SAP not to generate planned orders post MRP

[Former Member]

Hi All ,

We have a scenario wherein we do production of a material at a site and it is also directly sold from the site to the customer. The site here is the "warehouse" in reality.

For example in this case the production refers to a co-packing functionality using backflushing and production recording.

1. In reality C at most times is produced at another manufacturing site and then sent to Distribution warehouse site for sale.But at times due to limitations C is also co-packed produced at distribution warehouse.

To produce a Co-packed finished product C(24*200 gm) , it uses another finished component A(12*200 gm). So a BOM  has been setup for C having A as component.

2. Since it is a distribution warehouse , at most times there are customer orders for the Co-packed finished product C. These are visible in MD04 transaction.

3.At times there are situations that since Co-packed finished product is not available , it is co-packed. For this planned orders come in from 3rd party system.

4. So when MRP runs , dependent requirements are generated for the component finished product A and C can be co-packed produced and then sold to customer.

5. BUT , if there is no need for co-packing , and MRP run is done at plant level

           - AND Customer order/delivery quantity is more than the stock in distribution warehouse , MRP execution will lead to SAP generating planned orders for it.

6. But in reality we do not want SAP to generate planned orders at this distribution warehouse.

Is there a way we can restrict SAP to stop generating planned orders( by SAP) but let the planned orders be created based on the data feed coming from 3rd party system.

Thanks in advance.

[Former Member]

Vinayak,

It sounds like the primary Supply chain is that Demand at your Warehouse plant is supplied by your third party system.  It further sounds like when there is an excess of demand over the expected receipts from the third party system, you then decide "somehow" to build FGs in the Warehouse plant.

I am a little fuzzy about "C" and :"co-packed C".  Are these the same thing (except for the place they are produced)?  E.G.  when a customer buys this product, would he in all cases be satisfied with either "C" and/or "co-packed C" interchangeably?

How is production in the third party system triggered and managed?  How do you know how much to build there, and when to send it to the SAP warehouse plant?  Why wouldn't you always just build more C in the third party system whenever there is a shortage? 

Is the signal to build in the third party system coming from SAP, or from some other method? And, why are you sending a Planned Order (instead of some other type of supply element) from the third party system to SAP?  Can you not rely on this order to be fulfilled?

In general, if your third party system were to send some type of Firmed supply element to SAP (Purchase Order, firmed purchase req, production order, firmed planned order) against the Warehouse plant, then MRP would use it to determine the net requirements calculation (shortage).  Furthermore, MRP will not alter any firmed elements, the system assumes that firmed elements are inviolate.  Demand (such as sales) that is in excess of the firmed elements will cause MRP to create planned orders against the Warehouse plant and explode demand to A.  It is unclear from your description how "A" is planned, but I assume there is some kind of supply chain in place for it as well.

Best Regards,

DB49

[Former Member]

Hi DB49 ,

Hope below answers fulfil most of your queries:

1. I am a little fuzzy about "C" and :"co-packed C".  Are these the same thing (except for the place they are produced)?  E.G.  when a customer buys this product, would he in all cases be satisfied with either "C" and/or "co-packed C" interchangeably?

Answer - Yes "C" and Co-packed C are same products. C is mostly produced at another manufacturing site. At times , they are unable to produce it due to capacity constraints , so Co-pack C is produced at the distribution warehouse. Producing Co-pack C is nothing but packing 12*200 gm packets to change to a 24*200 gm cases.

2. How is production in the third party system triggered and managed?  How do you know how much to build there, and when to send it to the SAP warehouse plant?  Why wouldn't you always just build more C in the third party system whenever there is a shortage?

Answer - 3rd party system is Manugistics. It is a demand and supply planning tool which based on forecast plans future production. The planned order data comes from manugistics to SAP which results in creation of planned orders in SAP.

3.It is unclear from your description how "A" is planned, but I assume there is some kind of supply chain in place for it as well.

Answer - A is a produced and planned at another manufacturing site. It is being sent to distribution warehouse. It is just that in a situation where supply of C cannot be fulfilled by the manufacturing site , it needs to be co-packed (Product C to be made at distribution warehouse).

Kindly let me know if you have further query.

Thanks in advance.

[Former Member]

Vinayak,

This one is still unanswered

And, why are you sending a Planned Order (instead of some other type of supply element) from the third party system to SAP?  Can you not rely on this order to be fulfilled?

Also, for the "C" Warehouse Plant FGs MRP run, do you want

a. NO SAP C planned orders to be created

or

b. SAP C planned orders to be created ONLY whenever demand exceeds 'Manugistic-based supply plus FGs C inventory in the Warehouse Plant'?

My first thought is to suggest importing the Manugistics type orders into SAP as Purchase Orders; or perhaps as Production orders, but I don't know what your plan is for your execution cycle (how do you plan to receive against these orders; how do you plan to change/reverse/delete these orders; how do you plan to book these orders and these receipts financially).

Best Regards,

DB49

[Former Member]

Hi DB49 ,

4. And, why are you sending a Planned Order (instead of some other type of supply element) from the third party system to SAP?  Can you not rely on this order to be fulfilled?

Answer - The business works in such a way that planned orders coming from Manugistics are only considered and NOT the one's generated on its own by SAP.

5.  Also, for the "C" Warehouse Plant FGs MRP run, do you want

a. NO SAP C planned orders to be created

or

b. SAP C planned orders to be created ONLY whenever demand exceeds 'Manugistic-based supply plus FGs C inventory in the Warehouse Plant'?

Answer - We want option a i.e. No SAP C planned orders to be created.

Kindly let me know how to achieve this option a.

Thanks in advance.

[Former Member]

Vinayat,

Set the FGs Material Master MRP type to "X0 Externally planned".  In this case, MRP will explode the BOMs of the FGs to dependent demand of the Manugistics Planned orders, but it will not create any new planned orders.

Or, if you are not concerned with dependent demand (e.g. for "A" and its components) to be exploded to lower lovels, set the MRP type for Manugistic Planned FGs Materials to "ND No Planning".  MRP will just ignore these parts.

Best Regards,

DB49