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Are you experiencing challenges with order fulfilment? SAP S/4HANA for advanced available-to-promise is the answer!

With the advanced available-to-promise (ATP) capability in SAP S/4HANA, you (as a supplier can offer a much better experience for your customer, using a product that is functional, fast, flexible, simple and integrated. This blog gives an overview of the product as presented by SAP’s Digital Supply Chain Director Sujeet Acharya during the 2019 SAP Sapphire Now Conference.

For further details and a practical demonstration, be sure to listen to this 50 minute meet-the-expert (MTE) webinar available in the SAP Learning Hub, edition for SAP Enterprise Support. The webinar describes and demonstrates both the new advanced ATP and Backorder Processing, and also covers Alternative-based Confirmations (ABC) where plant substitution is possible. More blogs like this can be found in the SAP Enterprise Support value map for SAP S/4HANA On Premise*.

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Making accurate delivery promises can be tricky for any business. Providing exact promise dates considering business constraints and profitability is the biggest challenge during supply shortage situations. This is where available-to-promise (ATP) comes in. ATP uses real time data to match supply with demand to provide feasible delivery promises and therefore improve customer satisfaction and service levels.

Basic ATP has been available in SAP ERP for quite some time, although it treated customers on a simple ‘first come first served’ basis and did not provide the level of functionality that some customers require. In the past, these customers had to rely on the module ‘global available-to-promise (gATP)’ within the secondary system SAP Advanced Planning and Optimization to fulfil their needs. Having to connect to the SAP SCM solution meant that simplicity suffered with gATP. Today, ATP is available in SAP S/4HANA On Premise as part of the digital core and is the same offering as SAP ECC ATP.

However, for customers who require more advanced functionality, SAP S/4HANA Supply Chain offers advanced ATP which is also part of the core solution, but for an additional license fee. This is completely new code line developed natively in SAP S/4HANA and there is no technical migration available from SAP APO gATP to SAP S/4HANA for advanced ATP:

Figure 1: SAP ATP Evolution

Figure 2: SAP S/4HANA – Suite 1809

The functionality of advanced ATP is far easier to use and grouped into five parts, along with five separate acronyms to remember!

Figure 3: SAP S/4HANA for advanced ATP Functionalities and Value Proposition

  1. Product Availability Check (PAC) is very similar to what was offered in basic ATP and gATP. It carries out the availability check for sales orders and stock transport orders and then provides an order promise date by checking all available stock in real time. This way, you promise only what you can deliver.

What is different in advanced ATP is the mass enablement feature whereby every line item within a sales order is checked in parallel, compared to sequential checks in basic ATP. This ‘parallelization’ greatly reduces the checking time for orders that have many line items. In the pipeline, an SAP Fiori based simulation and explanation tool for PAC is planned, along with the ability to take shelf life and product characteristics into consideration.

  1. Backorder Processing (BOP) has been completely transformed in SAP S/4HANA and is far better than basic ATP when it comes to performance, flexible configuration and faster scheduling. BOP in SAP S/4HANA consists of four SAP Fiori Apps, that enable the user to configure BOP rules, setup and schedule BOP runs, and monitor the results of the BOP run:

Figure 4: ATP – Backorder Processing

In advanced ATP the concept of requirement segmentation is used to adjust customer backorders depending on customer importance and the inventory situation. Orders are classified accordingly, and the image below shows how confirmed stock for an order can be a win, lose, gain, redistribution or fill for a customer. This way, the orders of ‘lose’ or ‘fill’ category customers will always have their allocations reassigned to higher priority orders and you can manage business priorities to ensure that your most important customers are looked after:

Figure 5: SAP S/4HANA for advanced ATP – Backorder Processing

This backorder processing confirmation strategy will reduce headaches for supply chain executives who more often operate in multi-channel order fulfilment environments and deal with such prioritization issues on a daily basis. No more will back orders of high priority customers will be left unfilled while low priority orders get preference over high priority orders. You decide what the criteria or logic is behind each category and you can easily sort and filter by each customer segment.

You can also configure a fallback variant to optimize exception handling where you define a variant for BOP for automatic reschedule processing and rescheduling of materials when supply is short. In the background, an SAP Fiori based intuitive setup and result monitor will show the confirmation status and any processing issues that happened during the run. There is a new Supply Assignment (ARun) which was created with the fashion industry in mind to provide a fixed pegging between the supply and demand which is respected until the final delivery, and global filters to restrict product and location selection.

  1. Product Allocation (PAL) is all about rationing or controlling a limited supply of products to certain customers. PAL was always available in basic ATP and gATP and was extensively used by the consumer products, hi tech and fashion industry, for instance. With advanced ATP, the value proposition is much greater, with far fewer steps to configure product allocation making the setup process much simpler and allowing strict planning and control mechanisms.  With advanced ATP, materials that are in short supply can be allocated to specific regions and customers for a specific period. This in turn, helps you to avoid critical situations in demand and procurement and prevents a situation where a material in low supply is all allocated to one customer, leaving others with none. There is also a Product Allocation Monitoring Cockpit (SAP Fiori app) that has been introduced with SAP S/4HANA 1809 to help you drill down and understand better the product allocation situation:

Figure 6: Product Allocation Overview: PAL Monitor

In future, more analytics is planned, along with capacity-based allocations and possibly direct integration with SAP Integrated Business Planning (IBP) for supply chain, where SAP S/4HANA can import the planned allocation from IBP.

  1. Alternative-Based Confirmation (ABC) was known as ‘rules-based ATP’ in gATP. ABC functionality in advanced ATP comprises what is called ‘location substitution’ or ‘plant substitution’ and is completely different from what went before. For example, in gATP location substitution happened in a sequential order, so if the order quantity was requested in location 1 and was not found there, we would move to location 2, location 3 and so on. The order would be confirmed when the first fit is found, even if that is not the ‘best fit’. SAP S/4HANA for advanced ATP is different and takes ‘best fit’ into consideration. If the stock is not available in the requested delivery location, the system will search for the best alternative, considering all available alternatives and the criteria chosen.

This is all done using two new SAP Fiori apps for location substitution in SAP S/4HANA 1809:

The Configure Alternative Control app allows you to:

  • Create alternative controls (a set of values assigned to a given set of selected characteristics according to the specific scenario for the business document class sales order).
  • Display, edit, copy and remove existing alternative controls and their values.
  • Display, edit, and remove characteristics for the business document class sales order.

The Configure Substitution Strategy app allows you to:

  • Define substitution methods for plant substitution
  • Display substitution methods and their values.
  • Activate inline, plant substitution for line items in the business document class sales order.

Figure 7: ABC Setup: Substitution Strategy

The first version of ‘Product substitution’ is planned for 2020 and will follow a similar method as described above for location substitution. With the 1909 release ABC works with BOP and during order change as well. In future, we will have more advanced functionalities in the substitution along with manual alternative selection features.

  1. Release for Delivery (RFDY) is a completely new, highly flexible SAP Fiori based app developed for advanced ATP. Users can now quickly manipulate the confirmation quantities of sales orders before they are released for delivery from the warehouse. Since last minutes changes and finetuning of orders is allowed, this keeps end customers happy and avoids last minute escalations. You can use this app to:

Gain an overview of requirements to be delivered within a specific horizon by:

  • Displaying business documents containing materials for which you are responsible during a specific time period, including requirements for materials with limited availability.
  • Displaying the availability situation for the materials for which you are responsible.
  • Displaying the confirmation and delivery status for the materials in a requirement item.
  • Displaying the potential impact for your organization if materials are not available and material redistribution is not optimized.
  • Displaying any constraining elements (for example, reduced available quantity at a storage location) that may prevent a requirement item being fulfilled partially or completely.
  • Displaying any dependencies (for example, a particular item is part of a delivery group) that may impact a group of requirements from being fulfilled.
  • Refreshing your worklist to take any changes in underlying business documents into consideration, since you started processing your worklist.

Distribute quantities of materials in limited supply by:

  • Manually redistributing material quantities between requirement items, as required, to fulfill a business document partially or completely.
  • Applying confirmation strategies such as Confirm from Top to enable efficient, semi-automatic processing of mass data.
  • Protecting quantities of requirement items from further processing.
  • Postponing further processing of requirement items.

Release materials for delivery, thus triggering subsequent logistics processes (for example, picking). Note that the number of delivery documents created interactively when business documents are processed is minimized: where possible, only one delivery document is created per business document processed.

Figure 8: What’s coming in 2019 in SAP S/4HANA for advanced ATP?

Figure 9: SAP S/4HANA for advanced ATP Roadmap

Useful Resources

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