In this blogpost, we will review some basic concepts that you should be familiar with when implementing a planning and manufacturing solution specifically SAP S/4HANA Manufacturing for Planning and Scheduling. These concepts and definitions will help you define the solution design that is most appropriate to your organization and increase business value from the solution’s adoption.
Manufacturing Strategy
Manufacturing organizations use different types of manufacturing approaches according to various parameters of their manufacturing processes. Based on the volume, nature, and variety of products as well as the complexity and repeatability of the manufacturing processes – a job based, batch based, or continuous manufacturing approach could be followed.
SAP Cloud ERP allows customers to model and execute their manufacturing scenario per their manufacturing approach. A simplified way of understanding the different manufacturing strategies in SAP is as follows:
Discrete Manufacturing would be the production of goods that could be disassembled into components. Production is controlled by individual production orders. e.g., Industries – Mills, Automotive
Process Manufacturing would be the production of goods that cannot be separated to their components, typically produced in batches, and controlled using Process orders which have a tighter integration to quality management. E.g., Industries – Chemicals, Pharmaceutical, Foods & Beverages, Consumer goods (personal care)
Repetitive Manufacturing would be production en masse where same or similar products are produced over days using a production run schedule and a simplified order processing is done using backflush process.
Customers can also use Project-Based manufacturing.
Production Planning Strategy
Depending on the modularity of the product, number of final product variants and the supply network, planners may delay the final assembling of the finished product closer to the customer. This would mean that certain manufacturing steps could be performed ahead of the customer’s order while the final manufacturing steps would be performed when the customer order is received. This type of scenario is typically modeled by using planning strategies. Common planning strategies are make-to-stock and make-to-order but there are hybrid approaches such as the one described above.
Special Industry Requirements
Depending on the Nature of the industry, there may be special planning requirements. SAP S/4HANA Manufacturing for Planning and Scheduling (MP&S) supports scenarios for many different industries. For example - Mill Industries heavily use Characteristics Based Planning and Food and Pharma have an important Shelf-Life Use Case. Food and Chemical Industries also have Tank Planning use cases.
Production Optimization
The customer might also want to use optimizers available with S/4HANA Manufacturing for Planning and Scheduling (MP&S). For more details on production optimization, please check out the blog post: The evolution and future of Advanced Planning and Scheduling (APS) systems
Please also check out a how to video explaining the usage of the optimizers.
How to Video - PPO & DS Optimizers
Helpful Links:
Production Planning for Process Industry
PP/DS Repetitive Manufacturing
Sales Order Oriented Planning
Forecast Consumption and Requirements Strategies
Planning with Characteristics
Planning with Self Life Data in PP/DS
Optimization with PPDS
In conclusion, you now know more about concepts that form the building blocks of any S/4HANA Manufacturing for Planning and Scheduling implementation. We have discussed manufacturing strategies, production planning strategies, special requirements i.e. industry requirements and optimization requirements that have a significant impact on the solution design.
Manufacturing Strategy
Manufacturing organizations use different types of manufacturing approaches according to various parameters of their manufacturing processes. Based on the volume, nature, and variety of products as well as the complexity and repeatability of the manufacturing processes – a job based, batch based, or continuous manufacturing approach could be followed.
SAP Cloud ERP allows customers to model and execute their manufacturing scenario per their manufacturing approach. A simplified way of understanding the different manufacturing strategies in SAP is as follows:
Discrete Manufacturing would be the production of goods that could be disassembled into components. Production is controlled by individual production orders. e.g., Industries – Mills, Automotive
Process Manufacturing would be the production of goods that cannot be separated to their components, typically produced in batches, and controlled using Process orders which have a tighter integration to quality management. E.g., Industries – Chemicals, Pharmaceutical, Foods & Beverages, Consumer goods (personal care)
Repetitive Manufacturing would be production en masse where same or similar products are produced over days using a production run schedule and a simplified order processing is done using backflush process.
Customers can also use Project-Based manufacturing.
Production Planning Strategy
Depending on the modularity of the product, number of final product variants and the supply network, planners may delay the final assembling of the finished product closer to the customer. This would mean that certain manufacturing steps could be performed ahead of the customer’s order while the final manufacturing steps would be performed when the customer order is received. This type of scenario is typically modeled by using planning strategies. Common planning strategies are make-to-stock and make-to-order but there are hybrid approaches such as the one described above.
Special Industry Requirements
Depending on the Nature of the industry, there may be special planning requirements. SAP S/4HANA Manufacturing for Planning and Scheduling (MP&S) supports scenarios for many different industries. For example - Mill Industries heavily use Characteristics Based Planning and Food and Pharma have an important Shelf-Life Use Case. Food and Chemical Industries also have Tank Planning use cases.
Production Optimization
The customer might also want to use optimizers available with S/4HANA Manufacturing for Planning and Scheduling (MP&S). For more details on production optimization, please check out the blog post: The evolution and future of Advanced Planning and Scheduling (APS) systems
Please also check out a how to video explaining the usage of the optimizers.
How to Video - PPO & DS Optimizers
Helpful Links:
Production Planning for Process Industry
PP/DS Repetitive Manufacturing
Sales Order Oriented Planning
Forecast Consumption and Requirements Strategies
Planning with Characteristics
Planning with Self Life Data in PP/DS
Optimization with PPDS
In conclusion, you now know more about concepts that form the building blocks of any S/4HANA Manufacturing for Planning and Scheduling implementation. We have discussed manufacturing strategies, production planning strategies, special requirements i.e. industry requirements and optimization requirements that have a significant impact on the solution design.
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