Supply Planning
Demand explosion across the network
Supply planning is the generation of production and procurement proposals based on demand. Most straightforward case is using MRP in a make-to-stock environment. In this situation, the supply proposals generated by MRP basically follow demand and are converted into production and procurement orders in the nearby horizon. Restrictions in the supply chain or the fact that delivering from stock is not possible make the generation of supply more complex.
Make-to-order environment
In make-to-order or assemble-to-order environments, omitting the forecast in supply generating is not always the solution since this prevents a comprehensive capacity utilization picture and a complete forecast towards suppliers. Including the forecast in supply generation rises the need to check the ultimate independent demand related to production and procurement proposals before converting these into production and purchase orders. Proposals related to forecast should not be converted.
Straight forward demand explosion not always possible
Examples of restrictions in the supply chain are limited internal production capacities or a limited availability of purchased products. Or the requirement for a stable (flat) purchase plan over the horizon complicates supply planning. In these cases, using MRP for the generation of supply results in a lot of manual work from supply planners to deliver the desired supply plan. Instead, the use of an optimizer in supply plannin . g fits better, which can take several restrictions in the network into account when generating proposals. Another option would be to use MRP for supply planning and the scheduling solution of ePPDS in S/4HANA ® to generate a feasible production and procurement plan for the first part of the horizon
