Project Name: Document Name: Document ID: Prepared by: Reviewed by: Approved by: Released by:

TH Milk ECC 6.0 Implementation Project Production Planning Long term planning for farm in company code 1000 THM_BP_PP015_V1.0 Version: 1.0 Duc Q Nguyen Contact No. Date: PP Consultant Suresh V Rajagopalan Contact No. Date: Project Manager B Ganesan, Contact No. Date: Program Manager Duc Q Nguyen Contact No. Date: PP Consultant

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THM_SAP_IMPLEMENTATION_BLUE PRINT
Business Process Details
Module Business Process Sub Process / No Description Sr No 1.1 i. ii. iii. iv. v. Sr No 2.1 i. Production Planning Production Planning SOP and Long term planning for farm THM_BP_PP015_V1.0 SOP and Simulative planning for cow farms and crop fields

Topics Requirements & Expectations Information sharing among crop fields, cow farms, feed center and purchase department is not strong. A tool is needed to finalize the planning of those business units in company code 1000. Feeding materials will be planned yearly and monthly For feed material: External purchase = Demand Internal supply Safety stock of raw materials is expected to be in 2, 3, 7, 14, 21, 30, 60 days in the simulative planning. Optimization of the delivery to ensure enough warehouse space Topics Existing Process General Explanation Not applicable

2.2 i. 2.3 i.

Explanation of Existing Functions & Events Not applicable Special Organizational Considerations None

Sr No 3.1 i.

Topics Proposed Process General Explanation Definition of SOP Sales & Operations Planning (SOP) is a flexible forecasting and planning tool with which sales, production, and other supply chain targets can be set on the basis of historical, existing, and estimated future data SOP to streamline and consolidate the companys sales/ forecast and production operations Definition of Demand Management The function of Demand Management is to determine requirement quantities and delivery dates for finished products. To create a demand program, Demand Management uses planned independent requirements. Definition of Long term planning LTP (simulative planning) Long Term Planning is the tool used to predict or forecast the future requirement and procurement activities of future based on projected requirements or production plan. Plan

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is made in inactive version through demand management and LTP scenario.

Planned independent requirements are requirements that can be derived from a forecast of future demand. In make-to-stock production, it is used to initiate the procurement of the materials concerned, without having to wait for concrete orders. Using such a procedure, you can shorten delivery times and use forecast planning to load your own production resources as evenly as possible.

Definition of Simulative MRP Simulative Material Requirement Planning will ensure the right availability right material at right time, in simulative mode. Once the production plan or requirements are maintained in SAP MRP run will take place. Normally simulative MRP run will be done at a periodic interval say once in a month as a background Job.

ii. Use of SOP S&OP is used to carry out herd planning, with the ability to split to cow category such as milking cow, dry cow, heifer, etc, , Note: each cow category requires different daily ration. S&OP is used to carry out land planning, with the ability to split to the field ID and then land for grass, land for corn, land for soya, . Note: each field ID has different productivity. S&OP is carried out at material level and product group level. S&OP is carried out in monthly intervals The production plan is created and the requirements are then transferred to demand management in the form of Planned Independent Requirements. In turn, this data is taken for simulative Material Requirement Planning. Use of Long Term planning Entire LTP is run with a scenario reference. LTP scenario contains the details of Planned Independent Version to be considered for LTP, what stocks to be considered as opening stock, whether to consider the firmed existing procurement proposal etc., are maintained in the planning scenario. Use of Demand Management Demand management is used to manage independent requirements. The way in which independent requirements behave in material requirements planning (for example, if they affect requirements or if they consume other requirements) can be determined by their requirement type or their planning strategy. Planned independent requirements can also be entered directly for a production plant. iii. Maintenance of SOP, LTP and Demand Management MC81 Create Product Group; MC82 Change Product Group MC94 Change Standard SOP for material/ product group. MC78 Copy SOP version, MC80 Delete SOP version MC74 Transfer Material to Demand Management MD61 - Create Planned Independent Requirement MD62 - Change Planned Independent Requirement, MD63 - Display Planned Independent Requirement. MS31 Create Long term planning scenario; MS32 Change LTP scenario MS02 Run simulative MRP MS04 Simulative stock/requirement lists

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3.2 i.

Explanation of Proposed Functions & Events SOP functionalities The Sales & Operations Planning (SOP) application is based on information structures. An information structure is a statistics file containing operational data. Information structures are used for data evaluation, projection, and analysis. In TH Milk Standard SOP will be used for cow planning. From the planning figures, the system will calculate requirements of the feeding materials. In TH Milk Standard SOP planning works with Plant/ Material / SKU level, and with predefined key figures in a planning table with a set layout. All plans in Standard SOP are based on the standard information structure S076. Forecast will be maintained in SOP table (S076 Standard information structure) from Sales Information System (SIS)/forecast which is maintained by relevant departments: crop field, feed center, cow farm. In TH Milk forecast will be provided with respect to plant / product group/ material at SKU (stock keeping unit) Level. Production will be also maintained in SOP table S076. Production is the finalized figures among relevant departments. It is recommended that SOP will be revised and finalized monthly among the management board of cow farms, crop fields, feeding center and purchase department.

ii.

SOP version management The production plan can have different planning version under a version number with a description. This means different planning scenarios can be created for one information structure. In TH Milk company code 1000, forecast will be maintained in SOP table S076 info structure and the forecast will be converted into production plan in inactive version. Only one planning version is active. This is version A00. This version normally is used in real production planning, not simulative planning. All other planning versions are inactive. Inactive version can be considered as test versions to try out different scenarios. For long term planning, inactive version is recommended to use. In TH Milk the finalized inactive version of the production plan which in turn will be copied to Demand Management within the time period. SOP versions can be copied and deleted.

iii.

Planning Table SOP is carried out in the planning table and info structure S076. In TH Milk company code 1000, the input matrix is laid out in rows and columns. In the left column, there are key figures that are being planned such as forecast, production plan, stock level, target stock level, target days supply. In the right column, there are unit of measures that the key figures are recorded. Next to this column, values of key figures are entered there. Each of these columns represents a time bucket (displayed on the column title). TH Milk will use monthly time bucket. The system supports disaggregation from owner level to member level. It also supports the aggregation from member level up to owner level. In the SOP planning of company code 1000, product group will be used to group the cow categories and the crop field IDs. The higher level of the product group is named Owner

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level and the lower level is name Member level in SAP. Planning table of the herd: monthly time bucket with the key figures at both owner and member level:

Key figures Head count Rations/month Production Stock level Target stock level Days supply Target days supply

Month 1

Month 2

Month n.

SOP Planning for herd consists of 2 levels: L1: total cow; L2: cow category (milking cow, dry cow, heifer, ) with each (EA) as the unit of measure. Planning table of the land: monthly time bucket with the figures at both owner and member level: Key figures Forecast Production Variance Month 1 Month 2 Month n.

SOP planning for land consists of 2 levels: L1: total land; L2: field ID with hectare as the unit of measure. iv. Transfer SOP to Demand Management SOP can be transferred to Demand Management online or manually. TH Milk company code 1000 will be transferring production plan data of inactive version for each material at SKU level from Standard SOP to demand management. The result of the transfer is Planned Independent Requirement. The version of the Planned Independent Requirement should be set to inactive. TH Milk will be using transfer of production plan of material direct. The key figure is a quantity key figure. v. Planning strategy To create a demand program, the definition of planning strategy is a must. Planning strategies represent the methods of production for planning or manufacturing or procuring a product. TH Milk will be using Make-to-stock strategy. Strategy group - Make to Stock 010 Make-to-stock strategies are usually combined with a lot-size key or a rounding value. For

vi.

instance, you may want to produce the entire amount for the whole week once a week or you may want to produce based on the each production lot size. TH Milk will be using the standard requirement type LSF (make to stock strategy) Demand Management planning table

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Planned Independent Requirement can be managed using version. The versions are used to compare the medium/ short-term planning among them. Inactive version is recommended for simulative MRP run. To be easier, the version should be different from 00. Periodically, planned independent requirements can be reorganized. Requirement type determines the planning strategy to be used for a particular requirement. TH Milk will be using standard requirement type LSF. Planning horizon is used to narrow down the period of examination .

Long term planning scenario Minimum two simulative planning scenarios will be created: o Simulative planning of feeding materials demand (calculated based on the planned independent requirement of the herd) o Simulative planning of feeding materials supply (calculated based on the planned independent requirements of the crop fields) TH Milk can create more LTP scenarios according to the planning purpose. Simulative MRP run LTP or Simulative MRP runs with planning scenario. With the simulative planning scenario of the herd, the system will calculate the demand of feeding materials. With the simulative planning scenario of the field, the system will calculate the internal supply of feeding materials. Evaluation of long term planning This report helps to calculate the variances between the demand and the internal supply of the feeding materials. The calculated variances will be the reference for external purchase. Special Organizational Considerations None Topics Change Management Issues No Description of Improvements No Description of Functional Deficits None Approaches for covering Functional Deficit None

3.3 i. Sr No 4.1 i. 4.2 i. 4.3 i. 4.4 i.

Sr No 5.1 i. Sr No 6.1 i.

Topics Notes on Further Improvement None Topics System configuration considerations The Configuration Settings are carried out in the Customizing Transaction SPRO available in

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the menu path SAP easy access _ SAP Menu _ Tools _ Customizing _ IMG _ SPRO Execute Project. ii. iii. iv. v. 6.2 i. 6.3 i. 6.4 i. 6.5 Rescheduling horizon of the plants belong to company code 1000 will be revised to zero. Planning type for feeding material requirements Planning type for feeding material internal supply Add more range of coverage profile: 30 days, 60 days File conversion considerations (Master data maintenance). Not applicable Interface / Enhancements considerations Not Applicable Reporting considerations Authorization considerations

Business Process signoff document

Module Business Process Sub Process / No Description Production Planning Production Planning SOP and Long term planning for cow farm THM_BP_PP015_V1.0 SOP and Simulative planning for cow farms and crop fields Organizational Units THM purchase department at farm THM Crop field THM Feed Center Business Process Owner Pham Thi Huong Vuong Quoc Hanh Nguyen Ba Truong Tran Xuan Minh Le Tho Thang

Project THM Team

Name
Nguyen The Anh Vuong Quoc Hanh Gilbert Jardin

Designation
Project Manager Procurement Officer Chief Finance Officer

Signature

Date

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Project CSC Team

Name
Duc Q Nguyen Suresh V Rajagopalan Ganesan B Iyer

Designation
SAP PP Consultant Project Manager Program Manager

Signature

Date

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