SAP Optimization

Hey there fellow SAP detectives, my name is Martin. The topic today is around the status of TECO. As it relates to our orders and manufacturing. The shorthand for statuses related to manufacturing orders can feel a little bit like an alphabet soup. And TECO is perhaps one of the ones folks are most passively familiar with. Everyone knows it's an important step and is part of keeping the system clean and is very important to support the subsequent activities related to settlement. To provide a quick definition and drive clarity on this topic is Tom. Tom, what's the scoop with TECO? The scoop is, I got the boring topic. That's what the scoop is. But, it's one of those everyday things we often don't really understand and should. So here we are. Today, I'm going to define TECO as a status. I'll tell you what the implications of setting an order to TECO are, and what limitations are associated with that status. And, just in case you need to, I'll show you how to set it and reverse it. Let's go in and take a look. So today we're going to talk about TECOing a production order. Remember, when we TECO a production order, it means that order is complete. When we technically complete the order, or TECO, it means we no longer expect for any actions to be taken on that production order. We're passing the baton. That production order is done. It's complete. There'll be no more transactions, whether that's a scrap, confirmation, anything. All transactions will cease and nothing will happen. So as we get into the system, we're looking in a production order here. We have the option to manually TECO a production order. So as we go into the production order in this example, we've delivered 100 pieces of the 129 total. We're saying we are not going to produce the rest of this production order. As we can see, it's been partially confirmed and delivered for the quantity of 100. So for us to say now this is complete, we know we're not making any more, there's no more transactions going against this production order, we can manually TECO it. Manually TECOing, we go into functions, restrictive processes, and then we can technically complete. As we can see, the order status here switches to TECO immediately. When we save this, then if we were to go back in to change that production order, it's going to tell us change is not allowed. Again, the TECO status means we are done, there are no longer any changes happening to this production order. So as we go into it, all our fields will be grayed out now. No ability to change anything in this production order because we've TECO'd the order. That's why we have to be very sure when we TECO a production order that we are complete and we no longer are going to action anything against that production order. Now, there may be a time where you accidentally TECO an order or mistakenly TECO the order and then production does proceed. Production will not be able to confirm that final 29 pieces of this order because we TECO'd it. In that instance, we'd have to come back into the order, just like we are here, come into this status again, and go up to function, restricted process, and revoke the technical completion. Again, it'll go back to the release status, everything comes back to changeable status, and we save it. So now in this example, once we saved it, we go back in and it allows changes. So in this instance , if production now decides we're going to run the last 29 pieces of this production order, we have the ability to go in now, enter our production order, our operation, yes, it'll give us the option for those last 29 pieces to be completed against this order. Once that would be completed, and we would make that confirmation if that's what we want to do, we'd go back into the order and we'd have the ability to TECO it again. Now, we can TECO orders a number of different ways. A lot of companies will have a batch job that runs overnight, that look for a completed order. Quantity has to be completed, confirmed, delivered and the batch job will TECO their order saying everything's settled and we're good. Or we can also use a tool like COHV, where we can do mass TECOs, if there's some large error or large issue that comes up where we need to TECO orders on a larger level. Most commonly though, again we're going to come into the production order itself, Restricted Processing , Complete Technically, then save. Now that production order is TECO'd and no longer able to have anything else changed, added to it, or adjusted. So I have a question for you all. What's your cadence for TECOing? How often do you review orders and make sure they get moved out of active status? And, who does it? It should be an operation oriented activity, sometimes with the support of planning. When you think it's time to TECO, don't miss the check to make sure you're ready to proceed to that next status. And lastly, we always recommend looking at how many orders are being TECO'd because they never went into production at all or were significantly underproduced. If that happens, there are other pieces of the upstream process that need to be looked at. It's worth a review, you might be surprised what you find. Hey Tom, I don't believe I'm saying this, but I think you've taken a dry topic and sparked my interest. Thank you. Specifically for adding a little life to something that is indeed worth understanding a little better. We want to get this right, folks. So if you want to know more about this particular topic and others related to it, check out our video catalog. Also ask the chatbot and you will get some recommended videos.

Scheduling & Shop Floor

PTM

CO02; CO03; CO11N; COHV

What Is Safety Time?

Exploring Safety Time: its purpose, location, and optimal usage

The best way to learn is by doing, so welcome supply chain practitioners. Martin here. Ready for another topic to ante up the value of your SAP solution? Okay, today we're diving into an important topic around how to buffer and protect against disruptions. Today's topic is an introduction to safety time. Now SAP has a variety of safety techniques from traditional static safety stock, either via entry or by letting SAP calculate it to dynamic safety stock that moves with demand based on coverage profiles assigned to them. Now SAP has a variety of safety techniques from traditional static safety stock, either via entry or by letting SAP calculate it, to dynamic safety stock that moves with demand based on coverage profiles assigned, to safety time, which seeks to address challenges with the timing of demand or delays in supply. Each has their uses, and we have a series of videos dedicated to the exploration of each. For a topic like this, we need a solid tour guide, and we didn't have to look far to find a good one. Today, I'm pleased to introduce you to Luke. Luke, why don't you share your idea specifically on the topic of safety time. I will take that baton, Martin. While I'm just getting started in my supply chain career, I do know that the one thing that is always constant is our need to work with volatility, uncertainty, complexity, and ambiguity. We need a really solid toolkit to address these conditions and prevent disruptions. And I find safety time to be an interesting way to protect and problem solve. It literally seeks to buy us time. And yes, that time does come with a cost which we need to be aware of. On our tour today, I'm going to show you how MRP responds to safety time, and how we can toggle it on and off in the stock requirements list, so we can check our planning and evaluate what's happening. And while we're there, I'll walk through some options for settings. Let's take a look. Well, if the best way to learn is by doing, we should get right to it. What we can see here is a planning situation which we're going to review from our home base, the stock requirements list. Whenever we want to explore a new feature or even master data value, it helps us start with a simple or familiar planning situation and then build up from there. We can see that this material has a demand plan and a simple plan for replenishment that uses a lot for lot size procedure. Let's take a look at our planning settings. We can bridge the material master via change mode because I do intend on making an adjustment. If I was not planning to make an adjustment, I'd be going in with display only. That's an important habit. Okay, here we are in MRP1. You can see we're using an MRP type that is deterministic in nature and follows the demand plan. Here's the aforementioned lot size procedure that is matching the demand, lot for lot, and I've not added a MLQ or rounding value. We'll come back and play with those in a moment, but let's head over to MRP2 for now. Here's where our procurement type, lead time, and GR processing time lives. Let's take a look at our safety options. Okay, picture this. You have a supplier that is struggling to deliver on time, you are working with them on their challenges and want to continue holding them to their stated lead times, but also want to protect the shop floor and ultimately the customer from your supplier's performance. This is a specific and temporary condition that aligns well with the use of safety time. So let's add some here. I need to do two things. Choose how much safety time and set the safety time indicator. We have two options for which demand we want to include in our offset. Independent demand only or everything. We're going with everything today. Okay, so let's save. Now using my handy navigation profile, I'm going to ask MRP run. But before I do, let's take a second to look at the current timing of supply. Confirm we like the settings, and here we can see that there are some changes. Okay, now let's go back to the stock requirements list and refresh. Here we can see that offset. A good way to make this really easy when you're getting started or sharing this technique with the team is to toggle safety time on and off. It makes it really easy to see the offset. Now last thing, let's go back to the Material Master and add a periodic lot size. Let's add a MOQ and a rounding value as well. Now we can save and let's go run MRP one more time. Confirm we like the settings. See, those are some pretty big impacts. Now, as we see, this is a very important tool, but it does firmly demonstrate that time is money. Thank you all so much for taking a tour through Safety Time with me. I think this is an interesting tool that should be a standard part of our toolkit. Now before you go, I do want to mention a few Surgeon General Warnings. First, it's worth saying one more time. Although this is a time buffer, it does reflect a commitment and inventory investment. Second, Safety Time should be used in specific and temporary situations like the example we walked through today. Lastly, please be careful to avoid stacking safety techniques. Choose a path, define a well and make it transparent to the team. Thank you very much. Hey, Luke, I appreciate your guidance and your perspective on this. Thanks for the tour. I know that we have another video to share on the additional features of dynamic safety time. So be on the lookout for that and explore it when it's available. That'll be a great way to continue this conversation. Also, if you're struggling to find videos, feel free to use the chatbot or if you have a very specific question just for us, please submit it below.

What Is a Checking Group?

A brief definition of the Checking Group in relation to ATP

5 min

[00:00:00] Hey folks, Martin here. Welcome to the video service that unlocks and reveals the hidden value in your system. And as we know, the best way to learn is by doing so let's jump straight in. In this video, we're going to be defining what the checking group is. Kristie, tell us more specifically about this checking group. It seems complicated. But I feel like you got a better shot at helping us understand this. I will give it my best shot, Martin. A checking group lives in the material master and that, in combination with the checking rule, defines the scope of check for ATP. And whether that material is even eligible for ATP or not. In today's session. We're going to go in and look at where it lives and what it impacts. This is a grouping technique for materials with like behaviors that should follow the same logic. It's a very important rule and requires good cross functional support and alignment. Let's go in and take a look. There are a couple of definitions that are really important for us to understand because they're the building blocks of how we get to that particular material availability check. [00:01:00] One of those, I would say that there's three we really want to make sure that we understand because they work well together. You've got scope of check, you have your checking group, and you have your checking rule. Today, we're exploring checking group. And if you found yourself on your ATP journey and really struggling with where to apply availability checks or how to apply your availability checks, this checking group, this concept of grouping materials under a particular set of availability rules is one of the key things that we should consider and that's really at the material and plant level So I'll show you when somebody refers to the checking group really where you're seeing that is where you would see it in the availability check field. So if we're on the planning and buying and scheduling and material management side of the house we are used to seeing that right here in the MRP 3 view. Now if we're in the customer experience or sales order management side of the house, we are used to seeing it here under sales, [00:02:00] general and plants. And I can come in here, I need to drop in my sales org and I will need to drop in my distribution channel. I'm saying this for my supply side friends who maybe aren't hanging out here as much and we will see our availability check right here. We can see this one is assigned to a 02, that's an SAP standard availability check. That is for individual requirements. And when we think about our materials, our materials have different behaviors, which would cause us to assign a different checking group to them. For example, if you had materials where batch determination was in play, you may have them assigned with a CH availability check. This all works in conjunction as well with your planning strategies and with other elements of configuration and rules that come into play. One other thing to be mindful of is if you have ever felt like when you go to run your confirmations on your sales orders, all of a sudden something goes hinky and the material that you thought was available is suddenly not [00:03:00] for that sales order. There are a couple of key reasons why that can happen. One we've seen quite a lot recently at clients is that your accumulation settings may be incorrect. So if you don't have accumulation set, there's no accumulation going on, that can cause challenges when your supply plan shifts around, it can cause your sales orders to lose their place in line and you would see that you might be promising inventory that was destined for one sales order to another. Other places where this can happen are really related to your checking groups and to manual behaviors and interventions that come into play when we're doing things like rescheduling or robbing from Peter to pay Paul. So we will have little discussions on each of these topics, but in terms of your checking group and the configuration associated with it, this is another place to call out. Remember on your journey to ATP, you are making those assignments at the material and plant level. So think about your checking group and the assignment of those rules based on a grouping of [00:04:00] materials that are all going to be validated or verified in the same way as you're going through the confirmation process. So in summary. A checking group is assigned in the material master, and it reflects a group of materials that is subject to the same flow of rules for ATP. A checking group works in conjunction with a checking rule to make up a scope of check, and this is one of those master data settings where cross functional consideration and collaboration is essential. Not only does this apply to materials sold to our customers or transferred to our sister facilities, but is also applicable to manufactured parts that need a pre flight check on material availability prior to scheduling or release to the shop floor. Over to you, Martin. Okay, roger that, Kristie. Appreciate it. Sometimes it is helpful to get a clear definition on some of these critical data settings, and also to get a good sense of how they can be applied. I'm sure we've got many more and many more to review. So thank you. Folks, once again, if you're looking [00:05:00] for more data on this particular topic or others, there is a whole video catalog on this website. And of course, if you have a particular burning question, please suggest it below.

OTC; PTM; DM

MM03; CO09

What Is a Checking Rule?

A brief definition of the Checking Rule in relation to ATP and its purpose

6 min

[00:00:00] The best way to learn is by doing so welcome to the video service that unlocks and reveals the hidden value in your SAP system. Hi, Martin here, and in this video, we will be discussing checking rules as a part of ATP scope of check. Now, this is a definition video on focusing on one key term within ATP process that holds a lot of power and is often misunderstood. This can lead to a lot of chaos and confusion as organizations work hard to begin their ATP journey. And understanding or believing in those results actually. Kristie, I know this is a really hot topic. But checking rules, kind of the basics of ATP, take it away. Wait. Who said this was important? I'm only kidding. Yes, checking rules are very important. As we progress through time and march closer to physical execution of the process, it's critically important that we find the right check for the stage it is applied. So for example, in a sales order versus a delivery or created production order versus a production order that's ready for takeoff. [00:01:00] These are important stages in the process and our promise or pre flight checks will likely change as we move through them. What I'd like to do with our demo time today is to. Show you the difference as I apply different checking rules without changing the checking group. I'll show you where you can see this. And some of the common examples of what might change as we go. A couple of key definitions in the background that help us to understand how ATP is functioning circle around the scope of check or what we are allowed to include, what we are not allowed to include in terms of supply, and what we should consider or not consider in terms of demand. Our checking group, which is really the availability check that we're choosing to assign to a grouping of materials, and then what we're exploring today, which is the checking rule. And you can see I'm here in CO09. This is the availability overview. And in this [00:02:00] screen, I can actually go through and look at a material from different perspectives, so different checking rules. So think about this in terms of how we are flowing through our sales order or our production planning cycle. And especially when we have competing demands for manufacturing, for stock transfer, for sales orders out to customers. We can have kind of a collision of rules that can come into play here. And so if you think about it, something like a sales order may be allowed to go through and look at things like confirm production. So production that is out there that's in the scheduled horizon has been released. You may have purchase orders that have been confirmed and on their way and that you would want to consider. But by the time that sales order is going into delivery, or in the case of production, before that production order is being released to the floor, we may narrow down [00:03:00] what we are allowed to consider as relevant supply. That's how we get to the scope of check. So our checking rule helps us to invoke the right scope of check for where we are in the process. And so if we choose one here, we'll go ahead and here just choose sales orders. I just want to show you one thing. We can come in here and we see the availability. We can see our quantity that we have on hand, less what we have for a sales order that's going out, adding to that the production and then reducing that further with the next sales order that is going out after that production is planned to be received. So if we look at that in conjunction with our scope of check, that's going to tie back to the rules for what we are allowed to include or consider at that stage in the order cycle, so for a sales order. If we do something like this, watch, these are all going to disappear here. I'm going to change to a different checking rule, and this is going to be for a delivery. Now I'm going to change this, [00:04:00] I'll do the drop downs that you can see. I'm going to change this to a B for a sales order delivery. I'll go ahead and come in here and you'll see we no longer see the sales orders because in our scope of check for delivery, for our outbound deliveries, we are not including our sales orders that we have confirmed in that scope of check. Now we are competing only with the other deliveries that are out there and we are only including very specific things. You'll see here the production order that we were counting on to promise our sales order against is no longer here. We are only considering the stock that we have on hand. So as we go through and we start to get more real about the physical activities and the cost incurred with moving a sales order either into manufacturing, out the door on a stock transfer order, or out the door on a delivery for a customer, we may narrow what it is that we are choosing to include in that scope of check based on where we are in the process. And the checking rule is what makes that connection for [00:05:00] us. In today's demo. We illustrated the stated definition of a checking rule and demonstrated where to find it and how to see the results. We chatted through some of the common evolutions that may happen as you march forward in time with different activities, getting different levels of commitment . And we discussed some of the most common pitfalls that relate to checking rules. Okay, great. Thank you, Kristie, much appreciated. This makes a lot of sense if you're thinking about it. We have different expectations for the state of our supply chain, depending on where we are in the process. We should have different levels of firmness and commitment and flexibility. So again, thank you for that, I appreciate that a lot. You know, a picture is worth a thousand words and the best way to learn is truly by doing. So folks, if you want to learn more about ATP and checking rules, please check out other videos related to this topic. And of course, if you have a specific question, please feel free to submit it below.

OTC; PTM; DM

CO09

What Is a Scope of Check?

A succinct definition of SAP's Scope of Check

The best way to learn is by doing so welcome to the video service that unlocks and reveals the hidden value in your SAP system. Hi, Martin here, and in this video we'll be discussing checking rules as a part of ATP scope of check. Now this is a definition video on focusing on one key term within ATP process that holds a lot of power and is often misunderstood. This can lead to a lot of chaos and confusion as organizations work hard to begin their ATP journey, and understanding or believing in those results actually. Kristie, I know this is a really hot topic but checking rules, kind of the basics of ATP, take it away. Kristie: Hey, Martin, so great question. Sometimes it's good to take a step back to basics and make sure we're all on the same page with these different definitions. Today, I'm going to use SAP to bring the definition to light and walk through what exactly a scope of check is. What it influences, and how to check and see what scope of check is in [00:01:00] play. I'll also highlight some things that can cause hiccups in the process. Let's go take the tour. Alright, let's use SAP to help give this definition a little bit more life. ~Um,~ I am in CO09, ~um,~ which is the Availability Overview, and I really love this ~list.~ transaction because what it allows us to do is to go through and actually see what is available based on the checking group and the checking rule and it also lets us know ~kind of~ what the end of the lead time is for this item so we know that we should see the situation for planning if we're not running terribly behind we should start to see that even out and we should start to see recovery that should be the next available time to start to take in a customer order. So here's how I got to this transaction. I actually got here from MD04. So I'm going to go ahead and just navigate back and show you how I got here. So I went to Environment and I went to ATP [00:02:00] Quantities. So if you think about MD04 as being the place to be for our planners and buyers and our MRP controllers our schedulers, this is the place to be if you're checking availability, and that might be availability for sales documents, it might be availability for ~um,~ delivery, so customer orders versus deliveries versus stock transfer orders, or even for material that needs to be available for use in manufacturing. And the picture, the rule set that we're going to see is defined by the scope of check and that scope of check is the combination of the checking group and the checking rule. We will have a video that goes through the definition of the checking group and the checking rule, which makes up the scope of check. Now, if you're not sure how you got this particular checking group or checking rule as you were coming into this transaction, let me go back to MD04 and just show you one other thing, this is one of the hidden gems of the stock requirements list [00:03:00] that we highlighted in that video by the same name. So under Settings and Settings, if you come over here on General Settings this is what is controlling the checking rule that you are coming into that transaction, also for when you are doing your order report. So typically for an MRP controller, ~if it,~ if you're buying raw materials, your checking rule is going to be something related to production planning. I've modified that here because this is a finished good, and I want to take a look at it from the sales perspective to see what is going to be available and when. ~So,~ That's how it knew what to pull through, and the other thing I can do is, if you are on the ~um,~ customer service ~or,~ or customer excellence side of the house, you probably are coming directly into this transaction. So I'm just going to do a slash in CO09 and you'll see that it's actually going to prompt me for which checking rule I want to use. We'll talk more about the [00:04:00] definitions, but if you think about this, this is the progression through the process. So planned order versus production order, ~so~ a dependent requirement versus an order reservation, customer orders, a sales order versus delivery, so there's a progression there and that's how it knows what to bring in. And this is important because the combination of these two is what sets the rule for checking availability, so what is allowed to be included versus excluded. And you can see over here in your stock overview, this is the type of stock. This is the kind of stock that is eligible for consideration in the process. It tells us whether we're considering replenishment lead time, so if it's 15 days and we don't have any stock on hand, we know that we can make it and we will have it reliably in 15 days, so we're going to be able to go out and make that promise without any type of capacity constraint or consideration on material availability. We can go in and look at the storage location level information. And then also over here on inwards and outward movement, so [00:05:00] what other types of demand are competing with this particular requirement? And what do I need to factor in as I'm going through and seeing what is left over for this particular item? And then what am I allowed to include in terms of inbound inventory that's on its way in, as well as my certainty, the quality of my housekeeping, and the reliability of my information on what may be over and past due. And this is one where we do want to be really cautious, we want to be able to include receipts from the past and future. We want to be able to get our housekeeping in order and make sure that things are neat and tidy, we've got the correct over and under delivery tolerances. As soon as you start to exclude this, you really do have a significant chance of over planning. So only in very specific business situations should this rule be changed. And the other one that's really big is the replenishment lead time. So if you'd like to know more [00:06:00] about the checking groups and the checking rules that get us to this little playbook that tells us how we're going to determine whether inventory or inbound goods are going to be available for this order, how much we have available to promise, there will be other videos that go through specifically those definitions as well as the requirements for what you should or should not include. But the definition for today, for today's scope of check is the combination of your checking group and your checking rule gives us the rules for what can be included or not in your ATP quantity. Alrighty, thanks for exploring that with me. Being able to clearly articulate a definition can really help to ensure everyone is on the same page and talking about the same thing. One of the things we hope Reveal TV will do is promote a common framework of understanding, which enables critical thinking and excellent conversations. Understanding definitions for the big ticket terms [00:07:00] is essential for getting there. Today we learned. The definition of the scope of check. How we can figure out what scope of check is in play. And lastly, when and what some of the common hiccups may look like. Over to you Martin. Martin: Okay, great, thank you Kristie, much appreciated. This makes a lot of sense if you're thinking about it. We have different expectations for the state of our supply chain, depending on where we are in the process. We should have different levels of firmness and commitment and flexibility. So again, thank you for that, I appreciate that a lot. You know, a picture is worth a thousand words and the best way to learn is truly by doing. So folks, if you want to learn more about ATP and checking rules, please check out other videos related to this topic. And of course, if you have a specific question please feel free to submit it below.

OTC; P2P; PTM

MD04; CO09

What Is a Skip Lot?

Definition and purpose in boosting efficiency and performance focus

5 min

Quality & Batch Management

SAP S/4HANA®

P2P; PTM; QM

MM03

Hey there, fellow seekers of quality, Martin here. Managing a supply chain requires the right product, at the right place, at the right time, at the right price, and more specific, at the right quality. So let's talk through one of the key features SAP offers to support us in getting there. It's called skip lots in quality management. skip lots offer an incredible effective technique for building efficiency into the quality management procedures where demonstrated quality is in place. It allows us to focus time and attention on the areas that is the highest risk while permitting more flow where the risk is less. Today, Tom is going to talk us through skip lots. Tom, tell us more and help us understand what skip lots are. Hi, Martin. Let's start with a couple of quick things, and then we'll dive right into the system and see where the skip lot setup happens in the material master. So here's the deal. A skip lot is a sampling procedure whereby we are sampling only a fraction of the goods coming in. It allows us to keep an eye on things without checking everything and can be very useful when the demonstrated performance is high. Or, we don't have regulatory reporting requirements for a full inspection and the risk is not very high on the material that is subject to inspection. There needs to be a solid proven track record from the source and for the material. Let's jump into SAP and take a look at our skip lot procedures. It's important to remember a skip lot is simply a procedure that SAP allows us to skip inspecting certain lots instead of inspecting every single lot. This is particularly useful when the quality of the product is consistently high. So as we can see, we're in the material master in SAP on the Quality management tab. We're going to focus our attention on the inspection setup. When we go into inspection setup, down here it shows us skip lot allowed, which is currently checked on. The other important factor to this, when we're looking at skip lot procedures, is our dynamic modification rule. The dynamic modification rules are what actually dictate the procedure we follow with skip lots. So as we hit our drop down menu, we can see the available options for our skip lot procedures. We would focus our attention on skip lot procedure Z02. We can see we would inspect 1 lot, then skip the following 3 lots upon inspections. If we would shift our focus to the Z03 skip lot procedure, we would inspect 5 lots and then skip the next 10 lots. This is the procedure that SAP will follow when we set up skip lots. Setting up a skip lot in SAP increases our efficiency. It reduces the number of inspections required, leading to decreased inspection time and cost. It can also help us focus on risk management. It allows the quality team to focus their resources on the lots that are more likely to have quality issues based on our historical data. It'll improve our quality throughput. It speeds up the process, by minimizing inspection delays for lots that have high probability of meeting our quality standards. The key factors we have to remember when setting up a skip lot is our historical data. A skip lot procedure should only be based on a robust history of quality , to ensure the only lots with proven consistent quality are skipped. Using skip lots effectively can lead to a significant improvement in our quality management efficiency, but it should only be implemented with careful consideration of the quality risk involved. Thank you very much for taking the little walk through SAP with me. Let's take a moment to highlight the importance of what we just ran through. Skip lots are an effective technique to prioritize our time and energy towards the materials that represent the highest risk. Because we are only sampling some of the materials and not every good receipt. We need to keep up on the sampling, it must be timely. We also need to be vigilant in monitoring the results. If something comes back out of spec, it's very important that we take a decision on upping our inspection procedures for that material or supplier. We need to constantly monitor and stay on top of what's happening. This is a great technique when used correctly and offers flexibility to meet specific business needs. Hey Tom, thanks again. Much appreciated. Skip plots are an important tool in the quality management arsenal. I'm glad you were here to help us discuss it today. Thanks again. It really is going to help us focus our prioritization in both control and flow. Hey folks, if you want to learn more about quality management or even some of these additional features that we talked about today with Tom, please use the chatbot. And of course, if you have a specific question or suggestion for us, submit it below.

What Is an IDOC Error?

Overview of IDoc errors covering what they are, where they occur and why

WE02; WE09; VA03; ME23N

Hey folks, Martin here. Getting different systems talking with one another is often a challenge. Yet there are some great benefits to being able to send and receive information, particularly with communicating with our customers and our suppliers and just other systems in our landscape. Fortunately, there's a lot of standard best practices and communication protocols to lean on. When things are going well, we can manage issues as an exception. And today we have none other than Rutul to help us talk through IDoc errors and how we should think about proactively monitoring and managing them. Rutul take it away. An IDoc error lets us know that there has been a failure in processing a communication. This is very important because it's meant to make an update in your SAP system and it's failing, There's a load of important messages that can be sent back and forth. The errors really break down into three broad categories. Application errors. Syntax errors . And system errors. As a business team member, you are likely addressing a lot of syntax errors if you are actively monitoring your IDocs. Let's go in and talk about some of these places where you can see these IDoc errors. All right, here we are in one of those monitoring tools to catch, analyze, and resolve IDoc errors. There are several options in the system for example, BD87 or WE02, WE05, depending on your role and organization you might have different authorizations to these tools. One of the most common ones that we actually go through is the WE02 or 05. It will tell you by partner number or by specific IDoc messages and so on, there are multiple filtering options available in this transaction to see the errors or processing status of IDocs in specific areas, for example, you only want to look at for customer or vendor IDocs. You can filter those messages through the selection criteria and easily narrow down your search criteria. So what is an IDoc? IDoc stands for the intermediate document and IDoc is actually SAP specific terminology ortechnology or tool that is used to bring in the data in this SAP system. The flow is that there's EDI translation happening between the two partners and APO system is SAP. The translation that comes in or goes out to those partners or customers is an IDoc format. It may sound like a little technical and boring, but many of the IDocs errors are usually data errors or incorrect partner information, and so on and so forth. As I mentioned, the IDoc is an SAP terminology and the communication between the two partners happens through EDI, which means there are set specifications that SAP expects IDoc to be in and when that doesn't happen IDoc fails in SAP system and you have to use these tools to monitor and see those errors and correct those errors. It's very important that we not only address these errors in a one-off manner. We have to analyze and see the pattern, so to speak. When we talk about the IDoc errors and, resolve these errors long term. For example, a customer is sending you an order through EDI and it's failed in SAP system. So there could be a couple of very common issues related that, for example, a material number. What your customer is sending you is not matching up with what you are expecting in SAP system and IDoc will fail and say, hey, I cannot translate this material number. That's a very common error that you have to now work with the customer to say, hey, what are you sending? Are you sending the right part number? So on and so forth. And perhaps either change the settings in the EDI specification or within your SAP system communicating with them to say, okay, this is what I expect and then you can resolve this error for a long-term solution rather than changing or fixing in the one-off situation. One of the other common situations we get is where a customer order comes in and it has the SAP cannot find a ship to location, you know, ship to partner for that order that's coming in. And this is where a customer has lots of locations that you are shipping to and you are doing business with, and you are doing EDI with, but only some of them have been set up in the system. I. So now a new location automatically tries to send in an order but there is no ship to partner in your SAP system and IDoc will fail and say, hey, I cannot determine the ship to location. Or worse, it will attach an incorrect ship to location.Those type of situations are very common but this is where you can come in here and look at those errors and correct these errors. On the flip side, let's say you are doing business with your vendors you are sending the purchase orders to your vendor and they are sending you order acknowledgements or advance ship notices and so on from their side and it's failing. On the flip side, let's say you are doing EDI and communication and sending the purchase orders to your vendors. And your vendors are sending you the order acknowledgements or shipping notifications and those type of transactions back, and you see that it's failing. One of the common reasons these transactions fail is because they're sending you multiple acknowledgements for same PO or multiple advanced ship notices for same purchase orders again and again, and this is actually the bright side . We know in advance that things are coming in, we know that paperwork will be wrong, but at the same time, you want to also make sure that these occurrence are not happening again and again. We have to correct this at the transactional level as well, and communication level as well with your vendors so that it does not happen. We want these messages to constantly deliver to their destinations. We want the IDocs to flow in automatically. That is the purpose of it, so that it processes it without any issue, and being able to have these regular communications without any manual entry every time. It does help in removing the human struggle hours and allowsour teams to focus on what matters. IDocs provides us with an excellent opportunity. For communication and collaboration. When used effectively and monitored and addressed, they reduce the burden of actually the manual entry on our teams and lower the risk of data entry errors. Think about some of the examples, from today around sales orders and PO confirmations. That's a lot of manual work that can be alleviated with the proper use of EDI and resolution of IDoc errors. If we monitor these issues daily using some of the tools that we talked about today, we can achieve a good level of process efficiency. Hey Rutul, thanks a lot. That's a nice summary of benefits, balanced with necessary care and feeding. So again, thanks for the details. Hey folks, we don't always get into the technical topics specifically around how data is flowing from a technical perspective, but we do have a few others. If you're trying to find some of those, use the AI chatbot.

What Is the Purpose of MRP?

Find inspiration on why pursuing MRP is essential

Hey there Reveal TV community. Today we're going to go back to basics and produce a quick video to sure up the foundational understanding on the planning engine in ERP called MRP. Now we have loads of videos around MRP, but this one is for those of you who are not really using MRP today and want a little level set. First of all, I want to clear up confusion around the acronym. MRP stands for Materials Requirements Planning. Second of all, we commonly hear organizations say that they don't run MRP. Most of the time, this is not true. MRP is merely running along in the background. You've just never had the opportunity to find the value in the results. This is an epic journey filled with value. And today we're going to start with some inspiration. It is in my opinion that there is no better human in this world to get you excited about MRP than my friend, Sean. He has helped dozens of organizations come to grips with the journey and quality of MRP and has seen the outcomes for the business and for the people time and time again. So Sean, please tell us more about the definition and the purpose of MRP. Like many things we encounter in life, getting MRP up and running and delivering great value can be challenging. However, at the core, it's very simple. MRP's purpose is life to the supply, the demand, and it does so by determining what is needed. How many are needed. And by when they are needed to be there. It's time and quantity, it's primary school math, at scale, running on a set of rules, which are discussed in some of our other videos. It's a plan for every part in each location. Now then, let's go and we take a look. Well, welcome to the demo on what is the purpose of MRP. Now, in his introduction, Martin addressed MRP as an acronym and acknowledged that MRP stands for Material Requirements Planning. This is important because it is a good descriptor of what MRP does. However, what we want to do this morning is to use a transaction called MD06, and we are going to look inside of a plant at what does the MRP list look like in terms of the last run when MRP ran. And we'll take a look at that out there and you can see here there is a date at which the last MRP ran, which tells us this is the last time that MRP went to work to produce a plan for replenishment. Now we already know that MRP is responsible for determining what materials need replenishment, how many, and by what date. And that's all according to the rules that we've set. Now, most organizations run MRP on a regular cadence. And so even if you don't trigger it yourself, it's out there producing replenishment plans and managing the balance of supply and demand. It's a really, really good communicator. So let's look at our find in lists, which is really a material finder. Let's just focus ourselves for a moment on the group 4 messages where MRP is telling us what has happened. And we'll notice down here are my group 4 messages on the side. The first one, it's telling us is that these are the new proposals that we might want or need to review and to act on. It then also tells us that these are proposals that have been changed and we might want to look at that in case we've already acted and sent out an inquiry, whatever the situation might be, but we may want tolook at that because it has changed. It can even tell us that the replenishment has been triggered by the explosion of a bill of materials. Now, this last one is important to mention because MRP came about to allow companies to scale effectively as product assortments became more diverse, BOM's became more robust, and with more changes MRP could follow the rules and start letting us know if we had inconsistencies or if there were any other challenges that were out there. Now if you've ever wondered about these messages here that MRP is sharing with you and want to get some more background, I'll close this for the moment, you'll see here's an information tab. Inside of that information tab we get to see the groups, the messages, and what their definitions are. And I would encourage you to go and watch some of our other videos where we've done a ton of work around specific messages in terms of understanding and giving you insight into what they are and how you might want to respond. But if we go back to the Group 4 that we were dealing with, maybe let's just see from the highlights some of those exceptions that are coming out against those materials. You'll notice that it highlights them for me and if I go in to take a look at each one, I start to see my Group 1 messages. Here they are down here. This is a new requirement that came about from the last MRP run. And I get that opportunity to look, here's a good one, it's got plenty. All these new requirements have suddenly hit us, and we're going to have to respond to this, and make sure that we bring those materials in on time. Because often these messages , they get neglected. And we really need to guard against that. We spoke, for instance, earlier on about the message 42, which is the second one. So the proposals have been changed. Likewise, we allow the system to do the heavy lifting, we can get in and we can find a material that has now been changed, where the message is telling us it's been changed and we may want to act on that. And as we just go through, we'll just look at a few of those and you can start to see where these changes are and determine whether that's going to have an issue for us. Now, lastly, what I want to do is just to go back to all the exceptions and look at what's known as Group 8. So we look at these Group 8 messages. This is really telling us that MRP was unable to run, and you'll see there's quite a few of these that are out there, that it was unable to run and we need to fix or address the issue or the master data that is preventing MRP from running these materials. If we were just to take a look at it, here's an example for us, this one says it's in status blocked for procurement, warehouse does not allow for planning. So there's a rule that's put in place, but we still have an MRP type that wants to be planned, and therefore there's a conflict, and we need to take a look at trying to resolve that. Okay, so once more, if we go back to our exceptions, and we just look at a couple of materials, and I'm going to pick one or two. I'm going to pick this material, 1417. I'll say find that material, there it is. And when I start to look at it, here I start to see all of these new requirements that are out there. So I can see a number of new requirements which is message 01 for replenishment. So it's seeking supply for the demand and it's following certain rules. And so we don't have to do the math ourselves. Instead, we can focus on managing the process and then proactively intervening with exceptions as they occur. We saw it earlier on with some of the message 42, the new proposals. That is exactly the same thing that we would want to take some action and make sure that we stay ahead of the game as far as looking at business operations Now, the truth is there are probably tens or maybe hundreds of thousands of parts of several locations to plan across. And we quickly lose the ability to scale when only people are involved. And so MRP, it really is our next best friend, provided we have the right rules set in place to enable accurate replenishment proposals. And so folks, I would encourage you to explore what MRP has to offer. It can be a bit of a hill to climb initially but it gets easier as we go and the view from the other side, I can tell you, is great. MRP is a highly effective approach to managing replenishment at scale when it's set up and running well. It requires the discipline of daily cadence to stay relevant and move from the theoretical to the practical and operational. To recap our conversation today MRP is a rule based engine that produces a proposed plan for replenishment. Its job is to supply the demand. And when it's really humming, it puts us in a position to proactively manage by exception, alerting us to deviations from plan so that we can make decisions on how to best move forward and assure quality of supply. I'm a fan, Sean, that is amazing. Thank you for telling us more about MRP and thank you for showing us the power and the purpose of this particular functionality. Thanks again. Hey folks, if you want to learn more about MRP, there is an entire video catalog on MRP and all the exceptions and results related to that. And if you have a specific question, please feel free to submit it below.

What Is the Ripple Effect?

Seeing is understanding: discover the Ripple Effect visualized in SAP

Hey, hey, welcome back supply chain superstars, Martin here. We've got a good one today. Did you know that there is a tool in SAP that will allow you to visualize the connection between a supply element for a component at the lowest level of the bill of material and the final demand element that is planned to serve? Now, we'll acknowledge that it's not the prettiest graphic that you'll ever see, but for the purpose of impact and analysis and connection, it's a very powerful tool. We have two videos on this topic. One on the visualization end product, and the other goes into detail around the pegging report. What we're talking about today is the end result known as the ripple effect. To take us through this excellent feature in SAP, Sean's going to be sharing with the team about how this specific report can actually help us. Sean, take us away. Well, well, well, Martin. How the tables have turned, my friend. Usually, it's Martin who talks about the ripple effect. Today, I get to put my own spin on it. This is exciting. In our walkthrough today, I'm going to focus on three key things. First, I'll carry on the definition Martin started to frame up on what we mean by the ripple effect. Second, I'll show you how to navigate to it and zoom in and out once you're there. And lastly, I'll give you some insight as to why this is so useful. As they say, a picture paints a thousand words. So let's get in and take a good look. Right folks, so here we are and what we're going to do is we're going to go into a transaction called MD04, which is your stock requirements list. And in this stock requirements list, I've chosen a material PLA-BLK, so this is 3D black printing and it is for plant 1000 and it's going to open up the stock requirements list for me and we can see the details that are currently in there in terms of the requirements and so on. And what I want to do is I want to select one of those supply elements. So here is a planned order at the top and we'll look at that planned order and go to what's known as the pegging report. If you notice down the bottom here is a button called pegging requirements. It has the upward arrow. So I click on that and what it does, is it opens up the pegging requirements for me that's related to that particular planned order. And what I then want to do is I want to say, well, show me this geographically , how does this look from a graphical point of view that portrays what's happening in the pegging report. And on the top button here, there's a graphic. So if I click on that, there it opens it up. And what it's doing, and just simply put what the ripple effect is about, is having a visible view that sees the connection and the links from the supply element component, which is here, all the way through to the intended purpose to which it is supplying and supporting. In this case, it's a forecast. So the intended outcome here, or the support that it's for, is for this forecast, but it could just as well be for a sales order or for a delivery. And in between it, we notice all the layers and levels of production in between where that requirement is coming from and what the supply is trying to supply to. Now, one of the neat things inside of this report is that when you get a much more complicated view than the one that I've got here, which is pretty straightforward, it's pretty simple, it's a great example to show graphically what this looks like. You have this functionality of zoom in and zoom out. And so let's just assume if this was a very complicated and dense, you can hardly read it. If I was to hit the zoom in button, see what happens? It increases the size to the point that I will get to, to say, I can see now what these other elements are in terms of the links between the elements from the supply all the way through to where that demand is coming from. So in this case, as I said, it is a forecast. Now we get to stages very often that it's far more complex than this graphic and that's why we need the zoom in capability. So let me show you a quick example of that ripple effect, now take a look at this one. How detailed is this? Oh my goodness, it really does have multiple layers. There are multiple drivers of demand in between the supply element and the demand element. There's all these different production pieces that are part and parcel of the process. And so what this is showing us that where it is way more complicated, it's very useful for us to be able to use that zoom in functionality so that we can understand the ripple effect. We want to understand inside of this, what is it that these are all touching? What is that ripple effect so that we can get to the point of having debate and really looking to improve things. So if I go back to my example, in this case, now I was going to zoom out. There I have, in this case, fortunately, the entire example. And I can then look at what are all of these pieces of the puzzle that make it up. Now, here's a really cool thing that one can look at as well. The real value of doing this analysis and seeing this graphically is when it comes to the quality of the conversations that are going to direct us towards what that outcome looks like. That's really what the whole notion is about. What is the quality of the conversations that we can use these graphics for? And it's going to help us to uncover issues relating to, say, good or bad forecasts. It may be overdue sales orders. Maybe there's missing materials, incomplete production orders, deliveries, and so on. But it really helps us unpack that. And just by way of a quick example, if I look at one of these planned orders in between. If I was to double click on that planned order, look what happens. It opens up the details that are behind it. And so when I get into that conversation as a team, when I get into that conversation as a production team or as a purchasing team, whatever it might be, I can start to look at really what's going on. I can understand the links that are inside of that and it makes things so much more easy for me to understand. And I can see now from the links, from the supplier all the way through to that demand picture. So it really is a phenomenal opportunity for us to have those conversations. And I want to encourage you, that as you get out there, take a look at the ripple effect that you're seeing on your business and use this graphical functionality to enable you to get to a point where you can have good conversations. And with that, we're back in the studio. I hope you found that walkthrough helpful. Today, we wanted to give you a little bit of how you can be curious and explore in your own system. A few key things to keep in mind. One is the visualization of the ripple effect helps us to get a picture of the magnitude of the impact when we're dealing with a wrinkle in the supply or we're working on changing priorities. Two, this is a visual infographic that can be quickly brought up in meetings to answer questions and demonstrate concerns based on that magnitude of impact we just mentioned. And three, this is the visual representation of the pegging report. We have a lovely video on that for you to check out and it walks through the full anatomy of that report. So there's more to come. Thank you, Sean. And thank you for taking one of my favorite topics on the ripple effect. This is just one of those areas that actually just help us with cross functional understanding and just really understand the impact of up and downstream supply chain challenges. So folks, if you want to learn more about how to apply some of these tools, please use our chatbot that will actually help recommend some videos based on your specific questions. Otherwise, if you have a question for us, feel free to submit it below.

Demand & Supply Planning

DM; P2P; PTM; OTC

MD04; MD13

What Is the SLED Date?

Shelf life expiration decoded: acronyms simplified for easy understanding

6 min

Quality & Batch Management

QM; PTM; P2P; OTC; WM

MD04; MM03; MIGO; BMBC

Hey folks, Martin here. So good to see you guys again. Are you ready to dive into SAP and put it to good use? Well, let's get going. Is your organization challenging itself with ESG performance goals? Well, the good news is that there are many, many ways SAP can actually be a helpful vehicle of enabling achieving these goals. Today, we're going to explore a simple but effective example. We'll be dialing in on SLED and BBD. This is one of the many tools to support making the best use of our available inventory, keeping us and our customers safe and reducing waste. Our guide today is Ed, and he's going to introduce us to SLED, or S L E D and BBD, and show us where and how they are determined. Ed, what would you like to tell our audience today? Thanks, Martin. A lot of good can come from a simple concept, and the SLED and BBD dates are just that. The SLED, or the Specified Limited Expiration Date, and the BBD, or Best By Date, can be tracked at the material and batch level. Tracking these dates in SAP also produces another very important piece of information called the Remaining Shelf Life. This requires a few simple settings, which we'll review today. With these key pieces of data in hand, we now have a few of the foundational building blocks to ensure that we're rotating and moving through our inventory efficiently. We're able to meet customer specific requirements through batch search strategies. And, we can monitor, prioritize, and make usage decisions with our list displays. Let's dive in and go find the places where SLED and BBD live and review how the remaining shelf life is calculated. Where is that shelf limited expiration date, or SLED date? How is it calculated? What does it mean to us? Well, we can answer two of those questions with a look inside the Material Master. These settings live on a tab you may not visit very often. We're headed to the Plant Data Storage Location 1 tab. You can see a bunch of settings at the top around rules for storage. Let's say you're not running full warehouse management, and you need some basic things in place at the storage location level to manage the storage of that inventory. This is where that data lives. Now, if we look a little further down, we have a section on shelf life data. Let's walk through some of these fields. The first one we want to concern ourselves with is the total shelf life. This is the total time the product can expect to be of best quality and eligible for use without restriction. This is measured from the date of manufacture, and that could be our own production, or in this case, it's our supplier's date of manufacture. The next field we would want to consider is the minimum remaining shelf life. This is the rule the system will follow when receiving the goods. A supplier may have shipped us a lot from a while ago. That's okay, so long as we have the designated amount of time remaining. This would also apply if we transferred goods if the information was set appropriately in the receiving plant. Another important field is the period indicator. Here, we can set days, weeks, months, or even years, depending on the nature of the expiration and the associated storage requirements. We can also set a max storage period, restricting the amount of time that we would want to let the material age from goods receipt without review. Interestingly, the time period for the max storage period can get quite finite, down to minutes, seconds, even microseconds. Okay, let's see how this is applied. Let's go into MIGO and go through the receiving process. So here, we'll enter the manufacturing date and tick the item, check it. Okay, and now let's try to violate the rules and change the date. It's not within the allowable time, so we get the message and can work with that. We have several clients in the food and beverage industry that work with the byproducts of other processes. When the milk is coming, ready or not, or the harvest is coming, ready or not, you have to be very smart in what you choose to do with those products to maximize shelf life and meet different requirements for different customers. I'd say no one likes moldy cheese except for when they do. All right, now that we know where these settings are set and referenced, we have some of the foundational building blocks to reduce waste, prioritize use, and support customer specific requirements. Simply tracking this information and reviewing it consistently gives us a jump start, which opens up options and opportunities that we would not have without this additional visibility. SLED and BBD are useful for both procured material and manufactured goods. And through regular monitoring, which we'll explain in another video, we can proactively work to review expiring material and reduce the number of decisions required around disposition of expired materials. Thanks for joining us and I appreciate your time today. As do I. Thank you, Ed. There's no time like the present to put additional focus in this area and explore how SAP can help us meet our ESG performance objectives. This is but one of many pieces of functionality that can help set us apart and set us up for success. Thanks again, Ed. Hey folks, if you want to learn more about these particular topics or other ESG performance goals, please check out our videos or submit your questions below.

What’s the Reason? Exploring Reason Codes

Using reason codes to track root cause and resolve recurring issues effectively

Hey there Reveal TV community, Martin here. Do you ever find yourself looking at a transaction in SAP and wondering why somebody did what they did? Possibly even asking yourself why you did what you did. As time marches on, it's harder to unpack those deviations from the expected outcomes. The good news, we have a tool in the toolkit to help you with this challenge, reason codes. Reason codes gives us a quick and easy way to identify, explain, report on the reasons why we took a particular course of action and the difference in the normal expected process and outcomes. For today we're going to have Jason tell us more about it. Jason, tell us more about how to use these reason codes and why they're so important. What was the reason? Thanks, Martin. Chances are reason codes are being used or at least have been set up in some part of your business. They help us with a quick explanation of the course of action that we've chosen. Today we're going to work through a few examples of good use cases for reason codes. And as we do, I'd challenge us to think about how reason codes could open up the door for better reporting and analytics to drive corrective actions or process improvements or cross functional visibility for decision making. Let's dive in and take a look. So why reason codes? Well, if you have well thought out reason codes, and we have a quick and easy way to record the why, here's some examples . Why was this material moved from unrestricted use stock to quality inspection by block stock ? We expect material to move from quality to unrestricted, but to move back to quality and might need a little more information on the why. And if we're moving from unrestricted or quality to blocked, we would definitely not to know why . Was the material damaged, that happens. If we saw a pattern, we might find you need to up our incoming inspections then for a while until we see improvements. Or perhaps we aren't storing this material in the best place for it's survival and we need to think about a different storage strategy. Or maybe it's just not there. We really don't want that one, but sometimes it happens. We don't know where it is, so we block it to make sure that MRP and ATP won't see it as available for use. With a reason code, it makes it easy to quickly review and also spot patterns. Let's take this material, for example. If we look in the stock requirements list, we see three little golden cubes by our starting inventory position. Whenever we see these golden cubes, SAP is telling us we have inventory sitting somewhere other than unrestricted use. So I know there's something going on here. If I'm planning my replenishment, chances are this move to block stock was not on my bingo card for today. Now it's blocked and I don't know why. Wouldn't it be nice if I could just run MB51 for this movement type and see the reason code? Oh, and look right here. I've got three moves due to the material not found. Think it's time to call the warehouse and ask for a count . Things are getting a little out of handout there. Reason codes can help us a ton with reporting and analytics. We can use them in sales orders to help further define blocks. We could use them in production reporting if an activity was not completed or an order was completed short of the requested quantity, and we can certainly use them for unexpected movement or reclassification of material . Keep the list short and intentional. You'll make it easy to get quality information with minimal effort. Now, I'm a curious person and I like to know the why. Knowledge is power, and when you see the same issue popping up over and over again, it's a great opportunity to dive in. Now, a word of caution, require reason codes only when necessary. If you over do it, chances are good that the team will just go on autopilot and that is not what we want. We want quality reasons that drive activities. The choice of reasons should be well thought out and intentional. The goal is to drive transparency on the why. And cross-functional visibility that supports quality decision making. That's awesome Jason. Thank you. You clearly had some good reasons for bringing this topic to Reveal TV. Hey, those are great examples, but as we work to improve service levels and reduce downtime, reason codes would be very helpful in unpacking and resolving the myriad of issues that we deal with every day. Hey folks, I know there's a lot of these little tips and tricks that you could probably find in some of the videos we have, but if you can find one specifically to what you're looking for, feel free to submit it below.

When Your Supplier Puts You on Allocation

Supply is short, and you're on allocation - explore strategies to manage the impact

Hey, welcome back Reveal TV fans, Martin here, and I really hope you're thriving. Although I suspect that if you're watching this particular video, you have either trouble on the horizon or in the thick of it right now. If so, we're here to help. And you know that if you're dealing with constrained materials and facing being put on allocation is not a new challenge. Although, the cyclical nature certainly makes us feel like we're running an ultramarathon. As soon as we get one sector of the regional supply chain stabilized, it seems like we just have another one firing up. Now some of that is just normal supply chain life. But notice of allocation is certainly at the more extreme end of the spectrum. It's not fun for anyone. But there are some great tools to help us deal with the situation. And here to help us navigate the world of allocation today is Kelly. Kelly, you're quite the negotiator, I'm really interested to hear how you can introduce these tools to all of us. Thanks, Martin. No one likes to be told they can't have something, or that they are limited in what they can have, even if it's the best, most fair approach for the market served. For a lot of us, our response to the constraint of allocation has been alternate sources, often at a premium. Sometimes we've had to hedge our purchases and work with the burden of inventory carrying costs. Potentially expiring materials if we hedge too much or purchase from a less strategic source. And loads of other fun stuff. You're right. It's no fun. Even for someone who enjoys problem solving through negotiations like me. So here's a few things to know. We're on allocation when a supplier is managing priorities across customers in a limited or constrained environment. This can then limit sales potential to our customers and also result in a much higher cost to serve. I think in difficult situations like this, it is important to know that you're not alone. There are a lot of organizations going through this and comparing notes may be very helpful. For our demo today, I'm going to explain how three tools can work together to help you navigate the challenge of being on allocation. Let's go in and take a look. Sometimes it helps to bring the big picture together. I'm starting here in the stock requirements list. And if you look in the lower right corner of my screen, you'll see that I've asked SAP to show you the transaction code I'm in. This should help you as we go along. This is the current planning situation for a material that I've been told will be on allocation for the "foreseeable future". If you can't tell, I used air quotes for the foreseeable future part. I don't like that. I want a date. So here's what we're going to do. It's August right now, and my lead time is 90 days. I'm going to put a restricted plan in place for the next six months, and we're going to revisit this with the supplier monthly. My normal supplier has told me that to maintain the maximum allocation of X units per month, I need to guarantee a certain volume. I've pushed them, and we've agreed on a target quantity of the units you see here over the next 66 months. I've told them we will pull based on demand, but at a rate of no more than this many units per month. In addition, I am introducing a second source that will take my remaining volume, but at a price that makes us say, yikes. I'm going to have to chat with the sales, customer experience, and product management to see if we will weather the increase or pass some on. We hate to do that, but we may need to have that tough conversation to achieve customer tolerance time. To make this work, we're using several techniques. First, is a scheduling agreement that provides a forecast outlook for our supplier that has us on allocation. They have an idea of the pace of our demand and also an agreement that shows the total target quantity. In this document, I can also work with alternate master data related to lead time or pricing. I can update my source list to see this as the relevant source for the next six months, with a return to normal after that. I am also using firm and trade off zones for the commercial obligation of the information I'm sharing with them. Firm, they are cleared to produce and ship. Trade off, we will take it, but timing is not guaranteed and we've got a generous time horizon to meet our obligation. Second is a contract for my secondary supplier with specific information on the terms of the agreement. We've been eyeing this supplier for quite some time now. This may be an opportunity, if we can get them to give us better pricing and terms. I've asked for scaled pricing, which I will reflect in the price scales of the contract. This contract will also go into the source list as a valid source. Last but not least, I have a quota arrangement in place that's managing the split for me and restricting the volume that can go to my primary supplier. The one that has issued the allocation notice per month. I could base this on all kinds of different periods, but this month is good for now. The final product is in the system rules. That produces a balanced plan within the constraints. We have right now and a relatively easy exit to normal if normal arrives again. I can work with this. Today you were introduced to a few tools that can work together to help you manage the challenge of allocation. We have several other videos that go deeper into these tools and can help you get started. Without a doubt difficult situations require creative solutions. Sometimes people have great ideas for how to navigate rough waters, but the practicality of executing the plan can be daunting. I'm here to say that it can be made manageable. If you have an idea, let's explore how to get SAP to empower you to deliver it. Things change and when it's time, all of these tools we're talking about can be expired or discontinued , offering you a way out and back to business as usual or better. I love a good negotiation. Thank you, Kelly. Great insight. I too love a good negotiation and trying to turn what starts as a seemingly losing situation Into something good for the future. Out of a crisis comes innovation. So navigating tricky waters is a great time to see what you have to work with. This is a good starting point for a conversation. Well, folks, if you want to learn more about how to use some of these tools to be able to deal with suppliers and customer allocations, please check out our other videos as well.

When the Integration Breaks Down

Navigate cross-functional flows and fix breaks to keep SAP running smoothly

DM; P2P; PTM; OTC; WM

MD62; MD04; CM01

Martin: Hey, rock Stars Martin here. It's time for a chat around what happens when the integration starts breaking down. There's an inescapable truth about being a supply chain practitioner. The supply chain relies on integration and so does SAP. It is the beauty, the power, and the challenge. Getting it right isn't easy and it has both to do with people and a system. Here with the story to further explain is Steven. Take it away, buddy. Steven: Yes, Martin. Uh, the story has trials, uh, it has tribulations, it has people trying to do the right thing and a system that desperately wants to empower them to do those right things. The story revolves around the critical alignment of plan, schedule, and actual. We will seek to describe a scenario where the baton pass is, well, let's just say less than seamless. There's some confusion as to who's on first, and as we move through the process we have so much localized decision making. That we could definitely benefit from less. In short, we're not integrated, we're not aligned, and we can see that in SAP. So what should we do? Well, let's go in and take a look. The story I'm about to tell you is one that we've heard over and over again. It's a story about several individuals doing the best they can within the sphere of what they can control. It's also the story about frustration, confusion, and loss of value. Unfortunately, it's far more common than we'd like to believe. Our story starts with Rachel. Rachel's a demand planner who is the challenging job of painting a picture of what the company expects to sell over the next 18 months. She's a key player in the sales and operations process. She works with sales, marketing, product management to build an unconstrained consensus based plan. She keeps the system up to date with the best information she has and has a good process for monitoring the performance of her plan. Rachel also works with Chris. Chris is her planning counterpart. Chris provides feedback on whether it's feasible to supply the plan and attends the sales and operations planning meetings, and stays engaged with Rachel throughout the month. Now Chris knows that the demand plan is flawed and when product is not available, he feels like it's him and not Rachel that feels the heat. He constantly is fighting fires and he is rewarded for his finesse in crisis management. He works hard to align the schedule with what he sees as the priority needs of the customer, and sees Rachel's plan as information but doesn't really believe it's real. So he makes a plan based on what he thinks will actually happen. He also builds his plan in consideration of a balance of efficiency, service levels, and inventory investment. Not easy, especially since he has to redo Rachel's work in a spreadsheet, but he delivers quality plans to the shop floor every time. Now Dumebi is the recipient of the schedule. She's the supervisor for the first shift and sets up the other shifts as well. Chris's schedule is always changing and sometimes he even has scheduled downtime. He doesn't understand that her goals are all around OEE and absorption, and a lot of times his schedule doesn't prioritize those things. Plus customer service as a direct line to Dumebi and frequently asks her to intervene. Dumebi resequences a schedule and adjusts the quantities for more efficient runs based on what she knows they will need. Now meet Brent. Brent is the sorry soul who's making sure material is available to production. His suppliers think he's impossible. He is constantly making changes and asking for expedites . The things he expedites, production isn't running. Then there's unplanned consumption. For some reason, material planned for a particular run has gone elsewhere. Can't manufacturing make what they're just supposed to make? This team is actually a bunch of individuals. They're each doing the best that they can do, but when the baton is passed, they're looking at it and changing it and passing an entirely different baton onto the next person. What happens when this happens? Let's set the operational and business pieces aside. Each person, each well-intended individual is eroding the confidence of the prior person's work. There is no team, integration is broken down. We have to fix this. We have to get people engaged in conversations. We have to commit to a plan and collectively course correct. We can no longer make localized decisions the norm. We simply cannot win with that strategy. So let's engage as leaders and start making it possible for our individual superstars to become a well-functioning team. Imagine the possibilities. I wish I could tell you that this is a ridiculous overdramatized caricature of an integration breakdown. Unfortunately, it's not and examples like this are found throughout the functional areas of the supply chain. So what are our heroes meant to do? Well, first, if you see something, say something. Don't just go on your own way. But tell the person you take in the baton pass from what you're thinking and why. Let them challenge you and mutually agree on how to move forward. Second, inform SAP. Don't let the person receiving your baton pass wonder what's going on, or they'll come up with their own path forward. Thirdly, after you have a healthy debate, trust in your newly integrated approach and follow the plan until such time that another conversation is needed. Martin: Hey, thanks, Steven. Integration breakdowns are tough, and this is a good example of what happens when we let the problem fester and simply go our own way. We need to have a healthy conflict and figure out how to get back to the same page. Thanks again for the story and of course, the recommendations. Hey folks, if you want to know more about some of these Leadership Digest stories and videos, please check out our video catalog. And of course, if you're not sure or have a specific question, please submit it below.

Where are Exception Messages?

Optimizing demand with exception management strategies

Demand & Supply Planning

DM; OTC; P2P; PTM

MD04; MD05; MD06; MD07

The best way to learn is by doing. Welcome to the video service that unlocks and reveals the hidden value in your SAP system. Hi, my name is Martin and in this video we are going to focus on where to find SAP exception messages. When used correctly. Exception messages can alert organizations to potential issues with the MRP results or other processes within the SAP. But where are they? Kristie, help us discover where they are. I think I can show you where Martin. Let's talk about where to find this powerful feature. As a buyer or planner, this is the feature that should be helping us most with our day-to-day work. Yet, for many of us, we struggle on how to get started, and in this demonstration, we're going to focus on three key things. First of all, what transactions will lead us to find these exception messages? Second, where the exception messages will actually appear. And third, how we should think about getting started when evaluating and resolving materials with exception messages. Let's learn about exception messages together. So this is a great question. Where do we find exception messages for demand? Have you ever noticed that when you look at where your exception messages are placed that they are not placed against your demand elements, they are only placed against your supply elements. The only one that's a little confusing is safety stock, because safety stock is a demand element, but it's letting you know that the stock is fallen below safety stock level, so it's related to your ability to supply it. So if you think about the purpose of MRP and our purpose as planners is to supply the demand and as buyers to supply the demand. It's our whole, our whole goal is to make sure that we have the right material in the right place, at the right time, the right cost, and the right quality, but our exceptions, because it's communicating to us as folks who are on the supply side of the house, only fall on our supply elements. You can see right here I have this scheduling agreement for this customer. It's actually in the past. Today is the 14th of February. We don't have enough inventory for it. There's no exception message. Where's the exception message? It's on the purchase order that is intended to provide the supply to supply that demand. Interesting, right? There is a lot of exception monitoring available though, for demand side elements. So the first is what I'm going to show you today, which is how we monitor our forecast to see how we're doing there. The second is, a good example would be VA06 for those of you who are on ECC or some of the Fiori apps, for those of you who have migrated to S/4, that let us know what is happening with our sales orders and gives us a lot of exception monitoring and insight into those arenas. Another good example for how we would find some exceptions would be around housekeeping. So we can always look for overdue MRP elements, in our exception monitor related to demand side items. But let's look at one of the exception monitors for managing our forecast, and I'm going to come in here first, and I just want to sum this up. So sometimes it's nice to be able to look at things summed up by periods, so days, weeks, or months, and in this case we happen to be forecasting in monthly buckets, so I want to come in here and take a look, this column here for planned independent requirements. So this is what we have, we can think of it as our open remaining to sell. So if we had planned for the month, this is the balance that we do not currently have a sales order or scheduling agreement pegged against. Our requirements are what we have sold for the month, and then the balance of that is the plans receipts. You can see we're planning perfectly in balance for these items. We're planning to replenish to the total demand, and we're not planning to keep any additional stock. Okay, so then the question becomes if we are starting to see exception messages like request to expedite what caused us to be outside of plan, did we place our purchase orders on time is definitely something we could look at. The other thing we can look at is we can see how we are balancing against our current forecast, and so to do that I'm going to come up to environment and I'm going to go look at this thing called total requirements display. So in the interest of full disclosure, I have a background in demand planning, so this is not blaming the forecast for all of our supply chain woes. I wish that that was the case or blaming the customer, if only the customer would place that order with the lead time that they were promised, if only, you know, the forecasting team would get it together on the demand plan. No, we, we work in supply chain our purpose in life is dealing with the variability and the volatility and the mixed issues that occur. So this is our world and what we're good at working through, but we can get some exception monitoring on how we're performing to the forecast. You can see here all the pieces that are out here, so what we have consumed and where we are able to balance against that forecast and it's easier to do this if we actually go in and we look at the customer view. You'll actually get a red, yellow, and green light here. So these items that are in red at the top, this is demand that does not currently have any forecast that it's able to consume against, and that's why we don't have any information over here to the right. Further down from that we have items that do have forecasts they're able to consume against, so a hundred and this is what's been assigned to it, and we can work our way through until we get out into the future, where we've got greens where there's plenty for us to peg against. So this is our planned quantity, what we're currently pegging against and then based on our consumption rules, how much of that forecast we're able to consume, and so in this case we can see that these sales orders don't have anything, they don't have a forecast that's within their consumption window and so this demand is actually in addition to our forecast. Now this happens in the current period so there's other considerations in terms of how we might be dropping or reorganizing that forecast for the current month, but this is very helpful in determining whether we're ahead or behind. The other piece of this around just rolling it up to these totals is if you can think about the planned independent requirements as you're remaining open to sell. When you exhaust those and the requirements, quantity starts to climb. If you are within your firm zone, your lead time for your suppliers, your firm zone for manufacturing, this is where we'll start to see those exception messages pop up because we aren't in position to be able to supply, so we are overselling plan. The opposite can also happen and we'd be able to see that here if we are underselling the plan. There's lots of plan that is open and we don't have anything currently pegged against it. You know, you can get a look out across the horizons. You can see here for October, we've already consumed the totality of our forecast, we have requirements of 210 pieces, in fact that may be larger than what the original forecast quantity was, and so we can use that customer view for help to determine that and then to be able to have good conversations with our counterparts in the sales and operations planning process, the IPP process, or just in demand planning to work through and resolve any of those exceptions as they occur. So really nice to be able to go through and see how the customer orders are stacking up against that demand and then be able to adjust accordingly and that's how we might be able to detect some of the exceptions that are occurring in our planning process. That and housekeeping are our two main ways to be able to do that because we housekeep both for supply and demand, and we have to push back on the demand in order to resolve the supply. So if we go through and we cancel something, or we delete something, which we should never do, we should close out. If we're doing those types of activities and there's still open demand, then all that will happen is the next time MRP runs, it's just going to regenerate for us, so getting a line of sight on some of these daily views and being able to have those housekeeping conversations with our counterparts definitely helps us to get this cleaned up. So that's where we find our exceptions for demand. So in summary we have covered how exception messages. Show up in key transactions. Highlight areas where our supply is misaligned to our demand. And become a critical daily habit for managing the overall supply chain. Super exciting! Thank you Kristie. We know that exceptions are the lifeblood of buyers and planners daily activities but finding exception messages is important because they highlight potential issues and this allows planners and buyers to proactively work to resolve them before they become larger and time consuming and more impactful into the business. If you'd like to know more about exceptions, finding exceptions and exception management in general, of course plus any other features and function SAP please check out our video catalog and of course if you've got some suggestions we are happy to listen please submit them below.

Where to Focus: QM Lots That Need Prioritization

Identify what's most critical when drowning in inspection materials

Quality & Batch Management

SAP S/4HANA®

QM; P2P; PTM

QA33; MD07; MD04

Hey there Reveal TV community, Martin here. And today I believe we have a quality topic for you. One of my favorite things to see when we're out walking the floor is what's happening to the world of quality inspection. It's such a critical function and often so overlooked. Many of the times the challenge we see in quality isn't the actual defects. It's the efficient movement of material through the inspection process and having the right people, equipment and partners, et cetera, to keep it up. It actually turns into a physical backup on the shop floor, often exploding into exception messages, status confusion, and queue shuffling. Hey Jason, I know this is a tough topic, but such an important one. Tell us more. I completely agree that while quality is central to our processes and while everyone understands that it's a critical step, we really do struggle to keep tabs, keep up, and remain sufficiently resourced. So I can't wait to get into this. Today, we're going to explore how we as planners and buyers and MRP controllers can support our quality colleagues in prioritizing the inspection backlog. In today's video, we will. Identify some past due usage decisions and lock closeouts. Figure out which items have red lights by generating a work list. And use days of forward coverage in our exception messages to help prioritize a list to discuss with our partners in quality. Let's go in and take a look. You'll hear us talk a lot about integration and learning how to work collaboratively across the supply chain using exception messages to direct our actions to the most critical items. It often seems, though, that the quality team gets left behind a bit in this effort. They're off in their own little world, trying to figure out which inspections are most critical, often just taking them in order of start date without really knowing which ones are the most critical to keep the flow of production happening. Other than maybe getting an angry email or phone call when things go off the rails, they're pretty much on their own. Well, out of sight, out of mind is never a good approach to managing critical supply chain functions. So I'm going to share a couple of simple ways that we can help the quality team have better visibility to where they should focus their efforts. Here, you see the selection screen for QA33, which allows us to view inspection lots. We have a number of selection options here to choose from on the main screen, but I want to share a little inside pro tip to expand options. At the top left, you can see a red, green, and blue button. I thought surely this must be someone's flag, however my search proved to be frustrating and I was not able to find it. So, if someone knows out there, I'm curious. Can you send me an email and just let me know which country this belongs to? Or town, or county, I don't know. Whatever. Anyway, this is called dynamic selection options and, when I pop it up, you can see here that I get a bunch of different options that weren't there before. So for example, maybe I want to search QM Lots based on a specific purchase order number or specific purchase org. Those are options that I can use just by clicking here and then I can put my document in and run the list by that. So just a cool little tip that maybe a lot of people don't know about. You can explore this and take note that that button's available in a number of other transactions, so keep an eye out for it, and you might find it can help you refine your searches. Okay, enough of that, for this demo, I'm just going to keep it simple, I'm going to look at plant 1710, and I'm going to use only inspection lots without a usage decision. Now, this can sometimes run a little bit long, so I've already brought the information up on a different screen , and so here we go. First off, I have sorted these on the start date, earliest to latest. Now this is a perfectly logical way to prioritize the list and is often the approach when we're not collaborating as effectively across the supply chain as we possibly could. But how might we use other information in SAP to find out if there's a better sequence to support critical cases? So in this case, I'm going to use the old CTRL Y trick and highlight these guys and then I'm going to CTRL C to copy it to the clipboard and I'm going to pop over to MD07 and upload that list of materials. So I'm only looking at exceptions for those specific materials that I pulled from the QM monitor. So let's run that , and this is a pretty short list, but there's still some good info to be discovered here. If we just went by the dates in QA33, we would inspect one of the lots for QM001, then all four of the lots for this EWMS4-03 material. And then finally, FG129 and the final lots for QM001. But is that really the right approach? Take a look at the three columns that show here the stock days supply, the first receipt days of supply, and second receipt days of supply. What we can see here is that both QM001 and FG129 have red lights over here on the traffic lights, which means that they have a negative supply situation. While the third item is green, meaning that it basically has unlimited coverage. So in this case, if we just follow the dates from QA33, we'd be inspecting four lots of this material here that has no supply disruption and no current demand, while these guys that are having a critical supply situation wait. So that's most likely holding up production and could delay shipping to a customer, which is probably not the best plan. You can do this check very quickly in a daily stand up meeting and provide clear guidance to the quality team on what is most critical for them to complete right now to keep the process flowing. And this is even more crucial if, as we often find, quality is a bottleneck where optimizing the flow is vitally important. So there you have it. A simple way to use the red lights and days of coverage information in the MRP Exception Monitor to better prioritize quality inspections. And I am very serious about figuring out which country that flag belongs to. So help me out, send me an email, let me know what you find out. If it's not obvious, I am passionate about this topic. We so often see quality departments with good procedures that are just struggling to keep up. We need to partner well to provide some perspective on prioritization when there is a backlog. So a few points to take with you. First, Cadence keeps the chaos at bay. Trademark. Regularly review and help your colleagues to review delayed usage decisions or critical incoming inspections. Second, there are all kinds of work lists for status monitoring and QM. Make sure the team knows where to look so that all lots are appropriately addressed. And third, and I can't emphasize this enough, identify and feed your bottlenecks, but don't overfeed them. Work the constraint, look for the pacing that's possible, and adjust your inspection times to reflect reality, then improve that reality. That's what we do to make things better. Hey, thank you Jason. I knew that would get you fired up. Quality both feeds the processes on incoming inspections, and is the last leg in the relay before a product is ready for our customer. We focus on so many of the surrounding processes, but often quality inspection and how we work is prioritized and process is underserved. I'm really glad we're discussing it today. So thank you. Hey folks, you want to learn more about quality management just generally speaking or specifically, check out our chatbot, it will help recommend some videos for you.

Why Do We Call It the MAD Date?

Decoding material availability calculation and its impact

SD; MM; PP

MD04; VA03

Work Center Analysis

Assess work center performance for improved outcomes

The best way to learn is by doing. Welcome to the video service that unlocks and reveals the hidden value in your SAP system. Hi, my name is Martin and in this video we are going to focus on how to take the advantage of SAP work center analysis. When used correctly, work center analysis can help organizations gain insight to how well we're able to run the schedule on the floor and identify where the bottlenecks might lay. It's a valuable way to improve performance and uncover opportunities for improved throughput. So Eacliffe, tell us a little bit more about work center analysis. Sure Martin. Work center analysis is a powerful feature when used correctly, how well a work center is performing and keeping its commitment to its schedule. In this demonstration I'm going to focus on three things. Provide an understanding of what insight this report provides from a work center perspective. How it goes about providing this insight on work center performance. And how to evaluate each work center performance. The intent here is the use transaction MCP7 to perform work center analysis. In this report the data is primarily captured by plant, work center, and month. So let's get into this transaction, and what I'm going to do is, because it's a test system, I'm going to run it for a couple of years. So let me execute this, I'm going to bring up all work centers within this plant that has information. Okay and here we can see that we got information currently sitting at the plant level. So basically we specified the amount of historical information we want to take a look at hence the amount of history was driven by that date range. Ideally we should have zero variances and when I mean zero variances just looking at my screen here, what we can see is we have target lead time, we have actual lead time. So based on our master data, this is how much late time we expect versus based on the production confirmation. The variance is then reflected in this column. In terms of execution time I don't have a variance, but we could see what the target is versus actual. If we want to see what the difference is we can do the quick calculation or you can select this column, come here to comparison to key figures, going to compare the target execution time, I'm going to compare that to the actual execution time. Okay, and here we can see the difference. So we'd spent just over 39 days difference between the two. So the question is, hey, is this something I need to take a look at? Okay. And then even queue time again, we have target queue time, actual queue time. This is the amount of wait we expected based on our master data, we're expecting only one day of queue time, we ended up with 23 days of queue time, so deviation of 24 days. So again, what's going on? And this is sitting at the plant level. So what I'm going to do is do a switch drill down, and I'm going to bring it down to a work center. Let's see what this information looks like. So we have the totals still sitting like before on top, but now we can see who's contributing to the variance perspective, so let's look at this the deviation. So I'm going to sort this. I don't see any negatives. So let's do this, we could see the biggest contributor is coming from this particular work center where we said, yeah, it should take us 9 days when in fact it took us only 1.4 days to fulfill that particular operation for that work center. So this is great, but recognize that, look any kind of deviation, positive or negative that could have a significant risk to our operation. if we are running too fast, like this is implying we may not have other components in a timely manner resulting in a shutdown vice versa, if we are not completing orders in time without operation in time we also run risk to the business. So ideally, our goal is to really bring these lead times into alignment. The other thing I'm going to call out is, notice we see these big numbers here, it's like, wow, this is a big deviation, I mean, the difference is 144 days. So how can this only be 14.4 days at the total level? And we have to recognize that the system is actually averaging these numbers at a total level, so because we are dealing with time we just can't simply add it up, so what SAP has opted to do is to take these number of days and just average them by the number of entries or in this case work centers that we have here. So this can be a bit misleading looking at it, and hence it's definitely good to come down to this work center view and actually look at the information at the work center level. And then just to take this one level further here we can see we had a big deviation the question is, okay, when did this happen? I can pick this single line item, I can then do what is called drill down by, which is this icon here, and we'll dive into that specific work center. I'm going to pick months and we could see we have 4 months listed here and for the most part, things were looking pretty good until we came into 2023. So in this case because there's just one entry we will try and get an answer for what's going on, but it definitely looks like an anomoly and for that reason there's a high probability we don't need to take any action, but still, we don't want to second guess this, we want to determinethe root cause of this. You know, was it a matter of something posted incorrectly, in this case did this order linger around for a couple of years, for example given the number of days, et cetera. So at the end of the day, yes we use this transaction, we focus on columns like lead time deviation, we can compare processing time between the two, like what's going on, actual queue time, and of course we can also take further information to consideration like operation data and so forth. Okay, so this is the type of insight that you can gain from doing a work center analysis to help determine which data set you should be going to, to improve the quality of your master data. So in summary we have covered how work center analysis allows you to. Appreciate the feedback that this report provides by work center. Identify which key figures to focus on in this report. And evaluate each work center performance. Thanks Eacliffe. Using this feature allows real-time information on work center utilization and performance allowing the business to improve production planning, optimize resource utilization, and enhance cost control. If you want to learn more about this topic and others in your SAP features and functions please feel free to check out our video catalog and if you have any specific questions feel free to submit them below.

Scheduling & Shop Floor

PP; PTM

MCP7

Work Center Hierarchies and Superior Resources

How to evaluate capacity across similar resources using work center hierarchies

10 min

Production & Capacity Planning

PTM

CR31; CR32; CR33; CRC1; CRC2; CRC3; CM01

Martin: The best way to learn is by doing so welcome to the video service that unlocks and reveals the hidden value in your SAP system. Hi, my name is Martin and in this particular video we'll focus on using SAP's work center hierarchy to perform capacity evaluation for a group of liked work centers. A debate may take place to define one work center to represent a multiple like machines, or create a work center for each physical like machine and use a group center hierarchy with a superior work center to perform capacity evaluation. So let's get into this. Eacliffe tell us more about how do we do this specifically in this grouping of evaluations of work centers, specifically in a hierarchy. Eacliffe: Hey, thanks Martin. I have set up a demonstration to. Illustrate the functionality of a work center hierarchy and a superior work center. So while it be easier to generate a single work center, or let it represent multiple work centers, this approach can sometimes be challenging when assigning a particular manufacturing order to a specific work center, for example. Regardless of the reason for having a one-to-one definition between a work center in SAP versus the physical, uh, machine on the production floor. By defining a work center hierarchy, capacity evaluation can be done for both the individual work centers and the superior work center. So let's get into SAP and look at how this functionality works. So this is a demonstration on how to aggregate production capacity information for resources or work centers. So you have the situation where you have like multiple, resources or work centers, and the whole point is you want to see, if I combine the capacity information for more than one resource am I able to do so? So the answer is yes, and you have the ability to do this either under discreet production and with production you would use a combination of work center master data setup along with hierarchy information or master data setup, as well as under the PPPI, you would use resources and also the hierarchy master data setup. So I've set up some data to illustrate exactly how this works. First, let's take a look at the resource that I created that basically represents the superior resource. I'll come into change mode, I called it this name here, and let's just walk through some of the views. So on the basic view it's a very light version of a resource. Basically what I'm doing is really creating this object to say, look, this resource represents a superior resource. And you could see that I don't need to maintain any kind of standard value information for this particular resource. Likewise, if I come to the capacity tab, yes I maintain the capacity category because I want to see information from a machine perspective. If I want to see labor, I would create a second entry here for labor category. But again, I would not maintain any kind of formulas. The whole point is that we would obtain the information from the, call it the children resources or work center. And finally, coming here to the scheduling tab, again, there's nothing maintained because again, the information that's needed or that is used by the system would be derived, from the, resources that’s actually doing the production. So with that said let's come back out and now I’m going to come to the hierarchy. So let's look at it in change mode, I gave it the same name as I did the superior resource, the names do not have to match. Okay? So it's your prerogative in terms of what name and convention works for you. You can use the same names or you can use different names. It all depends on what works for you. So with that said, I'm going to come and click on this icon. And it's basically saying, hey, I have this superior resource, you could see the first entry here, and then we have the, what I've been calling the children resource. So we have these two packing lines, 1 and 2. The thinking is that the materials which I produce on, let's say line 1, the majority, if not all of the materials on line one can also run on line 2. So it makes sense to do an evaluation with the two of them combined, just in case I have insufficient capacity on one line, then I can say, okayoverall, do I still have sufficient capacity? And if I do, then I'm not going to worry about it. I'll just move some of the production from line 2 to line 1. So what I'm going to do next is let's take a look at the capacity evaluation itself. So here I am in CM01 and I'm going to come in here. I maintain my plan, and on the planning I'm going to go to work center and I'm going to click on this icon to work with the hierarchy rather then the individual resources. So this is the hierarchy name. I'm going to do a green check here. It gives you a illustration of what the hierarchy looks like. So here's the superior resource, and then I have the individual. I'm not aware of any limitations of how many resources or work centers you can have attached to a superior resource. And of course you can also do multilevel. So I can have SP2, and SP2 could be something, you know, let's call packing line 4 and 5, and then you could have it all roll up into, hey, give me an overall SP network. Okay, so it could be multilayers from top to bottom, and I've got multi resources work centers. With that said I’m going to green arrow back and from here you could see the superior resource as well as the individual resources sitting here as part of the selection criteria. Here, I'm going to do a standard overview. You could see that right now I am sharing that there's 0 capacity required at the superior level and as well as available everything is sitting at 0. If I scroll down we can see that hey, we have a little bit of capacity requirements sitting down here. And then if I come further down, we could see, hey, this resource it does have capacity requirements, and the red lines indicate that I am over capacity. So what I can do from this point is then come here, click on settings general, and you can see in my case, the hierarchy ID, popped in here. And I'm just going to say, okay, you know what show me the capacity, the requirements only at this point. I mean ideally we’d look at two but I want to show the fact that just by turning this on I'm going to do a green check and we can see that, all the requirements capacity required is now sitting up here in the superior. Of course, everything is red because of the fact that we did not turn on the indicator for available capacity. So of course, all entries are over capacity of each week. So what I'm going to do is come back up here and I'm going to come back and let's go back to settings, general, I'm going to turn on the accumulation of capacity. This is the available capacity now we're looking at, I'm going to green check, and you can see that, suddenly everything is white. So the available capacity for the superiors, 32 hours for the first week because of the fact that we got 16 hours coming from packing line 1. And if I come into parking line 2, we expect to see 16 hours also. So you can see, look, still looking at the individual resources, I'm over capacity. But looking at it from a superior perspective or hierarchy perspective, I have more than sufficient capacity week after week. So this tells me quickly that I can move production from one line to the next. Hey, welcome back. In this demo, we covered. What capacity evaluation looks like when we use a work center hierarchy solution in the capacity evaluation. With this approach, a finite production schedule is done to a specific work center. Hence, we would schedule to that specific work center rather than a generic one. Plus, you can specify downtime to a specific work center instead of reducing the number of individual capacities with that generic work center. Of course, the work center hierarchy would pick up all these business scenarios I just identified. Martin: Thank you, Eacliffe, that's actually brilliant. It's good to know that these kind of options exist, right? When it comes to how to set up work centers in SAP, it's not uncommon to implement a solution that works for many business scenarios, but when it comes to finite scheduling, for example, the production planner or operations requires a lower level of detail that may be required creating additional work centers. Regardless of the need for the additional work centers, using a work center hierarchy could be the compromise to bridge the gap. So folks, if you want to learn more about capacity planning, generally speaking, or in the hierarchies, there are other videos for you to check out as well. And of course, if you do have a particular question for us, feel free to submit it below.

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