Planning MRP - Overview The main function of material requirements planning is to guarantee material Availability
It is used to procure or produce the requirement quantities on time both for internal purposes and for sales and distribution.
MRP tries to strike the best balance possible between optimizing the service level and minimizing costs
Integration between master data, demand management, sales and distribution,
inventory management MRP Features Net requirements calculation
Lot sizing
MRP Internal production
and external purchasing Forecasting
Order scheduling Bill of Material
and generation Explosion MRP Overview - MRP at Plant or MRP Area Level You can plan material requirements at plant level or for different MRP areas. System adds together stocks from all of the individual storage locations, with the exception of individual customer stock, to determine total plant stock. Individual storage locations can be planned separately or be excluded from planning. In the case of material requirements planning on an MRP area level, only the stocks from the storage locations or subcontractor assigned to the respective MRP area are taken into account. Only the requirements in this MRP area are combined and procurement elements are created for them. This enables you to plan material requirements specifically for certain areas. MRP Overview - Material Requirements Planning in the Logistics Chain Sales and Distribution - concrete customer requirements from the market. In Demand Management - sales forecast. independent requirement, that is, the requirement for the finished product, tradable assemblies, trading goods and replacement parts. In order to cover these requirements, MRP calculates procurement quantities and dates as well as plans the corresponding procurement elements. The procurement element in the planning run is the planned order or, for external procurement, the purchase requisition. Both procurement elements are internal planning elements that can be changed, rescheduled or deleted at any time. Dependent requirements, Production orders for in-house production and purchase orders for external procurement. MRP Overview - Material Requirements Planning in the Logistics Chain The progress of the order for materials produced in-house is controlled by using the production order. The production order contains its own scheduling procedures, capacity planning and status management. Cost accounting is also carried out via the individual production order. Materials that are procured externally trigger the purchasing procedure. In this case, you must have chosen suitable vendors or you must have drawn up outline agreements. The quantities made available by production or by external procurement are placed in stock and are managed by Inventory Management MRP Overview The Planning Concept in SAP
SOP MASTER PLANNING MRP
Planned Customer Independent Independent Requirements Requirements Demand ie Sales Requirements Plan Requirements (Orders) from Offset SD Module
Keep Balanced
Planned Orders Production Plan Production Orders Order Proposals Purchase Requisitions
Order proposals, planned orders etc are created and adjusted by running the MRP programs. MRP Overview - MRP Proceedures
MRP
Consumption Based Planning
MRP PREREQUISITES
Activate MRP create the master data - material master (LO-MD-MM) bills of material (LO-MD-BOM) When you use MRP for in-house production, work center (PP-BD-WKC) routings (PP-BD-RTG) demand management (PP-MD-DEM) to define requirement quantities and requirements dates for finished products and important assemblies.. sales and distribution, if necessary Material Master MRP 1Key Fields MRP Type - Key that determines whether and how the material is planned. Reorder Point The stock level below which fresh stocks are to be planned Planning Time Fence: defines a period during which MRP will not automatically add or reschedule orders MRP Controller The personresponsible for material planning for the material. Material Master MRP 1Key Fields Lot Size: Key that determines which lot-sizing procedure the system uses within materials planning to calculate the quantity to be procured or produced. Minimum Lot Size Maximum Lot Size Fixed Lot Size Maximum Stock Level Planned Delivery: lead-time for purchased material GR Processing Time: goods receipt processing time Material Master MRP 2 Key Fields Procurement Type Inhouse / External / Both In-house Production: Lead time for the inhouse manufactured item. Planned Delivery: lead-time for purchased material GR Processing Time: goods receipt processing time Safety Stock
Availability Check indicates whether the system generates individual or summarized
requirements for sales orders for this material and for planning, which all MRP elements the system takes into account for the availability check. Material Master MRP 3 Key Fields
Availability Check indicates whether the system generates individual or
summarized requirements for sales orders for this material and for planning, which all MRP elements the system takes into account for the availability check. Material Master MRP 3 Key Fields
Storage Location MRP
MRP Indicator: determines whether or not requirements, for a specific storage location, are planned separately from the overall plan
Reorder Level: used for storage location MRP
Replenishment Quantity: used for storage location MRP
MRP Types
ND No Planning
PD MRP
VB Manual Reorder Point Planning:
MRP produces order proposals when stock falls below a reorder point. The reorder point and safety stock levels are entered manually
VM Automatic Reorder Point Planning:
The reorder point and safety stock level are calculated based on the forecast results
VV Forecast Planning The latest forecast is copied as requirements which are used to create order proposals Requirement Types MPS LEVEL PARTS Independent Requirements Planned Independent Requirements: Are used for the anonymous (Non-order-specific) planning of production or procurement (eg. demand forecast) Customer Independent Requirements: Are sales orders on the system. Sales Orders are generally copied directly into the PP system from the SD system, but they can also be entered manually
MRP LEVEL PARTS
Dependent Requirements Are directly related to or derived from the BOM structure for other items or end products. They are automatically generated during MRP Lot Sizing
Static Periodic Optimum (Cost )
Lot for Lot Daily Lot size Part period balancing
Fixed Lot size Weekly Lot size Least unit cost procedure
Replenish up to Monthly Lot size Dynamic Lot size creation
maximum stock level Flexible period Groff reorder procedure
Lot size according
to planning calen. MRP: Static Lot Sizing
Lot for Lot Order Quantity:
Shortage Quantity = Ordered Quantity
Fixed Lot Size:
Order Material Order = Shortage Quantity Order Shortage If Fixed Order = Quantity Fixed Order If > Quantity Quantity Fixed Order Quantity Order
Replenishment up to Maximum Stock Level:
Stock required to achieve Order Quantity = maximum stock level set in the material master Consumption Based Planning Use past consumption data (historical data) to calculate future requirements With the help of the material no reference to the master plan Prerequisites
The material consumption is consistent with
only a few fluctuations. You have an efficient and current inventory management. MRP procedures in consumption-based planning Reorder Point Planning
Forecast-Based Planning
Time-phased planning Reorder Point Planning The reorder point should cover the average material requirements expected during the replenishment lead time. Important for defining the reorder point: Safety stock, Average consumption, Replenishment lead time Reorder Point Planning important for defining the safety stock: Past consumption values (historical data) or future requirements Vendor/production delivery timelines Reorder Point Planning Manual Reorder Point Planning - define both the reorder level and the safety stock level manually Automatic Reorder Point Planning - both the reorder level and the safety stock level are determined by the integrated forecasting program. Reorder Point Planning -continuous monitoring of available warehouse stock within reorder point planning in Inventory Management. -calculates the net requirements -calculates the procurement quantity according to the lot- sizing procedure -schedules the procurement proposal Forecast Based Planning Forecast-based planning is also based on material consumption Forecast values and future requirements are determined via the integrated forecasting program-MP30/MP38 Period Pattern and Forecast Periods MRP Prerequisites
PLANT LEVEL Activated for MRP
MATERIAL LEVEL Valid MRP Type
Valid Material Status
Material MRP Views Maintained
MRP Controller Planned Lead Time MRP Group Lot Size Data MRP: Reorder Point Planning
Stock
Reorder Point
Safety Stock
Time Order Date Delivery Date Carrying Out the Planning Run Total Planning All materials in a given plant
MD01 All materials are reviewed by MRP regardless of activity
Only the materials in a plant that have undergone a change relevant
to planning since the last planning run (net change planning)
Planning Interval Limiting the MRP Planning Interval
example: 100 days
Planned requirements and
supply order receipts Time MRP Planning Horizon Planning Run Options for Automatic Creation of Requisitions and Delivery Schedules
MRP Control Parameter: determine whether or not MRP will
automatically create requisitions or delivery schedules Options are: Do not automatically create. Only create planned order Automatically create within the opening period Automatically create for the entire planning horizon Opening Period Parameter: allows the user to take advantage of MRP automatic creation features while retaining control over the number of open purchasing documents Total MRP Run Online-MD01 Total MRP Run Scheduling-MDBT Planning Run Types Regenerative Planning all master schedule items are planned for a plant. It is generally used during initial start-up to insure all items are planned or when heavy maintenance causes most items to be re- planned. Net Change Planning only master schedule items which have undergone a change to the supply/demand balance, such as warehouse receipts and issues, are re-planned. It is common to run net change MRP daily. Net Change Planning in the Planning Horizon shortens the period over which MPS plans to the planning horizon, which is set in Customizing. It is typically set to the length of time of the longest lead time item. This means that only those master schedule items which have undergone a relevant change within the planning horizon are planned. Single Item Planning-MD02/MD03 Single-level, Single-Item Planning Planning carried out for a single item on a BOM. Dependent requirements are only created for materials on the next lower level Multi-level, Single-Item Planning Planning carried out for the complete BOM structure of a material Multi-Level Planning Structure Independent Requirements Customer Requirements
Level 2 MRP List vs Stock Requirements List MRP Current Stock, MRP MRP Rqmts, Balances, Planning Planning Planning planned Receipts, Process Process Result Issues
Last planning Stock Requirements
run results List uses current data
The MRP List displays the result of the last planning run The Stock Requirements List displays the most up-to-date stock and requirements situation Stock Requirements List- MD04 Stock Requirements List-MD04
Date MRP Element Supply/Demand Ref EM Quantity Available
01/01 STOCK 100
01/08 ORDER Sales Order 25 75 01/15 PL ORD 1000 120 05 100 175
Stock Requirements List brings together all the supply orders, independent and dependent demands and stock balances for the material. MRP makes order proposals to balance the supply/demand position for the material
