Long Term Planning (LTP) Tutorial in SAP

PP
Long term planning (Simulative MRP) is used to simulate the future demand and supply
situation in all BOM levels. The main function is to check the capacity situation, material
requirement and vendor ability to provide the material in desired time.

This is not an actual run but a simulative run where actual planning situation is not being
affected, and we can see the capacity situation of the work centers well ahead in time. If
such information is available in advance, then we can decide at an early date whether
additional machines will be required to cope with capacity bottlenecks.

 LTP (Long Term Planning) is nothing but MRP run in simulation version to simulate
the production plan for the future.
 It is possible to transfer the plan from simulative version to operative version
"00"(actual planning) if through simulation it is found that all capacity and
requirement can be fulfilled.
 The purchasing department can also utilize the outcome of long-term planning. They
use the information on the future requirement quantities to estimate future purchase
orders. This provides them with an opportunity to negotiate delivery schedules and
contracts with vendors.
 Vendors also have an advantage from long-term planning results as they are sent a
preview of future estimated purchase orders and delivery schedules.
 Generally, Planned Independent Requirement (PIR) version can be either active or
inactive. For LTP planned independent version should be inactive as it is a simulative
version. Only active PIR version is being taken for operative planning (MRP).
 Existing master data can be used for LTP. But to have a different master data (BOM and
Routing) for LTP is also possible.
 If you want to delete the Long term planning data, then you need to delete the planning
scenario and you can re-run whole cycle again with new requirement again in another
inactive version.
 Long term planning data can also be utilized to transfer routing activity quantities to the
respective cost centers. Controlling department can calculate activity price calculation
by dividing the cost center budget value and activity quantity (calculated by LTP run)
which is used for standard cost calculation.
In this tutorial- you will learn

 How to Create Inactive version of Independent requirement (PIR)

 How to Create Planning Scenario

 How to run Long Term Planning

 How to Check Stock/requirement list

 How to check Capacity situation

 How to analyse Simulative Purchase info system

How to Create Inactive version of Independent

requirement (PIR)
Step 1) From SAP easy access, open Transaction MD61

1. Enter material code for which requirement needs to be created

2. Enter Plant Code.

3. Enter version as "02" which is inactive version and requirements would be considered
in Long Term planning run and not MRP.

4. Enter the Planning horizon dates for which demand needs to be created.

5. Enter planning period as month M.

After filling in all the fields, click or press Enter to go to the next screen.

Step 2) In this screen, we will input the requirement quantity of the material in monthly
buckets.

1. Version "02" and Active check box is unflagged which means it is an

inactive/simulative requirement and would be considered in LTP run only.

2. Enter the requirement quantity in monthly buckets.

Click to save after fill all the data, the system will show message .

How to Create Planning Scenario

Planning scenario creation is required for Long term planning run. Annual simulative
requirements in the form of PIR are assigned to the planning scenario.BOM selection ID
is assigned to the scenario for selection of relevant BOM in LTP run. We can also include
or exclude current stock , existing planned receipts from LTP run.

Step 1) From SAP easy access screen open Transaction MS31

1. Enter Planning scenario (numeric or alphanumeric of your choice) and give the
description of the scenario.

Press enter on the keyboard to move to next screen.

Step 2) In this screen,

1. Enter planning periods for which LTP run needs to take place.

2. Keep Opening stock as blank which means the current stock will not be considered in
LTP run.

3. BOM selection id "01" means active BOM will be exploded in LTP run.

Step 3) In the same screen,

1. Press "planned Independent requirement" button on top, a small pop-up window will
appear.

2. In the small pop up screen, enter version "02" and planning periods.

Step 4) In the same screen,

1. Press "Plants" button on top and a small pop-up screen appears.

2. Enter your manufacturing Plant code.

3. Press button "confirm", after verifying all the details

Step 5) In the same screen,

1. Press "Release+save" button and planning file entries will be generated.

2. Click "yes" in the pop-up window to release the scenario.

On clicking yes button, system will ask you to create planning file entries in online mode
or background mode.

Step 6) In this screen,

1. Planning file entries are generated. Click on button "immediately" to generate the
entries.
Messages will be generated regarding planning file entries which means system has
identified number of materials relevant for Long term planning run.

You can close this screen or can move back to easy access screen.

How to run Long Term Planning (LTP)

Step 1) In Transaction MS02, we will take LTP run.
1. Enter your planning scenario.

2. Enter the material code.

3. Enter your manufacturing Plant code for which you want to take MRP run.

4. Enter Processing key as "NETCH" ( Net change in total horizon)

5. Enter "1" in MRP List and system will create MRP list similar to stock /requirement
list for later analysis of previous MRP run.

6. Enter Planning mode "1" as we will take LTP run.

7. Enter Scheduling indicator "2" which means LTP will do lead time scheduling and
consider routing times to calculate the duration of simulative planned order.

8. Enter "1" to use settings from planning scenario i.e. firmed receipts will not be
considered in LTP run.
Press 2 times enter from keyboard to run the LTP. System will take some time to run LTP
and will throw messages regarding planning.

Step 2) In this screen,

1. Check the messages regarding number of procurement proposals created.

How to Check Stock/requirement list
This list will show you the requirement (inactive PIR) and receipt elements like
simulative planned orders for the planning scenario. This list will show all simulative
data and not the real time operative data.

Step 1) In Transaction MS04

1. Enter Planning scenario.

2. Enter material code.

3. Enter Plant code

Press enter to move to next screen.

Step 2) In this screen,

1. Check whether the planned orders got generated against the PIR and check the
rescheduling dates in the planned orders. These are all simulative planned orders and
nothing to do with real time data.
How to check capacity situation
Step 1) From SAP easy access, open transaction CM38 to check the capacity requirement
at the work center ie. Work center will be loaded with simulative planned orders which
has resulted in capacity requirements in terms of time.

1. Enter planning scenario.

2. Enter plant code.
Press enter to move to next screen

Step 1) In this screen,

1. Check the capacity load at the work center which is basically ratio of capacity
requirement (in hours) and available capacity (in hours).
How to analyze Simulative Purchase info system
LTP generates 'planned orders' instead of purchase requisitions and there is no 'Source of
supply' in planned orders. However, we can see the Vendor in the Standard Information
System reports.

After the LTP activity, a new version of the PURCHIS information system would be
created.
Step1) In Transaction MS70

1. Enter Planning Scenario.

2. Select the option "Standard/moving avg. price", which means simulative planned orders
will be evaluated at standard/moving avg price.

3. Unmark "Test mode" and execute. Version info structure 001 will automatically be
created.

When you press execute button, System updates the Purchase information system in
version 001 with simulative purchase order quantity with value so that purchase planner
can plan the raw materials for the whole year and can negotiate with the suppliers.

When you press the execute button, it will take you to the next screen.

Step 2) In Transaction MCEC, you can see the updates of purchase information system
done in previous step. Order quantity can be seen vendor wise for given period. This is all
done in simulation version.

1. Enter Planning scenario.

2. Enter your plant code.

3. Enter period to analyze

Press execute button on top or press F8 from keyboard to run this report. The report will
display the simulative purchase order quantity in next screen.

Step 3) This screen will display the anticipated Purchase Quantity and value for raw
materials based on simulative annual year production plan.

1. Check the PO quantity and value in simulation version

Troubleshooting

 All PP master data like BOM and routing needs to be in place to effectively run Long
term planning because without master data, you cannot drill down and plan to lowest
level in BOM i.e. raw materials.
 Ensure to enter the PIR quantity in inactive version to avoid any conflicts in real data.