Modeling Sourcing Rules

Objective

After completing this lesson, you will be able to model sourcing rules and quotas

Supply Chain Network for Product T-F3##

Sourcing Rules or Quotas

Sourcing rules define how a demand for customer or at a location must be satisfied.

SAP Integrated Business Planning (IBP) for Supply Chain distinguishes between sourcing rules for the following types:

  • Customer demand (C-rule)

  • Transportation (T-rule)

  • Production (P-rule)

  • Unspecified (U-rule)

Customer Source (C-Rule)

The customer sourcing rule (C-rule) defines from which location (distribution center, plant, or supplier) of the supply network a customer demand must be satisfied in what percentage.

Customer sourcing can be maintained as time-dependent or time-independent.

Transportation Source (T-Rule)

To plan supply through stock transfer from another location, one must specify a suitable transport sourcing rule (T-rule).

Transport sourcing can be maintained as time-dependent or time-independent.

Production Source (P-Rule)

Another way to satisfy a demand is to manufacture the required product at the given location.

The meaning of a production sourcing rule (P-rule) is that product is produced at the location where the demand for product exists.

Production rule can include BOMs and production resources.

Unspecified Source (U-Rule)

The unspecified sourcing rule (U-rule) is specified when the source of supply to meet the demand is not required to be modeled explicitly.

If, for instance, the supply network terminates at a location product where components are purchased, and the supply chain of the supplier should not be taken into account, one needs sourcing rules indicating the planning algorithms to stop the network propagation but to make supply available. This is the task of un-specified sourcing.

U-sources do not have a sourcing quota. There can only be one U-rule per product location.

Compound Master Data Types Supporting Sourcing

Compound master data types include customer source (SOURCECUSTOMER) and location source (SOURCELOCATION).

Customer Source

Customer source specifies the locations and quotas the customer product can come from and the lead time.

It is composed of 3 simple Master Data Types (Product, Location and Customer) and has 3 root attributes.

Among other attributes is CRATIO - Customer Sourcing Ratio. CRATIO is Quota. It has a value between 0 and 1. This number has to sum up to 1 when you group by CUSTID PRDID.

C-Ratio can be modeled as time dependent by setting the Time-Series indicator as X.

C-Ratio can also be modeled as time-independent.

Location Source

Location source describes how a product is sourced for a location by a transport from another location (the ship-from locations).It includes the lead time and lot-size information.

It is composed of 3 simple Master Data Types (Product, Location and Location From) and has 3 root attributes.

Location Sourcing Ratio or Transportation lanes can be modeled as time-dependent by setting the Time-Series indicator as X.

Location sources or Transportation lanes can also be modeled as time-independent, location to ship-to location.

Lead times are specified as integers, which represent multiples of planning periods. This is the most granular period defined in the Time-Profile used by the Planning Area.

Reference Master Data Types Supporting Sourcing

In addition to Simple and Compound master data types, IBP also allows for Reference master data. Reference master data types that support sourcing include ship-from location (LOCATIONFR) and ship-to location (LOCATIONTO).

Ship-From Location

Ship-from locations are locations that are used as the source location for transports between locations (for example, stock transfer from a plant to a distribution center). Ship-from locations are modeled as a reference master data type of locations, meaning that data does not get loaded for this master data type and can't be edited in SAP IBP, add-in for Microsoft Excel.

Ship-To Location

Ship-to locations are locations that are used as the target location for transports between locations. Ship-to locations are modeled as a reference master data type of locations.

Ship-to locations are required if the key figures that are to be used depend on ship-to location and location, as opposed to location and ship-from location. These two types of key figures are mirrors of each other.

Demonstration: How to Model Sourcing Rules

Model Sourcing Rules

Task 1: Display the C-Rules for Your Subnetwork

Task 2: Display the C-Rule Data

To become familiar with the supply chain model you will use in class, display the data for C-rules in the SAP IBP, add-in for Microsoft Excel.

Steps

  1. First display the results of the planning run using your planning view T## Supply Planning, which you saved as a Favorite, and the DC to Customer tab.

    1. In the SAP IBP, add-in for Microsoft Excel, open your Supply Planning favorite.

    2. Choose the DC to Customer tab.

    3. Use this information to answer the following questions.

  3. To see why this demand is being sourced from this location, display the Customer Sourcing for T-F2##.

    1. In the Master Data section, choose Favorites → Sourcing Rules.

    2. Filter the list for Product ID T-F2##.

Task 3: Create Additional C-Rules and Change the Existing C-Rule.

Steps

  1. To source the product from an additional locations, create a new sourcing rule using Edit Master Data Workbook functionality and your previously created Master Data Favorite. Use the following values:

    FieldValues
    Customer ID2400H_##
    Location ID1000
    Product IDT-F2##
    Customer Sourcing Ratio.5
    Customer Transportation Lead Time1
    Ratio Time Series IndicatorLeave blank

    1. If your Master Data Favorite from the previous exercise is still open, you can directly edit.

    2. Starting from a blank Excel screen, choose within the Master Data Workbook section Create →

    3. Select Master Data Type:Customer Source, and select OK.

    4. Enter the values from the table and choose Save Changes.

  2. Change the Customer Sourcing Ratio for location 2400 so that the sum is 1.

    1. Filter the view for Product ID = T-F2##.

    2. The records for that product, including the one that you entered in step 1 are displayed. Change the Customer Sourcing Ratio to .5 for location 2400 so all ratios sum to 1 for this product. Choose Save Changes.

Task 4: Display the T-Rules for Your Subnetwork

To become familiar with the structure of the SAPIBP1 standard delivered planning area, display the master data types used for location sourcing in the SAP IBP, add-in for Microsoft Excel.

Steps

  1. In the SAP IBP, add-in for Microsoft Excel, display the location source (SOURCELOCATION) compound master data type. Note the attributes that are assigned.

    1. In the Master Data section, choose Master Data Workbook → Create.

    2. In the Master Data Type drop-down, choose Location Source and select OK.

    3. View the attributes and the key attributes that are assigned.

  2. In the SAP IBP, add-in for Microsoft Excel, display the ship-from location (LOCATIONFR) reference master data type. Note the attributes that are assigned and note their references.

    1. In the Master Data section, choose Master Data Workbook → Edit.

    2. In the Master Data Type drop-down, choose Location From and select OK.

    3. View the attributes and the key attributes that are assigned.

  3. In the SAP IBP, add-in for Microsoft Excel, display the ship-to location (LOCATIONTO) reference master data type. Note the attributes that are assigned and note their references.

    1. In the Master Data section, choose Master Data Workbook → Edit.

    2. In the Master Data Type drop-down, choose Location To and choose OK.

    3. View the attributes and the key attributes that are assigned.

Task 5: Display the T-Rule Data

To become familiar with the supply chain model you will use in class, display the T-rule in the SAP IBP, add-in for Microsoft Excel.

Steps

  1. First, display the results of the transports in planning run in the SAP IBP, add-in for Microsoft Excel using your Supply Planning Favorite and the Transportation tab.

    1. In the SAP IBP, add-in for Microsoft Excel, open your Supply Planning favorite.

    2. Choose the Transportation tab.

    3. Use this information to answer the following questions:

  3. To see why this demand is being sourced from this location, display the Location Sourcing for T-F2##.

    1. In the Master Data Workbook section, choose Create → Location Source.

    2. On that tab filter for Product ID T-F2## and Location ID 2400.

Task 6: Create Additional T-Rules and Change the Existing T-Rule

Steps

  1. To source the product from an additional location, create a sourcing rule using Edit Master Data Workbook functionality and the following values:

    FieldValue
    Location ID2400
    Product IDT-F2##
    Ship-From Location ID2300
    Lead Time2
    Location Sourcing Ratio.8

    1. Starting from a blank Excel screen, choose within theMaster Data Workbook section Create → Location Source, and select OK.

    2. Enter the values from the table and choose Save Data.

  2. Change the Location Sourcing Ratio for Ship-From Location 2210 to .2. Ensure that the sum is 1.

    1. On the Location Source tab, filter for Product ID T-F2## and Location ID 2400.

    2. The record you entered previously is displayed. Change the Location Sourcing Ratio to .2 for Ship-From Location 2210 so that all ratios sum to 1 for this product-location combination. Choose Save Changes.

Task 7: Refresh Your Network Visualization

In order to see how this change in Master Data has affected your supply chain, return to your dashboard and refresh the view.

Steps

  1. Using the Web UI, refresh your dashboard Supply Planning to see how the master data changes you entered affected your supply chain.

    1. If your dashboard is currently open, select the refresh icon otherwise perform the next step.

    2. In the Web UI, in the General Planner section, choose the Dashboard Advanced tile.

    3. Select your Supply Planning dashboard from the list and choose the refresh icon.

    4. Analyze how the supply chain has changed. You should now see the new sourcing rule that you created. Location 2400 now has 2 options for sourcing demand of TF2##, from location 2210 and location 2300.

    5. Leave your dashboard open and return to the Excel UI.

Task 8: Execute a Planning Run and Check Your Sourcing

Steps

  1. In the SAP IBP, add-in for Microsoft Excel, use the S&OP operator to run planning again. Check the sourcing results.

    1. In Microsoft Excel, ensure that you are on the SAP IBP tab. In the Application Jobs section, choose S&OP Operator → Run.

    2. Choose Time-Series-Based Supply Planning Heuristic and choose Next.

    3. You can also select a reason code and enter a comment.

    4. Choose Run.

    5. On the pop-up the status of the job will be displayed. To review the logs select Navigate to Status, to close the Pop-up select OK. To review the logs later, choose S&OP Operator → Status.

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

  2. Refresh your planning view and check the results for Customer Receipts.

    1. Open your favorite T## Supply Planning and refresh the data on the DC to Customer tab.

    2. You should now have half demand for customer 2400H_##, sourced from Location 1000, and half from 2400 according to the quotas of .5, .5, respectively.

    Note

    Consider that you have maintained in Task 3, Nr.1 a customer transportation lead time of 1. The Consensus Demand of, for example,1000 for customer 2400H_## in a specific calendar week leads to a Dependent Customer Demand for location 2400 of 500 in the same calendar week, but due to the customer transportation lead time setting to a Dependent Customer Demand for location 1000 of 500 in the previous calendar week.

  3. Refresh your Transportation View. Ensure that the correct quantities are being planned from each location.

    1. In your Supply Planning favorite, select the Transportation tab.

    2. Ensure that you have a quantity planned from 2300 to 2400 and from 2210 to 2400, while supply of 2210 is being planned from 1000.

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