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Author's profile photo Caetano Almeida

Lead time scheduling for planned orders: Is it really necessary?

When a planned order is created by MRP, the basic dates are calculated according to the in-house production time defined on the material master. Additionally, MRP can read and explode the routing to calculate the operation dates. The planned order production dates can be then calculated according to the operation dates and the basic dates can be even adjusted to match the production dates, depending on the customizing settings.

The production dates calculated with the routing data are more accurate than the basic dates, however, this is a complex calculation and, depending on the number of operations defined on the routing, can lead to performance issues and a long MRP execution. The performance is even worse when lead time scheduling is used in combination with planning mode 2 or 3, since the routing of each planned order of each material will be read and scheduling will be carried out again.

The question here is:

Do we really need such accurate dates for a planned order?

Maybe an even better question is:

Is it worth to have a longer MRP execution to have the production dates calculated?

Considering that the planned order is merely a planning element and that it will generally be later converted to production or process orders (unless we are using repetitive manufacturing), it is usually only a big advantage to have the operation dates calculated for a planned order in the following scenarios:

  1. Capacity leveling is executed for planned orders;
  2. Variant configuration is used and there are dependencies on the routing, which may affect the results of lead time scheduling;
  3. Repetitive manufacturing is used with a rate routing/reporting point;

If these scenarios are not used, then we can simply run MRP without lead time scheduling and use the planned order basic dates only, in order to improve the MRP run performance. After the conversion to production or process order, the routing will be exploded and the operation dates will be calculated.

What about the accurate planned order dates calculated with lead time scheduling?

On the material master tab Work Scheduling we have the option to inform the lot size dependent in-house production time, which means that the planned order basic dates will be calculated according to the planned order size.

In addition, transaction CA97N can be used to calculate the in-house production time according to the routing and update this information directly on the material master. It means that the planned order basic dates will as accurate as the basic dates calculated with lead time scheduling.

I need lead time scheduling because I’m running capacity leveling for planned orders!

Ok, in this case lead time scheduling is really necessary. However, capacity leveling is generally carried out on the short term horizon. If this is the case, perhaps you convert planned orders to production or process orders earlier, in order to run capacity leveling only with production/process orders.

That way, you don’t need to run lead-time scheduling during the MRP run and the performance can be improved.

If you still decide that it is necessary to run capacity planning with planned orders, on the customizing transaction OPU5 it is possible to define an horizon for detailed scheduling. This horizon should be no longer than the capacity planning horizon. That means, you don’t need to run detailed scheduling for a planned order that is 6 months in the future, if you only run capacity leveling for one month in the future.

Where can I find more information about the system behavior?

On the following notes you can find more information about the functionalities mentioned on this blog, such as MRP performance, lead time scheduling and planning mode:

206666 MRP: Control parameters during planning
204517 MRP: Typical causes of performance problems
156115 Consulting: Scheduling of planned order for recipe
152319 Consulting: Scheduling of planned order for routing
78867 MD01: Documentation on the planning mode

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      Author's profile photo Mark Hager
      Mark Hager

      One other topic to mention is the impact the detailed planning scheduling horizon plays on lead time scheduling of planned orders.  This configuration value is set in customizing for planned orders for the combination of Plant, Order Type, and Production Supervisor.  The transaction code is OPU5.

      All planned orders whose basic start date lies within the detailed planning scheduling horizon are detailed scheduled using the selected routing times.   All planned orders whose basic start date lies outside the detailed planning scheduling horizon are scheduled with basic dates logic using the material master in-house production time to calculate the basic start and end dates.

      So the detailed planning scheduling horizon restricts the timeframe over which planned orders are detailed scheduled; not the planning parameters used during MRP execution.

      A major consideration is where to set the detailed planning scheduling horizon especially if the cycle time delta between scheduling with basic dates and scheduling and lead time scheduling is not minimal.  Consider the situation where the BOM structure is very deep and lead times for the components are very long. The in-house production times within the BOM structure must be very close to the routing times to avoid the shifting of requirements dates for the lower level components as the start dates of the planned orders cross over the detailed planning scheduling horizon.  The resulting MRP nervousness of shifting requirements dates can be problematic for Buyers trying to manage the procurement of component materials.