01 SCM200 AdvancedPlanning(APO)OverviewInstructor

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SCM200

SCM200 Advanced Planning

Overview (SAP APO)

mySAP Supply Chain Management

Date Training Center Instructors Education Website

Instructor Handbook

Course Version: 2004 Q3 Course Duration: 2 Day(s) Material Number: 50069188 Owner: Jochen Balla (D028014)

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About This Handbook

This handbook is intended to complement the instructor-led presentation of this course, and serve as a source of reference. It is not suitable for self-study.

Typographic Conventions

American English is the standard used in this handbook. The following typographic conventions are also used.

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Course Overview

This course covers the following subject areas:

• Advanced Supply Chain Planning overview

• Master data and transaction data for advanced planning • Demand Planning

• Cross-Plant Planning

• Production Planning and Detailed Scheduling

Target Audience

This course is intended for the following audiences:

• The target audience of this course is project team members and key users who are responsible for the introduction of advanced Supply Chain Planning using SAP APO.

Course Prerequisites

Required Knowledge

• SCM100 (Planning Overview (SAP R/3) ) Recommended Knowledge

• PLM100 (Lifecycle Data Management)

Course Duration Details

Unit 1:

Course Overview

Introduction 45 Minutes

Supply Chain Planning at a Glance 45 Minutes Unit 2: Master Data and Transaction Data

Supply Chain Master Data 20 Minutes

Exercise 1: R/3 Master Data 20 Minutes

APO Master Data 30 Minutes

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Unit 3: Demand Planning

The Demand Planning (DP) Concept 10 Minutes

Executing Demand Planning 40 Minutes

Exercise 4: Interactive Demand Planning 20 Minutes

Releasing the Demand Plan 10 Minutes

Exercise 5: Releasing the Demand Plan 10 Minutes Unit 4: Cross-Plant Planning

Supply Network Planning (SNP) Objectives 20 Minutes Executing Supply Network Planning (SNP) 40 Minutes Exercise 6: Executing Supply Network Planning 10 Minutes

SNP Planning Methods 40 Minutes

Exercise 7: Capacity Leveling 10 Minutes Unit 5: Production Planning and Detailed Scheduling

Objectives of Production Planning and Detailed

Scheduling (PP/DS) 60 Minutes

Executing Production Planning and Detailed

Scheduling (PP/DS) 80 Minutes

Exercise 8: Production Planning and Detailed Scheduling: Interactive Planning and Product

View 20 Minutes

Exercise 9: Production Planning and Detailed Scheduling: Executing Production Planning and

Detailed Scheduling 10 Minutes

Course Goals

This course will prepare you to:

• Gain a basic understanding of SAP functions in the area of advanced Supply Chain Planning

• Describe the Supply Chain Planning options available with the SAP R/3 and SAP SCM (APO) systems

• Understand the interplay between SAP R/3 and SAP APO in Supply Chain Planning

• Specify the advantages of the different Supply Chain Planning options

Course Objectives

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• Describe the role of both the SAP R/3 and SAP APO components in advanced Supply Chain Planning

• Specify which master data and transaction data are used in advanced Supply Chain Planning

• Explain the interplay and the integration of SAP R/3 and SAP APO • Execute fundamental planning functions, such as Demand Planning,

Cross-Plant Planning and Production Planning & Detailed Scheduling

SAP Software Component Information

The information in this course pertains to the following SAP Software Components and releases:

Revisions to Previous Instructor Handbook

The SCM200 course for Collection 33 has been replaced with the

fundamentally revised version for Collection 43. As part of this revision, most of the R/3-specific content has been removed. The course duration has changed from three days to two days. In the new course, planning is now only carried out in the SCM system under SAP APO.

Course Materials and Other Materials

Training material for course participants and SAP R/3 und SAP SCM (APO) systems.

Course Instructor Profile Level of Knowledge Required

The instructor must have a detailed knowledge of the processes of Supply Chain Planning in SAP SCM (APO). Since integration with SAP R/3 is an integral part of this course (master data, sales order management and shop floor control remain in R/3), knowledge of these areas is essential. A fundamental understanding of the master data in both systems, in particular, an understanding of production planning in discrete manufacturing, is essential, since the examples in this course deal with this area. Moreover, for planning within APO Demand Planning, basic knowledge of BW is an advantage.

Courses Recommended as Preparation

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Online help about APO (DP, SNP, PP/DS, integration of master data) and R/3 (material masters, BOMs, work centers, routings, and possibly demand management, material requirements planning and shop floor control). Hints on Preparing This Course

This instructor guide is not a substitute for your own preparation!

Despite the fact that Supply Chain Planning is carried out in the SCM system, it is executed in connection with R/3 for the reasons specified above. Since integration between the systems through the CIF interface plays a key role, the instructor should also have detailed knowledge of this area. Additional knowledge may be necessary, particularly when errors occur.

Monitoring of/error handling during the CIF transfer: The CIF transfer between R/3 and the SCM system for different data types takes place in corresponding data channels (queues). If an object transfer fails, the corresponding channel can become blocked, that is, all subsequent data transfers for this channel will be blocked. This characteristic becomes noticeable during the initial transfer of master data in particular. These situations therefore need to be monitored (for example, centrally for both systems using the SCM queue manager, transaction /N/SAPAPO/CQ ), and, if necessary, failed queues need to be reactivated or deleted, so that further transfers can take place.

Training System Data Required

This course is based on an R/3 System Release ERP with Plug-In 2004_1 and an SCM System Release 4.0 that contains SAP APO 4.0. RFC connections are used to link the systems to each other.

The data required for the exercises and demonstrations has already been created in the SCM and R/3 training systems (the R/3 training system is a copy of F34/Client 800 and the APO training system is a copy of F04/Client 800). In this course, pumps T-F2## in the locations 1000, 2300, 2400 and 2500 will be used as exercise data (pumps T-F3## and T-F4##, where ## equals 00 to 30 and 99, will also be available for demonstrations).

Pumps T-F2## (and their assemblies and components) are available in both the R/3 and SCM systems and the data transfer has already been set using an active integration model. Detailed Scheduling is set in plant 1000 in the same way as pumps R-F1## from R/3-specific planning courses.

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Model name for each T_PUMP0030 Application MD I (T_PUMP-MDI 0-30 variant)

contains material masters, plants, customers, suppliers and work centers for the product structures of pumps T-F2##, T-F3## and T-F4##.

Application MD II (T_PUMP-MDII0-30 variant)

contains production process models for the product structures of pumps T-F2##, T-F3## and T-F4##.

Application TD

(T_PUMPTD 0-30 variant)

contains sales orders, purchase orders and purchase requisitions, production orders and process orders, planned orders, manual reservations, planned independent requirements, storage location stocks, sales order stocks, special stocks stored by the customer, special stocks stored by the supplier and stock in transit for the product structures of pumps T-F2##, T-F3## and T-F4##.

Application ATP

(T_PUMPATP 0-30 variant)

contains the availability check for pumps T-F2##, T-F3## and T-F4##.

Hint: For an accurate and complete transfer of transaction data, active integration models are required for the master data. On its own, the active TD application is insufficient for the integration of transaction data.

Before the start of the course, it is recommended that you make sure that the specified integration models are active. Moreover, any existing queues should be deleted.

As a rule, pumps ## = 01 to 18 are used by course participants, so that numbers 00 and 19 to 30 are available for system demonstrations.

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If users have not yet been created, use transaction ZUSR to copy user IDs for course participants from a reference user ID (your own user, for example). The standard format for user IDs is the course ID plus the group number, that is, user names are SCM200-##. The initial password is “init”.

Preparation in the System

You need to create user IDs in both systems. Moreover, you should check before the course that the data for the exercises exists in full (by testing the exercises before the course, for example).

Goals and Objectives

The course provides an overview of the functions of Supply Chain Planning available within SAP SCM(APO) and SAP R/3.

At the end of the course, participants will be able to describe the basic functions of the following areas:

• APO Demand Planning

• APO Supply Network Planning

• APO Production Planning and Detailed Scheduling

Moreover, each participant will gain an overview of the required master data and with the essential characteristics associated with integrating these systems.

Course Structure and Flow

The sequence of the units determines the course structure.

It is recommended that you indicate that this is an overview course from the outset. The participants should acquire a general understanding of the main functions; it is not intended that they learn all the details.

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Unit 1

1

Course Overview

Putting the Unit into Context

The course discusses the content and organizational aspects of the course. Supply Chain Planning takes place in the SAP components SAP R/3 and SAP SCM (APO). While “standard” planning functions continue to be available in R/3 (SOP or MRP, for example), additional options for comprehensive and integrated Supply Chain Planning are provided in APO. As a rule, planning in APO is executed in R/3, which means that it is only useful to implement APO in connection with R/3. Therefore, in addition to a short introduction about the individual planning functions and the way they work together, you should also deal with the integration between the different systems in detail.

Unit Overview

In this unit you gain a brief overview of the mySAP Supply Chain

Management solution (mySAP SCM) and learn which SAP components are responsible for Supply Chain Planning: SAP R/3 (with plug-in) and SAP SCM (APO). You are also introduced to the functions of Supply Chain Planning in their overall context.

Unit Objectives

After completing this unit, you will be able to:

• Give a general description of the SAP components responsible for Supply Chain Planning, SAP R/3 (with a plug-in) and SAP SCM (APO).

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Unit Contents

Lesson: Introduction ... 3 Lesson: Supply Chain Planning at a Glance ... 11

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Lesson:

2

Introduction

Lesson Duration: 45 Minutes

Lesson Overview

In this lesson, you are introduced to SA ´Ps Supply Chain Planning solutions.

Lesson Objectives

After completing this lesson, you will be able to:

Ensure that the participants become familiar with the solution structure of mySAP SCM. It is also important for them to grasp that all three components, SAP R/3, SAP APO and SAP BW, must be taken into account when designing a Supply Chain Planning solution.

Business Example

You are a member of a project team currently using mySAP SCM to implement the functions of advanced Supply Chain Planning and first want to familiarize yourself with the relevant SAP components.

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mySAP Business Suite

Figure 1: Value creation using the mySAP Business Suite solutions

Cross-industry and industry-specific solutions are offered as part of the mySAP Business Suite. mySAP SCM (Supply Chain Management) and mySAP PLM (Product Lifecycle Management) are examples of cross-industry solutions.

Individual solutions have different key functional areas. Examples of key functional areas within the mySAP SCM solution are SCM Planning and SCM Production.

Each solution and key functional area uses components for technical

implementation. The key functional areas SCM Planning and SCM Production use principally the following components: R/3 Enterprise, APO (Advanced Planner and Optimizer) and BW (Business Information Warehouse).SAP R/3 (with a plug-in) and SAP SCM (APO)

mySAP Business Suite is based on SAP NetWeaver, an open, scalable

infrastructure, which facilitates the integration of heterogeneous environments (SAP and non-SAP components). SAP NetWeaver comprises the SAP Web Application Server, the portal infrastructure, the SAP Exchange Infrastructure and Information Integration. The SAP Web Application Server supports native Internet technology (both HTTP and XML)as well as JAVA and ABAP.

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SAP offers the relevant services together with these solutions: The SAP Customer Service Network helps customers to maximize their ROI with the mySAP Business Suite.

SAP Customer Service Network comprises:

• Business Solutions Consulting (business solution design, project management and continuous business improvement)

• Solutions Operations Services (technical implementation and continuous optimization)

• Training

• Support (24-hour support, 7 days a week, as well as EarlyWatch and GoingLive)

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mySAP SCM

Figure 3: Structure of the mySAP SCM solution

The mySAP SCM (Supply Chain Management) solution is divided into the following areas: Supply Chain Planning, Supply Chain Execution, Supply Chain Coordination and Supply Chain Collaboration.

In particular, the area of Supply Chain Planning includes Demand Planning, (cross-plant) distribution planning and procurement planning, detailed production planning down to operation level. You can execute these functions in SAP R/3 and/or SAP APO in the APO-DP, APO-SNP and APO-PP/DS components.

In particular, Supply Chain Execution contains planning execution as part of manufacturing. Materials Management also falls into this area. The SAP R/3 component plays a significant role in these functions.

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Figure 4: SAP APO 3.1 and SAP SCM 4.0

As a result of the continued development of APO functions, the SAP APO 3.1 system has been transported into the SAP SCM 4.0 system. In addition to the APO 4.0 functions, SAP SCM 4.0 contains the ICH (Inventory Collaboration Hub) and EM ((Supply Chain) Event Management) components.

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Supply Chain Planning

Figure 5: SAP components of Supply Chain Planning

Supply Chain Planning primarily uses the following SAP components: R/3, APO (Advanced Planner and Optimizer) and BW (Business Information Warehouse). The SAP SCM system contains several components, some of which constituted separate systems in preceding releases. In particular, SAP SCM 4.0 contains the APO 4.0 functions, therefore the further development of SAP APO 3.1. Furthermore, SCM 4.0 contains the Supply Chain Event Management (EM) and the Inventory Collaboration Hub (ICH).

The interfaces responsible for the integration of SAP R/3 with BW or APO are made available via a corresponding plug-in. The interface between R/3 and APO is called the Core Interface (CIF).

It is important that you draw the participants’ attention to the plug-in, which is itself an additional component to R/3. The plug-in contains the Core Interface (CIF) and has its own release and support cycles.

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Facilitated Discussion

See possible discussion questions in the “Supply Chain Planning at a Glance” lesson.

Discussion Questions

Use the following questions to engage the participants in the discussion.Feel free to use your own additional questions.

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Lesson Summary

You should now be able to:

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Lesson:

8

Supply Chain Planning at a Glance

Lesson Overview

In this lesson, you familiarize yourself with the individual Supply Chain Planning functions of SAP APO. You also gain an overview of the integration of these functions into SAP R/3.

Lesson Objectives

After completing this lesson, you will be able to: • Describe the planning functions of mySAP SCM • Define the different levels of Supply Chain Planning

• Outline how data is exchanged between R/3 and APO during the planning process

A general overview is sufficient at this time. The APO planning components are described in detail in the following units. You can therefore wait until later in the course to respond to detailed questions.

Business Example

You are a member of the project team responsible for implementing the functions of advanced Supply Chain Planning while using mySAP SCM. You gain an initial overview of the individual functions of advanced Supply Chain Planning.

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Overview

Figure 6: Supply Chain Planning scenario

The fundamental problem of Supply Chain Planning is that the delivery time of products to customers should be substantially shorter than the production time or lead time. To achieve this goal, stocks, or rather safety stocks, usually have to be created at either component level or finished product level in plants or distribution centers (DC).

You use postponement strategies to define to what extent the sales order is linked with the supply chain, in other words, at which point the decoupling of make-to-stock production (push strategies) and make-to-order production (pull strategies) takes place.

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Figure 7: Supply Chain Planning at a glance

Here you have an overview of the entire Supply Chain Planning process. This slide is used to place the relevant function into context at the beginning of each course content unit.

Generally speaking, Supply Chain Planning is divided into many steps, some of which can be executed by components in R/3 and others which can be executed in APO. It is possible and advisable to integrate these two systems and use both together when planning. The APO Core Interface (CIF) is used for this system integration.

Demand Planning, where historical sales figures can be used to derive a future production program, can be executed both within flexible planning in R/3 (using standard Sales & Operations Planning (SOP)), or within Demand Planning (DP) in APO.

Demand Management in its true sense takes place in R/3. However, it is also possible to derive planned independent requirements from APO-DP.

Sales orders are always created in the R/3 system. The global ATP check of a sales order can take place in APO (integration with PP/DS is also possible).

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Material requirements planning and capacity requirements planning can be executed in either R/3 or APO.

Production execution - that is, the processing of manufacturing orders (production orders or process orders), takes place in the area of Supply Chain Manufacturing.

Demand Planning

Figure 8: Demand Planning (1)

Demand Planning is a complex, powerful, and flexible tool that supports your company’s Demand Planning and material requirements planning process. The result of the forecast usually takes the form of demand forecasts at distribution center level or directly in production plants.

User-specific planning layouts of planning books enable you to include different departments or even other companies in the forecasting process. With APO Demand Planning, you can use univariate forecasting methods and advanced macro techniques to do the following: create forecasts from the demand history, based on many different causal factors; test predefined, and user-defined forecast models, and forecast results; and use a consensus-based approach to consolidate the demand plans of different departments. You can use forecast corrections and promotions to take account of marketing intelligence and management adjustments.

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Figure 9: Demand Planning (2)

It is appropriate to mention here that the terminology used for Demand Planning differs from that of Production Planning and Detailed Scheduling. The transition to Production Planning only takes place when the planning figures from Demand Planning are released as planned independent requirements to any chosen key figure.

Demand Planning can be executed in R/3 within the framework of Flexible Planning (Sales & Operations Planning) or in APO using the Demand Planning (DP) component.

In Demand Planning, a forecast based on aggregated historical data is executed. This historical data can originate from the SAP R/3 Logistics Information System (SAP R/3 LIS) or from the SAP Business Warehouse (SAP BW). The structure and formatting of planning data can be defined with extreme flexibility using the relevant data structures of SAP R/3 LIS or SAP BW. As a rule, these are based on the usage of characteristics (for example, location and sold-to-party) according to which key figures (for example, invoiced sales quantity) can be analyzed.

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Demand Management

Figure 10: Demand management

The term “demand management” does not appear in APO. However, planned independent requirements can still be generated and managed in APO. In this sense, demand management is therefore also possible in APO.

Demand management is used to manage independent requirements. The way in which independent requirements behave in material requirements planning (for example, if they affect requirements or if they consume other requirements) can be determined by their requirement type or their planning strategy.

Planned independent requirements are stock requirements that can be derived from a forecast of the future requirements situation. In make-to-stock production, you want to initiate the procurement of the materials concerned, without having to wait for concrete sales orders. Using such a procedure, you can shorten delivery times and use forecast planning to load your own production resources as evenly as possible.

Sales orders (customer independent requirements) are created in Sales and Distribution. Customer requirements can be transferred directly to material requirements planning, regardless of their defined requirements type. This

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Sales orders can act as exclusive requirements sources, for which procurement is then specifically triggered (make-to-order production); or they can be added to planned independent requirements in order to derive total demand. Consumption is also possible with planned independent requirements.

Cross-Plant Planning

Figure 11: Cross-plant planning

APO-SNP (Supply Network Planning) usually takes place within the medium-term to long-term horizon, that is, outside the production horizon. For example, it is based on requirements that you determine in Demand Planning for the distribution centers. These requirements should now be fulfilled by the distribution centers, production plants, and suppliers in your network.

Planning can be executed finitely, which means that production resources, storage resources, or transportation resources in your network can be taken into account even at this rough stage of planning. Planning in SNP is based on time buckets, that is, on the basis of freely defined time bucket profiles (the smallest unit in SNP is one day). In terms of performance, this bucket-oriented planning is much better than Detailed Scheduling in APO PP/DS and means that it is possible to plan even complex networks.

Supply Network Planning is carried out in two steps: During the first step (the actual planning), stock transport requisitions are created to optimize

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separate production plants. The second step occurs after production in the production plants is complete: Planning is executed within deployment. In deployment, stock transport requisitions are converted into deployment stock transfers, based on the quantities actually produced. The deployment stock transfer is then triggered.

Different planning and optimization methods are available in APO-SNP.

Transition from SNP to PP/DS

Figure 12: Transition from medium to short-term planning

Network planning within APO-SNP takes place outside the SNP production horizon. However, Production Planning/Detailed Scheduling, that is, detailed planning of procurement in a plant, takes place within the PP/DS horizon. It is possible for the two horizons to overlap and for the PP/DS horizon to follow the SNP production horizon.

SNP Planning is based on SNP bills of material and routings (that is, SNP production process models), which are usually simplified production plans. SNP bills of material, for example, usually contain only the strategically important components for which forecast planning is necessary, whereas procurement of the remaining components is only planned in plant-specific detailed scheduling. SNP planned orders based on this simplified master data

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Pegging refers to the procedure that links receipts and requirements along the supply chain. When an order is shifted, all dependent orders can be adjusted automatically. This function is only available in detailed scheduling. Supply Network Planning is based purely on quantities and periods.

Figure 13: Transition from SNP to PP/DS planned orders

Supply Network Planning is used for medium-term to long-term planning along the whole supply chain (especially if several plants and distribution centers are available). In this case, demands for a set bucket (one day, for example) are aggregated. When exactly the demand is accumulated in the respective bucket is not yet of any importance. Order sequences do not play a role in SNP either.

In the above example, the SNP production process model is used to create an order in SNP. SNP orders are therefore aggregated for each defined bucket. SNP takes place outside of the SNP production horizon. PP/DS orders are valid as fixed receipts in SNP and are taken into consideration during planning.

If the start date of an SNP order is within the PP/DS horizon, it is subject to PP/DS. It is therefore deleted in PP/DS planning and replaced with a PP/DS order, which is created based on the PP/DS master data.

If SNP orders are to be directly transferred to planning in PP/DS, they must be converted into PP/DS orders in time, that is, before the PP/DS horizon is

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PP/DS menu, which can also be scheduled periodically. As a result of the conversion, the order is created again in PP/DS using the production process model defined there.

The PP/DS horizon specifies the number of days within which PP/DS is used for planning. The PP/DS horizon can be defined in Customizing for Supply Chain Planning. In the product master, you can also define a PP/DS horizon for each of the products in the individual locations.

Production Planning and Detailed Scheduling

Figure 14: Goals of Production Planning and Detailed Scheduling

Production planning is mainly used for short-term planning using exact times in the production plant (both for in-house production and external procurement).

PP/DS covers requirements by generating planned orders (to plan in-house production) in addition to purchase requisitions or schedule lines (to plan external procurement).

In contrast to medium-term planning in APO-SNP, production planning in the plant is detailed and uses exact times. Exact production times for the production of materials are therefore determined.

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Figure 15: Main processes in APO-PP/DS

The production of a product can be planned in make-to-stock production. Various planning strategies are available. The production program is determined in make-to-stock production using planned independent requirements, and, if necessary, using sales orders that already exist. Requirements can be covered using finite or infinite planning. Different optimization procedures can be used within capacity requirements planning. Sales orders can also be planned in make-to-stock production as part of a CTP check (CTP: Capable-to-Promise). When a sales order is created, an ATP check is carried out to see if the necessary procurement elements exist, and, if necessary, a new procurement element is created and scheduled according to capacity. Possible delays (because of capacity overloads, for example) are directly reported to the sales order. In make-to-stock production, a CTP check is only possible within the PP/DS horizon.

Within make-to-order production, each sales order is planned in a separate segment. Since the PP/DS horizon plays no role in make-to-order production, the CTP check can be carried out without any time restrictions.

In addition to in-house production, external procurement can be planned in APO. Automatic source determination (based on costs, for example) can also take place. Scheduling agreement processing and subcontracting can

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Figure 16: Material requirements planning

Material requirements planning is the first step in Production Planning and Detailed Scheduling, which, as a rule, you carry out in the short-term horizon in the plant.

In material requirements planning within APO-PP/DS, the procurement dates for the required assemblies and components are determined on the basis of the requirements dates for the finished product (a sales order, for example). Routings are used for the procurement scheduling for products produced in-house. A routing specifies which production operations need to be

executed and how long the individual operations last. To begin the production of the finished product, the assemblies (from the bills of material) required for production must be available. Procurement of these assemblies must therefore be initiated earlier. In this way, assuming the dependent requirements date is the availability date, the system determines the basic order dates of the components by means of backward scheduling using the in-house production time or planned delivery time.

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APO Planning with R/3 Integration

Figure 17: APO planning with R/3 integration

The SAP SCM (APO) system is a planning tool that cannot be used in isolation. During planning, SAP APO relies on data from SAP R/3 (stocks or sales orders, for example) on the one hand, while dates and quantities planned in APO are executed in R/3. The planning process in APO is therefore linked to a constant exchange of data between APO and R/3.

Planned independent requirements, for example, can be the result of Demand Planning in SAP APO (release forecast to APO Demand Planning). These planned independent requirements can be transferred to R/3 for further planning.

Sales orders and planned independent requirements form the starting point for both Supply Network Planning (SNP) and Production Planning/Detailed Scheduling (PP/DS) in SAP APO. Existing storage location stock is also included in planning. Sales orders are entered in the R/3 system and, from there, they are transferred to APO.

In Supply Network Planning (SNP), you carry out rough-cut planning for the short-term or medium term horizon along the entire supply chain: You generate stock transport requisitions (for planning and the stock transfer)

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external procurement planning) directly in the production plant for the longer term horizon. In Production Planning and Detailed Scheduling, however, you usually generate planned orders and purchase requisitions directly in the production plant for the short-term horizon. Transaction data generated in SAP APO is transferred using the SAP R/3 APO interface (CIF: Core Interface) to the R/3 system for execution.

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Facilitated Discussion

Discuss the main characteristics of Supply Chain Planning.

Discussion Questions

Use the following questions to engage the participants in the discussion.Feel free to use your own additional questions.

How important are the following principles of Supply Chain Planning? • Planning is as comprehensive as possible, but also realistic (functional,

hierarchical and temporal).

• Quantity planning and capacity planning occur simultaneously. • Collaboration (with suppliers, and so on)

• Group as many functions as possible together into a subapplication (therefore with only a few planning interfaces).

• Commit yourself as late as possible in your planning (for example, place the goods in storage as late as possible).

• Plan using mathematical optimization.

• Compare using key figures instead of costs, since key figure determination is easier.

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Lesson Summary

• Describe the planning functions of mySAP SCM • Define the different levels of Supply Chain Planning

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Unit Summary

• Describe the planning functions of mySAP SCM • Define the different levels of Supply Chain Planning

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Unit 2

23

Master Data and Transaction Data

Refer to the instructor notes in the individual lessons.

Unit Overview

The basis of this type of planning is the master data which defines the objects that are to be planned: locations, materials, bills of material, and so on. As individual SAP components, R/3 Enterprise and APO generally have their own master data; that is, R/3 master data is not the same as APO master data. Ideally, the master data from R/3 can be transferred to APO, so that the business implications of various master data are demonstrated using R/3. The same applies to the transaction data. This unit explains transaction data using the system that best demonstrates its business background.

In this unit, you will familiarize yourself with the master data and transaction data of advanced Supply Chain Planning.

Unit Objectives

After completing this unit, you will be able to:

• Specify which master data is used in advanced Supply Chain Planning • Explain the integration of master data using the CIF interface

• Describe the main functions of the CIF interface • Explain the master data in SAP APO

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Unit Contents

Lesson: Supply Chain Master Data ... 31 Demonstration: Locations in the Supply Chain ... 35 Demonstration: Material ... 39 Demonstration: Bills of Material ... 41 Demonstration: Work Centers ... 42 Demonstration: Routings ... 46 Exercise 1: R/3 Master Data ... 49 Lesson: APO Master Data... 57 Demonstration: Master Data Integration ... 63 Demonstration: Supply Chain Engineer ... 68 Exercise 2: APO Master Data ... 71 Exercise 3: Supply Chain Engineer ... 75 Lesson: Transaction Data in Supply Chain Planning ... 80 Demonstration: Transaction Data (Optional) ... 86

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Lesson:

25

Supply Chain Master Data

Lesson Overview

In this lesson, you will familiarize yourself with the master data of advanced Supply Chain Planning.

Lesson Objectives

• Specify which master data is used in advanced Supply Chain Planning

The supply chain is defined primarily by individual master data objects: locations such as plants, distribution centers, customers or suppliers, products that are to be planned, and resources that are available for production. In addition, the production processes in the production plants are defined using bills of material and routings. External procurement relationships depict the material flow between the different locations.

Business Example

As a member of the project team responsible for implementing the functions of advanced Supply Chain Planning, you want to familiarize yourself with the necessary master data.

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Data Flow in Supply Chain Planning

Figure 18: Data flow in Supply Chain Planning

Generally speaking, Supply Chain Planning is divided into several steps, some of which can be executed by components in R/3 and others which can be executed in APO. It is possible and advisable to integrate these two systems and use both together when planning. It is then necessary to exchange a large number of data objects between both systems: Master data should be transferred from R/3 to APO, planning results should be transferred from APO to R/3 and so on. The systems are integrated using the APO Core Interface (CIF).

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Master Data Objects in the Supply Chain

Figure 19: Master data objects in the supply chain

Supply chain master data objects are usually created in R/3: plants,

distribution centers (DCs), suppliers, and customers. Supply Chain Planning concerns materials that are defined as material masters. For plants that produce as well as plan, you also create resources, bills of material (BOMs) and routings, in addition to the materials for planning. Transportation lanes are defined between the individual locations of the supply chain (that is plants, suppliers and so on), and these define the material flow through the supply chain.

Even when you use an SCM system for advanced Supply Chain Planning, master data is generally created in a connected R/3 system and transferred to APO from there. Only master data that exists purely in SAP APO and has no counterpart in SAP R/3 is to be created in APO.

In APO, transportation lanes are used to connect a network of plants and DCs so that stock transfers can be planned between these locations. Corresponding lanes can also be maintained in R/3 (in the form of special procurement keys, for example).

The supply relationship between a supplier and a plant is created in R/3 in the form of a purchasing info record or outline agreement. When you transfer these external procurement relationships to APO, they are also displayed there as external procurement relationships. A corresponding transportation lane is created at the same time.

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Plants and Distribution Centers

Figure 20: Plants and distribution centers

A plant is an organizational unit that divides a company into production, procurement, stockholding or material planning. In a plant, materials can be produced or goods and services can be staged.

You specify an address, a language, a country assignment and a factory calendar for a plant. If you are to use SAP APO for Supply Chain Planning, you can transfer the plants from R/3 to APO.

Distribution Centers (DCs) are predominantly plants that are mainly used for merchandise distribution or from which products are sold. Their only functional difference between DCs and plants is a corresponding entry in R/3 Customizing, that is, a plant also contains full sales and distribution functions, just as products can be produced in a DC. Different symbols are used to represent plants and DCs in the supply chain.

One or more storage locations can be defined within a plant. A storage location specifies where a material is stored. Storage locations therefore enable a differentiation of material stocks within a plant.

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Customers and Suppliers

Figure 21: Customers and suppliers

Customers and suppliers are defined as business partners in the R/3 system. They enable the control of different sales or purchasing processes.

Sales and Distribution processing as such plays no role in SAP APO. Customer master records can be transferred to APO as corresponding locations to plan the transportation of a product to a customer.

Source determination for external procurement can take place in SAP R/3 or SAP APO. Supplier master records can be transferred to the SCM system for planning in APO. Purchase order handling, goods receipt and invoice verification takes place in R/3.

Demonstration: Locations in the Supply Chain

Purpose

Hint: If necessary, make it clear to the course participants that, in contrast to R/3, customers and suppliers cannot have the same name in APO.

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Client: User ID: Password:

Set up instructions:

1. Display production plant 1000 in APO (location type 1001). Explain some of the settings: Name, address and time zone.

2. Display distribution center 2400 in APO (location type 1002). 3. Display customer 0000001000 in APO (location type 1010). 4. Display supplier 0000001003 in APO (location type 1011).

External Procurement Relationships

Figure 22: External procurement relationships

External procurement relationships (purchasing info records, contracts and scheduling agreements) can be transferred from R/3 to APO. The corresponding external procurement relationships are therefore created automatically. However, transportation lanes (for stock transfers, for example), often have to be maintained in APO (using mass maintenance, if necessary).

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To transfer products between two locations in the supply chain, for example, from a production plant to a distribution center, a corresponding transportation lane has to exist. Transportation lanes are created in SAP APO for this reason. The information that corresponds to a transportation lane (such as a special procurement key) can be created in R/3 (in the material master). Special procurement keys for stock transfers between plants can be transferred from R/3 to APO.

Purchasing info records or outline agreements, used to create price and supply agreements with certain suppliers in R/3, can be transferred to the SCM system as external procurement relationships. In addition, a corresponding transportation lane is created.

In principle, transportation lanes are product-specific. However, they can also be valid for all products. A transportation lane contains one or more means of transport, which determine how the product can be transported (for example, by commercial truck or barge). Costs and durations can also be defined. On the basis of priorities, decisions can be made about stock transfers.

Materials

Figure 23: Materials (1)

Planning of the material flow along the supply chain takes place at material level. Materials are defined by corresponding material masters. R/3 material masters can be transferred to SAP APO as product masters.

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A material master contains global data that is valid across locations (for example, the information for this material is the same in all production plants) and location-specific data, which contains different settings for each relevant location (a certain production plant, for example). General data such as the measurements or the weight of a material is set globally, whereas settings for planning are usually predefined locally. This data may therefore differ, depending on location.

Figure 24: Materials (2)

To provide a clear display, material master data is subdivided into views. These views are globally valid (basic data, for example) and some are also location-specific (material requirements planning, for example).

The material master is the data object that contains all information necessary for the business use of a material, in particular, all settings for procurement, production, storage or sales. Not all settings in the material master are relevant for Supply Chain Planning. Rather, they partly apply to the R/3-specific functions for evaluation and sales management.

Settings for Supply Chain Planning are mainly found in the Materials Planning views. The procurement type or planning strategy, for example, is determined here. In different locations, these settings can be maintained entirely differently.

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A material master is transferred to the SCM system for advanced planning in SAP APO.

Demonstration: Material

Purpose

Hint: The R/3 material master is used to demonstrate the definition of a material. The APO product master is structured differently: It contains information that is only relevant for planning and which is usually found in the MRP views in R/3.

System Data System: Client: User ID: Password: Set up instructions:

1. Display and explain the R/3 material master R-F100 (plant 1000). Draw the participants’ attention to the division of data into views and its relevance (in part) to the plant.

2. Explain the following settings in the MRP views in more detail: • MRP type

• Lot size

• Strategy group • Production version

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Bills of Material

Figure 25: Bills of material

The BOM contains the assemblies or components that are to be included in the production of a material. R/3 BOMs can be transferred to SAP APO in the form of production process models (PPMs) or runtime objects (RTOs).

BOMs are used in material requirements planning, production, procurement and for product costing.

A BOM consists of a BOM header and BOM items. The base quantity in the BOM header specifies to which amount of the finished product the item quantities refer.

Bills of material are single-level. An item of a BOM can itself also contain components. In this way, multilevel production is described using the single-level BOMs of the finished product and those of the assemblies and where required, using the BOMs of the assemblies of the assemblies and so on. A BOM can also contain documents or text items in addition to stock items that are required for the finished product.

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Demonstration: Bills of Material

Purpose

Hint: The structure of a BOM is demonstrated in R/3. Bills of material are mapped in APO using PPMs or RTOs.

1. Display and explain the R/3 bill of material for the T-F200 material in plant 1000. Point out the structure (header and items)

2. Display the item overview and explain the individual items.

Work Centers

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A work center is where an operation or an activity is carried out in a plant. It therefore specifies where production ultimately takes place. Work centers are used in routings. R/3 work centers can be transferred to SAP APO as resources in the form of their capacities.

The capacities that are available to a work center are explicitly specified in the work center. Therefore, more than one capacity can be used for each work center. For example, a machine capacity and a labor capacity can be assigned to a work center.

The capacities contain the working time that is available. Moreover, formulas specify how long the capacities will be loaded by a certain operation.

In addition to standard available capacity, intervals of available capacity and shift schedules are stored. These specify exactly when a certain machine is available, for example.

Demonstration: Work Centers

Purpose

Hint: The structure of a PP work center is demonstrated in R/3. Work centers are mapped in APO as resources.

1. Display and explain R/3 work center T-L00 in plant 1000. Point out the division of data into views.

2. Display and explain the planning-relevant settings in the capacities and scheduling views: Capacity categories, available capacity and scheduling formulas.

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Routings

Figure 27: Routings (1)

Routings contain the steps that are necessary for production, that is, the relevant operations, their sequence and the work centers in which these operations are to be executed. R/3 routings can be transferred to SAP APO in the form of production process models or runtime objects.

An R/3 routing can be defined using the routing group and the group counter. Moreover, the routing contains reference to the material whose production it describes. A routing can contain parallel or alternative sequences in addition to the standard sequence.

Alongside the standard values, the routing also contains the time elements that are relevant for scheduling operations. Note that each operation in the routing may contain its own base quantity, to which these time elements may refer.

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Figure 28: Routings (2)

A work center is assigned to an R/3 operation. Using its standard value key, the work center specifies which time elements (standard values) can be taken into consideration during planning (for example, setup time, machine time and personnel time). The scheduling formulas defined in the work center determine the duration from the permitted time elements in the routing. Setup, processing and tear down of an R/3 operation are each described using a corresponding formula. The steps for which a formula is defined are executed (for example, tear down may not be necessary).

If several capacities are stored in a work center, the scheduling basis is used to determine which of these capacities is relevant for scheduling.

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Routing and Bill of Material

Figure 29: Routing and bill of material

A routing and BOM are used to describe production. For this reason, BOM components can be assigned to a certain operation. The procurement of these components is then planned at the beginning of the particular operation. Components are assigned in the routing. BOM components that are not explicitly assigned are considered to be assigned to the first operation. In addition to BOM components, production resources/tools can also be assigned in the routing. Production resources/tools are operating facilities that are not location-bound, but are necessary for production, such as a measuring instrument or a support.

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Master Data in Process Industries

Figure 30: Master data in process industries

As previously described, discrete manufacturing master data is used when the controlling of production is mapped with production orders. A production order therefore uses routings, work centers and BOMs.

Other master data is required if production with process manufacturing (PP-PI) is to be mapped. A master recipe (instead of the routing) and resources (instead of work centers) are used for the process order.

Discrete manufacturing master data can logically be transferred to the range of concepts in the process industry. The master recipe is actually a special routing that was enhanced with process industry-specific functions. Moreover, in Production Planning-Process Industries (PP-PI), production versions are usually used, so that the corresponding BOMs are assigned directly to a recipe. The BOMs can therefore be directly maintained from the recipe. The resource largely corresponds to the work center.

All of the relationships displayed so far are therefore also valid in PP-PI. Material Requirements Planning, for example, is completely identical for PP and PP-PI.

Demonstration: Routings

Purpose

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1. Display and explain the R/3 routing for material T-F200 in plant 1000. Point out the structure (sequences and items)

2. Display the item overview and explain the individual items: • Relation to the work center

• Relationship between formulas in the work center and standard values in the routing

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39

Exercise 1: R/3 Master Data

Exercise Duration: 20 Minutes

Exercise Objectives

After completing this exercise, you will be able to:

• Display the R/3 master data that is necessary for the production of a material in a plant

Business Example

Pumps with the material number T-F2## (## denotes your group number) are produced in plant 1000. Production Planning and Detailed Scheduling for pump T-F2## takes place in SAP APO, whereas the master data is created in R/3 and transferred to APO from there.

Using the master data in R/3, you familiarize yourself with the production planning process of detailed scheduling.

Task 1:

Display the material master of pump T-F2## in plant 1000. In the R/3 system, use the transaction for displaying material masters, which you call from the production master data menu, for example.

1. Call the transaction and specify material T-F2##. On the screen that follows, select the Basic Data 1, MRP 1 to MRP 4 and the Work

Scheduling views and then enter Plant 1000 as the Organizational Level. 2. Display the Basic Data 1 view. What is the exact description of the

material?

What material type does the material belong to?

3. Choose Enter to access the next selected view, that is, the MRP 1 view. Which MRP type has been entered?

Is the material produced in-house or procured externally (MRP2 view)? 4. Proceed to the MRP 4 view (by choosing Enter twice, for example). Has a

production version been defined for the material?

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A routing and a BOM have been defined in the production version. What is the number of this routing?

Task List Group ?

Group Counter ?

What BOM has been defined?

Usage ?

Alternative ?

5. Exit the production version and display the Work Scheduling view. What in-house production time has been entered here?

Therefore, roughly how long does the production of 100 pumps take? Does this time include the procurement of the required assembly groups and components?

Task 2:

To find out which assemblies and components are necessary for the production of pump T-F2##, display the BOM that is used in production version 0001 (see above).

1. Display the material BOM for material T-F2##. You can find the relevant transaction in the production master data. Call the transaction and enter the material, plant 1000 and BOM usage 1. Choose Enter to access the item overview. What components are required to produce the pump (five materials, one document)?

2. Which “components” are themselves made up of further components? (note the “Assembly” indicator).

3. Double-click on the“Assembly” indicator in the BOM item to enter the BOM of the assembly. Note which components are contained in the T-B1## assembly.

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Task 3:

Finally, display the different steps that have to be carried out to produce pump T-F2##. To do this, refer to the routing that is contained in production version 0001 (see above).

1. Display the standard routing for the T-F2## material. You can find the relevant transaction in the production master data. Call the transaction and enter the material and plant 1000. Press Enter to access the header overview. Select the first routing in the overview (that is, the plan with Group Counter 1, as defined in the production version) and proceed to the Operation Overview for this routing (simply double-click on the corresponding lines in the header overview).

Which operations are carried out at which work centers (note the operation descriptions)?

2. Now enter the component overview (using the CompAlloc button). Are components assigned to operations other than the first one?

Hint: No explicit assignment means that components belong to the first operation.

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Solution 1: R/3 Master Data

Task 1:

Display the material master of pump T-F2## in plant 1000. In the R/3 system, use the transaction for displaying material masters, which you call from the production master data menu, for example.

1. Call the transaction and specify material T-F2##. On the screen that follows, select the Basic Data 1, MRP 1 to MRP 4 and the Work

Scheduling views and then enter Plant 1000 as the Organizational Level. a) In the R/3 system, select the following menu path from the SAP

Easy Access screen: Logistics→Production→Master Data→Material Master→Material→Display→Display Current.

2. Display the Basic Data 1 view. What is the exact description of the material?

What material type does the material belong to? a)

Material description Pump PRECISION 102

Material type FERT (finished product)

3. Choose Enter to access the next selected view, that is, the MRP 1 view. Which MRP type has been entered?

Is the material produced in-house or procured externally (MRP2 view)? a) MRP type: The MRP type X0 has been entered. The material is

therefore planned externally (in APO).

Produced in-house or procured externally: The material is produced in-house (procurement type E).

4. Proceed to the MRP 4 view (by choosing Enter twice, for example). Has a production version been defined for the material?

Display the details for production version 0001. For which lot-size range can this production version be used?

A routing and a BOM have been defined in the production version. What is the number of this routing?

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Task List Group ?

Group Counter ?

What BOM has been defined?

Usage ?

Alternative ?

a) Production version defined? Yes, a production version has been defined. The version indicator has been set.

Production version lot-size range: The production version can be used for lot-sizes of 1 to 999,999 pieces.

Routing Task List Grp varies (for example, 50000492)

Routing Group Counter 1

BOM Usage 1

BOM Alternative 1

5. Exit the production version and display the Work Scheduling view. What in-house production time has been entered here?

Therefore, roughly how long does the production of 100 pumps take? Does this time include the procurement of the required assembly groups and components?

a) In-house production time: A setup time of 0.07 days, an interoperation time of 0.71 days and a processing time of 15.48 days per 100 pieces has been entered.

Time taken to produce 100 pumps: The total of the aforementioned time elements gives the time needed to produce 100 pumps, that is, roughly 17 days.

Is procurement of the required assemblies and components included? No, this is the time taken to produce the pumps only.

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Task 2:

To find out which assemblies and components are necessary for the production of pump T-F2##, display the BOM that is used in production version 0001 (see above).

1. Display the material BOM for material T-F2##. You can find the relevant transaction in the production master data. Call the transaction and enter the material, plant 1000 and BOM usage 1. Choose Enter to access the item overview. What components are required to produce the pump (five materials, one document)?

a) Select the following menu path from the SAP Easy Access screen:

Logistics→Production→Master Data→Bills of Material→Bill of Material→Material BOM→Display.

Components for pump production: • Material T-B1##

• Material T-B22## • Material T-B3## • Material T-B4## • Material T-T3##

• Assembly drawing for pump document

2. Which “components” are themselves made up of further components? (note the “Assembly” indicator).

a) T-B1##, T-B22##, T-B3## and T-B4##

3. Double-click on the“Assembly” indicator in the BOM item to enter the BOM of the assembly. Note which components are contained in the T-B1## assembly.

a) Materials T-T1##, T-T2## and T-T3##

Task 3:

Finally, display the different steps that have to be carried out to produce pump T-F2##. To do this, refer to the routing that is contained in production version 0001 (see above).

1. Display the standard routing for the T-F2## material. You can find the relevant transaction in the production master data. Call the transaction and enter the material and plant 1000. Press Enter to access the header overview. Select the first routing in the overview (that is, the plan with

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Group Counter 1, as defined in the production version) and proceed to the Operation Overview for this routing (simply double-click on the corresponding lines in the header overview).

Which operations are carried out at which work centers (note the operation descriptions)?

a) Select the following menu path from the SAP Easy Access screen:

Logistics→Production→Master Data→Routings →Routings→ Standard Routings→Display.

Opera-tion

Operation short text Work center 0010 Material staging by

picking list

T-M##

0020 Press flywheel in casing T-V## 0030 Paint casing RAL 1015

white

T-L##

0040 Insert hollow shaft in casing

T-E##

0050 Final assembly of pump T-F##

0060 Deliver to stock T-P##

2. Now enter the component overview (using the CompAlloc button). Are components assigned to operations other than the first one?

Hint: No explicit assignment means that components belong to the first operation.

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Lesson Summary

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Lesson:

47

APO Master Data

Lesson Overview

In this lesson, you will familiarize yourself with the behavior of the master data of advanced Supply Chain Planning in SAP APO.

Lesson Objectives

• Explain the integration of master data using the CIF interface • Describe the main functions of the CIF interface

• Explain the master data in SAP APO

Ideally, even if planning takes place using SAP APO, the master data can be created in R/3 and transferred to APO from there. The maintenance of master data in APO should be an exception. As a prerequisite for integrating R/3 and APO, you must install a relevant SAP R/3 plug-in that makes the Core Interface (CIF) available. The CIF is used to transfer master data.

Business Example

As a member of the project team responsible for implementing advanced Supply Chain Planning, you want to familiarize yourself with APO master data and with the transfer of master data from R/3 to APO.

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Supply Chain Planning in the SAP System Group

Figure 31: Supply Chain planning in the SAP system group

For Supply Chain Planning, the SCM system is used in connection with the R/3 system. Linkage with R/3 systems (one or more) is based on the SAP APO Core Interface (CIF). A mutual system connection is set up in Customizing in the form of RFC connections, which makes it possible to transfer data relevant for the planning processes from the R/3 system to APO and also to return the planning results from APO to R/3.

The data transfer between R/3 systems and APO systems is defined and controlled using the SAP APO Core Interface (CIF). The CIF is the central interface used to connect the SCM system to the R/3 system. The CIF interface is an add-on to the R/3 system, which you install using the relevant plug-in.