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Introducing Scheduling Agreements in SAP S/4HANA

Objective

After completing this lesson, you will be able to explain the usage of scheduling agreements.

Working with Scheduling Agreements

A scheduling agreement is a long-term agreement with a supplier covering the supply of materials subject to predetermined conditions, which are valid for a defined period and a defined total purchase quantity.

You can use scheduling agreements with or without release documentation. This is controlled in Customizing through an indicator when you define the document type for scheduling agreements.

For scheduling agreements without release documentation, you can use the LP document type.

For scheduling agreements with release documentation, you can use the LPA document type.

Introduction to Scheduling Agreements

You can create scheduling agreements either with or without reference to one of the following:

An outline agreement requisition
A request for quotation
Another scheduling agreement
A centrally agreed contract.

When you create a scheduling agreement with reference to a centrally agreed contract, it is possible to use centrally negotiated prices.

A flowchart illustrating the procurement and contract management process, including steps such as requisition, RFQ, contract, and purchase order, with item categories and accounting assignments.

Creating Scheduling Agreements

Scheduling agreements are always plant-specific. Item categories M (material unknown) and W (material group) are not permitted. For the subcontracting item category, you can separately enter the material components to be provided for each delivery date.

Conditions may apply for the whole validity period of the scheduling agreement. If you use a document type that permits time-dependent conditions, you can also enter conditions for multiple validity periods.

If you have created the scheduling agreement item with reference to a centrally agreed contract, the conditions in the scheduling agreement should not be changed. This is because the system always refers to the current conditions of the central contract. Price control is set so that the conditions are always calculated at the time of goods receipt.

You can also create scheduling agreement items for materials without material master records. Costs incurred can be distributed among different controlling objects through the account assignment. In contrast to contracts, you are not allowed to use the U (unknown) account assignment category in scheduling agreements.

The total quantity of material to be delivered specified in the scheduling agreement item is split into a number of partial quantities with individual delivery dates in the delivery schedule lines. Delivery schedule lines can be created manually with or without reference to a purchase requisition. Delivery schedules can also be created automatically by material requirements planning (MRP).

You can issue scheduling agreement releases notifying the supplier that they are to deliver the required material on the scheduled dates. You can use scheduling agreements with or without release documentation. This is determined through the document type.

Hint

Goods receipts for scheduling agreements can be posted prior to the schedule line date only if you are working with confirmations or if there is an unlimited over-delivery tolerance.

Scheduling Agreement with/without Release Document

While using scheduling agreements (SA), you have the option to work with or without release documentation. The following table outlines the details of scheduling agreements, both with and without release documentation.

Without release documentation	With release documentation
The delivery schedule lines are official and are sent to the supplier exactly as they are saved in the system.	If you use scheduling agreements with release documentation, the delivery schedule lines are not transmitted directly to the supplier.
The system does not keep detailed records of the releases sent to the supplier. Therefore, for scheduling agreements without release documentation, the message control should be configured to immediately notify the supplier of any changes to the delivery schedule in the system.	Initially, the lines of the delivery schedule stored in the system for a scheduling agreement with release documentation (LPA) are for internal information only.
All open scheduling agreements are consistently communicated.	A message informing the supplier of your material requirements cannot be transmitted to the supplier until you explicitly create an SA release, that is, a forecast (FRC) or Just-in-Time (JIT) delivery schedule. Through this process, you can change the way the schedule lines are represented. With the release documentation, you can display the SA releases (delivery schedules) transmitted to a supplier over a certain period at any time. This enables you to trace precisely when you sent which information to the supplier.

Automatic Creation of Scheduling Agreement Schedule Lines

When the volume of transactions is large and the degree of repetition (repetitive manufacturing) is high, it is preferable to automatically generate scheduling agreement delivery schedule lines.

You can automatically generate scheduling agreement delivery schedule lines through MRP if you complete the following prerequisites:

Set the F (External procurement) procurement indicator in the MRP data of the material master record. The exception is when you are working with quota arrangements. In this case, it is sufficient to define external procurement for a source in the quota arrangement item.
Allow automatic scheduling agreement delivery schedules in the planning run. The SA Deliv. Sched. Lines indicator sets the timeframe for which the scheduling agreement delivery schedule is to be generated.

A source list is only necessary if you have more than one valid scheduling agreement for a material in combination with the same plant and you want to define your own priority.

With MRP live, the system always creates schedule lines if a scheduling agreement exists for the material.

A diagram illustrating the ‘Automatic Creation of Scheduling Agreement Schedule Lines’ process, showing steps involving purchasing, material master record, and MRP run, with schedule lines showing quantities and dates.

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