Name: U2_L2_1.mp4
Uploaded: 2024-11-27
Duration: 478 s
Description: In this video you learn about the classic forecast-based planning method, the recommended alternative and how net requirements are calculated.

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Understanding the Net Requirements Calculation for Forecast-Based Planning

<div id="content"><p tabindex="0">Forecast-based planning is based on material consumption. Forecasting tools determine predicted consumption values based on historical values.</p><p tabindex="0">In traditional forecast-based planning, these forecast values are used as requirements values for the planning run. Since classic forecast-based planning will be discontinued as part of the <span class="nobreak">SAP S/4HANA</span> compatibility package by the end of 2025, SAP recommends using an alternative.</p><p tabindex="0">Listen to Julia, our virtual trainer, to learn more about forecast-based planning, the recommended alternative, and how net requirements are calculated.</p><div class="kalturaVideoLessonWrapper"><div aria-label="" class="kalturaVideoLessonContainer" data-testid="video" id="1_i3kttpos"></div></div><div class="parentsection"><div class="section"><p tabindex="0">The following interactive demo shows you how to maintain a material to be planned using the <strong>classic forecast-based planning</strong> procedure. You'll see how forecast values are transferred to MRP as forecast requirements. You'll carry out a planning run and analyze the results. You'll also learn about the splitting indicator, which allows you to split the forecast requirements into smaller periods.</p></div></div><div class="parentsection"><div class="section"><div class="simulationTile demo"><div class="content"><span class="simulationLabel">Demo</span><a href="https://education.hana.ondemand.com/education/pub/mmcp/index.html?show=project!PR_6A0440073916DFA4:uebung" target="blank" class="simulationButton">Watch Demo</a></div><div class="simulationImage"><img src="/illustrations/simulation-demo.svg" alt="In this demo, you learn how to maintain a material master record for classic forecast-based planning, display forecast requirements, run a planning run, and analyze the results." class="no-zoom"></div></div><div class="note"><div class="noteTitle"><span class="noteIcon"><img title="Note" src="/icons/note.svg"></span><span class="noteTitleText">Note</span></div><div class="noteBody">The forecast demand is reduced by each material withdrawal, so that the already realized part of the forecast demand is not planned again.</div></div></div></div><div class="parentsection"><div class="section"><p tabindex="0">The following interactive demo shows you how to maintain a material to be planned using the <strong>recommended alternative to classic forecast planning</strong>. You'll see how forecast values can be converted into planned independent requirements.</p><div class="simulationTile demo"><div class="content"><span class="simulationLabel">Demo</span><a href="https://education.hana.ondemand.com/education/pub/mmcp/index.html?show=project!PR_A70A6BF9A1656A8B:uebung" target="blank" class="simulationButton">Watch Demo</a></div><div class="simulationImage"><img src="/illustrations/simulation-demo.svg" alt="In this demo, you learn how to maintain a material master record for the recommended alternative to forecast-based planning, convert forecast values into planned independent requirements, run a planning run, and analyze the results." class="no-zoom"></div></div></div></div></div>

Net Requirements Calculation for Forecast-Based Planning

Using Consumption-Based Planning in SAP S/4HANA

<div>In this video you learn about the classic forecast-based planning method, the recommended alternative and how net requirements are calculated.</div>

U2_L2_1.mp4

Hi again. Now let's look at forecast-based planning. First, I will explain the prerequisites for planning a material using a forecast-based planning procedure, and then we will concentrate on the net requirements calculation. Let's start. What are the prerequisites for planning a material using a forecast-based planning procedure? First, you must assign an appropriate MRP type to a material that is to be planned using forecast-based planning. You remember that the MRP type selected in the material master record controls how this material is planned. We distinguish between traditional forecast-based planning and the new recommended alternative. For materials to be planned using the classic forecast-based planning, the standard MRP type is VV. Classic forecast-based planning, using MRP type VV, is part of the SAP S/4HANA compatibility pack that comes with limited usage rights. Classic forecast-based planning can be used until the compatibility pack license expires on December 31, 2025. To replace traditional forecast-based planning, SAP recommends using one of the MRP types for deterministic planning, such as PD, together with an appropriate strategy group and converting the forecast values into planned independent requirements. In addition to selecting the appropriate MRP type, The second prerequisite for planning a material based on forecasts is, of course, that forecast values exist. To run a forecast for a material, the forecast parameters for the material must be maintained in the material master record, and historical consumption values must exist for the material. Don't worry, we'll learn how to run a forecast in a future unit. Now that we've looked at the prerequisites for forecast-based planning, let's move on to the net requirements calculation. How does the system calculate net requirements in forecast-based planning? Again, we distinguish between traditional forecast-based planning and the new recommended alternative. In classic forecast-based planning, that is with MRP Type VV, the forecast values are the requirement values. Let's look at an example to illustrate this. Look at the available forecast values for our example material that we plan using classic forecast-based planning. We see that in this case the forecast periods are months. Let's focus on the forecast values for the next four months, skipping the current month of June. We have a forecast of 311 for July, 321 for August, 332 for September, and 342 for October. Now, if we open the stock requirements list for this material, for example, using the Check Material Coverage app, what do we see? The requirements for the next four months, which we are currently focusing on, are exactly the forecast values. In traditional forecast-based planning, forecast values are automatically adopted as demand values without any further action. In the new recommended procedure, which includes using an MRP type for deterministic planning such as PD, forecast values are not automatically adopted as demand values. values must be converted to planned independent requirements. Let's look at an example. We have run a forecast for our example material that we want to plan with MRP type PD. The forecast periods are months. Let's focus on the forecast values for the next four months, skipping the current month of October. We have a forecast of 347 for November, 344 for December, 341 for January, and 338 for February. Now, if we open the stock requirements list for this material, for example using the Manage Material Coverage app, we can see that the forecast values have not been automatically adopted as demand values. Forecast values must be copied as planned independent requirements. To do this, use the Schedule Copying Total Forecast Runs app. After we have copied the forecast values to planned independent requirements, we can see these planned independent requirements in the stock requirements list of our material. The planned independent requirements for the next four months, which we are currently focusing on exactly match the forecasted values. To calculate the net requirements, the system compares the available stock with the safety stock plus the requirements for each period. If the available stock does not cover the requirements, there is a shortage. There may be other demand elements, such as sales orders and reservations for a material, but they are not included in the net requirements calculation in classic forecast-based planning. In classic forecast-based planning, only the forecast requirements are included in the net requirements calculation. In the new recommended process, using an MRP type for demand-driven planning and planned independent requirements gives you more flexibility. You can use additional parameters such as the strategy group in the material master record to specify, for example, whether sales orders consume planned independent requirements or are not relevant to material requirements planning. Let's recap the definition of available stock that we covered earlier for reorder point planning, which still applies. The available stock for planning is the sum of the stock in the warehouse and the stock on order. The on-order stock consists of fixed receipt elements such as purchase orders, fixed planned orders, and fixed purchase requisitions. Let me just add that we are focusing on external procurement here. For materials produced internally, we should also include production orders. Procurement is triggered when the planning run detects a shortage. The quantity in the order proposal is calculated using the lot sizing procedure specified in in the material master record. We learned about both the classic forecast-based planning, which will soon be phased out, and the new alternative. This alternative method is actually a deterministic planning method. However, it also requires the execution of a forecast, the values of which are then copied as planned independent requirements. Continue with the course. We will provide some demos of old and new forecast-based planning before exploring lot size calculation.