always created for a plant.

Master Data
List of Master Data in SAP PP Module are:
Material Master
Bills Of Material
Work Centers
Routings

Master Data
Material Master

Material Master

Material Master

Material master record is a company's main source of

material-specific data. It is used by all components in
the R/3 Logistics System.

The integration of all material data in a single database

object prevents the problem of data redundancy. Every
area, such as Purchasing, Inventory Management,
Materials Planning, and Invoice Verification can use
the data stored.

Material Master
Since materials are processed by various user
departments within a company and each department
stores different information for the materials, the
material master is subdivided into information grouped
by user departments.
Each user department has a different view of the
material master record and is responsible for
maintaining the data to support its function.
The data maintained within a view may be valid for
more than one organizational level.

Material Master

Material Master

Material Master

Material Master

Material Master

Material Master

Material Master Units of Measure

Base unit: Piece

16

72

Box
(unit of issue)

Crate

Pallet

(order unit)

(sales unit)

Material Master

Material Master

Master Data
Bills Of Material

Bills Of Material

Bills Of Material

Bills Of Material

Bills Of Material

Bills Of Material

Bills Of Material

Bills Of Material

Bills Of Material

Bills Of Material

Bills Of Material

Bills Of Material

Bills Of Material

Bills Of Material

Bills Of Material

Bills Of Material

Bills Of Material

Master Data
Work Centers

Work Center

Work Center

Work Center

Work Center

Work Center

Work Center

Work Center

Work Center

Work Center

Work Center

Work Center

Work Center

Work Center

Work Center

Work Center

Work Center

Work Center

Work Center

Master Data
Routings

Routing

Routings - Components

Routing - Components
R o u tin g s
R o u tin g s c o n ta in :

T h e s te p s re q u ire d to p ro d u c e o r m a k e a n a s s e m b ly

T h e w o rk c e n te rs w h e re th e s te p s a re to b e p e rfo rm e d

T h e re s o u rc e s a n d to o ls n e c e s s a ry to c o m p le te a s te p a t a w o rk
c e n te r

M a te ria l a llo c a tio n

T h e m a te ria l b e in g m a n u fa c tu re d is a llo c a te d to th e g ro u p
c o u n te r (h e a d e r)

C o m p o n e n t m a te ria ls a re a llo c a te d to o p e ra tio n s

S ta n d a rd v a lu e s fo r s e tu p , p ro c e s s in g , a n d te a r-d o w n tim e

In s tru c tio n s o f w h a t to d o a t e a c h w o rk s te p

S k ills re q u ire d to d o e a c h s te p in th e a s s e m b ly p ro c e s s
R

S A P A G 0 6 /2 3 /9 7

Routings
R o u tin g s
A m a te ria l c a n b e m a n u fa c tu re d in d iffe re n t
w ays.
F o r e a c h m a te ria l, y o u c a n c re a te s e v e ra l
ro u tin g s fo r d iffe re n t

L o t s iz e ra n g e s

W o rk c e n te rs

U s a g e s , in c lu d in g

P ro d u c tio n
R e w o rk
P ro to ty p e
R

Routing - Group
R o u tin g s
R o u tin g s a re s to re d in g ro u p s o f s im ila r o r re la te d ro u tin g s .
E a c h in d iv id u a l ro u tin g is re fe rre d to a s a g ro u p c o u n te r
w ith in th e g ro u p

R o u tin g G ro u p

G ro u p
C o u n te r 0 1

G ro u p
C o u n te r 0 2

G ro u p
C o u n te r 0 3

G ro u p
C o u n te r 0 4
R

S A P A G 0 6 /2 3 /9 7

Routing - Group

Material Allocation
M a te ria l A llo c a tio n
B
M a te ria l

BOM

Ite m 1 0
Ite m 2 0

SAP AG

A
M a te ria l

R o u tin g

BOM

O p. 10

Ite m 1 0

O p. 20

Ite m 2 0

O p. 30

Ite m 3 0

PRT Assignments
P ro d u c tio n R e s o u rc e /T o o l A s s ig n m e n ts
R o u tin g

O p e ra tio n 1 0

PRT 1

O p e ra tio n 2 0

PRT 2

O p e ra tio n 3 0

SAP AG

Sequences in Routing
S e q u e n c e s in R o u tin g

A lte rn a tiv e s e q .
0002

M a in s e q u e n c e
0000

A lte rn a tiv e s e q .
0001

20

O p e ra tio n 1 0

10

25

O p e ra tio n 2 0

15

30

O p e ra tio n 3 0

20

O p e ra tio n 4 0

25

O p e ra tio n 5 0

30

Parallel Sequences
P a ra lle l S e q u e n c e s
20

25

30

O p e ra tio n
10

20

20

SAP AG

30

30

40

Scheduling in PP
S c h e d u lin g in P ro d u c tio n P la n n in g
M a te ria l R e q u ir e m e n ts P la n n in g

S e p a ra te s c h e d u lin g o f p la n n e d o r d e r s
E x a c t to th e d a y
B a s ic d a te s c a lc u la te d
P la n n e d s ta rt d a te
P la n n e d d e liv e r y d a te
C re a tio n d a te
U s e s lo t-d e p e n d e n t/lo t-in d e p e n d e n t in -h o u s e p r o d u c tio n
o r re p le n is h m e n t le a d tim e
O p tio n a lly u s e b a s ic p la n n in g d a y s fro m th e m a te r ia l
m a s te r to im p ro v e p e rfo rm a n c e
O p tio n a l c a lc u la tio n o f c a p a c ity re q u ire m e n ts

P r o d u c tio n o r d e r m a n a g e m e n t

SAP AG

P er io d s

O rd e r h e a de r

o p er at io n s

L e a d tim e s c h e d u lin g
E x a c t to th e s e c o n d
B a s e d o n b a s ic d a te

M RP
M an u al
T a rg e t d a te s c a lc u la te d (s c h e d u le d d a te s )
T a rg e t s ta rt d a te
T a rg e t fin is h d a te
O p e r a tio n s p e c ific d a ta u s e d to c a lc u la te o rd e r d a te s
C a p a c ity r e q u ire m e n ts c a lc u la te d

m a te ria l c om po n e n ts

P RT s

c o st s

p la n n ed
t arg e t
a ct u al

100 20
50

Scheduling
S c h e d u lin g : T im e E le m e n ts in a n O rd e r
F loa t b e f. O p e r. O p e r. O p e r. O p e r.
p ro d u c tio n 0 0 1 0 0 0 2 0 0 0 3 0 0 0 4 0
BS

........

O p e r.
0099

SS

Q u e ue
ES

F loa t a fte r
p ro d u c tio n

SF

S e tu p P ro c e s s in g T e a rd o w n
LS

W a it

EF

GR
P ic k /p a c k L o a d in g
p ro c e s s in g
BF

GI

DDD

LF

O p e ra tio n d a te s

BS
SS
SF
BF
AD
LT
GI
DDD

ES
LS
EF
LF

SAP AG

LT

M ov e

O rd e r d a te s
B a s ic s ta rt d a te
S c h e d u le d s ta rt d a te (p ro d u c tio n s ta rt d a te )
S c h e d u le d fin is h d a te
B a s ic fin is h d a te
A v a ila b ility d a te (e x p e c ted )
L o a d in g tim e
G o o ds is s u e
D e s ire d d e liv e ry da te

AD

T ra n s it

E a rlie s t s tart d a te
L a tes t s ta rt d a te
E a rlie s t s tart d a te
L a tes t fin is h d a te

T im e te rm s
L e a d tim e o rd e r o r
o p e ra tio n
F loa t tim e s o rd e r
E x e c u tio n tim e o p e ra tio n
In te ro p e ra tio n tim e s
P ro c e s s in g tim e s in
S a le s a n d D is trib u tio n

Sub Operations in Routing

S u b -o p e ra tio n
O p e ra tio n 1 0

O p e ra tio n 2 0

SAP AG

S u b -o p 1 0 /1 0

S e tu p

S u b -o p 1 0 /2 0

P ro c e s s in g 1

S u b -o p 1 0 /3 0

P ro c e s s in g 2

Scheduling
S c h e d u lin g S u b -o p e ra tio n s
10
BS

20

30

SS
E x e c u tio n

2 0 /1 0

F in is h re fe re n c e
to o ffs e t

W a it

TS

Q ueue

SF

2 0 /2 0

S ta rt re fe re n c e
to o ffs e t

F in is h re fe re n c e
2 0 /3 0

S ta rt re fe re n c e
to o ffs e t

M ove

BF

Production Planning

Demand Management

Material Requirement Planning

Planning of Purchased parts
Planning of in house assemblies

Planning Process: Process flow

Central marketing office
Demand (Weekly)

Dispatch plan
Demand planning cell
Production Requirement (Week wise, Model wise)

Planned Prod.
Confirmed
Vendor
Schedule

PPC

MRP Run

Planned Vendor Schedule

Vendor
Web site
Confirmed Production

Production

Third Party Log

Dispatch sheet

Planning Process: Strategies

While doing planning, you need to decide which planning strategy to use when the customer
places their order.

Make-to-Stock Production

Make-to-stock production means we build stock in anticipation of customer demand. We ship

the customer order from our stock of finished goods

Make-to-order Production

We wait for a customer order before we start production/procurement. i.e. We produce as per
demand from customer

Planning process: Demand Planning

Dealer

Dealer

Dealer

Dealer

Dealer

Territory office

Area Office

Dealer

Territory office

Area Office

Area Office

Zonal

Central Marketing office

PPC

Consolidation of Demand

Area Office

Planning Process: Demand Management

Demand management is the link between top-level
requirements planning (SOP) and materials planning
(MRP).
Input for the demand program can come from several
sources:

Materials Requirement Planning

M R P P ro c e d u re s : O v e rv ie w

M a te ria ls P la n n in g P ro c e d u re s

MRP

F o re c a s t-b a s e d
p la n n in g

C o n s u m p tio n -b a s e d p la n n in g

R e o rd e r p o in t
p la n n in g

T im e -p h a s e d
p la n n in g

SAP AG

MRP Overview

Uses of MRP
M R P U ses

M a te ria l re q u ire m e n ts p la n n in g is u s e d to p la n th e o n
tim e p ro d u c tio n o r p ro c u re m e n t o f th e re q u ire d
q u a n titie s fo r b o th in te rn a l c o n s u m p tio n a n d c u s to m e r
dem and.
T h is p ro c e s s in v o lv e s m o n ito rin g s to c k le v e ls a n d
a u to m a tic a lly c re a tin g o rd e r p ro p o s a ls fo r p u rc h a s in g
a n d p ro d u c tio n .
F o r m a te ria ls p ro d u c e d in -h o u s e , th e d e p e n d e n t
re q u ire m e n ts o f th e c o m p o n e n ts a re d e te rm in e d d u rin g
B O M e x p lo s io n .
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S A P A G 0 6 /2 3 /9 7

MRP Functions
MRP Functions
Material requirements planning (MRP) consists of the
following important functions:

Net change planning (short- and long-term) and regenerative

planning

MRP and consumption-based planning

Various lot-sizing procedures

Single-item or collective planning

Processing and rescheduling proposals

Easy-to-use options for evaluating the planning result

Single and multi-level pegging

Planning at multi-plant level

R

SAP AG 06/23/97

MRP Prerequisites

Planning Run

Planning Run - Types

P la n n in g R u n
T y p e o f P la n n in g
Run

W h a t is it?

T o ta l P la n n in g

P la n n in g a ll m a te ria ls fo r a
s p e c ifie d p la n t

S in g le -ite m , M u lti-le v e l P la n n in g

P la n n in g a c o m p le te B O M
s tru c tu re fo r a s in g le m a te ria l

S in g le -ite m , S in g le -L e v e l P la n n in g

P la n n in g a s in g le m a te ria l
o n e le v e l

In te ra c tiv e P la n n in g

S to p p in g th e M R P ru n
p e rio d ic a lly to m a k e c h a n g e s

S A P A G 06/2 3/97

MRP - Control Parameters

C o n tro l P a ra m e te rs fo r M R P
P la n n in g ru n c a n b e c a rrie d o u t a t tw o d iffe re n t le v e ls :

S in g le -ite m p la n n in g fo r a n in d ivid u a l m a te ria l

T o ta l p la n n in g fo r a ll m a te ria ls in a p la n t

P la n n in g R u n T y p e s

D u rin g re g e n e ra tive p la n n in g , a ll M R P ite m s a re p la n n e d fo r a p la n t.

T h e n e t ch a n g e p la n n in g p ro ce d u re p la n s o n ly th o se M R P ite m s th a t h a ve
ch a n g e d re le va n t to p la n n in g sin ce th e la st M R P ru n .

In n e t ch a n g e p la n n in g in th e p la n n in g h o rizo n , M R P is ca rrie d o u t o n ly
w ith in a d e fin e d p la n n in g h o rizo n .

S A P A G 0 6 /2 3 /9 7

Net Change Planning

Planning in Planning Horizon

P la n n in g in th e P la n n in g H o riz o n

NNeett cchhaannggee ppla

lannnnin
ingg
in
in th
thee ppla
lannnnin
ingg hhooriz
rizoonn::
m
maate
teria
riall is
is ppla
lannnneedd

P la n n in g h o riz o n

T im e
Tod ay
NNeett cchhaannggee ppla
lannnnin
ingg in
in
th
e
p
la
n
n
in
g
h
o
riz
o
n
:
th e p la n n in g h o riz o n :
m
maate
teria
riall is
is nnoott ppla
lannnneedd

P la n n in g h o riz o n

!!!

T im e

Tod ay

SAP AG

Planning Run - Single Item

E x e c u tin g th e P la n n in g R u n fo r S in g le Ite m s
S in g le -ite m , m u lti-le v e l p la n n in g
- p la n n in g a B O M s tru c tu re
- p o s s ib ility o f c h a n g in g th e m a s te r p la n fo r
e a c h m a te ria l in th e b ill o f m a te ria l m a n u a lly

S in g le -ite m , s in g le -le v e l p la n n in g
- p o s s ib ility o f c h a n g in g th e m a s te r p la n m a n u a lly
+ c re a te
+ d e le te
+ change
+ re s c h e d u le
SAP AG

Single-item, Multi-Level Planning

S in g le -Ite m , M u lti-L e v e l P la n n in g
F in is h e d p ro d u c t
A s s e m b ly 1
C om ponent 1

A s s e m b ly 2

C om ponent 2

E x e c u te
p la n n in g ru n

P ro c e s s
p la n n in g re s u lts

M a te ria ls o v e rv ie w
S e le c t m a te ria ls
A id s :
- s o rtin g o p tio n s
- s e a rc h o p tio n s
- in o v e rv ie w
- in in d iv id u a l lis ts
SAP AG

E x e c u te
p la n n in g ru n
R

Single-Level MRP

Multi-Level MRP
M u lti-L e v e l M R P
D ependent
R e q u ire m e n ts
fro m M P S ru n

M o to rc y c le
MRP
A ll le v e ls
re c e iv e
d ep en dent
re q u ire m e n ts
fro m th e u p p e r
le v e l a n d th e n
p la n o rd e rs to
s a tis fy th o s e
re q u ire m e n ts

P o w e r T ra in

M o to r

G ear

Exhaust

C h a s s is

F ro n t
W heel

R ear
W heel

F ra m e

P la n n e d
= D ependent
O rd e r
R e q u ire m e n ts
fro m M R P ru n

B ra k e
S y s te m

P la n n e d O rd e r
o r P u rc h a s e
R e q u is itio n

M u lti-le v e l p la n n in g p la n s a c o m p le te B O M s tru c tu re .

T h e p ro c e s s fo r m u lti-le v e l p la n n in g is th e s a m e a s fo r s in g le le v e l e x c e p t th a t it c o n tin u e s fo r e a c h le v e l in th e B O M s tru c tu re .

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S A P A G 0 6 /2 3 /9 7

Total Planning
C a rry in g O u t T o ta l P la n n in g
PPla
lannnnin
ingg ty
typpeess::
PPla
lannnnin
ingg aallll th
thee m
maate
teria
rials
ls in
in aa ppaartic
rticuula
larr ppla
lannt,t, oorr

P la n t

PPla
lannnnin
ingg aallll th
thee m
maate
teria
rials
ls wwhhic
ichh hhaavvee uunnddeer-rggoonnee aa cchhaannggee re
rele
levvaanntt to
to ppla
lannnnin
ingg
(n
(neett cchhaannggee ppla
lannnnin
ingg))
P la n n e d re c e ip ts

P la n n in g in te rv a l:
U n lim ite d o r

P la n n in g
h o riz o n

P la n n in g in th e p la n n in g h o riz o n

T im e

R e q m ts

In th e to ta l p la n n in g p ro c e d u re , y o u c a n p la n a ll th e m a te ria ls in a p a rtic u la r
p la n t (re g e n e ra tiv e ) o r p la n th e m a te ria ls th a t h a v e u n d e rg o n e a c h a n g e
re le v a n t to re q u ire m e n ts p la n n in g s in c e th e la s t p la n n in g ru n (n e t c h a n g e ).

W h e n p la n n in g w ith in th e p la n n in g h o riz o n , o n ly th o s e m a te ria ls th a t h a v e

c h a n g e d re le v a n t to p la n n in g in th e n e a r te rm a re in c lu d e d .
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S A P A G 0 6 /2 3 /9 7

MRP Procedure
A b o u t th e M R P P ro c e d u re
D u rin g th e n e t re q u ire m e n ts c a lc u la tio n in M R P , th e S A P
R /3 S y s te m c o m p a re s a v a ila b le w a re h o u s e s to c k o r th e
s c h e d u le d re c e ip ts fro m p u r c h a s in g a n d p r o d u c tio n ,
w ith p la n n e d in d e p e n d e n t re q u ire m e n ts , m a te ria l
re s e r v a tio n s , a n d in c o m in g s a le s o r d e r s . If a v a ila b le
s to c k is le s s th a n th e q u a n tity r e q u ire d , th e s y s te m
c re a te s a n o rd e r p ro p o s a l.
T h e s y s te m c a lc u la te s th e q u a n tity re c o rd e d in th e o rd e r
p ro p o s a l a c c o rd in g to th e lo t-s iz in g p ro c e d u re y o u
s p e c ifie d in th e m a te ria l m a s te r. T h e o rd e r p r o p o s a l is
a ls o s c h e d u le d (i.e ., d e liv e r y a n d re le a s e d a te s a re
d e te rm in e d fo r m a te ria ls p r o c u re d e x te rn a lly ).
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S A P A G 0 6 /2 3 /9 7

MRP Control Parameters

S in g le -Ite m , M u lti-L e v e l M R P
M
MRRPP -- SSin
inggle
le-Ite
-Item
m,, M
Muulti-L
lti-Leevveell

UUssin
ingg NNeett cchhaannggee fo
forr to
tota
tall hhooriz
rizoonn,, M
MRRPP is
is
ppeerfo
rm
e
d
th
ro
u
g
h
o
u
t
th
e
e
n
tire
p
la
n
n
in
g
h
rfo rm e d th ro u g h o u t th e e n tire p la n n in g hooriz
rizoonn..
O
Onnly
ly th
thoossee m
maate
teria
rials
ls th
thaatt hhaavvee cchhaannggeedd re
rele
levvaanntt
to
to M
MRRPP aare
re re
re-p
-pla
lannnneedd..

S A P A G 0 6 /2 3 /9 7

MRP Control Parameters

S in g le -Ite m , M u lti-L e v e l M R P
M
MRRPP -- SSin
inggle
le-Ite
-Item
m,, M
Muulti-L
lti-Leevveell

TThhee DDeeliv
liveery
ry sscchheedduule
le ccoonntro
troll ppaara
ram
meete
terr ddeete
term
rmin
ineess ifif
sscchheedduulin
g
lin
e
s
w
ill
b
e
c
re
a
te
d
fo
r
th
o
s
e
p
u
rc
h
a
s
lin g lin e s w ill b e c re a te d fo r th o s e p u rc h a seedd m
maate
teria
rials
ls
th
thaatt hhaavvee aacctiv
tivee sscchheedduulin
lingg aaggre
reeem
meennts
ts in
in th
thee ssyysste
tem
m..

S A P A G 0 6 /2 3 /9 7

MRP Control Parameters

S in g le -Ite m , M u lti-L e v e l M R P
M
MRRPP -- SSin
inggle
le-Ite
-Item
m,, M
Muulti-L
lti-Leevveell

TThhee CCre
reaate
te M
MRRPP lis
listt ccoonntro
troll ppaara
ram
meete
terr ddeessig
ignnaate
tess ifif th
thee
M
MRRPP lis
listt wwill
ill bbee ccre
reaate
tedd aass aa re
ressuultlt ooff th
this
is ppla
lannnnin
ingg ru
runn..

S A P A G 0 6 /2 3 /9 7

MRP Control Parameters

S in g le -Ite m , M u lti-L e v e l M R P
M
MRRPP -- SSin
inggle
le-Ite
-Item
m,, M
Muulti-L
lti-Leevveell

TThhee PPla
lannnnin
ingg m
mooddee ccoonntro
troll ppaara
ram
meete
terr
ddeete
rm
in
e
s
h
o
w
th
e
s
y
s
te
m
re
a
c
ts
to
te rm in e s h o w th e s y s te m re a c ts to oord
rdeerr
ppro
roppoossaalsls,, fro
from
m ppre
revvio
iouuss ppla
lannnnin
ingg ru
runnss,, wwhheenn
th
e
y
s
till
m
e
e
t
th
e
n
e
w
re
q
u
ire
m
e
n
ts
th e y s till m e e t th e n e w re q u ire m e n ts ssitu
ituaatio
tionn..

S A P A G 0 6 /2 3 /9 7

MRP Control Parameters

S in g le -Ite m , M u lti-L e v e l M R P
M
MRRPP -- SSin
inggle
le-Ite
-Item
m,, M
Muulti-L
lti-Leevveell

TThhee SScchheedduulin
lingg ccoonntro
troll ppaara
ram
meete
terr ddeete
term
rmin
ineess hhooww
th
e
le
a
d
tim
e
fo
r
e
a
c
h
o
rd
e
r
w
ill
b
e
c
a
lc
u
la
te
th e le a d tim e fo r e a c h o rd e r w ill b e c a lc u la tedd..
YYoouu m
maayy cchhoooossee to
to ccaalclcuula
late
te th
thee le
leaadd tim
timee bbaasseedd
oonn th
e
o
p
e
ra
tio
n
s
in
th
e
ro
u
tin
g
o
r
to
u
s
th e o p e ra tio n s in th e ro u tin g o r to u see th
thee bbaassicic
ppla
n
n
in
g
d
a
te
s
fro
m
th
e
m
a
te
ria
l
m
a
s
te
r.
la n n in g d a te s fro m th e m a te ria l m a s te r.

S A P A G 0 6 /2 3 /9 7

MRP Control Parameters

S in g le -Ite m , M u lti-L e v e l M R P
M
MRRPP -- SSin
inggle
le-Ite
-Item
m,, M
Muulti-L
lti-Leevveell

TThhee PPro
rocceessss ccoonntro
troll ppaara
ram
meete
ters
rs ddeete
term
rmin
inee ifif
ccoom
p
o
n
e
n
ts
w
ill
b
e
p
la
n
n
e
d
w
h
e
th
e
r
o
r
n
m p o n e n ts w ill b e p la n n e d w h e th e r o r noott th
thee
BBOOM
M hhaass bbeeeenn cchhaannggeedd,, wwhheeth
theerr th
thee M
MRRPP lis
listt wwillill
bbee ddisisppla
y
e
d
b
e
fo
re
s
a
v
in
g
th
e
o
rd
e
r
p
ro
p
o
s
a
la y e d b e fo re s a v in g th e o rd e r p ro p o s alsls,, aanndd
wwhheeth
theerr th
thee ru
runn-tim
-timee ssta
tatis
tistic
ticss wwillill bbee ddis
isppla
layyeedd..
R

S A P A G 0 6 /2 3 /9 7

Net Requirements Calculation

N e t R e q u ire m e n ts C a lc u la tio n fo r M a te ria ls
P la n n in g U s in g M R P
S to c k
F irm e d re c e ip ts
R e q m ts

S a fe ty s to c k

A v a ila b le q u a n tity
N e t re q u ire m e n ts

T im e

S h o rta g e
R

SAP AG

T im e

Requirement Quantities
H o w to D e a l w ith U n fo re s e e n D e v e lo p m e n ts
in R e q u ire m e n t Q u a n titie s ?

S a fe ty s to c k
S a fe ty s to c k p a rtia lly a v a ila b le
D y n a m ic s a fe ty s to c k
S a fe ty tim e

SAP AG

Safety Stock
S a fe ty S to c k P a rtia lly A v a ila b le
S to c k
O rd e r p ro p o s a l

A v a ila b le
p o rtio n
S a fe ty s to c k
T im e

R e q m ts

SAP AG

Safety Time
S a fe ty T im e

T im e

S a fe ty tim e

Safety Time in Production

S a fe ty T im e in M u lti-L e v e l P ro d u c tio n

P la n n e d o rd e r

F in is h e d
p ro d u c t

T im e
Reqm t
S a fe ty tim e
P la n n e d o rd e r

C o m p o n e n ts
T im e
In d e p .re q m ts

D e p e n d e n t re q m ts

S a fe ty tim e

SAP AG

Lot Size Calculation

L o t-S iz e C a lc u la tio n

N e t re q u ire m e n ts
T im e

O rd e r p ro p o s a ls

T im e

SAP AG

Lot Sizing - Overview

Overview of Lot-Sizing Procedures
Lot-Sizing Procedures
Static
procedures

Period
procedures

Optimum
procedures

Lot-for-lot order quantity

Daily lot size

Part period procedure

Fixed lot size

Weekly lot size

Least unit cost

procedure

Replenish up to
maximum stock level

Monthly lot size

Groff reorder procedure

Flexible periods
according to
planning calendar

Dynamic lot size

creation

SAP AG

Static Lot Sizing

S ta tic L o t-S iz in g P ro c e d u re s
L o t-fo r-lo t o rd e r q u a n tity
Q u a n tity

R e c e ip ts
R e q m ts
T im e
P la n n e d w a re h o u s e s to c k =

F ix e d lo t s iz e

R e p le n is h u p to m a x im u m
s to c k le v e l
R

SAP AG

Period Lot - Sizing Procedure

P e rio d L o t-S iz in g P ro c e d u re s

R e c e ip ts
T im e
R e q m ts
P e rio d 1

P e rio d 1

P e rio d 1

SAP AG

Optimum Lot Sizing

O p tim u m L o t-S iz in g P ro c e d u re s
M a n y d e liv e rie s /
H ig h o rd e r c o s ts

M in im a l s to c k k e e p in g /
M in im a l s to ra g e c o s ts

F e w d e liv e rie s /
L o w o rd e r c o s ts

M o re e x te n s iv e s to c k k e e p in g /
H ig h e r s to ra g e c o s ts

SAP AG

Long Term Lot Sizing

L o n g -T e rm L o t S iz e
PPla
lannnnin
ingg hhooriz
rizoonn

SShhoort-te
rt-term
rm ppeerio
riodd
ee.g
.,
lo
t-fo
r-lo
t
o
rd
.g ., lo t-fo r-lo t o rdeerr qqty
ty

LLoonngg-te
-term
rm ppeerio
riodd
ee.g
.,
m
o
n
th
ly
lo
t
.g ., m o n th ly lo t ssizizee

P la n n in g h o riz o n is s p lit in to tw o p e rio d s .

D iffe re n t lo t-s iz in g p ro c e d u re s c a n b e d e fin e d
fo r e a c h p e rio d .
P la n n in g ru n is c a rrie d o u t in re g u la r in te rv a ls
u s in g a tim e -p h a s e d p la n n in g ru n .
R

S A P A G 0 6 /2 3 /9 7

Other Lot Sizing Features

O th e r N e w L o t-S iz in g F e a tu re s
L o t-s iz e c a lc u la tio n fo r m a k e -to -o rd e r
O v e rla p p in g o f fix e d lo t s iz e w ith s p littin g
P e rio d lo t-s iz e w ith s p littin g a n d o v e rla p p in g
F ix e d lo t s iz e 3 0 0 , c y c le tim e 1 d a y
F o rw a rd o v e rla p p in g
B a c k w a rd o v e rla p p in g

Reqm t
3 /1 5
900

Reqm t
3 /1 5
900
3 0 0 p c b y 3 /1 5
3 0 0 p c b y 3 /1 4
3 0 0 p c b y 3 /1 3

N E W 3 .0

3 0 0 p c b y 3 /1 5
3 0 0 p c b y 3 /1 6
3 0 0 p c b y 3 /1 7
R

S A P A G 0 6 /2 3 /9 7

Lot Size Rounding Profiles

L o t S ize R o u n d in g P ro file
R o u n d in g p ro file X Y
L e v e l T h re s h o ld v a lu e
1
2
2
32

R o u n d in g v a lu e
5
40

R eqm t

O rd e r
p ro p o s a l

1
2
6
7
21
22
31
32
41
74

0
5
5
10
20
25
30
40
40
80
R

S A P A G 0 6 /2 3 /9 7

Layout of MRP List

Stock Req. List - Layout

L a y o u t o f th e C u rre n t S to c k /R e q u ire m e n ts L is t
C u rre n t s to c k /re q u ire m e n ts lis t
V a ria b le h e a d e r
C o n te n ts
M a te ria l in fo rm a tio n
R e c e ip t/S to c k lis t

D a te
E x c e p tio n m e s s a g e
R e c e ip t/R e q m ts q u a n tity
A v a ila b le q u a n tity

C o n te n ts
re a d w h e n
lis t is
accessed

...

M R P e le m e n ts

P la n n e d o rd e rs
P u rc h a s e re q u is itio n s
P ro d u c tio n o rd e rs
P u rc h a s e o rd e rs
P la n t s to c k /
S to ra g e lo c a tio n s to c k
F o re c a s t re q u ire m e n ts
S a le s o rd e rs
R e s e rv a tio n s
R

SAP AG

MRP List - Collective Display

MRP List - Functions

Exception Messages
Exception Messages
Exeptions indicate:
New order proposals created in the planning run
Dates in the past (start, finish or opening date)
Problems in BOM explosion
Problems in scheduling
Rescheduling

The following settings can be made in Customizing:

Priority: if several exception messages exist for one MRP element, the system
will display the message allocated the highest priority.
Creation of the MRP list depending on the exception message created.
Splitting into exception groups for the selection.
R

SAP AG

Rescheduling Checks
R e sc h e d u lin g C h e c k fo r F irm e d R e c eip ts
e .g . p ro d u c tio n o rd er, p u rch ase o rd er, p lan n e d o rd er)

EM
R e s ch e d u le
in

noEM
R e s ch e d u le
o u t? N o !

R e v ers e
R e c eip ts
T im e

T o le ran c e

T o le ran c e
R e q m ts

R e s ch e d u lin g h o rizo n

Old / New Exception Message

Old / New Exception Messages
Old MRP list
Exception: bring forward

Purchase order 4711/10

Time

10.10.

Processing by MRP controller;

Processing indicator set
Reschedule

Time
New MRP list after the next planning run
Same exception ==> Old exception
Purchase order 4711/10
10.10.

Time
R

SAP AG

Planned New Exception Message Order

Conversion
C o n ve rtin g P la n n ed O rd e rs C o llec tiv e ly

T o d ay

C o n v e rt

P lan n ed o rd e rs
T im e

O p e n in g d ate

SAP AG

Material Supply for Production

Collective Display

Search in Individual List

Current List - Functions

C u r r e n t S to c k /R e q m ts L is t: F u n c tio n s
PPro
rocceessssin
ingg oopptio
tionnss
M a te ria l m e m o

H
Heeaaddeerr ddaata
ta

C h e c k re s c h e d u lin g

M a te ria l m a s te r d a ta

S e a rc h o p tio n s
S to c k s ta tis tic s

V a ria b le h e a d e r

C o n s u m p tio n v a lu e s

G o to n e x t M R P lis t
in c o lle c tiv e d is p la y

P la n n in g s e g m e n ts
D
Dis
isppla
layy oopptio
tionnss
P e rio d to ta ls
G ro u p in g re q m ts
V a ria b le d is p la y o f
d a te s

S to c k s

R e c e ip ts

A
Acctio
tionnss fo
forr M
MR
RPP eele
lem
meennts
ts
D is p la y
C hange

R e q m ts

C o n v e rt
P e g g e d re q m ts
R

O rd e r re p o rt
SAP AG

Pegged Requirements
P e g g e d R e q u ire m e n ts
P la n n e d o rd e rs
FFin
inis
ishheedd ppro
rodduucctt
T im e
S a le s o rd e r

In d e p . re q m ts

CCoom
mppoonneennts
ts

P u rc h a s e o rd e r

T im e
D e p e n d e n t re q m ts

SAP AG

Order Report
O rd e r R e p o rt
S a le s o rd e r
PPla
lannnneedd oord
rdeerr

FFin
inis
ishheedd ppro
rodduucctt

AAsssseem
mbblie
liess

CCoom
mppoonneennts
ts

D e p e n d e n t re q m ts

D e p e n d e n t re q m ts

P la n n e d o rd e r

D e p e n d e n t re q m ts

PPuurc
rchhaassee
oord
rdeerr

PPro
rodduucctio
tionn oord
rdeerr

R e s e rv a tio n

SSto
tocckk

R e s e rv a tio n

PPro
robble
lem
m !!!
!!!

SAP AG

Planning Time Fence

D e te rm in in g th e P la n n in g T im e F e n c e
L e a d tim e
d ia g ra m

BOM
E1

M PS
M RP

B2
R1

D e te rm in e
- M a te ria l m a s te r
- M R P g ro u p

R2

P la n n in g le v e l

B1

E1
B1
B2
R1
R2

P la n n in g tim e fe n c e

M a n u a l m o n ito rin g

A u tom a tic or de r
p ro p o s a ls

Open
p e rio d

P la n n in g h o rizo n

B y u s in g th e p la n n in g tim e fe n c e , th e M R P c o n tro lle r c a n d e fin e a s p e c ific

p e rio d , fo r e a c h m a s te r s c h e d u le ite m , in w h ic h n o a u to m a tic c h a n g e s c a n b e
m a d e to th e m a s te r p la n .

T h e M R P c o n tro lle r c a n d e fin e th e p la n n in g tim e fe n c e p e r m a te ria l in th e

m a te ria l m a s te r re c o rd (M R P 1 s c re e n ), p e r p la n t, o r p e r th e M R P g ro u p .
R

S A P A G 0 6 /2 3 /9 7

Planning Time Fence

Scheduling in PP
S c h e d u lin g in P ro d u c tio n P la n n in g
M a te ria l R e q u ir e m e n ts P la n n in g

S e p a ra te s c h e d u lin g o f p la n n e d o r d e r s
E x a c t to th e d a y
B a s ic d a te s c a lc u la te d
P la n n e d s ta rt d a te
P la n n e d d e liv e r y d a te
C re a tio n d a te
U s e s lo t-d e p e n d e n t/lo t-in d e p e n d e n t in -h o u s e p r o d u c tio n
o r re p le n is h m e n t le a d tim e
O p tio n a lly u s e b a s ic p la n n in g d a y s fro m th e m a te r ia l
m a s te r to im p ro v e p e rfo rm a n c e
O p tio n a l c a lc u la tio n o f c a p a c ity re q u ire m e n ts

P r o d u c tio n o r d e r m a n a g e m e n t

SAP AG

P er io d s

O rd e r h e a de r

o p er at io n s

L e a d tim e s c h e d u lin g
E x a c t to th e s e c o n d
B a s e d o n b a s ic d a te

M RP
M an u al
T a rg e t d a te s c a lc u la te d (s c h e d u le d d a te s )
T a rg e t s ta rt d a te
T a rg e t fin is h d a te
O p e r a tio n s p e c ific d a ta u s e d to c a lc u la te o rd e r d a te s
C a p a c ity r e q u ire m e n ts c a lc u la te d

m a te ria l c om po n e n ts

P RT s

c o st s

p la n n ed
t arg e t
a ct u al

100 20
50

Scheduling - Basic Dates

S c h e d u lin g : C a lc u la tio n o f B a s ic O rd e r D a te s
R e q u ire m e n ts d a te
fo r p ro d u c t

B a c k w a rd s c h e d u lin g
BS

BF

BS

V a ria b le -s iz e p a rt

BF

P ro d u c t

A s s e m b ly
BF

BS

P la n n e d d e liv e ry tim e In -h o u s e p ro d u c tio n tim e

In -h o u s e p ro d . tim e
T im e

F lo a t b e fo re
p ro d u c tio n

SAP AG

E x e c u tio n tim e

F lo a t a fte r
p ro d u c tio n

Scheduling - Production Time

S c h e d u lin g : In -H o u s e P ro d u c tio n T im e
C a lc u la tio n o f p la n n e d d a te s
R e q u ire m e n ts d a te
BS

BF

In -h o u s e p ro d u c tio n tim e fro m m a te ria l m a s te r

10

F lo a t b e fo re
p ro d u c tio n

20

30

40

L e a d tim e s c h e d u lin g
u s in g ro u tin g

50

F lo a t a fte r
p ro d u c tio n

C a lc u la tio n o f p ro d u c tio n o rd e r d a te s
In -h o u s e p ro d . tim e g re a te r th a n s c h e d u lin g in ro u tin g
In -h o u s e p ro d . tim e s m a lle r
In c o rre c t in -h o u s e p ro d u c tio n tim e in m a te ria l m a s te r ?

SAP AG

Planning Process
Supply
Plant
Stock

Demand

Planning
Parameters

MRP

External
Procurement

Order
Proposal

In-House
Production

Planning Process

Production Execution

Stock transfer to WIP location

Order Execution
Production confirmation
Error handling

Planning Process

Planning Process

Production Execution
Physical Movement
Storage Loc MAIN

Storage Loc WIP

Production Execution
Planned Order

Availability Check

Convert Order
BOM
Routings

Production
Order

Move
floorstock

Work Center
Release

Avail check

Goods issue
Production

Goods receipt

Confirmation
TECO

Best Practices
Logistics Planning

Make-To-Stock Discrete Manufacturing

Production Subcontracting (External
Processing)

Rework Processing (Stock-Manufactured

Material)
Rework Processing (Work-In-Process)

Logistics Planning
Purpose and Benefits:

Purpose

Benefits

The purpose of logistics planning is to make sure that future demand can be satisfied by
your companys available resources and to point out situations where demand cannot
be met in time or in the desired quantities.
Seamless Integration in complete planning cycle
CO-PA SOP LTP Demand Planning

Key process flows covered

Sales and Operation Planning

Long Term Planning

Logistics Planning
Detailed Process Description:
This

process sometimes is called Sales and Operations Planning. The process usually
takes place in a simulative mode and at an aggregated (usually product group rather than
end-item) level. Once a feasible production plan is found that satisfies demand it can be
used as the basis for operational production planning (MRP and Detailed Capacity
Scheduling).
The

Best Practice scenarios in this section cover the following planning workflow:

Planning/forecasting of future demand

Aggregated production planning including capacity check in order to check at product

group level if demand can be satisfied (using the SOP functionality)

Transfer of results to Long Term Planning (using the LTP module) to enable simulation
of material requirements, based on the production plan (s)

Planning takes place in separate (simulative) planning versions within LTP

Review and adjustments of planned requirements as needed

Once the simulated requirements are accepted, the demand (independent

requirements) is then transferred to active demand management for detailed MRP
Production Planning / Scheduling in the active version.

and

Logistics Planning Process Flow Diagram

Operational
Production
Planning &
Control
(Production
scenarios)

Revenue Planner

Event

Periodic Sales
and Operations
Meeting

Sales Qty
Budget and
Transfer to SOP
(with CO-PA),
Revenue
Planning (172)

Strategic Planner

SOP Verification
Demand Verification
(Check Sales Plan)
Create Rough-Cut
Production Plan

Sales Quantity
forecast (179)

Transfer Rough
Cut Production
Plan to Inactive
Demand
Management

Create LTP
Planning
Scenario

Evaluate
Capacity
Planning

Execute LTP
MRP

Operative
Productio
n Data

No

Copy to Active
Demand
Management

Acceptable
Plan

Yes

CO-PA = Profitability Analysis, SOP = Sales and Operations Planning, LTP = Long Term Planning, MRP = Material Requirements Planning

Make-To-Stock Production with Discrete

Manufacturing
Purpose and Benefits:

Purpose

This scenario describes a business process, which is typical for companies with lot-size
oriented production.
The production scenario produces a finished good and all dependent components in make-tostock production (MTS).
Furthermore, the scenario is supported by the main cost object controlling functions required,
such as preliminary costing and period-end closing.
Benefits

Production triggered by a production plan

Serial number and batch management included
Optional with: quality management, consigned inventory, external processing
Key process flows covered

Creating Planned Independent Requirements

Material Requirements Planning at Plant Level
In-House Production (subassembly)
In-House final assembly (Finished Good)
Capacity Leveling
Confirming Assembly Activities

Make-To-Stock Production with Discrete Manufacturing

Detailed Process Description:
This scenario describes a business process, which is typical for companies with lot size oriented
production. The production scenarios consist of both goods movements (goods issues and receipts)
and confirmation of completion of the production order.
Furthermore, the scenario is supported by the main cost object controlling functions required, such
as preliminary costing and period-end closing.
The typical planning process starts with sales quantity planning. The previous periods actual sales
figures can be used as a basis for future planning.
In Sales and Operations Planning, you ensure that production stays in line with sales so that you
may create the production plan synchronously to sales. The planning data is transferred from Sales
and Operations Planning to Demand Management. Demand Management generates independent
requirements, which are used in the subsequent Material Requirements Planning (MRP) run.
In material requirements planning, the bill of materials (BOM) for the top-level material demand gets
exploded and production is planned right down to procured component level. MRP results in planned
orders being generated for the material to be produced.
If insufficient warehouse stock is available, purchase requisitions are created for the raw materials
required. When the order is created, target costs are calculated for the order lot size (preliminary
costing).
During the production process, costs incurred are updated on the order, which enables you to keep
track of and compare target costs and actual costs at any time.
Period-end-closing activities are applied to the order. This includes Work In Progress calculation and
variance calculation.
After this, Work in Progress is settled to financial accounting and production variances are settled to
management and financial accounting.

Production Planner

Strategic
Planner

Event

Make-to-Stock Production Discrete Industry Process Flow Diagram

Periodic Plan
Revision

Beginning of
Planning Cycle

Creating
Planned
Independent
Requirements

Logistics
Planning
(144)

No

Material Requirements
Planning at Plant Level &
Evaluation of Stock /
Requirement List

Update Capacity

Capacit
y
Levelin
g O.k.?

1
Yes

MRP List

Purchase
Requisition

Planned
Orders

Material
Available
?

Convert
Planned Order to
Production Order

Yes

Capacity
Leveling

Release
Production
Order

Order Print

Buyer

Confirming
Assembly
Activities
/ Final
Confirmation

Material Staging
for Planned
Orders

Pick List

Inventory
Consumption @
Standard. Cost

Plant
WareControl house
ler
Clerk

Manufacturing

No
Semi-Finished
Goods Receipt

Goods Issue/
Back flush

Goods Receipt
Slip

Goods Receipt
Slip

Finished Goods
Receipt

Inventory @
Standard. Cost

Period End
Closing General
Plant
(181)

Procurement
w/o QM
(130)

Procurement of
Stock Material
with QM (127)

Procurement &
Consumption of
Cosigned
Inventory (139)

MM
Subcontracting
(138)

PPSubcontracting
(External
Processing)
(150)

Production
Supervisor

Event

Make-to-Stock Production Discrete Industry Process Flow Diagram

Review
Operation List

Production Subcontracting (External Processing)

Purpose and Benefits:

Purpose

Benefits

During the Manufacturing process, when a "Planned Order" for Production is converted to a
"Production Order", the system will check to see if there are any routing/work-center
operations which require external processing. External processing is when you have individual
production steps, that are operations or sub-operations, which are performed outside of your
company by a vendor. This type of processing is particularly important for subcontracting. It
can also provide a company with a feasible alternative to in-house processing, if capacity
bottlenecks occur.
An outline agreement can specify that a certain operation of the production order is executed
by an external subcontractor on a regular basis
In the case of capacity bottlenecks, the assembly procedure of the finished product can be
assigned to a subcontractor

Key process flows covered

Creating Purchase Order for External Processing

Goods Receipt for subcontracting Purchase Order
Enter Invoice
Periodic Payment

Production Subcontracting (External Processing)

Detailed Process Description:
Production

Subcontracting (External Processing)

When a Production Order is scheduled, external operations need to be taken into account. The duration of
an external operation is calculated either by using the planned delivery time or using the standard values.
The system automatically creates a purchase requisition for the operation or sub-operation that requires
external processing. The Production scheduler should inform the buyer they need to check the workload
for requisitions that require external processing.
When data is maintained for an external activity, a cost element is specified. The cost element determines
how the external activity is to be valuated. A decision needs to be made as to whether an operation or suboperation is processed externally via its control key. In the control key, it is determined whether externally
processed operations are scheduled on the basis of their standard values or the planned delivery time.
This information is needed to settle externally processed operations and sub-operations that have been
marked as relevant for costing in their control keys.
Purchasing should not convert the purchase requisition until the external processing is required. The
reason for this is that any quantity changes on the production order will automatically update the
requisition.
Once the purchase order is created it is printed and sent to the vendor. The purchase order informs the
vendor which service is required. The buyer/planner/scheduler creates a manual shipping document and
provides the information to the shipping department on what components need to be gathered for the
external processing and ships the components to the vendor.
When the vendor has completed the external processing, the material is shipped back. The warehouse
clerk receives the externally processed goods back into the warehouse. The vendor service is reflected on
the production order via an operation confirmation. The purchase order and the production order show the
quantity received.
The goods receipt of an externally processed material causes the status of the operation to be updated:
For a partial delivery of an external process operation, the status is: EOPD (External operation - partial
delivery) and for final delivery of a external process operation the status is: EOFD (External operation final delivery).

Production Subcontracting (External Processing) Process Flow Diagram

Accounts
Payable
Accountant

Warehouse
Clerk

Purchaser

Production
Supervisor

Event

Vendor

Vendor Receives
Material and
Performs External
Services

Perform External
Services

Ship External
Material Back
to Plant

Production Order
Generates Purchase
Requisition for
External Services

Incoming
Vendor
Invoice

Completion
Confirmation
of Production
Order

Check Order
Operations

Create PO from
Purchase Req (Vendor
assigned by Info
record)

Ship
Material to
Vendor

Print Purchase
Order

Subcontract
Services GR/IR

Goods Receipt
for
Subcontracting
PO

Periodic
Payment:
Accounts
Payable (158)

Deliver
Material
Back to
Shop
Floor

GR/IR PPV
Vendor

PP = Production Planning, RFQ = Request for Quotation, PO = Purchase Order, GR/IR = Goods Receipt/Invoice Receipt, PPV = Purchase Price Variance

Invoice Receipt

Rework Processing (Work-In-Process)

Purpose and Benefits:

Purpose

Benefits

Processing of defective material on a production order.

Scraps at defined operation automatically trigger rework process.
After rework, additional activity and material consumption can be confirmed.
Fully integrated in the production process

Key process flows covered

Confirming Production Activities

Confirm Scrap defective material
Confirm Parent Order at Rework Operation
Continue Shop floor-Activities

Rework Processing (Work-In-Process)

Detailed Process Description:
This scenario focuses on a rework process within production. All required rework
activities are related to the parent production order. For this reason, errors are
recognized and corrections initiated such as insertion of a rework operation within the
same production order. The additional rework operation is confirmed and settled within
the original production order, causing production variances within controlling and price
differences for the dedicated product.

Rework Processing (Work-in-Process) Process Flow Diagram

Confirming
Production
Activities

Event

End Process

Confirm Parent
Production Order for
Reworked Quantity That
Can Proceed to
Subsequent Operations

Confirm Scrap
Defective Material

Shop Floor Specialist

No

Insert Rework
Operation on Parent
Production Order
Automatically

Confirm Parent
Production Order at
Rework Operation
for Non-Defective
Quantity

Any
Complaint
Quantity to
Be
Scrapped?

Yes

Scrap Defective
Quantity that
Cant Be
Reworked

Continue Shop-FloorActivities for NonDefective-Quantity

Rework Processing (Stock-Manufactured Material)

Purpose and Benefits:

Purpose

Benefits

This process covers the rework of defective manufactured materials that are
found in the warehouse.
Transparent costs for rework activities
Use of all standard shop-floor control functionalities is possible

Key process flows covered

Create rework production order

Goods issue for defective material
Confirmation of rework production activities
Posting goods receipt for rework production order

Rework Processing (Stock-Manufactured Material)

Detailed Process Description:
Rework
For

Processing (Stock-Manufactured Material)

materials that can be reworked, a production order is created for correcting the
defect. The costs associated with the rework production order will be settled to
profitability as a material variance.

Production
Supervisor

floor
Warehouse Clerk Shop
Specialist

Production
Planner

Event

Rework Processing (Stock-Manufactured Material) Process Flow Diagram

Identified
Component in
Stock Requires
Changes

Create Rework
Production Order

End Process

Release Rework
Production Order

Confirmation of
Rework
Production
Activities

Posting Goods
Receipt for
Rework
Production
Order

Goods Issue for

defective Material

Review Order
Confirmations