Table of Contents

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Introduction
19
1 Introduction to Supply Chain Planning
25
1.1 Sales and Operations Planning
28
1.1.1 Goal of Sales and Operations Planning
29
1.1.2 Case Study: Manufacturing and Distribution
30
1.2 Supply Chain Operations Reference Model
33
1.2.1 Level 1: Process Types
35
1.2.2 Level 2: Process Categories
36
1.2.3 Level 3: Process Elements
38
1.3 Types of Supply Chains
44
1.3.1 Pipeline Structure
45
1.3.2 Late-Customization Structure
45
1.3.3 Diverging Structure
45
1.3.4 Converging Structure
45
1.4 Case Study: A Supply Chain Dilemma
46
1.4.1 Business Situation
46
1.4.2 Sourcing
47
1.4.3 Manufacturing
47
1.4.4 Order Management
48
1.4.5 Distribution
49
1.4.6 Modeling the Company with the SCOR Model
49
1.4.7 Value Stream Mapping
52
1.5 Demand and Supply Planning Overview
54
1.5.1 Demand Planning
55
1.5.2 Supply Planning
61
1.5.3 Supply Chain Maturity Model
65
1.5.4 Supply Chain Performance Management
67
1.6 Summary
71
2 SAP APO as an Advanced Planning and Scheduling Tool
73
2.1 Advanced Planning and Scheduling Concepts
74
2.1.1 Planning and Scheduling
75
2.1.2 Concurrent Planning
76
2.1.3 Modeling
77
2.1.4 Exception Management Using the Alert Monitor
78
2.1.5 Differences between ERP and APS
79
2.2 Introduction to SAP APO
80
2.2.1 Core Planning Modules
81
2.2.2 Task Structure
83
2.2.3 Benefits of Using SAP APO
85
2.3 Planning Functions
90
2.3.1 Demand Planning and Forecasting
92
2.3.2 Inventory Management
93
2.3.3 Supply Network Planning
93
2.3.4 Distribution Planning
93
2.3.5 Supply Chain Monitoring
93
2.3.6 Sales and Operations Planning
93
2.3.7 Network Design and Optimization
94
2.4 Demand Planning Overview
94
2.4.1 Statistical Forecasting
95
2.4.2 Casual Forecasting
96
2.4.3 Composite Forecasting
96
2.4.4 Promotion Planning
97
2.4.5 Collaborative Demand Planning
97
2.4.6 Data Management
97
2.4.7 Bill of Material Forecasting
98
2.4.8 Characteristics-Based Forecasting
98
2.4.9 Lifecycle Management
98
2.4.10 Transfer of Demand Plan
99
2.5 Supply Network Planning Overview
99
2.5.1 Safety Stock Planning
100
2.5.2 Solvers
100
2.5.3 Subcontracting
103
2.5.4 Scheduling Agreement
104
2.5.5 Hierarchical Planning
104
2.5.6 Distribution Planning
104
2.5.7 Supply Chain Monitoring
105
2.6 Technical Architecture
105
2.7 SAP liveCache
107
2.8 Summary
109
3 Guidelines for Implementing SAP APO
111
3.1 Transformation Initiatives and Prerequisites
112
3.1.1 Transformation Process
113
3.1.2 Transformation Framework
114
3.2 Implementation Methodology
117
3.3 Template Rollout Approach
120
3.3.1 Pre-Activities
121
3.3.2 Baseline System Activities
122
3.4 Change Management
123
3.5 Implementing Performance Measures
125
3.6 Business Benefits Realization
128
3.6.1 Increased Sales
130
3.6.2 Profit Optimization
131
3.6.3 Finished Goods Inventory Reduction
132
3.6.4 Raw Material Inventory Reduction
133
3.6.5 Material Cost Reduction
133
3.7 Case Study
135
3.7.1 Supply Chain Transformation Planning
135
3.7.2 Key Guiding Principles
137
3.7.3 System Architecture
138
3.7.4 Sales and Operations Planning Characteristics
139
3.7.5 Demand Planning Characteristics
141
3.7.6 Inventory and Deployment Planning Characteristics
142
3.7.7 Rough-Cut Production Planning Characteristics
143
3.7.8 Planning Organization
144
3.8 Summary
147
4 Preparing for Basic Planning Functionality
149
4.1 Basic Planning Tasks
150
4.1.1 Demand Planning
151
4.1.2 Supply Network Planning
153
4.2 Basic Customization in SAP APO-DP
155
4.2.1 InfoObjects
156
4.2.2 Planning Object Structure
161
4.2.3 Planning Area
164
4.2.4 Planning Book
170
4.2.5 Macros
175
4.2.6 Locking Key Figures
180
4.2.7 Time Series Consistency Checks
182
4.3 Data Staging for SAP APO-DP
182
4.4 Data Management in SAP APO-DP
190
4.4.1 Creating New Characteristic Value Combinations
191
4.4.2 Capturing History
191
4.4.3 Transfer Planning Data
192
4.5 Setting up Forecast Methods
193
4.5.1 Univariate Forecasting
194
4.5.2 Forecast Definitions
196
4.5.3 Univariate Forecasting Methods
200
4.5.4 Casual Forecasting Methods
207
4.6 Basic Customization in SAP APO-SNP
208
4.6.1 InfoObjects
208
4.6.2 Category Group
209
4.6.3 Planning Area
212
4.6.4 Planning Book
214
4.6.5 Key Figures and Macros
216
4.7 Supply Chain Modeling for SAP APO-SNP
223
4.7.1 Model and Planning Versions
223
4.7.2 Location
224
4.7.3 Location Product
226
4.7.4 Resources
232
4.7.5 Production Data Structure
235
4.7.6 Transportation Lanes
237
4.7.7 Quota Arrangement
238
4.7.8 Supply Chain Engineer
239
4.8 Summary
241
5 Basic Interactive Planning
243
5.1 Demand and Supply Planning Cycle
244
5.2 Interactive Demand Planning
248
5.2.1 SAP APO Planning Book Navigation
248
5.2.2 Characteristic Value Combination Maintenance
255
5.2.3 Realignment
257
5.2.4 Notes Management
258
5.2.5 Fixing Cell
259
5.2.6 Chart Engine
260
5.2.7 Releasing the Demand Plan from SAP APO-DP to SAP APO-SNP
262
5.3 Interactive Statistical Forecasting
265
5.4 Interactive Supply Planning
269
5.5 SNP Heuristics
271
5.5.1 Heuristic Engine Run Process
274
5.5.2 Replenishment and Procurement Using SNP Heuristics
275
5.5.3 Master Production Schedule and Capacity Leveling Using SNP Heuristics
278
5.5.4 Distribution Planning Using SNP Deployment Heuristics
281
5.5.5 Master Data Maintenance
282
5.5.6 Interactive SAP APO-SNP Deployment Planning
286
5.6 Load Planning Using the SAP APO-SNP Transport Load Builder
288
5.7 Demand and Supply Planning Alerts
292
5.7.1 Types of Alerts
293
5.7.2 Visualizing Alerts with the Alert Monitor
293
5.7.3 Methodology: The Decision Tree
296
5.8 Simulation via Version Management
297
5.9 Summary
299
6 Advanced Demand Planning
301
6.1 Promotion Planning
302
6.1.1 Promotion Planning with SAP APO
303
6.1.2 Promotion Planning with SAP CRM
308
6.2 Lifecycle Planning
310
6.2.1 Phase-In/Phase-Out Modeling
311
6.2.2 Interchangeability
314
6.3 Seasonal Planning
315
6.4 Bill of Material Functionality
318
6.4.1 Creating a New Planning Object Structure
319
6.4.2 Creating a New Planning Area
320
6.4.3 Defining a New Planning Book
321
6.4.4 Maintaining the Production Process Model and Production Data Structure
322
6.4.5 Maintenance of Characteristic Value Combinations
324
6.5 Customer and Product Segmentation
326
6.6 Customer Forecast Management
328
6.7 Alerts
330
6.8 Microsoft Excel-Based UI
331
6.9 SAP Duet Demand Planning
335
6.10 Summary
336
7 Advanced Supply Planning
337
7.1 Safety Stock Planning
338
7.1.1 Manual Static Safety Stock Planning
340
7.1.2 Manual Time-Dependent Safety Stock Planning
342
7.1.3 Advanced Safety Stock Planning
344
7.2 Aggregated Planning
349
7.2.1 Hierarchical Planning Scenarios
350
7.2.2 Setting up the Hierarchy Structure
352
7.2.3 SAP APO-SNP Customization
353
7.2.4 Preparing Master Data
355
7.2.5 Technical Design Flow
357
7.2.6 Testing Business Scenario
359
7.3 Shelf Life Planning
362
7.3.1 Shelf Life Master Data
363
7.3.2 Shelf Life Transaction Data
364
7.3.3 SAP ERP Batch Integration
367
7.3.4 Shelf Life Key Figures
369
7.3.5 Shelf Life Propagation
372
7.3.6 Shelf Life Alerts
372
7.4 Planning Strategies and Forecast Consumption
373
7.4.1 Planned Independent Requirement Segment (Requirement Planning)
376
7.4.2 Assignment Mode (Forecast Consumption)
376
7.4.3 Category Group (Forecast Consumption)
377
7.5 Subcontracting
379
7.5.1 Master Data Requirements
380
7.5.2 Planning Book
383
7.6 Warehouse Capacity Overview
385
7.6.1 Master Data
385
7.6.2 Perform the SAP APO-SNP Planning Run
386
7.7 Direct Shipment Customers
387
7.8 Product Interchangeability
390
7.8.1 Scenario 1: Consume Existing Inventory
392
7.8.2 Scenario 2: Consuming Existing Inventory until a Specific Date
396
7.9 Transport Load Builder
399
7.9.1 TLB Profile
399
7.9.2 TLB Loading Method
400
7.9.3 Shipping Strategies
401
7.9.4 Pull-In Horizon
404
7.9.5 Shipment Sizing
405
7.10 Stock Balancing
407
7.11 Supply Planning Alerts
410
7.11.1 Managing Favorites in the Alert Monitor
411
7.11.2 Using the Alert Monitor
412
7.11.3 Alert Monitor Hierarchies
414
7.11.4 Alerts in the Interactive Planning Screen
416
7.12 Supply Chain Cockpit
418
7.13 Planner’s Home Page
419
7.14 Summary
424
8 Collaborative Planning
425
8.1 Overview
426
8.2 Collaborative Demand Planning
429
8.3 Collaborative Supply Planning
432
8.4 Workflow
434
8.5 Configuration
435
8.5.1 Activate ICF Services
436
8.5.2 Maintain Entries in Table TWPURLSVR
436
8.5.3 Maintain ICM Monitor
437
8.5.4 Publish Internet Services
437
8.5.5 Collaboration Partner User
438
8.6 Vendor-Managed Inventory
442
8.6.1 VMI Model and Technical Messaging Flow
444
8.6.2 Configuring VMI Scenario in SAP APO-SNP
446
8.7 Integrating SAP Supply Network Collaboration with SAP APO
449
8.8 Inter-Market Demand and Supply Planning in a Single SAP APO Application
452
8.9 Summary
457
9 Reporting
459
9.1 SAP Supply Chain Performance Management
460
9.2 SAP APO and SAP BW Integration
463
9.2.1 Data Dimensions in SAP APO
463
9.2.2 SAP Business Warehouse Layers
465
9.2.3 Integration Scenarios
467
9.3 Extraction Process from SAP liveCache to SAP BW
472
9.3.1 Generate DataSource Export
472
9.3.2 Create a Query
478
9.4 SAP APO-DP Data Model
480
9.4.1 Flow 1: Historical Data Load (Inbound Flow)
480
9.4.2 Flow 2: Data Extraction (Outbound Flow)
482
9.5 SAP APO-SNP Data Model
483
9.6 SAP BW Business Content
484
9.6.1 Access Standard Business Content
485
9.6.2 Install Standard Business Content
485
9.6.3 Supply Chain SCOR Metrics
487
9.6.4 Level 1: High-Level Strategic Metrics
489
9.6.5 Level 2: Diagnostic Metrics
491
9.6.6 Level 3: Configuration Metrics
492
9.7 Summary
493
10 SNP Optimizer
495
10.1 SNP Optimization Concept
496
10.1.1 SNP Optimization Steps
498
10.1.2 Differences between Heuristics and Optimizers
499
10.1.3 Constraints
500
10.2 Costs
501
10.2.1 Unsatisfied Demand or Delay
503
10.2.2 Storage Costs
505
10.2.3 Safety Stock Penalty
505
10.2.4 Production
506
10.2.5 Transportation
507
10.2.6 Resource Expansion
508
10.2.7 Procurement
509
10.3 Profiles
510
10.4 Case Study: Network Model
513
10.4.1 Identifying Variables for a Graphical Representation
514
10.4.2 Running the SNP Optimizer with Constraints
515
10.5 Automatic Cost Model
525
10.5.1 Priorities and Preferences
525
10.5.2 Business Rules
527
10.6 SNP Optimization Explanation Log
528
10.7 Case Study: Supply Allocations
529
10.7.1 Optimization Model Input
530
10.7.2 Optimization Constraints
530
10.7.3 Optimization Cost Factors
531
10.7.4 Production Capacity Maintenance
532
10.7.5 Maintain Storage Inventory Costs
534
10.7.6 Testing
535
10.7.7 Planning Run
535
10.8 SNP Deployment Optimizer
538
10.9 The APO Performance Monitor
540
10.10 Integrating External Optimizers
541
10.11 Summary
543
11 Demand and Supply Matching with Capable-To-Match
545
11.1 Capable-to-Match Concept
546
11.1.1 Planning Characteristics
546
11.1.2 Planning Scenario
546
11.1.3 Planning Modes
548
11.1.4 Demand Prioritization
549
11.1.5 Supply Categorization
550
11.1.6 Search Strategy
551
11.2 Customization via the CTM Profile
551
11.2.1 Planning Scope
552
11.2.2 Strategies
555
11.2.3 CTM Integration with Global ATP
556
11.2.4 CTM Early/Late Demand Fulfilment
560
11.2.5 Aggregation
561
11.2.6 Demand
562
11.2.7 Supplies
563
11.2.8 Settings
564
11.2.9 Supply Distribution
566
11.3 Master Data
566
11.4 Planning Run
568
11.5 Case Study
569
11.6 Summary
571
12 Inventory Planning and Optimization with SAP APO and SAP ERP
573
12.1 Inventory Optimization
575
12.1.1 Dynamics
576
12.1.2 Supply Chain Applications
578
12.1.3 Techniques
580
12.2 Inventory Analysis Methodology
581
12.2.1 Product Portfolio Classification (ABC Analysis)
582
12.2.2 Inventory Stocking Policies Quadrant
585
12.2.3 Inventory Historical Analysis
587
12.2.4 Inventory Un-Bundling
591
12.2.5 Inventory Modeling
594
12.2.6 Inventory Cost-Benefit Analysis
598
12.3 Designing an Inventory Control System
600
12.3.1 Economic Order Quantity
600
12.3.2 Lot Sizing
602
12.3.3 Target Stock Level
608
12.4 Multi-Echelon Inventory Planning
611
12.5 Summary
614
13 Characteristics-Based Planning
617
13.1 Process Overview
618
13.2 Technical Steps
620
13.2.1 Case Study
621
13.2.2 Variant Configuration
622
13.2.3 Material Master
624
13.2.4 Characteristics
626
13.2.5 Variant Class
628
13.2.6 Super BOM
629
13.2.7 Super Routing
630
13.2.8 Configuration Profile
631
13.2.9 Object Dependencies
632
13.2.10 Customizing Sales Orders
633
13.3 Forecasting
635
13.3.1 Activate Characteristics-Based Planning
636
13.3.2 Master Data
636
13.3.3 Planning Book Design
639
13.3.4 Descriptive Characteristics
642
13.3.5 Demand Planning Release
643
13.4 Supply Planning Integration
645
13.4.1 Business Scenario and Technical Steps
645
13.4.2 Block Planning Integration
648
13.5 Summary
650
14 SAP Industry Solution Example with SAP APO
651
14.1 SAP Apparel and Footwear Industry Solution
652
14.2 SAP ERP (AFS Extension): Integrated Solution Overview
654
14.2.1 Process Steps
655
14.2.2 AFS Planning
658
14.3 Master and Transactional Data Integration
659
14.3.1 Maintain Master Data
660
14.3.2 Data Transfer from SAP ERP to SAP APO
660
14.3.3 Bill of Materials Construct in SAP ERP (AFS Extension)
661
14.3.4 Transactional Data Integration
663
14.4 SAP APO Solution for AFS Using Aggregated Functionality
667
14.4.1 Demand Planning: Seasonal Functionality
668
14.4.2 Supply Network Planning: Aggregated Functionality
668
14.5 SAP Business Function
673
14.6 Summary
674
15 Technical Architecture
675
15.1 Core Interface
676
15.1.1 Configuration Steps
677
15.1.2 Integration Models
679
15.1.3 Incremental Data Transfer
684
15.1.4 Administration
688
15.1.5 Troubleshooting
700
15.1.6 Customer Exits
703
15.1.7 Publication of Planning Results
704
15.1.8 Regular CIF Monitoring Transactions
705
15.2 Technical Upgrade Functional Activities
710
15.2.1 Plan Phase
713
15.2.2 Prepare Phase
713
15.2.3 Upgrade Phase
714
15.2.4 Post-Upgrade Phase
714
15.3 SAP APO on SAP HANA
716
15.3.1 Deployment Options
717
15.3.2 Benefits
718
15.3.3 SAP S/4HANA
720
15.4 SAP Supply Chain Info Center
721
15.4.1 Dashboards
722
15.4.2 Deployment Options
727
15.4.3 Data Replication
727
15.5 Rapid Deployment Solutions for SAP APO
737
15.6 SAP APO as an Add-on to SAP ERP
741
15.7 SAP Fiori Apps for SAP APO
744
15.8 Hardware Sizing using Quick Sizer
746
15.9 Technical Integration with Non-SAP Applications
750
15.9.1 SAP APO Business Warehouse
751
15.9.2 Enterprise Service Bus
752
15.10 Summary
753
16 Technical Enhancements
755
16.1 Data Conversion Strategy
756
16.1.1 Data Conversion Process
757
16.1.2 Data Mapping and Cleansing
758
16.2 Legacy System Migration Workbench
760
16.3 Converting Data Using LSMW
761
16.3.1 Loading Master Data
763
16.3.2 Converting Transactional Data
768
16.3.3 Importing Data with IDocs
772
16.4 Technical Modifications in SAP APO
772
16.4.1 Business Scenario 1: Material Master CIF
773
16.4.2 Business Scenario 2: Product Master Creation
775
16.4.3 Business Scenario 3: Transaction Data Mapping
777
16.4.4 Business Scenario 4: SAP APO-SNP PDS Modification
780
16.4.5 Business Scenario 5: SAP APO-SNP Planning Book Modifications
781
16.4.6 Business Scenario 6: User Exit Macro
782
16.4.7 Business Scenario 7: SNP Heuristics Lot Sizing
785
16.4.8 Business Scenario 8: CTM Demand Prioritization
785
16.4.9 Business Scenario 9: Demand Planning with SAP BW
786
16.4.10 Business Scenario 10: Demand Planning to Supply Planning Release
787
16.4.11 Business Scenario 11: Alert Monitor
788
16.4.12 Business Scenario 12: TLB Interactive Display
788
16.5 Authorization Concept
788
16.5.1 Master-Derived Role Concept
789
16.5.2 Defining Roles
790
16.6 Process Chain
791
16.6.1 Main Components
792
16.6.2 Create the Process Chain
793
16.6.3 Process Chain Monitoring
796
16.6.4 Parallel Processing
797
16.7 Summary
798
17 Conclusions and Outlook
799
Appendices
803
A Resources
805
B List of Acronyms
807
C The Author
811
Index
813