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 Planning w/ a Planning Material and w/o MTO (63)

Purpose

This strategy allows you to procure non-variable components based on the planned independent requirements of a planning material. Production of the finished product, however, is based on actual sales orders. This procedure allows you to react quickly to customer requirements, even if the finished product has a long overall lead time; you can avoid the main value-added process until you have a customer.

This strategy has the same basic features as Planning Without Final Assembly and Without MTO (52) . In addition, more than one material can consume the planned independent requirements of one planning material.

This strategy allows you to plan the variants of one product. The term variant indicates "similar" parts; it is not used in the sense of variant configuration, which implies a much higher number of variants. With this strategy, for example, you can easily exchange a component in all similar BOMs.

Examples from Industry

This strategy lends itself to the planning of different sizes or packages for one product. For instance, you may want to sell a product:

  • In packages containing 1 liter, 2 liters, and 1 gallon.

  • In packages labeled in English, German, and Japanese.

All variants are set up as different material numbers. In addition a planning material is usually set up that consists of the non-variant components only, which means excluding the packaging materials which form the variants. All variants are linked to the planning material by means of the correct conversion factors.

The packaging materials (boxes or cartons for the different sizes or different labels) can be planned on the basis of consumption because they are not too expensive.

Prerequisites

You must maintain the following master data for the products:

Master data

‘Variant’ products

Planning material

Strategy group

( MRP screen)

63

63

Item category group

( Sales organization screen)

For example, NORM

For example, NORM

Lot size key

( MRP screen)

EX

EX

Consumption parameters

( Consumption mode,

Bwd consumption per., Fwd Consumption per .)

( MRP screen)

NOT to be maintained, the values of the planning material are used.

Need to be maintained so that the planned independent requirements can be found.

(See Consumption Strategies and Logic )

Planning material, Planning plant and Plng conv. Factor

( MRP screen)

Need to be maintained.

Bill of material

Required

Contains all parts

Required

Contains the non-variable parts

Note Note

You need to set the MRP type (on the MRP Screen) to P* or M* to plan the component in MRP.

You may want to consider setting the Individual//coll. indicator (on the MRP Screen) to 2.

End of the note.

Process Flow

For a detailed example of the entire process, see Sample Scenario: Strategy 63 .

The planning material could be sold in the same way as any variant product. However, it is generally used as an "artificial" material that contains the non-variant parts only. The BOMs of the variant products contain additional components which diversify the product.

Note Note

These variant components cannot be planned exactly using this strategy.

The variant components are consumption-based.

The variant components are planned independently using a planning strategy for components.

You accept an over-planning or an under-planning of the variant components.

If your products have a high level of variance, you may want to use characteristics planning in order to automate the planning of components. See Characteristics Planning (56/89) for more information.

End of the note.

This strategy can also be used as a cross-plant version of strategy 52. See Cross-Plant Planning for more information.

Other Areas

The Other Areas section of Planning Without Final Assembly and Without MTO (52) also applies to this strategy.

Capacity Planning Using Strategy 63

This strategy is often used to manage a simple but effective method of capacity planning.

The planned independent requirements for the planning material represent a given capacity situation. All variant materials require a similar capacity and there is an allocation of given capacity with requested capacity at the order entry stage. You can easily check the capacity situation using the total requirements list.

Overplanning and Underplanning of Components

Imagine that the planning material contains the components A, B, and D. The variant material contains the components A, B, and C.

The planning material is planned with 100 pieces each month. There are therefore also dependent requirements for 100 components each month. Due to the fact that the planning material is a representation of all variants, too much is planned for component D and too little is planned for component C.

This situation is not a problem if you want to over-plan component D on purpose to have a higher stock level for it, for instance.

In most cases, however, you would avoid this situation by employing other means, that is, by not including components C or D in the BOM of the planning material. The variant parts could be planned using Planning at Assembly Level (70) , or by simply using consumption-based variant parts.