SAP PP Material Planning

SAP PP Material Planning

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Testing: Unit Testing / User Manual

Module: PRODUCTION PLANNING

ENVIRONMENT SYSTEM

: SAP R/3 ECC 6.0

CLIENT

:

UNIT TESTING SCENARIO SCENARIO NUMBER

: PP01- 03

DESCRIPTION

: Material Planning

PREPARED BY NAME

: Pradeep D. Kalapure

DATE

: 03/01/09

TEAM

: Production Planning

APPROVED & TESTED BY NAME

: Nanhe Babu (PwC)

DATE

:

TEAM

: Production Planning

Page 1 of 39

Testing: Unit Testing / User Manual

Module: PRODUCTION PLANNING

The Concept Of MRP In SAP MRP is the planning tool in SAP which will look at all aspects of a material and is highly based upon the master data of the material. MRP looks at current inventory, current requirements, and open purchase requisition/orders and so on. So if a material is required to satisfy a sales order and there is no inventory, MRP will create a planned order if the item is to be produced in house. This planned order can then be converted to a production order by the master scheduler. If the item is to be procured, then MRP will create a purchase requisition which the Buyer will convert to a purchase order. This is just one scenario, the system is highly configurable and will do pretty much whatever you tell based on config and master data. The main function of material requirements planning is to guarantee material availability, that is, 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. MRP Overview

MRP analyzes the demand from sales orders and forecasts. If stock is needed then a planned order is created. A planned order consists of a suggested order quantity, a start date and a finish date. The bill of material of the planned order is exploded, creating dependent requirements. These are processed later by MRP, to determine if planned orders are needed for the components. In order to replenish stock, we must convert the planned order to a production order (if it is for a manufactured item), or to a purchase requisition (if it is for a purchased item). MRP can create purchase requisitions directly, for purchased materials, depending on runtime settings. If the purchased material is part of a scheduling agreement with a vendor, MRP can create Page 2 of 39

Testing: Unit Testing / User Manual

Module: PRODUCTION PLANNING

schedule lines. When the planned order is converted to a production order, the dependent requirements for its components become reservations. Planning Procedure

Planning procedures automatically generate order proposals to purchasing and to production. R/3 planning procedures can be divided into Material Requirements Planning and Consumption-based planning. In MRP, the system compares available stock plus planned receipts with demand. If the available quantity is less than the required quantity at a point in time, then an order proposal is created. MRP at Plant or MRP Area Level You can plan material requirements at plant level or for different MRP areas. With MRP at plant level, the system adds together stocks from all of the individual storage locations, with the exception of individual customer stock, to determine total plant stock. The requirements are combined in the planning run and procurement elements are created for these pegged requirements with unknown sources. Individual storage locations can be planned separately or be excluded from planning. In the case of material requirements planning on an MRP area level, only the stocks from the storage locations assigned to the respective MRP area are taken into account. Only the requirements in this MRP area are combin