Determination of Source of Supply Ranking List 

Use

Within source determination in Supply Network Planning (SNP) and in Production Planning and Detailed Scheduling (PP/DS), the system defines a ranking order for the valid, alternative sources of supply, based on the following data:

·        Quota arrangements

·        Procurement priority

·        Procurement costs

·        Procurement type

The ranking order of the sources of supply is a recommendation for the planning application. The planning application selects a source of supply from this ranking list according to application-specific criteria. For PP/DS, for example, on-time delivery is a decisive factor.

The function described here does not apply to deployment. You can find information on the prioritization of destination locations in deployment under Source Determination in Supply Network Planning.

Features

The system evaluates the data according to the following rules:

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       1.      Quota arrangement

With a quota arrangement, you define the proportions in which you procure a product from alternative sources of supply (incoming quota arrangement), or in which you want to deliver to alternative destination locations (outgoing quota arrangement). Quota-allocated sources of supply are at the top of the ranking list. If a product has a non-quota-allocated source of supply A and two quota-allocated sources B and C, the ranking order of the sources of supply is B, C, A, irrespective of other criteria. To define the ranking order of the quota-allocated sources in more detail, the system uses the procurement priority, the procurement costs, and the procurement type as additional criteria (see the following paragraphs). In Production Planning and Detailed Scheduling (PP/DS), the system prioritizes the sources of supply using the quota rating. For more information, see Quota Arrangements.

       2.      Procurement priority

If there are no quota arrangements, or if quota-allocated sources of supply have to be prioritized in more detail (see 1), the system uses the procurement priorities of the sources of supply. The value 0 means the highest priority, and the value 9,999,999,999,999.99 means the lowest priority. The default setting for the procurement priority is 0 (highest priority).

       3.      Costs

If the priorities are the same, a source of supply with low costs takes precedence over a source with high costs. The costs might consist of transportation and procurement costs. The system determines the costs automatically in source determination.

       4.      Procurement type

If the priorities and the costs are the same, in-house production takes precedence over external procurement. If various external procurement relationships exist for a supplier-product combination, the following data is also included in source determination:

                            a.      External procurement relationship type

If several transportation lanes with different external procurement relationship types exist, a scheduling agreement takes precedence over a contract, and a contract has priority over a purchasing info record.

                            b.      Procurement form

If several external procurement relationships with different forms of procurement exist, the procurement form consignment takes precedence over the procurement forms normal and subcontracting.

Modification to the Ranking List

You can use the BAdI /SAPAPO/PWB_SOS to modify the content and the sequence of the sources of supply in the ranking list. For example, you can sort the sources of supply according to procurement costs and then according to procurement priority.