Multi-Level Supply Planning Overview and Exercises

February, 2014

In IBP Sales and Operations Planning (S&OP), you can use a set of supply planning algorithms to compute a plan for
your supply chain network.

This section provides an overview of the algorithms used to calculate the Supply Plan for your Network. We look at
all steps involved along with detailed explanation of the key concepts and exercises to demonstrate the system
behaviour

Business Scenario modeled in the Training exercises

In this training we will use the Supply Chain Network for ACME company. This company has the supply chain
networks as illustrated above. There are 2 finished products sold to 2 customers supplied from the 2 Distribution
Centers. The DCs are sourced from two Manufacturing Plants. All the raw materials or components are procured
from one Supplier. 2 Resources are modeled at the manufacturing locations. The BOM is illustrated as below at the
2 manufacturing locations
O VE R VI E W OF K E Y C O N CE P TS

SAP Sales and Operations Planning offers set of planning algorithms to compute a complete plan for the supply
chain network comprising all planned material flows from plants and suppliers via distribution centers or other
intermediate locations to customers and comprising all production processes.

An arbitrarily deep network of supply chain relevant locations and production steps can be modeled and planned.
In order to calculate the plan the planning algorithms utilize master data such as sourcing rules or quotas,
resources, production sources (bill-of material), lead-times, lot-sizes, co-products etc. and input planning data
such as Consensus Demand, Inventory Target, Available Capacity etc

S&OP allows you to generate supply plan using two algorithms types: Heuristics and Optimization.

Heuristics
The heuristic algorithm supports the Unconstrained Demand and Supply Planning mode of the SCM Operator. For
planning using the Unconstrained Heuristic, resource capacities are not taken into account to compute supply. The
supply is computed based on the assumption that resource capacities are infinite, i.e. they are unlimited.
Resources might be overloaded, i.e. based on the resulting computed plan some resources might have a utilization
of more than 100%.

Unconstrained planning does not compute a feasible plan. Nevertheless, it might be beneficial to a planner as the
infinite plan reveals for each product how much capacity is required in order to fulfill all customer demand on
time. All resources having a utilization of more than 100% reveal the bottlenecks of the planner’s supply chain
network.

Besides resources there can be other constraints in the supply chain network, and these are also relevant for the
Uncontrained Demand and Supply Planning mode:

• Due to the fact that there are lead times, in some situations products or components cannot be
transported or procured on time to fulfill demand
 • In general ‘Adjusted’ key figures can be used to overwrite and fix the plan. This can be done for
production, for transports (between locations and from locations to customer) as well as for external
sources of supply. These are material constraints introduced by the user

The S&OP Unconstrained Demand and Supply Planning mode does not propagate constraints upstream. Rather it
creates a shortage for the location product where a constraint occurs, so that it becomes visible. This is aligned
with the idea of an unconstrained plan, which fulfills customer demand but shows the bottlenecks.

Optimization
The Optimization algorithm supports 2 modes of the SCM Operator; profit maximization and cost-minimization-
for-full-delivery modes.

The objective of the Optimizer is to minimize the total costs of the supply plan. Optimization is performed via a
transformation of the S&OP-model in to a mathematical model (Mixed Integer Linear Programming (MILP)-model).
The output is an optimal and feasible production, distribution and procurement plan for the entire supply chain
network taking into account the constraints.

The following constraints are considered:

• Minimum & Maximum lot-size

• Lead-time
• Maximum inventory
• Production and Handling Resource capacity
• “Interactive” manual adjustments (demand, customer & external receipts, production, transport)

In addition, the optimizer takes the following cost key figures as inputs:

 Price or Non-Delivery Cost Rate

 Production Cost (Fixed and per-unit rate)
 Transportation Cost (Fixed and per-unit rate)
 External Procurement Cost (Fixed and per-unit rate)
 Inventory holding cost (per-unit rate)
 Safety-stock violation cost (per-unit rate)
All supply planning algorithms use the following key figures as inputs:

 Consensus demand
 Inventory Target
 Stock on hand
 Customer sourcing ratio
 Location sourcing ratio
 Component Coefficient quantity, that is, quantity of component in a bill of material (BOM)
 Capacity consumption rate, that is, of products consuming a resource in a location
 Capacity supply or Available Capacity
 Output coefficient or Base Production Qty

The output of the Planning Algorithm run is stored in these Key Figures. Broadly these can be sub-classified as
Demand-Side and Supply-Side output Key Figures

Demand-Side Output Key Figures:

 Dependent Customer Demand

 Dependent Location Demand
 Dependent Production Demand
 Dependent Demand
 Net Demand
 Capacity Demand

Supply-Side Output Key Figures:

 Capacity Usage
 Customer Receipts
  Production Receipts
 External Receipts
 Transport Receipts
 Total Receipts
 Production Supply
 Total Supply
 Projected Inventory

The SCM Planning Operator using Heuristic or Optimization logic can be called in interactive mode (simulation) and
in batch mode (background jobs) .

Each time the Multi-Level Supply planning run is completed the computed results can be viewed in S&OP Excel UI .
All computations are performed on the most detailed level which means they are performed at the product
location level and not, for instance, on a product group, region or any other aggregation level. However, once the
results are available, the results can be viewed at any aggregation level.

REV IE W SU PP LY C H AI N MA S T ER D AT A
Now let’s walk together through and Review the Master Data used to model the Supply Chain Network for ACME
Company.

EX ERC ISE 1 A: P R O D U C T S
In a Supply Chain Network products are produced, transported and stored. The S&OP product ID corresponds to a
material number in ERP and a product number in APO.

Step 1: In the Excel UI, Click on the select Download icon in master data
Step 2: In the pop-up, select Product. Click OK
Step 3: In the excel tab review the downloaded data.

Note: Only the Product ID field is mandatory. It’s represented by the attribute PRDID. The other
fields & attributes are an example only.

Components are products that are used as inputs in production process. You can define a separate master data
type for components (with key attribute PRDFR)., which then comes with its own set of master data entries, or you
can reuse the entries already maintained as products by defining reference master data type. In the training
model we are using it is defined as reference master data.
EX ERC ISE 1 B: C U S T O M E R S
Products are sold to and shipped to customers. S&OP customer ID corresponds to customer number in ERP or
APO.

Step 1: In the Excel UI, Click on the select Download icon in master data
Step 2: In the pop-up, select Customer. Click OK
Step 3: In the excel tab review the downloaded data.

Note: only the Customer ID field is mandatory. It’s represented by the attribute CUSTID. The
other fields & attributes are an example only.

EX ERC ISE 1C : L O C A T I O N S
A location is often a physical place where products are stored, produced, shipped to or shipped from (via a
transport). The locations can be of type Distribution Centers, Manufacturing Plants. In S&OP suppliers can also be
modeled as locations.

Step 1: In the Excel UI, Click on the select Download icon in master data
Step 2: In the pop-up, select Product. Click OK
Step 3: In the excel tab review the downloaded data

Note: only the Location ID field is mandatory. It’s represented by the attribute LOCID. The other fields & attributes
are an example only.

There is also a Ship-From Location master data type with key attributes LOCFR. This can be defined as reference
data types referring to Location

EX ERC ISE 1 D : R E S O U R C E S
In S&OP Resource defines a means of production or handling in terms of capacity and requirements
S&OP on HANA offers two types of resources: production and handling resources.

Production resources model a production or assembly process. Their capacity is consumed per produced or
assembled unit of product.

Handling resources apply to all goods receipts at a location in the sense that each arriving unit of a product
consumes a certain capacity unit of the resource. This resource type is relevant for all receipts of the location
product, which are Transport, Production and External Receipts.

Resource in S&OP can be modeled as finite or infinite. Available Capacity or Capacity Supply is defined at Resource
Location level

Step 1: In the Excel UI, Click on the select Download icon in master data
Step 2: In the pop-up, select Resources. Click OK
Step 3: In the Pop-up select Resource Location. Click OK
Step 4: In the excel tab review the downloaded data

RESOURCE

Note: only the Resource ID field is mandatory. It’s represented by the attribute RESID. The other
field is an example only.

RESOURCELOCATION

 The Available Capacity is defined at ResourceLocation level.

 Capacity Supply can be modeled as Time-Independent or Time-Dependent. If “Capacity
Supply Is Time-Series” field is marked as ‘X’, then “Capacity Supply” Key figure is used.
 Constraint Type identifies whether the Resource is Finite or Infinite. If left blank it’s
infinite. ‘F’ is for Finite
EX ERC ISE 1 E: S O U R C I N G R U L E S O R Q U O T A S
Sourcing rules define how a demand for customer or at a certain location has to be satisfied. S&OP on HANA
distinguishes between sourcing rules for Customer demand (Customer Ratio /C-Rule) and for transportation
(Transportation Ratio / T-Rule) and production (P-Rule) and unspecified sources (U-Rule).

CUSTOMER SOURCE (C-Rule)

Defines from which location (distribution center, plant or supplier) of the supply network a customer demand has
to be satisfied and in what percentage.

The Customer ratio or Customer sourcing rules are maintained in Customer Source master data.

Step 1: In the Excel UI, Click on the select Download icon in master data
Step 2: In the pop-up, select Customer Source. Click OK
Step 3: In the excel tab review the downloaded data.

• Customer Sourcing Ratio can be modeled as time dependent by setting the Time-Series
indicator as ‘X’. For e.g Product2 and customer101 the ‘Customer Sourcing Ratio’ keyfigure is
used because this flag is set
• Customer Sourcing Ratio can also be modeled as time independent. For e.g Product1,and
customer 101. In this case the ratio comes from the customer source master data object
directly
• Lead times are defined for Customer Sourcing i.e. shipment from own Location to a
Customer. Lead times are specified in integer multiples of periods – the most granular period
defined in the Time-Profile used by the Planning Area

TRANSPORTATION SOURCE (T-Rule)

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

The Location ratio or transportation sourcing rules are maintained in Location Source table..

Step 1: In the Excel UI, Click on the select Download icon in master data
Step 2: In the pop-up, select Location Source. Click OK
Step 3: In the excel tab review the downloaded data.
 • Location Sourcing Ratio or Transportation lanes can be modeled as time-dependent by
setting the Time-Series indicator as ‘X’. In this case the location Sourcing Ratio key figure is
used.
• Location sources or Transportation lanes can also be modeled as time independent. In this
case the Location sourcing ratios are specified in the source location table by using ‘Location
Transport Ratio’ attribute
• In above example, each Product at the Distribution Centers DC101 and DC102 sources 50%
from each Manufacturing plant PLANT101 and PLANT102. The Components at each
manufacturing plant are 100% sourced from the supplier location SUP01.
• Lead times can also be defined for Transportation Sources i.e. for each product from ship-
from location to ship-to location.
• Lead times are specified as integers, which represent multiples of planning periods – the
most granular period defined in the Time-Profile used by the Planning Area

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 is that Product is produced at the location where the demand for Product exists.

Optionally, the production rule can also serve as a model a bill-of-material (BOM) which defines a set of
components or raw materials which are needed to produce or to assemble the “output product”. In addition
Production Resources can also be modeled. Now, let’s review the master data set-up for Production Sources.

The Production sourcing rule is maintained in Production Source table.

Step 1: In the Excel UI, Click on the select Download icon in master data
Step 2: In the pop-up, select Production Source. Click OK
Step 3: In the excel tab review the downloaded data.
 • Source Type field with value ‘P’ identifies that the product is manufactured at THE specified
location.
• The production Sourcing Ratio or P-Ratio can be modeled as time dependent by setting the
Time-Series indicator as ‘X’. In this case the PRODUCTIONRATIO key figure needs to be
loaded as it is used by the SCM heuristics.
• The Production Sourcing Ratio can also be modeled as time independent. In this case the
Location ratios are specified in the Production Source table directly.
• In our example, Production Ratio is modeled as time-independent and the P-Ratio is 1. Also,
100% of the demand for a product placed on the Plant is manufactured in-house

UNSPECIFIED SOURCE (U-Rule)

U sourcing rules are specified when the source of supply to meet the demand is not required to be modeled with
any detail.

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” stands for “unspecified”. The meaning of a U-rule is that the propagated Net Demand is available without
defining in detail where it comes from. It could come from a supplier (procurement) or also through in-house
production, which however in this case does not get modeled and is not tied to a resource constraint. Technically
unspecified sources are maintained together with the Production Source master data type in one table.

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

NOTE:

In the training exercises, so far we considered that for a specific location-product only one of these three sourcing
types is used to get supply. However, it is possible to mix multiple source types, which implies that one can specify
that the Net Demand should be distributed according to quotas between different sourcing types.

It would be possible, for instance, to source a Net Demand 30% from a Production Source (P-rule), 50% from a
Transportation Sourcing (T-rule) and the remaining 20% from a Unspecified Source (U-rule) meaning that 30% of
the Net Demand should be propagated to a production process, 50% to another location and 20% of the Net
Demand are assumed to be available without limitations – whatever real use case might be behind such a model.

It is also possible to combine multiple production and transportation sources for one location product. The sum of
ratios across all sources has to sum up to 100%. If a U rule is present, which does not have its own sourcing ratio it
is assumed to make up the difference to 100%.
EX ERC ISE 1F : P R O D U C T I O N A N D T R A N S P O R T A T I O N L O T -S I Z E S

Lot sizing allows to model production and transportation quantities per period to be set within limits and / or
according to a certain strategy.

The Following Lot-Sizing procedures are supported

Minimum Lot-Size:

Transportation and Production quantity cannot be lower than a minimum. If production or transport is triggered,
the quantity has to be equal or higher than the minimum lot size. Heuristic algorithm and optimizer will respect the
minimum lot size

Maximum Lot-Size

Maximum Lot-Size defines the maximum production or transportation quantity. Only optimizer respects the
Maximum lot size

Periodic Lot-Size

The system plans to produce the demand of N future successive periods, where the parameter N is called the
periods of coverage. Periodic Lot-Size is relevant for production only. Only infinite planning heuristic respects the
periodic lot-size. Optimizer computes the supply plan with the objective to minimize the specified costs.

The production Lot-Size rule is maintained in the Production Source master data

Step 1: In the Excel UI, Click on the select Download icon in master data
Step 2: In the pop-up, select Production Source. Click OK
Step 3: In the excel tab review the downloaded data.

Note:

If no values are specified for the minimum and maximum lot-size, lot-for-lot planning procedure is used

If a minimum and a periodic lot size is specified the system will plan to produce at least the quantity specified
by the minimum lot size.

If periodic lot size is defined in conjunction with a maximum lot size the optimizer will limit the periodic lot size
to the quantity specified by the maximum lot size, which can have the result that the demand of the N periods
might not be covered in one period.
Transportation Lot-Size is maintained in Source Location table

Step 1: In the Excel UI, Click on the select Download icon in master data
Step 2: In the pop-up, select Source Location. Click OK
Step 3: In the excel tab review the downloaded data.

Note:

If no values are specified for the minimum and maximum lot-size, lot-for-lot planning procedure is used

EX ERC ISE 1G : M U L T I - L E V E L B I L L O F M A T E R I A L
Multi-level BOM (Bill-Of-Material) refers to the capability of modeling multi-level production processes. For
example, finished product P is assembled out of component X and X itself is produced by consuming component Y.
This describes two levels of production. The number of levels is arbitrary, i.e. not limited.

Multi-level BOMs are modeled via the production sources. Production sources contain BOM information as well as
information about relevant resources, resource consumption rates, etc. Production Sources data is maintained in
SOURCEPRODUCTION, PRODUCTIONSOURCEITEM and PRODUCTIONRESOURCE table.

In this exercise we will review BOM data at Plant 101. BOM is maintained via ‘Production Source’ and ‘Production
Source Item’ tables

Step 1: In the Excel UI, Click on the select Download icon in master data
Step 2: In the pop-up, select Production Source. Click OK

Step 3: In the pop-up, select Production Source Item. Click OK

Step 4: In the excel tab review the downloaded data.

• Output coefficient defines the Base Production Qty of the produced product.
 • Component Coefficient defines the Qty per to produce the quantity defined in Output
coefficient.
• For example:
o To produce one unit of PRODUCT2 at PLANT101 requires 1 unit of COMPONENT1
and 2 units of COMPONENT3. The Source ID “PLANT101_PRODUCT2” field links the
2 tables together. This is an example of a Single Level BOM
• A Multi-Level BOM is modeled for Product1:

o Product 1 is produced by consuming Sub-Assembly and Component 1

o Sub-Assembly is produced by consuming Component 2

EX ERC ISE 1 H: C A P A C I T Y C O N S U M P T I O N R A T E S F O R P R O D U C T I O N R E S O U R C E S
This master data type describes resource consumption rate for production source.

Capacity Consumption Rates is maintained via Source Production and Production Resource table.

Step 1: In the Excel UI, Click on the select Download icon in master data
Step 2: In the pop-up, select ProductionResource. Click OK

Step 3: In the pop-up, select Production Resource. Click OK.

Step 4: In the excel tab review the downloaded data.
o Capacity Consumption: Defines how much capacity is consumed per unit of product
produced at a Location. This is specified for a production source. Different
production sources can have different resource consumption rates for the same
product in the same location.
o Capacity Consumption can be modeled as Time-independent or Time-dependent.
The Time-series flag is used to make this distinction. The ‘Capacity Consumption
Rate’ Key figure is used to model time-dependent capacity consumption rates.
G E N E R A T E A S U P P L Y P L A N (H E U R I S T I C S A N D O P T I M I Z E R )
Now that we have reviewed the master data, let’s generate a supply plan for ACME Company. The plan can be
generated in Simulation Mode or in Batch mode.

EX ERC ISE 2 A: E X E C U T E U N C O N S T R A I N E D D E M A N D A N D S U P P L Y P L A N N I N G H E U R I S T I C

Step 1: Open ‘Consensus Demand View’ favorite from Excel UI

a. Execute the plan from Simulate mode ‘Unconstrained Demand and Supply’.

Click Save Data

Step 2: Now let’s review the output of the Heuristic Planning Run
Step 3: Consensus Demand View.

Constrained Demand Qty is the demand that can actually be supplied by the network.

Step 4: Open Location Centric View (Favorite – Location View) and Review the Output of the SCM
Planning Run
 Consensus Demand Qty, Stock on-hand and Inventory Target are input Key Figures
 Dependent Demand, Net Demand, Supply, Receipts, Projected Stock are output key
figures
 Dependent Demand: Demand which is propagated using sourcing ratio from previous
location or customer offset by lead-time. Sourcing ratio between customer and DC is
50%

 Net Demand: Demand that needs to be sourced for location product

o Net Demand (1) = Max {0; (Dep. Demand + Inv Target – Stock on-hand) }
o Net Demand (t) = Max {0; (Dep. Demand + Inv Target – Projected Stock (t-1)}
Computed only by Heuristic and not by Optimizer
 Projected Stock:
o Projected Stock (1) = Stock on-hand + Receipts(1) – Supply(1)
o Projected Stock (t) = Projected Stock (t-1) + Receipts (t) – Supply (t)
for t = 2, 3, 4… T.
 Receipts:
o Sum of all receipts - everything that is received (coming in) at a location for a
product. The various receipts types are:
o Production receipts, defining the amount received via a production sourcing
rule
o Transport receipts, defining the amount received via a transport sourcing rule
o External receipts which is the quantity that is received via an “unspecified”
sourcing rule
  Supply:
o These are quantities that are transported to another location or transported to
a customer.

Step 5: Open Transportation View  DC to Customer Transport View favorite and Review the Results

 Customer Transport Receipts is supply output key figure and is defined on the lane or
on the Customer and Location node
 It shows the product quantity which is supplied from a location to a customer

Step 6: Open Transportation Views  Plant-to-DC Transportation View and Review the Results

 Transport Receipts is supply output key figure and is defined on the lane or on the Ship-
From location (Plant) and Ship-to (DC) node
 It shows the product quantity which is supplied from a location to a customer

Step 7: Open Favorite “Capacity View” and Review the Results

  Capacity Supply: Available Capacity for the Resource at the Location
 Capacity Demand: The Capacity Demand of Production Resource describes the amount
of capacity which is needed to produce the portion of the Net Demand of a location-
product which is sourced via a P-rule to a Production Source
 Capacity Usage: The Capacity usage shows how much of resource’s capacity supply is
consumed by the production of a product. For the unconstrained heuristics capacity
usage is always equal to capacity demand, whether the demand is higher or lower than
the capacity supply. Depending on costs, for the optimizer usually i- f there is enough
capacity supply available to satisfy the capacity demand caused by all products - the
Capacity Usage of Production Resource equals the Capacity Demand of Production
Resource. If there is not enough capacity available and the plan is computed with a
finite planning algorithm the Capacity Usage of Production Resource is, in general,
smaller than the Capacity Demand of Production Resource.

Step 8: Open Parent Child BOM View and Review the Results

• Quantity Per: Defines the Qty per to produce the finished or semi-finished quantity defined
in Output coefficient.
• Dependent Production Demand Qty: It stores the demand for components (input products)
which is derived from the Net Demand of a finished or semi -finished product
 Step 9: Open Component Where-Used View. This is similar to BOM view displaying by which product the
Component is consumed

EX ERC ISE 2 B: E X E C U T E P R O F I T O P T I M I Z A T I O N
Before we execute the Optimizer, the costs have to be set. Optimizer takes the following cost and price key figures
as inputs:

 Price or Non-Delivery Rate

 Production Cost (Fixed and per-unit rate)
 Transportation Cost (Fixed and per-unit rate)
 External Procurement Cost (Fixed and per-unit rate)
 Inventory holding cost (per-unit rate)
 Safety-stock violation cost (per-unit rate)

In the exercises the following input key figures are modeled.

 Consensus Demand Price or Non Delivery Cost Rate

 Transportation Cost per Unit rate
 Production Cost per Unit Rate

Step 1: Open ‘Consensus Demand View’ favorite from Excel UI and Add Consensus Demand Price key
figure. Update the favorite.
Step 2: Open ‘Plant To DC Transp Cost Rate’
Step 3: Open ‘Production Cost Rate’ favorite

Step 4: Go to ‘Consensus Demand View’ and Click Profit Optimization

Step 5: Now let’s review the output of the Profit Optimization Planning Run.
Note: Unlike the heuristic, the Plan generated by Optimizer is feasible plan and takes into account
the constraints such as Lead- times, lot-sizes, Capacity supply, Maximum Inventory
  You can open other Planning views and review the results
o Location View
o Capacity View
o DC-To-Customer Transport View
o Plant-To-DC Customer View

Step 6: Now lower the Consensus Demand Price(Non-Delivery Cost Rate) for Product1/Cust101 to 10 for
few buckets and Click ‘Profit Optimization’ under ‘Simulate’ button in ‘Consensus Demand View’

 Non-Profitable demand is not met or shorted

 Step 7: Open Capacity View. Reduce the Capacity Supply for Resource 2 to 2000 from (Jan, Feb and
March 15). Run the Optimizer
 Capacity Usage is equal to Capacity Supply.
 In Resource Capacity Constraint scenario only the Demand for a Product which is more
profitable is produced on the resource.

EX ERC ISE 2C : I N T E R A C T I V E M A N U A L A D J U S T M E N T S

Adjusted key figures are special type of Key Figures that allow adjusting (i.e. overwriting) the input or the output of
an algorithm. For example, if the algorithm computes that the dependent demand at a location is X, you can over-
write this dependent demand by inserting a value of your liking for the key figure Adjusted Demand. There are
algorithms that take into account adjusted values when re-computing the key figures, and there are those that
clear all adjusted values when re-computing the key figures.

The main use case of Adjusted Key Figures is interactive planning, where a user changes these key figures manually
to influence the output of a planning algorithm. For that reason, Adjusted Key Figures are also called manual
adjustments.

The following are the Adjusted Key figure types currently available:

 Adjusted Transport Receipts

 Adjusted Customer Receipts

 Adjusted External Receipts

 Adjusted Production Receipts

 Adjusted Demand
For example, if the algorithm computes that the dependent demand at a location is X, you can adjust the demand
by inserting a value for the key figure Adjusted Demand. There are algorithms that take into account adjusted
values when recomputing the key figures.

Step 1: Open ‘Adjusted Transport’ Views favorite.

Step 2: Enter Transport Receipt value of 1000 in March 15 for Product 1 /DC101 and Plant 102. Click

Simulate . This can be run in Heuristic and Profit optimization. All

adjusted key figures will be considered as constraint by the Optimizer.

The Transport Receipts is replaced by Adjusted Transport value 1000.

EX ERC ISE 3 A: E X T E N D T H E M A S T E R D A T A S E T F O R A N E W P R O D U C T

ACME Company has introduced a new product (PRODUCT3) to market and would like to model the Supply Chain
master data. PRODUCT3 will be sold to Customer 101 and will be supplied from DC101. PRODUCT3 at DC101 will
be procured from PLANT101. The PRODUCT3 will be manufactured at PLANT101 on RESOURCE1 by consuming
COMPONENT1

Step 1: In Excel UI click on

Step 2: Create PRODUCT3: In the pop-up select ‘Product’ in the Master Data Type drop-down. In the

Product ID field enter: PRODUCT3. Click on “Add Create new icon

Step 3: In the pop-up Enter Product Description, Product Family, Product Series and Product Sub-Family.
Click Add

Step 4: Add ‘PRODUCT3/101’ combination in Customer Product master data via Master Data

maintenance. Click
Step 5: Click Add

Note: Create the following master data types using the similar steps as above

Step 6: Create Customer Source

 Product ID: PRODUCT3
 Customer ID:101
 Location ID: DC101
 Lead-time =1
 C-Ratio=1
Step 7: Create Location Source:
 Product ID: PRODUCT3
 Location ID: DC101
 Ship-From Location: PLANT101
 Lead-time=1
 T-Ratio=1
Step 8: Create Production Source
 SOURCEID: PLANT101_PRODUCT3
 Product ID:PRODUCT3
 Location ID:PLANT101
 P-Ratio:1
 Source Type: P
 Output Coefficient:1
 Periodic Lot-Size:1
Step 9: Create Production Source Item
 SOURCEID: PLANT101_PRODUCT3
 Product ID:COMPONENT1
 Component Coefficient:2
 Source Item ID:10

Step 10: Create Production Resource

 SOURCEID: PLANT101_PRODUCT3
 Resource ID:RESOURCE1
 Capacity Consumption Production Rate:1