Explaining Organizational Structure Integration

In this lesson, you will learn about:

Organizational Levels in Logistics.
Matching Defense Organizational Structure to Logistics Organizational Levels.

Org. Structure - Logistics Integration, Plants:

In classic SAP ERP, Plants were representing a manufacturing facility or a location that stocks, manages, plans and valuates Inventory.
Plant is a sub-division of company code, where detailed production planning activities are carried out.
Material valuation is typically done at plant level, however, in defense environment material valuation is often not differentiated per plant.
Plant is a customizing definition. Unlike other material organizational levels, it remains customizing also in DFPS. Customizing requires project team involvement and release control, hence it is not flexible.
A significant portion of a Material’s Master Data is managed on a Plant level. Therefore, the Material Record must be extended to all the plants it is used in.

Org. Structure - Logistics Integration, Storage Locations:

A plant can be subdivided into storage locations, allowing stocks of materials to be broken down according to predefined criteria (for example, location and materials planning aspects).
The Storage Location is an organizational unit allowing the differentiation of material stocks within a plant.
A material can be stored at several storage locations within a plant. To store data specific to each storage location, you must extend a material master record for each storage location.
In the SAP S/4HANA system, Storage Locations do NOT store planning information (for example reorder points).

In a military implementation, storage locations can represent actual warehouses in logistic supply centers, wartime storages of weapons and vehicles, deployed labs or even frigates along with their carry-on-board inventory.

MRP Areas

MRP Areas,Introduction:

MRP Areas were originally created for differentiation of Logistical Planning (MRP). The MRP area represents an organizational level for which material requirements planning is carried out independently.
MRP Areas consist of Storage Locations.
All Plants are referred to as MRP Areas as well.

The image is a hierarchical diagram showing the structure of a Plant organization. The Plant is divided into two MRP Areas, each containing multiple SLOCs.

D&S Promotes usage of MRP Areas:

MRP Areas are the integration points between Organizational and Logistical Structure. They are assigned to Force Elements.
MRP Areas differentiate between Stocks and Provisions (and Infrastructure).
MRP Areas in D&S are named according to a naming convention. For now, there is no "legal" way to bypass it.
MRP Areas in D&S are data, not Customizing!

MRP Area is a logistics level that was introduced at a later stage than Plants. Similarly to Plants, it carries a material planning role; however, unlike plants, it lacks a material valuation meaning.

In material master, one can see that the MRP views can be defined on either Plant or MRP area level, but the Accounting view is attributed to a plant only.

In D&S, the naming convention for MRP Areas is: _S suffix for Stocks, _P suffix for Provisions, and _R suffix for Infrastructure.

The image shows a force element management interface. It displays information about a 2nd Infantry Battalion, including its logistics data, provisions, and infrastructure. The interface is divided into sections for the plant, storage locations, and MRP areas, each with relevant details.

Plants and storage locations have to be assigned to each force element relevant to Inventory Management. Inventory Management distinguishes between stock elements (planned by Flexible Material Planning Objects) and provisions (material packages).

To enable a FMPO model to be planned, material masters have to be created for the relevant storage locations.

In Stocks, the minimum assignment is a Storage Location. The Stock Element of a Force Element may be a complete MRO area or a Storage Location belonging to the MRP Area of a superior Force Element.

The image depicts a force element management system. It shows two force elements, 1234 and 2345, each with stock, provision, and infrastructure elements. The image also includes information about assigning storage locations to force element subordinates, and that stock elements are accountable if they have their own MRP area.

A Stock storage location enables authorized-actual comparison for the Force Element. As such, it does not need to represent a physical storage. A platoon of tanks may be lacking any storage facility, but its tanks are still in a storage location representing the platoon. Otherwise, an Authorized-Actual comparison on the platoon level would not be possible. For this reason, DFPS distinguishes between the planning level of an MRP Area, assigned to a higher Force Element and the capability to assign individual Storage Locations from the MRP Area to a subordinate force element.

The image shows a force element management interface for a 2nd Infantry Battalion. It displays information about the stock, provisions, and infrastructure elements of the force element. The interface is divided into sections for the plant, storage locations, and MRP areas, each with relevant details.

In DFPS, for Provisions, the minimum assignment to a Force Element was an MRP Area. This led to designs where the logistic elements (Such as a Battalion's Supply Activity) owned a Provisions MRP Area, while the Battalion itself and the subordinate companies had no Provisions Element. This was changed in D&S, and it is now possible to allocate a single provisions storage location to a Force Element.

The image shows a force element management interface. It explains that in D&S, a force element can be assigned to a complete Provisions MRP area or to a single Storage Location from an MRP Area owned by a superior Force Element. It also states that multiple Storage Locations can be defined in a Provisions MRP Area, and some of these can be associated as default locations per External Material Group (Class of Supply).The image also includes a photograph of a worker in a warehouse setting.

Multiple storage locations per MRP area are possible, but associating individual storage locations to subordinate force elements is not allowed in DFPS. Provisions MRP areas represent physical storages of materials.

The image illustrates the management of support dependencies between units as organizational relationships in a defense solution. It explains that supply relationships involve defaulting the internal supplier unit based on the requesting unit and external commodity groups. Changes can be made in real-time, and the logistics processes are routed based on the current support structure. The image also includes visual representations of the organizational relationships and supply units.

Support relationships between units identify logistics (as opposed to command and control) responsibilities. They are flexible by the minute. On the supply side, they determine the default supplier by a class of supply.

D&S manages the Support Relationships in a new Assignment Framework, instead of the DFPS FORCER Framework. Therefore, a data migration (or re-creation) is necessary when migrating from DFPS to D&S.

On top of Supply Relationships, Support Relationships also include Maintenance Relationships. Maintenance Relationships are further explained in the unit Plant Maintenance Integration.

Storage Locations

In SAP S/4HANA, the storage location carries no MRP information in the Material Master. Subsequently, MRP Live does not support Storage Location MRP.