Sales Operation Planning

PRODUCTION/PROCUREMENT
PLANNING
Planning flow & Integration
Sales & Ops Demand

MRP
Planning Management
MM – PU
Procurement Warehouse
(Stock
Proposal Management
Control)
FI - CO QM
(Cost (Quality
Control) Control)
Master Data Master Data provides the

infrastructure for transactions
Maintenance
SALES AND OPERATIONS
PLANNING
Course Objectives
 Understand Concepts of Sales and Operations Planning

(SOP)
 Understand the SOP processes
 Perform SOP transactions
What is Sales & Operations Planning?
 Sales & Operations Planning (SOP) is the process of

aligning forecasts of customer demand with procurement.
 Q
 U
 A
 N
 T
 I
 T
 Y
May June July
 TIME
Stock
Requirement
Sales Forecast
What is the SOP Process ?
 SOP is used for the annual planning processes of budget

preparation and the rolling monthly/weekly execution plans
 There are three principal sources of data:
 Annual plan of capacity including maintenance shutdown
 Sales forecast by region, country and grade
 Profitability Analysis
 The plans are prepared in calendar months and can be split

into weekly. Planning is checked and adjusted where
necessary
 The rolling plan moves forward each month and the Planner
check and confirm the detail for the next months/weeks.
How does SOP data apply to the Process?
 SOP Flow
Sales Order Invoiced
Planning Table update
Aggregate Procurement
Plan
Transfer Planning Values

to Demand Management
Frequently used transactions for SOP
Practice the following transactions
 MC8E Create Forecasting Job

 MC8G Schedule Forecasting Job
 SM37 Background Job Overview
 MC94 Display/Change SOP Plan
 MC90 Transfer to Demand Management
 MD63 - Display Independent Requirements
DEMAND MANAGEMENT
Demand Management
Demand Management does the critical function of determining

the quantities and delivery date of the products by arriving at
an appropriate combination of
 Planned Independent requirement
 Firm customer requirement
It Also
 Uses past sales data/quantities to calculate future demand
program.
 Marketing intelligence and management adjustment can be
added using forecast overrides / forecasting methods.
 Result of Sales & Ops. planning are transferred to Demand
management as PIR. Planned Independent requirement
form the basis for procurement.
Splitting Requirements
Requirements Qty.
Split
Requirements
M1 M2 M3
Time
Requirements Qty.
11
Days Weeks
Time
Material Requirement
Planning
Materials Requirements Planning
 MRP compares the requirements for the products, from Demand
Management, with the current stocks and creates purchase requisition
 Purchase requisitions may be converted to purchase orders
 Manual  SOP  Sales

entry order
 Demand
Management
Purchase
Requisition
Current Stock  MRP 10

20
30
What is MRP?
 MRP stands for: Materials Requirements Planning.
 The function of MRP is to provide material availability, i.e.,

it is used to procure the requirement quantities on time.
This process involves the monitoring of stocks, demand,
lead time and leading to the automatic creation of
procurement proposals (PR’s) for purchasing.
 The main objective of MRP is to determine which material
is required, the quantity required and by when it is
required.
MRP Type’s
Deterministic MRP (PD)

 Using the forecast for unplanned
requirements
 Planning for the total
requirements
Consumption-Based MRP (YB) Reorder Point

 Manual reorder point planning
Safety Stock
 Automatic reorder point planning
15
Start Delivery Time
Date Date
No Materials Planning (YD)

MRP Type
 For the MRP procedure, use MRP type PD in the material
master
 MRP creates purchase requisitions to balance the demand
plan
 Safety stock can be used to cover unplanned requirements
Receipts
Time
Requirements
Evaluations
There are several options for analyzing the Planning run

 MRP list
 By material
 Collectively
 Stock requirements list
 By material
Planning Result
 Collectively
MRP list
MRP list
 Use the MRP list to analyze the planning result

 The MRP list displays the future stock/requirements
situation at the time of the last planning run
 By using the collective display, you can select a specific
MRP list based on plant and MRP controller
 Analyze the exception messages in the MRP list, judge and
or solve problems
MRP Related Transactions
 Practice the following exercise
 MD01 Total Planning Run Online

 MD02 Single-Item, Multi-Level
 MDBT Total Planning in Background
 MD04 Stock Requirements List
 MD76 Reorganization to delete PIR’s
 MD05 Evaluate MRP List
 MD44 Planning Situation Material

Sales Operation Planning

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What is the purpose of Sales and Operations Planning (SOP)?

What is the purpose of Sales and Operations Planning (SOP)?

What are the main steps involved in the SOP process?

What are the main steps involved in the SOP process?

PRODUCTION/PROCUREMENT

Sales & Ops Demand

Master Data Master Data provides the

 Understand Concepts of Sales and Operations Planning

 Sales & Operations Planning (SOP) is the process of

 SOP is used for the annual planning processes of budget

 The plans are prepared in calendar months and can be split

Sales Order Invoiced

Planning Table update

Transfer Planning Values

 MC8E Create Forecasting Job

Demand Management does the critical function of determining

 Manual  SOP  Sales

Current Stock  MRP 10

 MRP stands for: Materials Requirements Planning.

 The function of MRP is to provide material availability, i.e.,

Deterministic MRP (PD)

Consumption-Based MRP (YB) Reorder Point

No Materials Planning (YD)

There are several options for analyzing the Planning run

 Use the MRP list to analyze the planning result

 Practice the following exercise

 MD01 Total Planning Run Online

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