Implementation approach roll out of Supply Network Planning

[former_member298549]

Dear all

I was wondering what best practice is for roll out of Supply Network Planning for a global company.

First start with implementing SNP on sales organisations and distribution centres, and the last step at the factories (top down)? Or can you also start with implemenation at the factories, then at the distribution centres (bottom up)?

What are the pros and cons of each implementation approach?

How to deal with intercompany movements (stock transfers) in case a distribution centre is live with Supply Network Planning and other distributioin centres or factories are still on ECC?

[rajkj · Accepted solution]

Hi Peter,

Per APICS' OMBOK and OM framework, the planning function should start with direct demand consolidation and DRP. Based on this recommendation, the SNP should go-live first for distribution centers. This will generate the distribution (indirect) demand at plants. These distribution elements can easily be transferred to ECC and execute MRP run there to generate the receipt elements. This can complete the planning cycle. If I'm correct, even SAP recommends first DRP and then, MPS.

On the other hand, if you want to start the plant planning in SNP first, the consolidated demand at plant is questionable and replenishment elements timing may not be accurate due to various approximations used in SNP. For instance, forecast order requirement time will be 00:00:00 hours, STR requirement time 12:00:00 hours, and planned order's material available time 23:59:59 hours.

Thanks,

Rajesh

[former_member298549 · Accepted solution]

Dear Rajesh,

I think you are right. Just another related question. How to deal with VMI scenarios?

Some factories act as a vendor and create deliveries and sales orders to manage the inventory of the customers.

Does this mean that also the VMI scenarios for the manufacturers should be rolled out after the go live of the distribution centres?

[rajkj · Accepted solution]

Hi Peter,

In APO based VMI planning, typically, the company's DC try to replenish the customer's warehouse. However, it depends on the established supply network between the partners. We can safely assume that it also needs the DC to be live on SAP first to support VMI planning in SNP.

In one of the projects for a major Canadian food processor, the VMI solution deployed without plants fully on the SAP. The generated VMI sales orders of ECC were sent to legacy planning system (BPCS) through a custom interface where it creates a direct demand at the plant. The legacy system was responsible for stock allocation and delivery functions. Upon delivery, the custom interfaces close the VMI sales order and report the available stock back to ECC in real time.

Thanks,
Rajesh

[former_member298549 · Accepted solution]

Thanks Rajesh