Ann’s area of expertise is SAP Production Planning; from sales forecasting to goods receipt of manufactured material. For more on Ann, please click here

Here are ways companies can use SAP to mitigate the impact on their current business within their production planning process

For manufacturers that are shut down but expecting to reopen at future date X

  • If you haven’t done so already, adjust the work centers’ calendar to reflect the fact that the business is closed until date X.
  • Within the sales and operations planning process re-forecast sales quantities that you expect to achieve for the next 24 months once you expect your business will re-open (date X).  This will be a shot in the dark but the more collaboratively this is planned with customers and suppliers the more accurate these time and quantity estimates will be.  Do rough cut capacity checks to ensure that you will have the resources to achieve the plan:  line capacity; labor capacity; cash flow; quality lab capacity; key raw materials; etc.  Once a feasible plan is achieved push this sales plan to demand management.
  • Your Material requirements planning program (MRP) will plan the supply elements (planned orders and purchase requisitions) to meet this demand with planned orders starting on date X.
  • Do Exception Monitoring to resolve the exception messages within the Stock Requirements List.  Pay particular attention to Group 6 Exception messages which address excess or not enough stock.  Also address Group 7 messages which address expedites and de-expedites.
  • Run the capacity evaluation report to see how loaded the work centers are in the capacity planning period (say, next 13 weeks).  Use this report to adjust working times of the work centers.  Maybe in the first few weeks you’ll have only 1 shift running and then you’ll need to ramp up by adding a shift in week 4.  Communicate with employees to ensure they will be available to resume work at the planned dates.
  • Purchases for long lead time materials will have to be made long before date X.  Ensure that your purchasing staff (who are working from home) are aware of the plan and will place the purchase orders accordingly.

 

For manufacturers that are running full tilt (e.g. manufacturers of PPE)

  • List your work centers in transaction CR60 Work Center Listing and view/edit the capacity of each work center in turn.  Ensure that the machine and/or labor capacity reflect your current working shifts which are probably at the maximum (7 days x 24 hours/day).
  • Review the sales forecast in the demand management program to ensure it is reflective of your planned sales.
  • Your Material requirements planning program (MRP) will plan the supply elements (planned orders and purchase requisitions) to meet this demand.
  • Do Exception Monitoring to resolve the exception messages within the Stock Requirements List (SRL).  If you have sorted the SRL and set the traffic light definition correctly you will see the materials with a red traffic light at the top of the list.  These are materials where the stock days’ supply is negative; these materials are in danger of stocking out and the planning situation must be addressed by the planner.
  • Run the capacity evaluation report to see how loaded the work centers are in the capacity planning period (say, next 13 weeks).  Likely some work centers are overloaded in some but not all of the 13 weeks.  Do the following to resolve capacity overloads:

o   Manually reschedule some planned orders to a sooner date when capacity exists

o   Where you have the option to buy vs. make, convert some of those planned orders to purchase requisitions (either subcontract or turnkey purchase requisitions).  This will remove the capacity demand on your work centers.

o   If labor capacity is overloaded but machine time is not, ask your personnel to work extra shifts and update the labor capacity in the work centers to reflect this additional time

  • Remind your shop floor personnel to confirm production/process orders in a timely fashion because planners are relying on this information so they can schedule / re-schedule work centers correctly.  And the timely goods receipts allow you to ship as soon as possible following production.

 

I hope you’ll find this helpful,

Ann