Analyzing SAP IBP response and supply business planning processes in order-based planning

Objective

After completing this lesson, you will be able to assess how SAP IBP's response and supply business planning processes enhance overall order-based planning efficiency and effectiveness.

Overview of SAP IBP for response and supply Business Planning Processes

The four main planning processes include Supply and Allocation Creation, Response Planning, Deployment Planning, and Transportation Load Building. Each of these planning processes can be executed by a planning run. Some customers execute deployment planning, or may just execute Supply and Allocation creation and pass on the allocations to either SAP APO GATP or SAP S/4Hana for advanced ATP. Order-Based Planning is very flexible, and a customer could use one of the processes or all four processes depending on business requirements.

Supply and Allocation creation generates Allocations. Allocations could be defined as a "cap" that sets how much product a customer could get in a certain time bucket. The additional requested quantity (over the threshold) spills over to the next period. This planning process also creates a regular supply plan along with the allocations.

During response planning, supply is created, and the allocations if set as a constraint are consumed. Moreover, this process creates sales order confirmations. If we have a material requirements date, and for some reason, if we cannot meet that date, we can show it as late or partially late, and using Real Time Integration (RTI) we can send the updated demand element back to ERP indicating that the sales order cannot be met fully on time, and here is the best availability date.

Deployment planning creates a short-term deployment plan, pushing or pulling product downstream depending upon the demand elements. Stock Transfer Requisitions (STRs) are changed to Deployed Stock Transfer Requisitions (DSTRs).

Transportation load building (TLB) enables grouping planned distribution receipts into optimized transportation loads and best uses the transportation equipment.

The process relies on the output of the Order-Based Planning: Transportation Load Building (with Profile) application job, also called the TLB run. The jobs use a cost-based load optimization algorithm that considers different equipment types and their upper limits in various units of measure to create transportation loads. The loads can then be reviewed and eventually fully re-planned if needed. Loads are integrated as multi-item requisitions to SAP ERP or SAP S/4HANA using Real-Time Integration.

An overview of each process is presented in this section.

An overview of the Operational Supply Planning Flow is presented in Figure below.

The image is a flowchart illustrating a supply planning process. It starts with inputs on the left, including Unconstrained Demand, Inventory Targets, Network Sourcing, Model Parameters, and Supplier Commits. These inputs feed into Supply Planning Algorithms, which consist of a Supply Planning Heuristic and a Supply Planning Optimizer. The algorithms consider network constraints, priorities, and relationships. The output is a Feasible Supply Plan, which includes an Order Level Granular Plan, Allocations for Available to Promise (ATP), Inventory Projection, Deployment and Loads, Sales Order Confirmations, and Constrained Demand. Additional elements include planner input, review, override, scenario comparison, simulation, intelligent alerting, and procedure playbooks.

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