Roundup: Optimizing on the Basis of
Hierarchical Planning Principles
mySAP Supply Chain Management
PD. Dr. Heinrich Braun
Dr. Dirk Meier-Barthold
GBU SCM
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 1
Agenda
1
2
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 2
Integration of SNP and PP/ DS
Example:
Integrated campaign optimization
Integrating SNP and PP/DS planning
SNP
PP/DS
Respects PP/DS orders as fixed
Respects pegged SNP demands
as due dates
" Capacity reduction
" Material flow
Planning SNP orders only in SNP
Horizon
" No capacity reduction
" But material flow
No restriction for scheduling
PP/DS orders
But release SNP orders only in
PP/DS Horizon
PP/DS Horizon
SNP Horizon
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 3
SNP considers setup in PP/DS
Setup for each bucket
Bucket 1
Bucket 2
PP/DSorders
SNP
PP/DS
Enhancing PP/DS orders by SNP orders
Bucket 1
SNPorders
A
PP/DS
orders
Bucket 2
B
A
SNP
PP/DS
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 4
SNP considers setup in PP/DS
Setup for each bucket
Bucket 1
Bucket 2
PP/DSorders
SNP
PP/DS
Enhancing PP/DS orders by SNP orders
Bucket 1
SNPorders
Bucket 2
A
PP/DS
orders
B
SNP
PP/DS
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 5
Lotsize/campaigns spanning several buckets
Setup for each bucket
SNP
Setup for each lotsize/ campaign
SNP
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 6
Enhance campaigns
SNPorder
PP/DSorders
SNP
SNP
PP/DS
PP/DS
released SNP-order
1. SNP plans order in the bucket at the end of the campaign,
if capacity is available
2. PP release order in this bucket
3. Campaign optimizer tries to enhance the campaign,
if allowed in optimizer profile
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 7
SNP selects alternative PPMs (sourcing)
Sourcing of SNP to alternative Production Process Model orders
Can be respected for release to PP/DS orders
PP/DS need not create orders
SNP-Orders
PPM1
400 250 100
300 250
PPM2
200 50
500 400
PPM1
150 150 150
PPM2
150 150
Fix Lotsize: 150
PPDS-Orders
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 8
Supply network wide campaign planning
Rolling planning schema
stages
Packaging
Bulk
Active
Ingredient
t
t+1
time
1. Enhance plan horizon and actualize demands
2. Optimize supply chain plan
3. Release SNP-orders in PP/ DS-orders in PP/ DS-horizon
4. Campaign optimization in PP/ DS
5. Reoptimize supply chain plan (considering PP/DS optimization)
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 9
Agenda
1
2
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 10
Integration of SNP and PP/ DS
Example:
Integrated campaign optimization
Concept of integrated campaign
optimization
APO
DP
PI-CIF
SNP
Demand Planning with
Bill of Material
PP/DS
R/3
PP/PI
SNP-confirmed forecasts
Release DP-forecast
to SNP
Deleting of PP/ DS production orders
(optional)
Supply Network
Optimization
SNPproduction orders
Release SNP-orders
to PP/DS
PP/DSproduction orders
R/3-production orders
Campaign planning
for bottleneck resource
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 11
Production orders
assigned to campaign
R/3-production orders
assigned to campaign
Trigger for
releasing to R/3
PP/PI-production orders
assigned to campaign
An Example of integrated campaign optimization
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 12
Concept of Demand Planning with dependent
demand
∑
DP-Relationships
∑
(Product 4711,Customer B, ...)
(Product 4711,Customer A, ...)
*q
*s
SNP-Relationships
(Component F,Product 4711,Customer A, ...)
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 13
(Component F,Product 4711
,Customer B,...)
Demand Planning with dependent demand (1)
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 14
Demand Planning with dependent demand (2)
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 15
Result of the Demand Planning
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 16
Release of Demand Planning forecast to SNP
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 17
Forecast im SNP
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 18
Strategy of the SNP-Optimizer
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 19
SNP-Optimizer result
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 20
SNP-Optimizer result for endproduct
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 21
Release of SNP-confirmed forecast to Demand
Planning
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 22
SNP-confirmed forecast in Demand Planning
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 23
SNP-Optimizer result for bottled product (1)
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 24
SNP-Optimizer result for packaged product (2)
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 25
SNP-Optimizer result for bulk product
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 26
SNP-Optimizer result for active ingredient
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 27
SNP-Optimizer result for raw material
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 28
SNP-Optimizer result in PP/ DS planning table
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 29
Concept of SNP-order and PP/DS-order integration
SNP
PP/DS
Packaging
Campaign Optimization
X
SNP
PP/DS
Bulk
Campaign Optimization
X
Rounding value!!!
Active Ingredients
X
SNP
PP/DS
Campaign Optimization
Production horizon
Demand
Set up time of SNP order
Production time of SNP order
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 30
Production time of PP/DS order
Set up time of PP/ DS order between different campaigns
Set up time of PP/DS order within a campaign
Result of the release in the product view
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 31
Result of the release in the PP/DS planning
table
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 32
Strategy of the campaign optimizer
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 33
Result of the campaign planning for the active
ingredients
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 34
Result of the campaign planning for the bulk product
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 35
Result of the campaign planning for the packaged
product
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 36
Result of the campaign planning for the end product
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 37
Strategy of the Generic Algorithm
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 38
Result of the integrated campaign optimization
 SAP AG 2001,
SCM Optimization Infodays, Dr. Heinrich Braun 39