Describing Other Parameters for the Heuristic

Objective

After completing this lesson, you will be able to identify and describe the parameters of the planning operator

Supply Planning Parameters

The table, Supply Planning Parameters, describes some of the parameters of the planning operator. Note that new parameters are being introduced with quarterly releases of SAP Integrated Business Planning (SAP IBP).

Supply Planning Parameters

ParameterDescription
HEURISTIC TYPE

Infinite Without Shortages, Supply Propagation or Finite Heuristic.

ALLOWED QUOTA DEVIATION

Allows ratio totals to be plus or minus deviation during check.

CHECK QUOTAS

Specifies whether the planning algorithm performs the quota checks and what happens if it detects inconsistent quotas.

INCLUDE ZEROS IN QUOTA CHECK

Specifies how the planning algorithm handles a total quota of zero percent.

NORMALIZE QUOTAS

Sets consistent quotas for all sources of supply.

SOURCE OF SUPPLY VALIDITY

Activates validity settings for sources of supply.

INITIALIZE LEAD TIME HORIZON OF TRANSPORTS

Deletes all supply key figures even within the lead time horizon during the planning run.

INITIALIZE LEAD TIME HORIZON OF CUSTOMER RECEIPTS

Deletes the values in the key figures Customer Supply and Customer Receipts within the lead time horizon of the customer sources of supply prior to each planning run.

COMPUTE EXPECTED SUPPLY

Ignores adjusted key figure values in the planning run.

BALANCE RECEIPTS

Overrides ratios to plan under and over coverage situations caused by adjusted key figure values or minimum values.

VALUE FOR INFINITE COVERAGE

Specifies the integer value to be returned in the coverage key figure to visualize infinite coverage.

CARRY OVER NEGATIVE PROJECTED STOCK

Specifies whether the heuristic carries over negative projected stock.

LIMITS FOR MESSAGES

Limits the number of messages that the planning operator (heuristic or optimizer) writes to a log for each message ID.

ADDITIONAL PARAMETERS

Reset Adjusted Key Figures — sets adjusted key figure values to null.

Allowed Quota Deviation

Note the following:

  • If the sum of all quotas is less than 100%, the algorithm does not consider the entire customer demand of a customer product or the entire net demand of a location product.

  • If the sum of all quotas is more than 100%, the algorithm considers more than the requested customer demand or net demand.

In general, both deviations are difficult to detect once a supply plan has been calculated. Therefore, we recommend that you set a low value for this parameter. The allowed value is in the range of 0 to 0.1. The maximum allowed deviation is therefore 10%. If you do not specify an allowed quota deviation, the default value of 0.001 (0.1%) applies. The sum of the quotas must therefore be within the range 100% +/- 0.1%.

Check Quotas

Specifies whether the planning algorithm performs quota checks and what happens if it detects inconsistent quotas.

If you activate the checks, you have the following options:

  • Stop with Error:

    If the algorithm detects inconsistent quotas, it terminates without calculating a supply plan and issues error messages.

  • Warning:

    If the algorithm detects inconsistent quotas, it continues to calculate the supply plan, but it issues warning messages.

Note

If the sum of the quotas does not equal 100%, the algorithm might not consider the entire demand for a location product or customer product (if the sum is smaller than 100%), or it might consider too much demand (if the sum is greater than 100%). It is important to bear this in mind, especially if the quota checks are switched off.

Caution

We recommend that you activate the checks and select Stop with Error. The other options (that is, not activating the checks or selecting Warning) are intended to be used only during the initial phase of an implementation project, that is, when quotas might not have not been defined yet or imported correctly into the system. The parameter values could also be used temporarily in a production system to allow the supply plan to be calculated despite inconsistent quotas - for example, to overcome inconsistent quotas for less important location products until these inconsistencies have been corrected.

Include Zeros in Quota Check

Specifies how the planning algorithm handles a total quota of zero percent.

If you activate this parameter, the algorithm regards a total quota of zero percent as inconsistent (as defined by the quota condition) and issues a warning, error, or no message according to how you have configured the Check Quotas parameter. If you do not activate this parameter, the algorithm ignores quotas of zero percent.

Normalize Quotas

Allows consistent quotas to be set for all sources of supply.

The configuration of quotas can be a complicated task, especially at the outset of an implementation project. To make this task easier, you can use this parameter to quickly set consistent quotas for all sources of supply.

You have the following options:

  • Equally:

    The planning algorithm calculates the quotas of all sources of supply connected with one customer product or one location product so that the following applies:

    • The quotas add up to exactly 100%.

    • The quotas are equivalent (for example, if a customer product has four alternative customer sources of supply, then the quota of each source is set to 25%, which corresponds to a key figure value of 0.25).

  • Proportionally:

    The planning algorithm calculates the quotas of all sources of supply connected with one customer product or one location product so that the following applies:

    • The quotas add up to exactly 100%.

    • Existing proportions of the quotas are kept. For example, if a customer product has two alternative customer sources of supply with quotas of 40% and 20%, then the quotas are set to 66.67% and to 33.33%.

External sources of supply are treated like customer, location, or production sources of supply, that is, their calculated normalized quota will have the same value as all other sources connected with a certain location product.

If you do not activate this parameter, the behavior defined by the other quota check parameters applies.

The benefits of activating this parameter are as follows:

  • The quota check, which is performed each time the planning algorithm is called, does not return any issues. Therefore, a planner can run the algorithm without having to complete the time-consuming task of populating all quotas consistently or with final values.

  • All sources of supply that are defined in the system are used to create a supply plan.

Note

If you activate this parameter (equally or proportionally), the planning algorithm temporarily overwrites all quotas with equally or proportionally distributed values, regardless of any values entered previously (for example, by the planner). The changed values are temporary, that is, they are not stored in the database when the planner saves the planning session.

Note

This parameter should be used only during the early stages of an implementation project. As soon as possible, and in time for go live, deactivate the parameter so that the entire handling of quotas, especially their import from another system, is checked.

Exclude Zeros During Quota Normalization

Specifies how quotas equal to zero percent (zero quotas) are handled during quota normalization.

If you do not activate this parameter, the quotas of sources of supply that are set to zero are included in the normalization process. For example, if a customer product has two alternative customer sources of supply with quotas of 0% and 20%, then the quota of each source of supply is set to 50% if Equally has been set for the quota normalization. If Proportionally has been set, the quotas are set to 0% and 100% because existing proportions are kept.

If you activate this parameter, the quotas of sources of supply that are set to zero are excluded from the normalization process. For example, if a customer product has two alternative customer sources of supply with quotas of 0% and 20%, then the quota of each source of supply is set to 0% and 100%, both for equal and proportional quota normalization.

Source of Supply Validity

Activates validity settings for sources of supply.

Select this parameter to activate source validity

If you select this parameter, source validity is activated, as defined using the following:

  • Master data types Customer Source Validity, Production Source Validity, and Location Source Validity (used to specify the validity of sources of supply for a range of time periods across the planning horizon)

  • Master data attributes CINVALID, PINVALID, and TINVALID (used to specify that a source of supply is invalid for the entire planning horizon; assigned to the source of supply)

Initialize Lead-Time Horizon of Transports

Initialize Lead-Time Horizon of Transports Not Selected

In the standard system, when a planner runs the planning algorithm, the algorithm always initializes all output key figures in all periods of the entire planning horizon specified by the planner. In other words, the algorithm deletes the previous supply plan by overwriting all output key figure values with zero. The only exception applies to the Transport Receipts and Transport Supply key figures. These key figures are not initialized in the lead-time horizon, which is the subset of periods at the start of the planning horizon in which demand for a product can be satisfied only by a transport that started in the past.

The planning algorithm determines the lead-time horizon based on the lead time for transportation between two locations that is defined in the relevant location source of supply (for example, a lead time of 3 periods, where the periods can be days, weeks, or months). This means that a transport starting at location L2 in period t arrives at its destination location L1 in period (t + T) where T is the lead time that is specified as a number of periods in the corresponding location source of supply. For example, if the lead time is 3 periods, a transport that starts in period 2 at L2 arrives at L1 in period 5 (period 2 plus the lead time of 3 periods). As a consequence, the demand at L1 in periods 1, 2, and 3 of the planning horizon can be satisfied only by transports that have already been scheduled to start at L2 in periods -2, -1, and 0 (that is, in the past, from the perspective of the planning horizon, which starts with period 1). The planning algorithm cannot plan any new transports to the ship-to location during these three periods (that is, during the lead-time horizon), because the shipment date would be in the past.

Initialize Lead-Time Horizon of Transports Selected

Initialize Lead-Time Horizon of Customer Receipts

Specifies whether the planning algorithm initializes the values in the key figures Customer Supply and Customer Receipts within the lead time horizon of the customer sources of supply prior to each planning run.

This parameter works in the same way for customer sources of supply as the parameter Initialize Lead-Time Horizon of Transports works for location sources of supply.

Compute Expected Supply

Planners of subnetworks can fix supply between subnetworks using Adjusted Transport Receipts and Inter-Subnetwork Transport Receipts.

If you activate this parameter, the planning algorithm does the following for all subnetworks selected for planning:

  • Ignores (but doesn't delete) the values in the receipt key figures (Transport Receipts, Adjusted Transport Receipts, and Inter-Subnetwork Transport Receipts)

  • Calculates exactly the receipts needed to satisfy the customer demand

  • Updates the value of key figure Inter-Subnetwork Transport Receipts with the calculated receipts

Balance Receipts

Specifies whether the planning algorithm balances receipts during planning.

Specifies whether the planning algorithm balances receipts during planning

If a user has defined adjusted or minimum key figures that constrain the receipts for one or more sources of supply, the algorithm may create a supply plan with over-supply or insufficient supply. Although this situation cannot always be avoided, the algorithm can try to improve the supply plan by balancing receipts between all relevant sources of supply, regardless of type.

If you set adjusted key figure values or minimum key figure values, it may cause the heuristic to create a supply plan with oversupply or with insufficient supply.

This is because the heuristic adheres strictly to these adjusted or minimum key figure values and also to the specified quotas.

Excessive or Insufficient Supply

Illustration of Excessive or Insufficient Supply

Set the BALANCE RECEIPTS parameter.

The heuristic will still respect the adjusted key figure values and the minimum key figure values.

The heuristic will override the ratios and plan the appropriate supply quantities to eliminate any over or under coverages.

The algorithm does this by increasing or decreasing receipts from sources of supply that aren’t affected by adjusted or minimum key figure values. During receipts balancing, the algorithm tries to stay as close as possible to any specified quotas, but overrules them if necessary.

To avoid this, you can balance your receipts between different sources of supply to meet demand more precisely. The heuristic algorithms do this by increasing or decreasing receipts from sources of supply that aren’t affected by adjusted or minimum key figure values. During receipts balancing, the algorithms try to stay as close as possible to any specified quotas, but overrule them if necessary.

The heuristics can balance receipts only for customer products or location products for which more than one alternative source of supply is defined. Receipts balancing can be applied to all types of source of supply. If different types of sources of supply are connected to a customer or location product, supply is balanced across all sources, regardless of type.

The supply planning heuristic and supply propagation heuristic handle receipts balancing in the same way. Both algorithms balance demand during demand propagation so that expected supply is maximized. Provided there is enough supply, both heuristics return the same results. If there is insufficient supply, each heuristic behaves in accordance with how it would behave without receipts balancing: the supply planning heuristic resolves such situations with negative projected stock, whereas the supply propagation heuristic provides only the available supply. This explanation holds for all subsequent examples in this chapter.

Optimal Receipts with Receipts Balancing

To balance receipts, make sure the Balance Receipts parameter is activated for the heuristic T-S Based Supply Heuristic.

Receipts balancing isn’t relevant for the time-series based constrained supply planning with SAP IBP optimizer, which implicitly balances receipts because its sourcing decisions are influenced by costs and constraints rather than quotas.

Note

To exclude sources of supply with a quota of zero percent from receipts balancing, set the following master data attributes to 1 in the relevant master data object:

  • CBALANCERECEIPTSCOPE in the customer source of supply

  • TBALANCERECEIPTSCOPE in the location source of supply

  • PBALANCERECEIPTSCOPE in the production source of supply

If the attribute contains the default value 0 (or if the attribute is not assigned), the source of supply participates in receipts balancing regardless of whether its quota is equal to or greater than zero percent.

Illustration of Optimal Receipts with Receipts Balancing

Demonstration: How to Add Parameters to a Planning Operator

Add Parameters to a Planning Operator

Task 1: Create a New Planning Operator

Task 2: Enter a Value for Adjusted Transport Receipts

Steps

  1. Enter a value of 2,000 for Adjusted Transport Receipts for product ID T-F2##, location 2210 for receiving location 2400. To do so, go to the Transportation tab of your Supply Planning favorite, and enter it in the 5th period. (Note that your planning view time buckets should be set to "weeks" rather than "technical weeks.")

    1. In the SAP IBP, add-in for Microsoft Excel, on the SAP IBP tab in the Planning View section, choose Favorites → Supply Planning.

    2. On the Transportation tab, choose the key figure Adjusted Transport Receipts (you should have that key figure in the view, if not add it, using Edit View → Edit Planning View).

    3. For location ID 2400 and ship-from location ID 2210, enter 2,000 in the Adjusted Transport Receipts key figure in the 5th period that has a value in Transport Receipts.

    4. In the Data Input section choose Save Data.

Task 3: Execute a Planning Run Using Your New Operator

Steps

  1. In the SAP IBP, add-in for Microsoft Excel, first use the supply planning operator to run the Time Series Based Supply Planning Heuristic operator.

    1. In Microsoft Excel, ensure that you are on the SAP IBP tab and in the Applications Jobs section, choose SOP Operator → Run.

    2. Choose the Time Series Based Supply Planning Heuristic operator, and choose Run.

    3. When the job has completed, proceed to the next step.

  2. In your Supply Planning favorite, refresh your Transportation view add the Key Figure Projected Stock and record the results of the planning run for your Plant to DC Transports in the table below.

    Ship From Location IDLocation IDPeriod + 4Period + 5Period + 6Period + 7
    23002400    
    22102400    

    1. Choose Favorites → Supply Planning and choose the Transportation view.

    2. Choose Edit View → Edit Planning View and on the Key Figures tab, add the Key Figure Projected Stock.

    3. Choose OK.

    4. Record the values from the Key Figure Transport Receipts into your table.

  3. In the SAP IBP, add-in for Microsoft Excel, use the supply planning operator to run your BALANCE_RECEIPT_## operator. You may need to log off and back on before you pick up the change in configuration.

    1. In Microsoft Excel, ensure that you are on the SAP IBP tab and in the Application Jobs section, choose SOP Operator → Run.

    2. Choose your BALANCE_RECEIPT_## operator, and choose Run.

    3. When the job has completed, proceed to the next step.

  4. Refresh your Transportation view and record the results in the table below.

    Ship From Location IDLocation IDPeriod + 4Period + 5Period + 6Period + 7
    23002400    
    22102400    
    Projected Stock2400    

    1. Choose Favorites → Supply Planning and select the Transportation view.

    2. Choose Refresh.

Result

You will see a change in the projected stock for 2400.

Task 4: Delete the Values for Adjusted Transport Receipts

Steps

  1. Delete the values of 2000 for Adjusted Transport Receipts and corresponding Adjusted Transport Supply for location 2210 to receiving location, 2400 on the Transportation tab of your Supply Planning favorite.

    1. In the Microsoft Excel user interface, on the SAP IBP tab in the Planning View section, choose Favorites → Supply Planning.

    2. Choose Edit View → Edit Planning View.

    3. On the Transportation tab, check if you have the key figure Transport Supply Adj.

    4. Delete all the values in key figures Adjusted Transport Receipt, and Transport Supply Adjusted (created during the last planning run by the algorithm).

    5. In the Data Input section, choose Save Data.

  2. In the SAP IBP, add-in for Microsoft Excel, use the supply planning operator to run the Time Series Based Supply Planning Heuristic operator.

    1. In Microsoft Excel, ensure that you are on the SAP IBP tab and in the Application Jobs section, choose SOP Operator → Run.

    2. Choose the Time Series Based Supply Planning Heuristic operator, and choose Run.

    3. When the job has completed, proceed to the next step.

    4. Refresh your Transportation view to be sure the data was deleted and the planning situation is returned to the starting state.

Value for Infinite Coverage

Specifies the integer value to be returned in the Coverage key figure to visualize infinite coverage

Specifies the integer value to be returned in the Coverage key figure to visualize infinite coverage (that is, when Projected Stock covers more than the Dependent Demand of all future periods within the planning horizon).

The default integer value is 999999.999999. To improve legibility in Excel by using fewer digits, you can activate this parameter and set it to the required value (for example, 999.0). If you do not activate this parameter, the default integer value is used.

Carry Over Negative Projected Stock

Specifies whether the planning algorithm carries over negative projected stock.

Specifies whether the planning algorithm carries over negative projected stock

The algorithm generates a supply plan with negative projected stock if, for any reason, the supply from a location product is higher than its total receipts in a particular period, and there is not enough stock-on-hand from the previous period to settle the difference. Negative projected stock indicates that the affected location product has a problem, because it cannot satisfy its entire demand.

If there is negative projected stock in period t, the algorithm uses zero as the stock on-hand for period (t+1). This is the standard behavior. However, if you activate the parameter Carry Over Negative Projected Stock, the algorithm carries over this negative projected stock. That is, it uses its absolute value in period (t+1) while calculating the net demand of period (t+1), which increases this net demand.

Note

This parameter changes the behavior of all location products in the relevant planning area.

Without Carry Over Negative Projected Stock

The table, Without CARRY OVER NEGATIVE PROJECTED STOCK, shows the key figures when this parameter is not set.

Without CARRY OVER NEGATIVE PROJECTED STOCK

Key FigurePeriod 1Period 2Period 3Period 4
Dependent Demand40404040
Projected Inventory00-150000
Net Demand40404040
Total Receipts40254040
Adjusted ProductionN/A25N/AN/A
Supply40404040

With Carry Over Negative Projected Stock

Set the CARRY OVER NEGATIVE PROJECTED STOCK parameter.

Now the negative stock of previous periods will be carried over into the calculation for future periods.

The table, with CARRY OVER NEGATIVE PROJECTED STOCK, shows the key figures when this parameter is set.

With CARRY OVER NEGATIVE PROJECTED STOCK

Key FigurePeriod 1Period 2Period 3Period 4
Dependent Demand40404040
Projected Inventory00-150000
Net Demand40405540
Total Receipts40255540
Adjusted ProductionN/A25N/AN/A
Supply40404040

Limits for Messages

Enter a limit for a specific message ID by entering the message ID and the limit (Value field)

Additional Parameters

Setting up other parameters in that section is possible. Consulting with SAP Product Support is recommended for the complex requirements.

Adjusted Key Figures Handling Policy

If you assign this parameter to the planning profile and set it to RESET, the planning algorithm initializes all adjusted key figures before it does anything else. That is, it overwrites all periods of all adjusted key figures with a NULL value (where NULL is an empty string and therefore not the number zero).

In addition, if a user has selected one or more subnetworks for the planning session, the algorithm initializes the values in the Adjusted Transport key figure if both connected locations belong to the selected subnetworks (the same subnetwork or different subnetworks) or if the ship-to location is in one of the selected subnetworks.

Note

If you activate this parameter, the planning algorithm removes adjusted values in all adjusted key figures. These values cannot be restored after the planning session has been saved. Therefore, you should use this parameter only in exceptional cases and if you understand the impact of using it.

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