Releasing Production Orders

The next step in the lifecycle of a production order is the order release. From a business perspective, the Bike Company releases orders that are ready for production execution. This means that, for example, all required components are available (→ availability checks) and the manufacturing resources have enough free capacity to execute the order(s) as planned (→ capacity evaluation and leveling). As you can see in the figure, order release is usually executed after availability checks and/or capacity evaluation were performed:

What happens during availability check? As discussed in chapter Business Process Overview: From Planning to Order Execution, you assemble components to manufacture a product. In our bike example, frames, wheels, chains, and so on, are assembled to the Special Bike. These components must be available at the production site. In a nutshell, the availability check in SAP S/4HANA compares the quantity of a component that is required by a production order to the, for example, available quantity of a component. If there is enough to be used, the availability check is positive and the production order can be executed. If there is a component shortage, the system informs the user accordingly and the production order cannot be executed. In this case, additional components must be procured or components from other, less important orders must be reallocated to this production order to be able to execute this order.

Note

For more information about missing parts and the availability check, refer to the SAP Help Portal.

What happens during capacity evaluation? Similar to component checks, the manufacturing resources, for example, an assembly line, must have enough free capacity so that an order operation can be executed on that resource. Capacity evaluation compares the capacity offered by a work center to the capacity required by an operation. If there is enough capacity, you can execute the order as planned. Otherwise, the production supervisor must reschedule orders that are currently allocated to this machine so that enough free capacity is available to execute the order in question.

After component availability checks and capacity evaluation is done, you release the order. It is only then that the subsequent processing steps, such as order printing, goods issue postings, confirmations, and goods receipt postings can be executed in the SAP S/4HANA system. From a technical point of view, releasing the order corresponds to a status change from created to released: Only after this status change, you can execute the subsequent processing steps.

If the SAP S/4HANA system is configured accordingly, the shop order papers are automatically printed upon order release. Shop order papers might be required to process an order if your company does not leverage a paperless production process, for example, using a manufacturing execution system. Some examples of shop order papers are:

• Time tickets or confirmation slips: With these documents, the shop floor personnel documents their efforts.
• Pull list or material withdrawal list: With these documents, the shop floor personnel are informed about the components that shall be assembled. Sometimes, warehouse personnel use these documents to execute material stating.
• Object overview: Using this list, shop floor personnel gets an overview over the entire order. From a business perspective, you would usually use this document as a process slip that accompanies the order through the entire production process.

Note

For more information about shop order papers, refer to the SAP Help Portal.

Finally, the lifecycle image shows the optional step, download to process control: You use this functionality in SAP S/4HANA if you execute your production process leveraging a manufacturing execution system (MES), for example, SAP Digital Manufacturing or any other third party MES. After order release, the order and related data is transferred to the MES that takes over execution from that point in time. During production execution, workers interact with the MES by confirming produced quantities, efforts, component consumptions, etc. Afterward, the MES transfers this data back to the SAP S/4HANA system (upload from process control) to ensure that data across systems is consistent.

The SAP S/4HANA system offers various options to release one or more production orders. From a business perspective, order or operation release informs your manufacturing personnel that the order/operation can now be executed as specified in the order. In our Bike Company, a released order for 100 Special Bikes triggers the production of the respective quantity. Review the following two figures for more information:

You must first decide whether you want to release an entire production order or individual operations of one order. If you release the entire order, the operations in the order are automatically released. If you release individual operations of one order, you must also respect the sequence of operations.

Usually, you release an entire order so that the shop floor personnel can smoothly execute a production order without additional system constraints. However, if you want to ensure that a subsequent operation can only be executed after a previous operation was completed, you release the individual operations of an order one after the other. From a business perspective, you typically choose the latter approach for complex orders (with many operations) that require that the sequence of operations is strictly followed.

After you decided whether you want to release entire orders or operations one after another, you must decide how to technically release the orders in the SAP S/4HANA system:

When individually releasing orders or operations, you manually release each object individually in the system. For example, if an express order is received from a customer and you immediately want to start production of the requested product, you manually create the express order and directly release it so that the requested product can be immediately produced.

Usually, you don't release orders or operations individually since a high manual effort is required. Instead, you select several orders and release them collectively, for example, using the Manage Production Orders app. To select production orders to be released, you can specify various selection criteria, for example, plant, production scheduler, release date, material, and so on. In our Bike Company example, all orders that are due for execution in the next week are automatically released by the Production Supervisor in the week prior to execution.

Note

In principle, this approach corresponds to the time-oriented conversion of planned orders which we discussed in a previous chapter.

You now know the different ways the Bike Company can release production orders. Let's see how this works in SAP S/4HANA. In the following demonstration, you will learn how to release individual and multiple operations of a production order. After that, you will see how to release individual and multiple orders. Finally, you will learn how to release a production order with a background job. To do so, you schedule an order release run.

Note

If you have access to a practice system, you can now perform exercise Release a Production Order.