Make to Order Process IN SAP CLOUD Public edition

[mickaelquesnot]

Make to Order Process IN SAP CLOUD

 

https://youtu.be/ASRrCWjrzqs

PDF > https://icedrive.net/s/APyBWPS1tfDC5XRWt6wgj4DwAWhV

In this tutorial, we shall keep things simple to help you understand the SAP make to order process in the Sales & Distribution module. We shall differentiate the process from the make to stock production strategy. Then we will walk through the SAP make to order process. The process begins with creating the make to order material master for finished goods. Next, we show you how to create a quotation based on the customer request for the make to order product. We will then demonstrate creation of the sales order with reference to the quotation. Finally, we will create the production order in the Production Planning module to trigger the production process.
Production Strategies
Companies involved in the production of goods mainly follow one of the following two production strategies:
• Make to Stock – The product is mass produced and fast moving in nature, such as consumer products, pharmaceuticals, household items, etc.
• Make to Order – The product is not manufactured in advance, but produced once the customer order is received, as with high-end cars, motorcycles, textile products etc.
Make to Stock Production Strategy
Consumers use and buy make to stock products regularly, thus they are necessities rather than luxury items. Companies create demand for these goods through advertising, promotions, activations etc. and continue to produce based on demand, market trend, and forecast figures. Companies keep safety stock levels of finished goods in their stock in case of high demand due to seasonal changes or festive events.
The production process begins once the forecast is finalized. Material requirements planning (MRP) is executed and requirements are generated for the manufacture of the finished goods. The required raw materials are requested from the respective departments. For raw materials not produced in-house, purchase requisitions are generated, along with the required date of delivery, and sent to the procurement department.
Make to Order Production Strategy
Make to order products are specialized products which may be costly or highly customized, such that the manufacturer should not freeze capital by making and storing the goods in advance of the customer’s order.
In the make to order production process, a sales order initiates the demand for production. The production department creates a bill of material to produce the required quantity and runs MRP. Requirements for components manufactured in-house are sent to the respective department and if any component needs to be purchased, a purchase requisition is raised and sent to the procurement department. Once the make to order production process is completed, finished good are transferred to a storage location as “special stock”. Finally, the finished goods are delivered and invoicing is carried out.
There are two scenarios in the make to order strategy which may be elected:
• Offer a set of products with different varieties and flexible features. The various configurations have fixed rates and the product is only manufactured once the order is received from the customer. For example, a car manufacturing company offers different variations of a particular model with different engines and other specifications at certain prices. If the customer wishes to add or change certain features, the options can be included with the fixed price for each. The company will only manufacture the car when the order is received from the customer.
• Manufacture certain goods customized to specific customer requirements. For example, imagine a hotel company ordering towels for each of their properties. The customer may require white towels with their brand embossed or embroidered in a specific color or size. The company producing the towels does not provide a rack rate with fixed prices in this scenario, but instead will quote the customer based on their specifications and desired quantity for the finished goods.
SAP Make to Order Process
Now we shall demonstrate the steps in the SAP make to order process. We will walk through the following steps in the below sections:
1. Update Material Master
2. Create Quotation
3. Create Sales Order
4. Check Production Order
5. Execute Delivery
6. Generate Billing
Update Material Master
To initiate the SAP make to order process, first create a material master for finished goods or update an existing one with the appropriate item category group. We will demonstrate the simpler approach. Execute the app Manage Product Master to change an existing material master.
In the initial screen, enter the material number you want to update and hit Enter. Then, select the DISTRIBUTION CHAINS TAB, as shown below:

 

OPTION 1
Update the item category group to CB04 – Make-to-Order as shown below:

OPTION 2

 

Create Quotation
In the scenario described earlier where a customer requires a completely customized order for embroidered towels, the customer submits their requirements to the company, then the company must generate a quotation. In the SAP make to order process, create a quotation using Manage Sales Quotations APP. In the initial screen, enter a quotation type and hit Enter to enter the quote information.

 

Enter the following information:
1. Code of the customer that requested the product
2. Validity dates for the quotation
3. Finished goods material number from the last step
4. Order quantity

 

To update the pricing for the custom order, highlight the relevant line item and press the item conditions button .

Click the Conditions tab to see the price for the item. Update as necessary to correspond with the required customizations.

Hit Enter then Save . The quotation will be saved with a confirmation message:

 

 

Create Sales Order
Once the customer places the order based on the quotation, create the sales order with reference to the quotation created in the last step. Manage Sales Quotations APP and enter the relevant sales order type in the initial screen.

Sales order components are copied from the quotation. Take note of the item category. This field is populated as a result of the sales document type and item category group combination. This particular combination is configured to produce AN MTO Requirements type as shown below:
Requirements type

The requirements type determines the planning strategy to be used for a
particular requirement.

To check the pricing or make updates for customer changes, highlight the relevant line item and press the item conditions button . Click the Conditions tab to see the price for the item as copied from the quotation.

Hit Enter then Save . The sales order will be saved with a confirmation message:

Check Production Order
Monitor Material Coverage - Net and Individual Segments
With this app, you can monitor all the materials in a selected area of responsibility. This includes collective requirements materials, make-to-stock and make-to-order materials, and materials for direct procurement. You are provided with a list of all materials with a net requirement segment or individual planning segments, which considers the following planning segments:
• Net segment – planning for the whole MRP area
• Individual customer segment – using sales order stock
• Individual project segment – using project stock
• Segment for direct production planning – with direct creation of planned orders
• Segment for direct procurement planning – with direct creation of purchase requisitions
The system calculates the requirements for each segment separately. The materials of these planning segments might have coverage issues according to a specified shortage definition. The shortage definition you choose contains a set of rules that the system uses for calculating the material shortages. These rules define the scope of the shortage calculation, meaning the supply and demand elements to be considered and the conditions that have to be met to be a relevant shortage. You can use the default filter Time till Shortage to check the coverage of materials within a specific time frame.

Release Production Orders
With this app, you can release production orders. The order release can be executed at the following levels:
 If you release at order header level, the production order and all its operations are released. The order and the operations receive the status REL (released).
 You can also release individual operations within a production order. The operation receives the status REL and the order receives the status PREL (partially released). If all operations in an order have been released, the order has the status REL.
A newly created production order initially receives the status CRTD (created) and it must be released, before it can be processed.
Note
You can use this app if the role Production Supervisor - Discrete Manufacturing is assigned to your user.
Key Features
You can use this app to:
 Release production orders at order header level
You can select several production orders with, for example, the same order type, plant and MRP controller and release them simultaneously.
 Release individual operations of production orders
Note
An operation can only be released if the preceding operation has been released.
 Save selection criteria as a variant
Supported Device Types
 Desktop
 Tablet

 

Initial Stock Posting for the Material in BoM

Log on to the SAP Fiori launchpad as Warehouse Clerk. The SAP Fiori launchpad displays.

Open Post Goods Movement (MIGO)
The Goods Receipt Other - ZZZ (your user name) screen displays.

Choose Goods Receipt and Others on top of the screen.

In the Detail Data section, make the following entries and press Enter. Select Next Item icon to add entries.

On the Where tab:
● Goods Movement Type: 561 (Init.entry of stBal.)
● Plant: 1010
● Storage Location: 101B

On the Quantity tab:
● Quantity: <Quantity>, for example, <100>

On the Material tab:
● Material: <BOM Material>, see the Bill of Material Structure for FG228 and FG227 in the Master Data, Organizational Data, and Other Data section for a detailed materials list.
Run through Make-to-Order Production - Semifinished Goods Planning and Assembly (1BM) test script if you do not want to post initial stock for SG224.

Select Item OK, and choose Check. A message displays: The Document is OK. You also post initial stock for material RM20 in case you test with material FG227.

Confirm the message that the batch has been created and choose Post. A message displays: Material document ZZZ posted.

Availability Check
Checks whether the components required for a production order are available.
Use
Before you start production, you have the option of checking whether all the components assigned to a production order are available on the calculated requirements dates.
Features
In a production order, the system can check the availability of a component only if the following applies for the component:
 It is kept in stock.
 It is not a phantom item.
 It is not a bulk material.
Availability checks can be triggered automatically or manually:
 The availability of components can be checked automatically during order creation or during order release. In your configuration environment, you specify per order type and plant whether the availability should be checked automatically. In addition, an automatic availability check can be carried out when the order is saved.
In your configuration environment, use the search function to open the following activity: Define Checking Control. For more information, see Configuration Environment of SAP S/4HANA Cloud.
 You can always trigger a manual availability check.
Note
If you make changes in an order, which could affect the availability of its components (for example date or quantity changes), this does not automatically trigger a new availability check. For up-to-date information on any missing components in an order, you should restart the availability check manually after you have made the changes.
You should define the automatic availability check when the order is saved.
Checking Scope
The checking scope is defined via the checking group in the material master and the checking rule in your configuration environment:
 Every material that shall be considered in the availability check must be assigned to a checking group. The assignment is carried out in the material master record.
 The checking rule defines how the availability check is performed, that is, which stocks, goods receipts, and goods issues are included in the check and whether the check is performed with or without the replenishment lead time.
In your configuration environment, use the search function to open the following activity: Define Checking Control. For more information, see Configuration Environment of SAP S/4HANA Cloud.
Level for Availability Check
The availability check can be carried out at plant or at storage location level. At which level the check is actually carried out depends on the data maintained in the material component and the checking scope: If a storage location is specified in the reservation, the check is carried out at storage location level, unless the checking scope specifies that the check should always be carried out at plant level.
Note
If a check is carried out at storage location level and the components are available, the system automatically carries out an additional check at plant level. For performance reasons, we recommend that you only carry out this type of check where required.
If, during an availability check, a material requirement exists with reference to a sales order / project, the check is carried out in the individual planning section of the sales order / project.

 

Pick Components for Production Orders (CO27)
App ID: CO27
You can use this app to determine which components have not yet been issued from stock for a production order and then carry out the goods issue.
Note
In this app, components with mandatory serial numbers cannot be picked. Components with optional serial numbers cannot be picked using the serial numbers. Please use the Post Goods Movement (MIGO) app or the Post Goods Issue (MIGO_GI) app to post the material components by their serial numbers.
Key Features
The initial screen for selecting production orders is the same as the object detail list for components in the production order information system.
The result of the selection is a component overview for the orders selected and a pick list containing the components still to be issued.
Note
You select orders using selection criteria. All the components are displayed for each order selected. For example, if you enter a component as a selection criterion, all the components are displayed, of those orders that contain this component.
When you select orders for picking, note the following:
 Orders with the following statuses are not selected:
 Created
 Locked
 Technically complete
 The following components are not listed:
 Backflushed components

 Phantom items
 Components with direct production
 Components with ‘final issue’ indicator
 Batch totals records
 Co-Products
 Bulk material items
 Components with a deletion flag
 Text items

The goods issues can be carried out in online or background mode:
 Online mode
The system calls up stock determination. Successful goods movements are posted immediately. Any goods issues with errors can be immediately corrected online.
 Background mode
The components are marked for goods issue and then processed in background jobs.
Related Information
Mass Processing of Process and Production Orders
Schedule Posting of Predefined Confirmation Processes

 

 

Confirm Production Operation
App ID: F3069
With this app, you can partially or completely confirm production operations and suboperations. You can enter produced quantities including scrap or rework for operations. You can edit material movements and specify durations for activities for both the selected production operations or suboperations.
Restriction
 You can only confirm operations with automatic trigger points but not operations with trigger points that require user interaction dialog boxes. To confirm such operations, use the Confirm Production Order Operation (CO11N) app.
 You can only confirm operations that belong to a standard sequence.
 You cannot confirm a milestone operation for collective orders. While the confirmation itself will be posted successfully and all operations of the leading order and child orders will be confirmed automatically, the child orders will not get the status Delivered, nor will the Delivery Completed indicator get set for these orders. To confirm such operations, use the Confirm Production Order Operation (CO11N) app.
This app is contained in the business catalog Production Control (Discrete) - Order Execution (SAP_SCM_BC_PRODN_ORD_EXEC_MC). For more information about the business role templates, see the Fiori Apps Reference Library for your release.
Key Features
You can use this app to:
 Select a production order with a related production operation or suboperation for processing.
 Record quantities for yield, scrap, or rework for production operations.
 Select a reason for variances from planned quantities.
 Get an overview of the backflushed components used for the production operation.
 Edit a material used in the production operation or suboperation, for example the storage location or the quantity to be confirmed.
 Consume materials from various batches.
 Add and confirm unplanned materials.
This app also supports goods movements to/from warehouse-managed storage locations with synchronous postings.
 Enter information on activities that have been defined for the work center, such as setup, machine, and labor times.
 If configured, select the shift during which the activities have been performed from the proposed values.
 Enter the personnel number of the person confirming the operation or suboperation.
 Enter a note with additional information.
 Confirm the production operation or suboperation partially or completely.
In the configuration activity Define Confirmation Parameters, you can configure the following for each combination of plant and order type:
 Whether the confirmation sequence of the single operations of a production order is checked.
 Whether underdelivery and overdelivery are checked.
 Whether error logs are displayed for actual costs and goods movements and whether the confirmation process is canceled in case of errors.
 Whether the quantities and / or activities should be proposed automatically when you start the app. If you deselect these settings, the values are defaulted to 0 when you start the app. However, you can fetch the proposed quantities and activities in the app by choosing the Get Proposals button.
Note
If you want to confirm an operation that has been distributed to an external manufacturing execution system (MES), the quantities for that operation are never proposed in the app, even if the configuration setting for quantities is set to Propose. This is because the quantity confirmation is expected to come from the MES and double postings should be avoided. If you still need to confirm quantities for distributed operations in the Confirm Production Operation app nonetheless, you can choose the Get Proposals button to fetch the open quantity.
 Whether the shift field is displayed and available shifts are proposed.
Note
If you want to use shifts in confirmations, you have to make further settings in your system. For more information, see Shift-Related Confirmation.
In your configuration environment, use the search function to open the following activity: Define Confirmation Parameters. For more information, see Configuration Environment of SAP S/4HANA Cloud.
Supported Device Types
 Desktop
 Tablet
 Smartphone
Feature Comparison Documentation
For a comparison of the features offered by the apps for confirming operations of production orders, see:
Feature Comparison for Confirming Production Order Operations
Related Information
How to Confirm Unplanned Materials

 

Post Goods Receipt for Production Order
App ID: F3110
With this app, you can post the receipt of goods with reference to a production order.
The app proposes a selection of production orders as well as the corresponding material item level that can be posted. This app supports you, for example, as a warehouse clerk in your daily work.
Key Features
Central Use







Split Valuation

Serial Numbers

Integration of Mobile Scanner and Barcode Scanning





Others



In addition, the app supports the following technical features and options:
 output management and attachment service
 barcode scanning of production orders with mobile devices
Note
Prerequisite for barcode scanning is a mobile device with a touch-sensitive display.
 This app includes SAP CoPilot. This digital assistant in the SAP S/4HANA system supports you with features such as business context awareness or quick actions to manage follow-on activities directly from the app.
Supported Device Types
 Desktop
 Tablet
 Smartphone

 

 

 

 

 

Post Goods Receipt for Production Order
App ID: F3110
With this app, you can post the receipt of goods with reference to a production order.
The app proposes a selection of production orders as well as the corresponding material item level that can be posted. This app supports you, for example, as a warehouse clerk in your daily work.

 

RESULT

Execute Delivery
Now let’s suppose that the SAP make to order production process has been completed and goods are sent to the finished goods storage location awaiting dispatch to the customer. Check the stock overview MMBE APP and enter the finished goods material number to see the stock for the specific make to order product. (In the below stock overview, the quantity is presented in European format, with a comma representing a decimal point. Thus, the below image shows a quantity of 1 in unrestricted use.)

 

 

Let’s create a delivery and see what happens to the stock level. Use Create Delivery with Reference to Sales OrderAPP to enter a delivery. In the initial screen, enter the shipping point and sales order number as shown below:
Hit Enter to proceed to delivery document creation. The deliver document is displayed with delivery information pre-populated from the sales order.
Create Outbound Deliveries – From Sales Orders
App ID: F0869A (Link to Fiori App Library)
With this app, you can create outbound delivery runs from a list of sales orders. This app also allows you to display logs with information related to your sales orders or deliveries. For example, if errors occur while you are creating deliveries, the system issues a message to the log. Similarly, the system issues a message to the log if you successfully create a delivery.
This app is available for the role shipping specialist.
Key Features
 Search for sales orders due for delivery using basic filter options. You can also search using additional filter options.
 Sort your table entries by ascending or descending and then select the filter option you want to sort by.
 Personalize your table columns.
 If a product has been marked as relevant for compliance in the product master data, the system performs marketability, dangerous goods, and safety data sheet checks for the corresponding outbound delivery. The results are displayed in the corresponding columns.
 Create outbound deliveries from sales orders with a limited number of items, or navigate to the Schedule Delivery Creation app to schedule the mass processing of sales orders.
 Display a log that provides you with information about the delivery run that you have created.
 Use the Save as Tile option to create a personalized tile on the launchpad. This tile will display a fixed snapshot of your current selection criteria. For example, if you filter by the date option Today, your personalized tile will only display the number of documents that are relevant for that specific day, as the current date selection is stored as a fixed date.

 

 

Press the Post Goods Issue button POST GOODS ISSUE to save the movement. The delivery document will be updated with a confirmation message as shown below:

Let’s check the stock overview once more to see if the sales order stock is consumed. Execute STOCK – SINGLE MATERIAL APP and enter the finished goods material number. The stock is reduced by the quantity entered in the delivery document. In our case, the stock is now non-existent, as shown below:

 

Generate Billing
Finally, generate the billing for the make to order product. Execute CREATE BILLING DOCUMENT APP to create the billing document. In the initial screen, enter the sales order number and press Enter to proceed to the billing document.

 

Hit Save to post the billing document, print the output, and post the accounting document. The billing document is saved with a confirmation message:

 

 

Let’s have a look at the sales document flow via DISPLAY DOCUMENT FLOW. Here you can trace the flow of documents through the entire SAP make to order process, beginning with the quotation and completing with the accounting document.
With this app you can display all documents that are part of a business transaction.