MRP Overview Scribd

8/3/2019 MRP Overview Scribd

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Agenda SAP MRP Overview

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MRP Terminology Material Master MRP Views

Other Master Data

MRP Flow

MRP Run Steps

Step 1: Calculate net requirements

Step 2: Determine quantities

Step 3: Determine dates

Step 4: BOM explosion

Useful Transactions


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Horizons relevant for production planning

Planning horizon: Part of the planning area, where aplanning file entry is made for the net change planning inthe planning horizon. The planning horizon is calculated inworkdays. When a material has an entry in the planningfile, it becomes relevant for MRP

Scheduling horizon: Once a planned order (for in-house

production) is in the scheduling horizon, the exactproduction dates are calculated and the capacityrequirements are created.

Rescheduling horizon: Once a planned order is in therescheduling horizon, exception messages can be created

Dispatch horizon: If a planned order or process order is inthe dispatch horizon, it becomes visible in the planningboard for sequencing on a production line.


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Horizons relevant for production planning

Planning horizon => 182 days

Scheduling horizon => 120 days

Rescheduling horizon => 100 days

Dispatch horizon => 30 days

Time fence => 14 days


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Creation of exception messages

Exception messages depend on the transaction being carried outand are meant to inform you of an important or critical event.

By means of the exception messages, you can easily sort out anymaterials that you need to reprocess manually. Special search andselection functions are available for this in the evaluations for MRP.

During the planning run, the system recognizes exceptionalsituations where you usually have to manually reprocess theplanning result and it records these situations as exceptionmessages. The system displays the exception messages in theevaluations for MRP.

Exception messages refer to an individual MRP element. If several

exception messages occur for one MRP element, the mostimportant ones are stored.


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Creation of exception messages

Rescheduling proposals

If a material shortage exists, the system usually creates a newprocurement proposal. The rescheduling check is used to changethe dates of already existing firmed receipts not planned on thesame day as the requirement to suit the requirement date. For thispurpose, the system displays the appropriate exception messages

with rescheduling proposals for these firmed receipts to beprocessed by the MRP controller.

The rescheduling horizon (defined on MRP group) defines the timeperiods in which exception message are to be created.

There are also tolerance values which allow rescheduling ofa firm procurement proposal by MRP (defined on MRP group)

Rescheduling messages:

Bring process forward

Postpone/cancel process


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Lists for evaluation

Stock/requirements list: The stock/requirements list is amethod of evaluation that gives an overview of the stock,requirements and receipt elements. This list is continuouslyupdated (except when you keep the transaction open)

MRP list: The MRP list is the same list as the stock/requirementslist, with the difference that the MRP list is not continuouslyupdated. It gives an overview of the situation as it was at themoment of the last MRP run.


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Internal and external procurement

Material can be purchased externally and internally(Procurement type X)

Quota arrangements can be used to divide the procuredquantity over time in different sources of supply (internaland external)

If there are no quota arrangements, the systemautomatically switches to in-house production. MRPtherefore firstly creates planned orders, which you can thenconvert into production orders or purchase requisitions.


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Procurement proposals

Procurement proposals by MRP => planned orders & purchase

requisitions Proposal determination

Procurement type:

E In house production => always planned orders

F External procurement => planned orders and purchaserequisitions

X Both types => planned orders and purchaserequisitions

MRP groups:

Z001 Finished materials => always planned orders

Z002 Raw materials => purchase requisitions in theopening period, planned orders outside opening period

Z003 Semi-finished materials => purchase requisitions inthe opening period, planned orders outside opening period

Z004 Precious metal materials => purchase requisitionsin the opening period, planned orders outside openingperiod


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Planning file

The point of start for MRP is the planning file. The planning

run and scope of the planning run (which materials areplanned in which planning run) are controlled by theplanning file.

Next to the material number the planning file includes anumber of important entries:

Low level code

Net change planning indicator => if this indicator is set,this material has to be planned in the NETCH planningmode

Net change in the planning horizon indicator => if thisindicator is set, this material has to be planned in theNETPL planning mode

Reset procurement proposals => indicates that existingprocurement proposals will be deleted and recreated

Re-explode BOM => Controls the re-explosion of BOMsfor existing procurement proposals that came from thelast planning run. This indicator can be set by changesin the BOM, changes in the sales BOM, changes in thematerial classification, etc.


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Low level code

In an MRP run every material is

planned separately. In order to organizethe planning in the most efficient wayevery material in a BOM is assignedwith a low level code. The lowest codematerials are planned first, then thenext level until the last level is reached.

The finished product is given a low level

code 000. The next level in the BOM isgiven a higher number. A raw materialis always the highest code possible(999), because they are planned in theend of the planning run.

If a material is used in several BOMs

so that it has more than one low levelcode, the lowest number is chosen. Inthe examples BBB has low level codes001 and 002. MRP will only startplanning BBB when it starts planningthe materials with low level code 002.

A

AAA BBB

X Y

000

999 001

999 999

B

AA BB

AAA BBB

000

999 001

999 002

X Y999 999


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The days supply of a material indicates how long a material willcover requirements if you only take current plant stock intoaccount.

The first/second receipt days' supply indicates how manyworkdays a material will cover the requirements when taking

current plant stock and specific, predefined receipts into account.Days' supply 1st rcpt 2nd rcpt

Process orders + Production orders X X

Purchase orders + shipping notifications +schedule lines + schedule line deliveries X X

QM inspection lots X X

Firmed purchase requisitions XFirmed planned orders X

Assigned planned orders X

Receipt reservations X X

Shipping notifications X X

Days supply determination


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Other Master Data

MRP Flow

MRP Run Steps





Useful Transactions


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Material master data

MRP 1

MRP group: number of settings are defined on MRP group level=> linked to material type

Plant specific material status: Status that can be set to restrictthe usability of a material on plant-level.

MRP type: key that determines whether and how the material

is planned. Current keys that are used Reorder point: stock level that triggers a procurement element

(purchase requisition or planned order) => only used forreorder point planning (V1).

MRP controller: key to group materials in a number of listings

Lot size: key that determines how and when the quantity is tobe procured or produced is calculated

Min./max. lot size: to avoid procurement/production of toobig/small quantities

Rounding value: value to a multiple of which the system roundsup the production/procurement quantity


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Material master data

MRP 3

Total replenishment lead time: total time needed toreplenish the stock of a material => relevant for reorderpoint planning

MRP 4

Production versions: list of all the production versionsmaintained for the material => see next slide

=> Enter storage location at entry screen

Storage location MRP indicator: Indicator to exclude

storage locations from MRP at plant level => storagelocations excluded CA04, CA05 and CA06 excluded forplanning


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Other Master Data

MRP Flow

MRP Run Steps





Useful Transactions


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Other master data (1/2)

Resource: After calculating the basic dates MRP will start a

scheduling process and calculate the capacity requirements,in which MRP will start calculating backwards from the basicfinish date using a scheduling formula which is taken fromthe resource.

Bill of material: A bill of material is a formally structured listof the components that make up a product or assembly.The list contains the object number of each component,together with the quantity and unit of measure.

Production version: It is possible that a material can be

produced on different production lines or productionoperations. A production version determines the variousproduction techniques that can be used to produce amaterial.


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Other master data (2/2)

Master recipe: The master recipe in PP-PI describes the

production of a material in the production run. Next to theheader information, it lists the number of operations andthe component materials (BOM).

Quota arrangements: If a material can be obtained fromvarious sources of supply, each individual source of supplycan be allocated a quota arrangement. The quotaarrangement is valid for a certain period of time andspecifies exactly how the receipts are to be distributedamongst each source of supply.

Source list: List that links a material to a vendor to makeautomatic vendor determination possible.


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Other Master Data

MRP Flow

MRP Run Steps





Useful Transactions


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MRP Flow - Overview

In-house production

Capacityevaluation

Capacityleveling

External procurement

MRP run

Conversion of MRP proposals

MRPevaluation


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MRP Flow - Parameters

MRP

External requirements:Sales orders, schedulingagreements, deliveries

Order reservations Dependent requirements Safety stock

Fixed receipts: Purchase orders Shipping notifications Process orders Firmed planned orders Firmed purchaserequisitions

Stock level

Procurement proposals Planned orders Assigned purchaserequisitions

Dependent requirementsException messages

Planningfile


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MRP Flow - In-house production vs. External Procurement

Dispatch in

planning board

Planned order

MRP

Firm planned order

Collective

conversion

Process order

Firmingproposals *

Planned order

MRP

Firm purchase req.

Purchase order

Purchase requisition

Collectiveconversion

* Exceptional

In-house External Procurement


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Other Master Data

MRP Flow

MRP Run Steps





Useful Transactions


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MRP

Creation of proposal consists of 4 stages / steps

Calculate net requirements

Calculate quantity needed

Calculate dates: Determination of basic dates For in-house produced goods => calculation ofexact production dates and capacity requirements

Explode BOM Vendor assignment

MRP Run Steps

Result: Procurement proposals


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Result: Procurement proposals

Planned orders: A planned order is sent to a plant and is an MRPrequest for the procurement of a particular material at adetermined time. It specifies when the inward material movementshould be made and the quantity of material that is expected.Planned orders can be created for in-house produced materials as

well as for externally purchased materials. Purchase requisitions: Purchase requisitions are used to give

notification of requirements of materials and/or external servicesand keep track of such requirements.

Determination of which procurement proposal to create = definedin procurement type on MRP 1 view

E: always produced in house => planned order F: always externally purchased => purchase requisition in opening

period and planned order outside opening period


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Other Master Data

MRP Flow

MRP Run Steps





Useful Transactions


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MRP types:

PD: standard MRP run

P3: standard MRP runwith the use of a planningtime fence

V1: ( Reorder pointplanning): a newprocurement proposal will

be created by MRP as soonas plant stock falls below aspecified stock level(reorder point).

Plant stock

+ Open order quantity (purchase orders, firmed plannedorders, firmed purchase requisitions)

- External sales quantities in replenishment lead time

= Available stock



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MRP type PD

MRP calculates untill it finds a first net requirement =>completes all the next steps

First netrequirement


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MRP type PD MRP applies the next steps to calculate the dates and

quantity of the first procurement element

MRP moves to next net requirement and applies the samesteps

First net

requirement isno longerrequirement

New first net

requirement


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MRP type PD MRP applies the next steps to calculate the dates and

quantity of the first procurement element

MRP keeps iterating until are net requirements are handled

Second netrequirement is

no longerrequirement


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MRP type P3

P3 uses the same logic as PD

Use of planning time fence:

MRP will not schedule planned orders inside the planningtime fence

A requirement in the planning time fence will trigger thecreation of a planned order

MRP will schedule a planned order at the end of theplanning time fence

Planned orders which are not firm, will keep gettingpushed outside of the planning time fence => fixplanned orders to avoid this


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MRP type P3

Planned order is pushed out by MRP to end of planningtime fence

MRP RUN


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MRP type V1

V1 only takes into account only external requirements thatlie in the replenishment lead time of the material

The otherrequirements

are not takeninto account

by MRP


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Other Master Data

MRP Flow

MRP Run Steps





Useful Transactions


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Lot size procedures:

EX Lot for lot order quantity: Planned orders or purchaserequisitions are planned with the same quantities as therequirements. The procurement elements are planned to beavailable on the day that they are required. This procedure can beused in combination with rounding values, maximum and minimumlot sizes.

FX: Procurement elements are only created with one fixed lot size.

If the requirement is larger than lot size, a second order/requisitionis created. The procurement elements are planned to be availableon the day of the first requirement.

MB: All requirements for 1 month are bundled into one procurementelement. The elements are planned to be ready at the 1st day ofthe month. This procedure can be used in combination with

rounding values, maximum and minimum lot sizes. WB: All requirements for 1 week are bundled into one procurementelement. The elements are planned to be ready at the 1st day ofthe month. This procedure can be used in combination withrounding values, maximum and minimum lot sizes.


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Lot size procedures:

Z3 Two months lot size: All requirements for twomonths are bundled into one procurement element. Theelements are planned to be ready at the 1st day of themonth. This procedure can be used in combination withrounding values, maximum and minimum lot sizes.

Z4 Three months lot size: All requirements for threemonths are bundled into one procurement element. The

elements are planned to be ready at the 1st day of themonth. This procedure can be used in combination withrounding values, maximum and minimum lot sizes.

ZM All requirements for 1 month are bundled into oneprocurement element. The procurement elements areplanned to be available on the day of the first

requirement. This procedure can be used in combinationwith rounding values, maximum and minimum lot sizes.

ZW All requirements for 1 week are bundled into oneprocurement element. The procurement elements areplanned to be available on the day of the firstrequirement. This procedure can be used in combinationwith rounding values, maximum and minimum lot sizes.


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Other elements:

Rounding value

Maximum lot size

Minimum lot size

Assembly Assembly scrap: No examples at AC


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Other Master Data

MRP Flow

MRP Run Steps





Useful Transactions


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Calculation of basic dates

If backwards scheduling is not possible (Start date in thepast)=> switch to today scheduling

Step 3: Determine dates In-house Production


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Release date (only for process orders):

Scheduled startRelease date

Release period



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Calculation of scheduled dates using resource calendar. The production version of a material can be assigned

automatically to a planned order

The production version determines which master recipe,which BOM and which resource will be used

Production time is calculated based on data maintained

in the master recipe and resource

If the basic start date is different from the scheduledstart date, the basic start date will be adjusted.


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Select production version

Material master=> quota arrang.

usage indicator

Quotaarrangements

(MEQ1)

Productionversions (C223)

1/2 (no QA for MRP)

3/4 (QA relevant for MRP)

Productionversion X

Check quantities &validity dates

No quotaarrangements found

Check quantities &validity dates

Step 3: Determine In-house Production

In-house produced goods


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Step 3: Determine External Procurement

External procurement Calculation of basic dates

Opening period: time buffer for converting planned orders into purchaserequisitions. The opening horizon is calculated from the planned start date of thepurchase requisition into the past, determining the opening date. (defined in thescheduling margin key)

Processing time for purchasing: average time needed by purchasing to converta purchase requisition into a purchase order (2 days for AC)

Planned delivery time: If source list exists, the entry in the material master isoverruled by the purchasing info record

Release date: Latest date to convert purchase requisition to purchase orders


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Selection of source of supply

Material master=> quota arrang.usage indicator

Quotaarrangements

(MEQ1)

Source list

1/2 (no QA for MRP)

3/4 (QA relevant for MRP)

No quotaarrangements found

Vendor X

Check MRP indicatorin source list

Check MRP indicatorin source list

Step 3: Determine External Procurement

External procurement


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Step 3: Determine Factory Calendar

Factory calendar

Times defined on the material master can be defined in twoways:

Calendar days => 365/366 days per year

Work days => depending on factory calendar

Factory calendar AC Burlington: Work days => 7 days per week, except public holidays

Planning calendar => not used

Resource calendar => calendar with available days of a certainresource


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MRP Terminology

Material Master MRP Views

Other Master Data

MRP Flow

MRP Run Steps





Useful Transactions


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Select production version:

The production version of a material can be assigned automatically to aplanned order

The system will search in the quota arrangements which is the preferredproduction version. This can be based on:

Lot sizes

Quotas or percentages

Priorities If none of these are maintained, the system will take the first production

version using the alphanumeric name

Explode BOM

If a material is produced in-house, the system also calculates thedependent requirements, that is, the required quantity of componentsrequired to produce the finished product or the assembly and required

date. This is done by exploding the BOM which is defined in thepreferred production version. If a material shortage exists, plannedorders are created at every BOM level to cover requirements.

Component scrap is applied to calculate the required quantity


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MRP Terminology

Material Master MRP Views

Other Master Data

MRP Flow

MRP Run Steps





Useful Transactions


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Useful Transactions (1/2)

MD01: Plant MRP run

MD02: Single item, multi-level MRP run

MD03: Single item, single-level MRP run

MDBT: MRP run in background*

MD20: Create planning file entries

MD21: Display planning file entries

MDAB: Setup planning file in background

MDRE: Consistency check planning file

MD04: Individual stock/requirements list

MD07: Collective stock/requirements list

MD05: Individual MRP list

MD06: Collective MRP list

MD44: Planning situation material


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Useful Transactions (2/2)

MD14: Individual conversion of planned orders to purchase

requisitions MD15: Collective conversion of planned orders to purchase

requisitions

MD04/MD07: Firming of procurement proposals (exceptional case)

ME57: Collective conversion of purchase requisitions to purchase

orders CM01 Capacity load per resource

CM25 Capacity planning table (graphical)

CM29 Capacity planning table (graphical) => profile defined inparameters

COR7: Individual conversion of planned order to process order COR8: Collective conversion of planned orders to process orders

MD06/MD07: Firming of procurement proposals

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