Automatic Reorder Point Planning

[Former Member]

We are considering using ECC Automatic Reorder Point Planning for some of our materials. I am interested to hear others' experiences with this approach, in particular re. SAP's calculation of the Reorder Point. Did it provide good quality results? Any lessons learned or pitfalls that we should watch out for? Any other advice?

Thanks,

Laurence.

[former_member196530]

Dear

We have worked on this Automatic Re-order Point planning concept in certain stratgic vendor level .I feel it's not much accurate than pre-determined manual re-order point planning .Basically , Automatic re-order point planning is based on the Forecast ( i.e It is one kind Consumption Base MRP-VM, which calculates Safety Stock and Re-Order Qty based on the Consumption of previous perdiod (12-6 months) ) .Now , when ever there is Forecasted qty based on certain model and stastical calcualtion , it will never be accurate and to achieve that accuracy , there are smoothing factors like Alpha Betaa and Gama ( refer Forecasting View ) wich plays important role along with MAD ( Mean Absulute Deviation ) and finally calculates the Sfety stock and ROP qty .But in actual business process for certain items , this calcualtion will not be 100% correct when you will plan and order through MRP .

After having this experince , we switch over two manual ROP (MRP Type : V1-just check ) .

Please refer my earlier post in the similar topic :

Hope it helps

Regards

JH

[Former Member]

Hello Jiaul,

Many thanks. That is very useful input.

How are you calculating the reorder point for your manual reorder point planning?

Regards,

Laurence.

[Former Member]

Hi Laurence,

I have worked on automatic Reorder point planning. It has not helped much as compared to manual re order point planning.

In automatic: we have to mantain historical values in Forecast tab. sometimes system shows unexpected reorder points which considers all alpha, Beta, Gamma Calculations.

Lot of values such as unplanned & consumed values to be kept track of it for accuracy.

In Manual : only reorder point quantity to be maintained. and can be monitored frequently for having realistic reorder point planning.

Advisable to go for manual re order point planning than automatic.

Regards,

Pradeep

[Former Member]

Thanks Pradeep. That is useful input.