If you follow the right supply chain circles, and lately also some of the big conferences, you might have already noticed there is some buzz around Demand-Driven Material Requirements Planning (DDMRP for short). In the SAP world, however, there is still a deafening silence about this subject. This series of blogs intends to fill this gap.

I haven't yet decided how many parts this series will have (it also depends on the amount of interest it gets) but the idea is, after this short historic introduction, to detail why changes to MRP are needed, and then proceed to explain DDMRP with one post about each of its components. Wherever possible I'll try to discuss what can and cannot currently be done directly with SAP, and maybe even what would have to be developed in SAP to fulfill the minimum DDMRP software compliance criteria.

DDMRP stated goal is, then, to solve the shortcomings of traditional MRP in the new normal. The main authors behinds DDMRP, Carol Ptak and Chad Smith (no, not the Chilli Peppers drummer) have apparently been working for almost 20 years on what was to become DDMRP, but only in the last few years it has become more popular. It was first known by the unfortunate name of Actively Synchronized Replenishment (ASR), and I dare say that only when it was re-baptized to DDMRP (and branded as a successor to MRP) did it really take off. No criticism there, of course, just highlighting the importance a good name can have.

Both Ptak and Smith have strong connections to Eli Goldratt's Theory of Constraints (TOC), and they don't try to hide it: that would be hard anyway, if you think that Carol Ptak, a former APICS society president, was co-author with Goldratt of the business novel Necessary But Not Sufficient, and Chad Smith worked at the Goldratt Institute and has built a career around the different applications of TOC. The basic principles of ASR, not by accident, were described in Chapter 12 of the TOC Handbook (2010). Those versed in TOC will easily recognize some things they borrowed, like the green / yellow / green color coding used for buffers. However, I think they have made a great effort to appeal not only to the TOC tribe, but also to both MRP and Lean practitioners.

So, in a sentence, what is DDMRP? It is a method used both for planning and execution control that by defining (1) where to stock and (2) how much to stock - in a (3) dynamic way - will (4) generate supply orders according to average daily usage plus qualified sales spikes and finally (5) guide and alert execution in a visual way. The numbers in parenthesis are there for a reason, as each part of the definition briefly describes the five DDMRP components:

1.      Inventory Positioning;
2.      Buffer Profiles;
3.      Dynamic Buffer Adjustments;
4.      Demand Driven Planning; and
5.      Highly Visible and Collaborative Execution.

I understand for now this might not say much, but hopefully everything will become clearer with the following posts.

There is a growing list of DDMRP compliant software solutions (some exclusively doing DDMRP and others in addition to other planning methods), though the original Replenishment+ from Demand Driven Technologies seems to have the edge. There have been rumors that SAP Labs is working on some kind of a DDMRP solution, but I have no concrete details about that. Some (most?) of the existing DDMRP solutions can of course integrate with different ERP packages including SAP, but I still believe that having a working DDMRP solution in SAP itself would be a big advantage for SAP customers. This series is also a call for anyone interested in developing such a solution: I'd be very interested in hearing from you and discussing what we could do in that direction.

Currently the best reference for DDMRP is the 3rd version of Orlicky's MRP bible (2011), revised by Ptak and Smith and with the last half a dozen chapters now dedicated to DDMRP. Not directly dedicated to DDMRP, but discussing related concepts and with an appendix that summarizes DDMRP quite well, is the also highly recommended Demand Driven Performance: Using Smart Metrics, by Debra and Chad Smith. The definitive reference, though, is to come out in a couple of weeks (beginning of July 2016) and should, among other things, define the official terms for some concepts whose previous name still bore a linkage to the original ASR.

SAP strategy for the digital economy is based on the concept of simplification. The SAP strategy is to accelerate business innovation through radical simplification.

This concept was also used on the new SAP S/4HANA, on-premise edition 1511 and several application scenarios available on the ECC were simplified. The idea is to make the S/4 HANA implementation faster and easier, in order to accelerate the return on investment and also make the life of the consultants easier.

A complete list of the simplified scenarios is available on SAP Help and it is available on the following link:

http://uacp.hana.ondemand.com/http.svc/rc/PRODUCTION/pdfa4322f56824ae221e10000000a4450e5/1511%20000/en-US/SIMPL_OP1511.p…

Between those scenarios, some are specific to Material Requirements Planning and changes were made on functionalities that were part of the standard system for a long time.

Some of the most relevant changes are the following:

1 - Simplified sourcing

The source determination carried out by MRP was completely redesigned for internal and external procurement.

For internal procurement, a BOM selection method is no longer available for selection. Now, the BOM is always selected according to the production version, therefore, it is mandatory to have a production version.

For external procurement, the source list is no longer relevant to MRP and it is enough to have a valid info record, in order to have a vendor selected for a planned order or purchase requisition by MRP.

With these changes, the source determination on MRP is similar to the source determination on APO and, according to SAP, unified source of supply model is the basis for future innovations in sourcing.

2 - Storage location planning

The default option to plan a storage location separately is the storage location MRP area. It means that the option to define on the material master that a storage location will be planned separately or excluded from MRP is no longer available.

With the storage location MRP area, there is a separate planning file entry, which means that the MRP area is planned independently. This is a good thing from a performance point of view, since we don't need to plan the entire material just because a change happened on the storage location planned separately.

Besides that, the storage location planned separately runs a very simple reorder point MRP type, while the MRP are offers almost the same settings available on the material master.

3 - Subcontracting

Planning of components provided to the vendor must be now carried out with MRP areas. A separate stock segment for the vendor is not available anymore and the main reason is the performance. It is also now easier to use subcontracting MRP areas, since we simply need to create them on customizing and they will be available for all the materials.

4 - Planning file

The old planning file entry tables were replaced by the new table PPH_DBVM, with simplified update logic, consistency and for update performance.

There is also a new report and transactions to create and check the consistency of the planning file.

When we are planning a material on an individual stock, such as a sales order stock or a WBS stock, this material is planned on a separate stock segment.

In this case, the existing replenishment elements and the plant stock are not considered by MRP to cover the requirements under this individual stock and new planned orders are created by MRP to cover those requirements.

By default, MRP will consider the standard lot-for-lot logic (similar to lot sizing procedure EX) and it will create replenishment elements to cover exactly the shortage quantity. This standard logic for individual planning was developed, in order to avoid a leftover stock under the individual segment, as it would need an additional goods movement to transfer this leftover from the individual stock to the plant stock.

Considering the example below, where a fixed lot sizing procedure (FX) of 10 was defined for the material. On the Stock/Requirements List (transaction MD04), we can clearly see that MRP created planned orders of 10 EA to cover the Planned Independent Requirements, respecting the lot sizing constraints.

However, for a sales order under the individual sales order stock, a single order planned order of 30 EA was created to cover the sales order requirement, which means that the fixed lot sizing procedure was not considered.

Under specific circumstances, we want to use a different lot sizing procedure under the individual stock, such as a fixed lot sizing procedure or a rounding value for example. In this case, there is a setting on the lot sizing procedure customizing which allows us to choose which logic we want to use under the individual stock segments.

The mentioned customizing can be found in transaction OMI4, as we can see in the image below:

The options available for this customizing setting allow us to simply consider the rounding or to use the same lot sizing procedure used in the Short-Term Horizon.

Now, let's see what happens on the same example if we create a new lot sizing procedure, as a copy of the standard lot sizing procedure FX. Here, we will change the value of the field Lot Size: MtO to 2 - 'Lot size as in short-term period' and set this lot sizing procedure for the same material used on the previous example.

Here, we will observe that the same logic used to calculate the quantity of the planned orders created to cover the PIRs was used for the planned orders created under the individual stock. That means, the fixed lot size of 10 was considered under the individual stock.

Besides a sales order individual stock, the same setting is also valid for a project or WBS individual stock.

Fiori is a new SAP User interface offers a simplified and unified user experience that will at least partly replace standard SAP transactions. The standard Fiori apps are more of plug and operate for the end user and it does not require much  effort which are developed on user interface framework, UI5. SAP lists three types of Fiori applications

• Transactional apps: Allows users to perform SAP transactions on mobile devices as well as on desktops. For example Scheduling MRP runs, Maintaining MRP controllers, release production orders
• Fact sheets: Display information of key business objects in SAP. Display production orders, Production order confirmations.
• Analytical apps: Allows to display key performance measures and other aggregate information about the business.

SAP Fiori design principles:There are five design principles for SAP user UI5 that decompose the different SAP transactions into simple task based UI applications.Role based – SAP has decomposed various SAP transactions that show the most relevant information to the user. For example in manufacturing the roles defined are material planner, production planner, and production operator and master data specialist. Material planner role will be to maintain MRP controller, manage internal and external requirements, and schedule MRP runs.Responsiveness – When SAP Fiori combined with the power of HANA, the execution time will be unmatchedSimple – SAP advocates a design principle known as 1-1-3. It means 1 user role, 1 user case and maximum three navigation screens.Seamless experience – SAP has provided all the Fiori apps based on the same language and it does not matter on the deployment and platform.Delightful – SAP Fiori was designed to work with S4HANA and ECC 6.0 and easy to deploy, out of the boxApplications that can provide instant value to the customer.Some of the production planning apps are analyzed here to see how best it will be helpful to the material planner of internal and external requirements.Planning Apps:

1. 1.       Monitor internal requirement (F0263)

Monitor internal requirements is a transactional app that provide information that helps to ensure that components are available in right quantity and in time to meet the internal needs resulted from production/process orders, maintenance orders and network orders. This app will be more similar to MDO4 transaction and will be helpful to material planners/MRP controllers

The filters that can be applied select the required information is by component, Planning plant, MRP controller, MRP area, storage location, order type, Material for order, order status etc..

Output screen:

2.       Monitor material coverage/material shortages (F0247)

This transactional app is primarily designed for both external and internal material planner roles. The output of the transactional data can be controlled by using filters Plant, material, MRP area, material type, material group etc…

The outcome of the report display Material, vendor, current stock, shortage quantity, and stock availability, days supply along with the other relevant material-plant and MRP data.

3.       Schedule MRP runs (F1339)

This Transactional app will be useful for material planners to create and schedule a job to execute MRP run. The MRP run has been improved a lot in the last few years, but never eliminated batch runs. But with SAP HANA, it improved manifolds and the MRP can be executed in the foreground using MD01N transaction or can be scheduled using Fiori app

4.      Display MRP key figures (F1426)

With this transactional app, the material planner can view the detailed information on each MRP run such as MRP run status, number of materials planned, documents created, updated and deleted and the duration of MRP run.

5.     Display MRP material issues(F1425):

It is a trasactional app with which the material planner can view the issues of different materials during the last MRP run. The analysis will be helpful to the planner to quickly take corrective action.

6.      Manage external requirements (F0250)

It is a transactional app that monitors the uncovered requirements originating from sales orders and stock transport orders.

Apart from the above planning Apps, some of the apps that will be helpful to material and production planners are

My observation is that these apps are going to be very helpful to material and production planner, but there is a lot of improvement that can be carried out on the screen designs so that it will be more effective for the end user. Some of the apps are of SAP GUI transactional screens and needs to be refined to look better.

100 Most important SAP PP Interview Questions.

1. What is MTS and MTO and the difference between them?

2. Different types of consumption based planning.

3. What is MPS and difference between MRP and MPS?

4. Explain the Difference between the Discreet and REM.

5. Difference between PP and PI.

6. Explain PI sheet.

7. What is the Difference between TECO and CLSD?

8. What is Backflush, the places where the backflush is used?

9. What are the MRP master data?

10. What is MRP group?

11. What is MRP Area or How can I excluede one storage location stock from MRP?

12. What is MRP Profile and MRP Group?

13. When you run MRP, What steps it Perform in Back ground or How do you schedule BG job for MRP

14. Which MRP types you have used?

15. What is Planning time Fence?

16. What is the difference between the fixing type 1, 2, 3, 4?

17. What is time phased Planning?

18. Difference between Manual reorder point and Automatic reorder point.

19. What are the lot size you have used?

20. In the monthly lot size proc, how to generate lot at the end of Period?

21. Different types of scrap or difference between types of scraps.

22. Special Procurement type 40 – proc. form alt. plant

23. What is Phantom Assembly?

24. What is collective order. Pre requisite of the collective order?

25. What is Schedule Margin key.  How floats works in scheduling?

26. What are the strategy groups you have used?

27. What is requirement class and requirement type?

28. What is the SPRO Path for requirement class and req. type?

29. Difference between different strategy groups.

30. What is Individual and collective requirements and differecne between them in MTO scenario?

31. What is REM or What is REM profile

32. Have you used Pull list or back flushing in REM?

33. What is SOP and types of SOP?

34. Explain Flexible Planning procedure or How many levels of Flexible planning.

35. What is Material status and which view of the material master it is available?

36. What is Production scheduling Profile and use of it?

37. Difference between byproduct and co-product.

38. What are the Important tables in PP, QM?

39. Can we create a production order without BOM and Routing?

40. What is planned consumption and unplanned consumption?

41. What are the different type of BOM usage?

42. Which BOM item category you have used?

43. Difference between Item categories or what is variable size item or non stock item.

44. What is alternate item group?

45. What is recursive BOM

46. What is alternative BOM, or diff between BOM group and Group BOM?

47. Difference between Routing, Ref op set, Rate routing and Ref rate routing.

48. Steps to configure Production order type.

49. What are the parameters are there in Order type or in dependent para. config?

50. Once the Production order is created, how to change the BOM and routing in that order?

51. How do you do capacity planning ?

52. How do you carry out capacity leveling?

53. What do you mean by pooled capacity?

54. Can you dispatch capacity for a single work center?

55. What is finite scheduling?

56. How do you integrate HR (employee) with PP?

57. How can you create production order without  routing and BoM?

58. Explain what is PRT – how many types of PRT is used?

59. How to create PRT master record?

60. What is trigger Point. What are the setting required to trigger one action?

61. What are the levels of batch, explain batch determination process?

62. Question related to Production order status or status profile?

63. Explain LTP.

64. Integration between PP and SD module.

65. Integration between PP and PM module.

66. Integration between PP and QM Module.

67. Integration between PP and MM Module.

68. Explain Kanban.

69. Explain Planning file entry.

70. Difference between NETCH, NETPL and NEUPL.

71. Difference between MD01, MD02 and MD03.

72. What is scope of planning?

73. What do you do to run MRP  for just one MRP Controller?

74. Explain customer Independent requirement .

75. What is the transaction code to run MRP for sales order?

76. What is the transaction code to execute forecast, and explain types of forecast model?

77. What parameters you maintain in “plant parameters” in configuration?

78. SPRO path for order, confirmation or requirement class.

79. Difference between MD04 and MD05.

80. What are the key fields in MRP views?

81. What is Variant configuration?

82. Different types of Object Dependencies.

83. What is Auto GR?

84. Explain Availability check.

85. Explain different inspection type you used .

86. Explain In-process inspection.

87. Explain source inspection.

88. What is the use of QM control key?

89. What are the types of MIC?

90. What is the purpose of Catalog? how you reverse UD?

91. What is Inspection Points?

92. Explain DMR.

93. Difference between plan cost, Actual cost and target cost.

94. Difference between standard cost and variable cost.

95. What is primary cost and secondary cost?

96. How system calculate the actual cost?

97. What is activity type and how it works in costing?

98. Explain the process of Material costing.

99. Why and how you calculate WIP?

100. Explain transaction code KO88 or CO88.

Hi Friends,

These are most common and important questions which are usually asked into the interviews. Hope this will help a lot of new guys and also the interviewer. Some configuration or scenario related question we can include but than the list will be too long.

Please also suggest if you have any interesting questions. I will add into the list.

Regards,

Solomon

When you want to define a control recipe destination with type 2 or 3, the address field in O10C for the control recipe destination means the RFC destination of the external system, you may find all the RFC destination definition in SM59, for PP-PI process, you should define TCP/IP RFC destination that to be used in control recipe destionation.

However, if you fill in the address NONE, then what's the meaning?

It means the same system and the same client.

NONE is an ABAP keyword, if you want to call a remote function which should be executed in the native system, you should call them as

CALL Function DESTINATION "NONE"

this is the same here in the address field.

So if you define a control recipe destination with type 2 and with address NONE, then when the control recipe is generated in CO53 and you send it, it will create a copy in the same system again and again.

Therefore, choose the correct address when you want to use destination type 2 or 3.

For more details about the process management customizing in PP-PI, you may refer to the following Wiki page:

Configuration Of Customizing: https://wiki.scn.sap.com/wiki/x/EQrOFw

Note 2237251 was released to correct a program error on Long Term Planning and it causes a side-effect that can lead to several problems on Long Term Planning. After the implementation of this note, Long Term Planning does not consider Planned Independent Requirements when it is executed on transaction MS01 or by transaction MSBT in background, and LTP will not create planned orders to cover those Planned Independent Requirements.

This issue was resolved with the following correction note:

2256211 - Different planning results using MS01 or MSBT and MS02

However, It may be difficult to identify the issue, as it seems that the material was not planned at all by Long Term Planning and, when LTP is executed on transactions MS02 or MS03, the material is correctly planned. Therefore, the issue seems like a problem on the update of the planning file entries. Therefore, this blog explains under which circumstances this note is necessary and how to check if this issue is observed on your system.

How to identify the issue?

The issue was already described with the following symptoms:

• Materials are not planned by LTP;
• LTP does not generate planned orders;
• LTP deletes planned orders;
• LTP planning file is not updated;

The trick is to compare the MRP list (transaction MS05) just after the LTP execution with the Stock/Requirements List (transaction MS04).

On the Stock/Requirements List, all the PIRs will be correctly listed, as shown on the figure below:

On the MRP List, however, there will be not PIRs, even though they exist during the LTP run:

We can even confirm running LTP on transaction MS03 and observing that the PIRs will be correctly considered and that LTP will create planned orders to cover those PIRs:

The note which causes this side-effect was delivered on the following Support Packages, therefore, if your system is running one of these support packages, this issue will be probably observed and the implementation of note 2256211 is strongly recommended: