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Intelligent ERP Update: SAP S/4HANA Cloud 1905 for Manufacturing and Supply Chain

This blog provides an overview of innovations in SAP S/4HANA Cloud 1905 for Manufacturing and Supply Chain.

Here is the table of contents:

Business Area Scope Item Innovation
Quality Management Nonconformance Management (2QN) Defect Handling Supported by Machine Learning
Production Planning Material Requirements Planning (J44) Avoid excess stock with situation handling (MRP Material Exception)
Warehouse Management Warehouse Kanban Supply into Production (3VT) Accelerated and simplified production supply with harmonized control cycle and integrated KANBAN processing
Warehouse Management Resource Management in WM (3W0) Improve efficiency of mobile execution with new APIs for warehousing activities
Warehouse Management Warehouse
Outbound Processing(3BS)
Process Warehouse Tasks – Picking
Inventory Management Core Inventory Management (‏BMC‏) Slow or Non-Moving Materials / Slow-Moving Indicator
Hybrid ERP Manufacturing Just-In-Time Supply to Customer from Stock (‏2EM‏) Just-In-Time Integration in SAP S/4 HANA Cloud automates the JIT process flow

My video guides you through the first four innovations on the list.

 

Quality Management

Defect Handling Supported by Machine Learning

The first innovation I want to highlight is a brand new machine learning use case in the business area of Quality Management. This machine learning feature supports quality technicians in their daily work. When describing a defect, quality technicians can make use of the SAP Fiori application Record Defects and simply enter the text – even by using a mobile phone – and the application automatically proposes the best matching defect codes. For this purpose the predictive model QM_DEF_CODE_PRPSL_MODEL uses a k-nearest neighbor (kNN) algorithm for comparing the entered text with the description text of saved defects. The proposal of best matching defect codes increases the data quality of all recorded defects and supports the detection of defect frequency and related actions for improvement.

Fig. 1: The system highlights the field ‘Defect Code’ when the predictive model proposes best matching defect codes. By clicking on the highlighted field the system shows the proposed defect codes.

Fig. 2: For using the described machine learning use case an analytics specialist has to activate and train the predictive model QM_DEF_CODE_PRPSL_MODEL.

 

Production Planning

Avoid excess stock with situation handling (MRP Material Exception)

The main function of material requirements planning (MRP) is to guarantee material availability. It is used to procure or produce the requirement quantities on time both for internal purposes and for sales and distribution. This process involves the monitoring of stocks and, in particular, the automatic creation of procurement proposals for purchasing and production. To plan as accurately as possible, you can now make use of intelligent situation handling for material coverage to bring important issues to the users’ attention. A typical issue could be that a sales order gets cancelled. If this is the case, you can identify the related MRP elements, such as production order or purchase order, which may have already been created to fulfill the cancelled requirement. Detecting unnecessary supply elements in time avoids excess inventory and thereby reducing costs.

Fig. 3: The user is automatically informed via notification if a situation of type ‘MRP Material Exception’ occurs. Opening the notification the system navigates the user to the ‘Material Coverage’ app and suggests how to resolve the MRP situation.

In the SSC-UI ‘Define Rescheduling Check for Plant’ you can decide, which MRP Elements shall be taken into account for the detection of MRP Situations:

  • Firmed Planned Orders
  • Production Order
  • Fixed Purchase Requisitions
  • PO/SA Schedule Line
  • QM inspection lot
  • Shipping Notification

If you want to enable MRP Material Situations Handling to detect unnecessary supply elements, please review SAP Note 2733550.

Warehouse Management

Accelerated and simplified production supply with harmonized control cycle and integrated KANBAN processing

In Kanban, a new stock transfer replenishment strategy has been created, which enables direct warehouse task creation in  Warehouse Management. The tight integration between warehousing and production reduces the total manufacturing costs by supporting lean execution principles based on standardized pull processes. In the Kanban control cycle, you can enter the new standard stock transfer strategy PD80 Warehouse Task. When a Kanban container status is set to “Empty”, the Warehouse Management task is created. The warehouse task can be confirmed in two possible ways:

  • The User confirms the warehouse task and the system sets the Kanban container to “Full”.
  • The User sets the Kanban container to “Full” and the system confirms the warehouse task.

The benefits are obvious:  Immediate visibility of Kanban replenishment requests in Warehouse Management and smoother manufacturing flow.

Fig. 4: After saving the Kanban container status ‘Empty’ the system automatically creates the Warehouse Task.

 

Improve efficiency of mobile execution with new APIs for warehousing activities

The new scope item Resource Management in Warehousing (3W0) allows you to leverage interfaces (APIs) for the development of customer-specific apps for warehouse task processing on mobile devices. In addition, it enables you to manage your warehouse resources, such as a user or equipment that executes work in the warehouse.  A resource is mandatory to process warehouse orders and tasks with the APIs. The API utilization of resources to block warehouse orders prevents concurrent processing by different warehouse workers. But if a warehouse operative forgets to log off, the Warehouse Management Monitor enables the warehouse clerk to monitor and log off resources.

Fig. 5: The ‘Warehouse Management Monitor’ enables the warehouse clerk to monitor and log off resources.

 

Fig. 6: Apple iOS prototype for mobile warehouse task processing implemented with the ‘SAP Mobile Development Kit’

 

The mobile development kit is a feature of SAP Cloud Platform mobile services for development and operations. In this demo, you will see how you can build native mobile applications for Apple iOS devices in a highly productive environment.

 

Improve usability and productivity of warehouse picker

The new SAP Fiori app Process Warehouse Tasks – Picking enables the warehouse operative to easily view, print and confirm open picking tasks also on mobile devices. In the overview screen, you can view all relevant information about the pick warehouse tasks in your warehouse. You can directly choose one or multiple warehouse tasks for confirmation or cancellation. You can print a pick list with this app. You can also view the details of a warehouse task or handle an exception.

Fig. 7: New SAP Fiori app ‘Process Warehouse Tasks – Picking’

 

Inventory Management

Slow or Non-Moving Materials / Slow-Moving Indicator

The analytical list page Slow or Non-Moving Materials enables you to monitor slow-moving materials and to determine how much capital is bound by the slow-moving items. With the 1905 release we are introducing the Slow-Moving Indicator (SMI) which enables you to determine slow-moving materials based on the consumption to stock ratio. The slow-moving indicator is an indicator for a slow-moving material.

This indicator is defined as the total consumption quantity (Qcons) for the analysis period divided by the product of stock quantity (Qstock) on the reference date and multiplied with the period length in number of days (NOdays). By taking time and percentage into account, the result is normalized and thus makes different analysis periods comparable.

Additionally it is now possible to filter also for materials and their usage in bill of materials (BoM). The new filter criteria Use in BOMs indicates the number of material BOMs a material is used in as a component.

Fig. 8: Use the SAP help (green circles) on the new filter criteria ‘Slow-Moving Indicator (SMI)’ and ‘Use in BOMs’ for further explanation.

Furthermore a new chart ‘More than 100 Days without Consumption’ is now available on the ‘Inventory Analysis Overview’ app. By clicking on the new chart the user can directly navigate to the ‘Slow or Non-Moving Materials’ app.

Fig. 9: ‘Inventory Analysis Overview’ app with new chart ‘More than 100 Days without Consumption’

 

Hybrid ERP Manufacturing

Just-In-Time Supply to Customer from Stock

Just-in-Time (JIT) processing is a common practice in Automotive Industry for efficient demand-driven production and logistics across supply chains. Long-term supply relationships are in place between supplier and customer, with outline agreements upon target quantities per material for a contract period, e.g. one year. The customer sends JIT calls to transfer dedicated requirements for delivery within a short-term horizon. The communication arrangement SAP_COM_0168 (Just-In-Time Integration) in SAP S/4 HANA Cloud automates the process flow.

Fig. 10: Process flow of the scope item ‘Just-In-Time Supply to Customer from Stock (‏2EM‏)’

 

For more information on SAP S/4HANA Cloud, check out the following links:

 

Follow us via @SAP and #S4HANA, or myself via @GerhardWelker and LinkedIn.

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