Production Planning and Execution

• Production Planning


  The process of aligning demand with manufacturing capacity in creating production and procurement schedules for the finished products and component materials.
• The PP organizational structure shares some organizational units with the previous modules. This includes:

  • Client
  • Company Code
  • Plant
  • Storage Location
  • Work Center Locations
• Client 


  An independent environment in the system.
• Company Code 


  The smallest organizational unit where a legal set of books can be maintained.
• Plant 


  The operating area or branch within the company, such as manufacturing, distribution, purchasing, or maintenance facility.
• Storage Location 


  Allows differentiation between the various stocks of material in a plant.
• Work Center Locations 


  Define where and when the operation is performed. These can be machines, people, production lines, or groups of tradespeople. The activities performed in this unit are evaluated by charge rates, which cost centers and activity types determine.
• The PP Master Data has five (5) types:

  1. Material
  2. Bill of Materials (BOM)
  3. Routing
  4. Work Center
  5. Product Group.
• Material Master 


  Contains all the information a company needs to manage a material. It includes the General Data of the material, Material Requirement Procedure (MRP), Lot Size Data, and MRP Areas.
• Bill of Materials (BOM)


  This master data lists the components that make up a product or assembly.
• There are three (3) different kinds of BOM:

  • Single-level
  • Multi-level
  • Variant Bill of Materials
• Single-level 


  Lists the main components.
• Multi-level


  Lists the main components and their sub-components.
• Variant Bill of Materials 


  Displays several products with many identical parts.
• Item Category 


  An object that defines the items in a BOM according to criteria, such as the object type of the component, for example, material master record or document information record.
• The Item Categories include the following:

  • Stock Item
  • Non-stock Item
  • Variable Material
  • Document Item
  • Text Item
• Item categories 


  Contain the screen sequence, field selection, default values, material entry, inventory management, and subitems.
• Routing 


  It is the series of sequential steps or operations that must be carried out to produce a given product.
• Routing


  It enables the planning of the production of materials (products.)
• Routing1


  It is also used as a template for production orders and run schedules and as a basis for product costing.
• Routing 


  Contains each step's what, where, when, and how.
• Control Key 


  Specifies how an operation or a suboperation is processed in functions such as orders, costing, or capacity planning.
• Activity Type


  A unit in a controlling area that classifies the activities performed in a cost center.
• Work Center 


  It is the location within a plant where Value-added work (operations or activities) is performed.
• Work Center1


  It can represent people or groups of people, machines or groups of machines, and assembly lines.
• Work Center2


  It defines capacities such as labor, machine, output, and emissions used in Capacity Requirements Planning (CRP), detailed scheduling, and costing.
• Work Centers capture and use the following Resource-related data:

  • Basic Data: Person Responsible, Location of Work Center
  • Scheduling Information: Queues and Move Times (interoperation), Formula Keys
  • Costing Data: Cost Center, Activity Types
  • Personnel Data: People, Positions, Qualifications
  • Capacity Planning: Available Capacity, Formulas, Operating Time
  • Default Data: Control Key, Standard Text Key
• Product Group 


  It is aggregate planning that groups materials or other product groups (Product Families). It can be a multilevel or single-level, wherein the lowest level must always consist of materials.
• The Production Planning & Execution includes the following processes:

  • Forecasting
  • Sales and Operations Planning (SOP)
  • Demand Management
  • Master Production Scheduling (MPS)
  • Material Requirement Planning (MRP)
• PP processes are divided into three (3) layers:

  • Strategic Planning (Forecasting and SOP)
  • The Detailed Planning (MPS and MRP)
  • The Manufacturing Execution
• Strategic Planning (Forecasting and SOP)


  Involves the CEO, COO, CIO, CFO, Controller, and Marketing Director.
• The Detailed Planning (MPS and MRP) 


  Involves the Line Managers, Production Scheduler, MRP Controller, and Capacity Planners.
• The Manufacturing Execution 


  Involves Line Workers and Shop Floor Supervisors.
• Forecasting 


  The foundation of a reliable Sales and Operations Planning (SOP).
• Accurate forecasts


  are essential in the manufacturing sector, which could help oversee the stock since overstocked and understocked warehouses both result in a profit loss.
• Though forecasting is vital, it should always be considered wrong.
• Forecasting Models include the following, which can be selected automatically or manually:

  • Trend
  • Seasonal
  • Constant
  • Trend and Seasonal
• Trend 


  Uses market research and consumer data to predict future trends.
• Seasonal


  Used for predicting short-term customer demand at different times of the year.
• Constant 


  Uses the actual value of each period to predict the next.