Key Capabilities

In this section, we are introducing an overview of the capabilities of order-based planning.

More details can be found in subsequent chapters. We will also be making use of some of these capabilities in the exercises.

Demands are pegged to supply. You can influence the pegging of fixed supply elements by selecting the pegging strategy of the segment the demands that consume them are in. You can set the pegging strategy when creating or editing a demand prioritization segment in the Planning Run Profiles app. The following pegging strategies are available:

Prefer just-in-time supply

This is the standard behavior of the planning engine. The handling of a fixed supply of this pegging strategy has the following characteristics:

• If available fixed supply with which demand can be fulfilled on time is used. If there are multiple fixed supply elements available to fulfill the demand on time, the one closest to the requested date is pegged.
• If no fixed supply is available, new planned supply like planned orders and purchase requisitions is created as late as possible.

Prefer stable supply

The handling of a fixed supply of this pegging strategy has the following characteristics:

• If available fixed supply with which demand can be fulfilled on time is used. If there are multiple fixed supply elements available to fulfill the demand on time, the earliest is pegged.
• If no fixed supply is available, new planned supply like planned orders and purchase requisitions is created as late as possible.

You should only use the Prefer stable supply option for short horizons. Define the segment condition in such a way that only demands within - for example, the next two weeks are included. Following this pegging strategy, you can lock up a lot of capital in your locations and can also reduce the service level because supply is allocated to high priority demands in the far future.

A gating factor is anything that prevents you from fulfilling an order on time, for example, insufficient stock or manufacturing capacity. In order-based planning, the planning runs calculate gating factors and update them for the planned scope.

By familiarizing yourself with gating factors, you can develop an increased understanding of your order network. This helps you overcome any immediate gating factors and can also provide you with some ideas on how to update your supply plan so those gating factors do not arise again in the future.

The concepts of What-If Analysis in Order-Based are similar to Time-Series Based Applications. However, there are some differences that we will explore in subsequent chapters.

With the Simulate Sales Order, functionality offered in the Projected Stock app, you can simulate a sales order to check if you can achieve an acceptable confirmation percentage. Based on the results you get, you can efficiently respond to any changes or requests from a customer for order fulfillment.

Only Time-Series Key Figures can be promoted from scenario to base version, and from a planning version to a base version.

Sales orders cannot be promoted from scenario to base version nor can sales orders be copied from a planning version to a base version.

Similar to Time-Series based applications, the results can be viewed in the Excel Add-In. For order-based planning, there are additional Web UI Apps available for the planner to review the planning results. We will address that functionality in next chapters and exercises.

Alerts and Dashboard functionality is the same as Time-Series Based Application.

In this section, we provide an overview of the additional capabilities of order-based planning.

More details are provided in subsequent chapters. We will make use of some of these capabilities in our exercises as well.

With the View Confirmations app, you can check the confirmation status of a sales order after a planning run. You can analyze the demand and simulate changes to find out if the confirmation status of a sales order or sales order item can be improved.

The app displays the sales order item details and information on their confirmation status in a table. This includes the following:

• Confirmation percentage details such as on-time, delayed, and unconfirmed
• A visual representation of the confirmation status for the following statuses:
  • Confirmed
  • Confirmed with Delay
  • Partially Confirmed
  • Partially Confirmed with Delay
  • Unconfirmed

• Gating factors that are blocking the supply chain, that is, the constraints that do not allow confirmation of the sales order item for the requested date and quantity
• You can also see schedule line details for a particular sales order item by selecting a row in the table

You can use the Projected Stock app to see if demand outweighs supply at any point in the network. This can happen if the projected stock levels of a certain material fall below zero, or simply below a safety stock level that your company has specified. Using this app, you can keep track of any potential stock issues that might arise, and then resolve the problem before it even occurs.

On the Stock Projection tab, you can make manual changes to certain supply elements. Initially, you make changes in simulation mode to check their effect on stock levels. If you are satisfied with the outcome, you can then save the changes to your version.

As discussed in Supply Planning with Allocation Creation Run section, Gating factors that give you root cause analysis of why demands could not be fulfilled or why demands are delayed could also be used for further analysis.