Run MRP, Convert Planned Order To Production Order, Settle Costs of Production Order

Run MRP, Convert Planned order to Production Order,
Settle Costs of Production Order

Run the full Material requirements planning, and then display a planned order. In the next step you
will convert the planned order to a production order. The production order will be used to issue
goods for production. The goods receipt for the production order will be created, and finally, the costs
of the production run will settled.
Create Requirements for Finished Good

From SAP Easy Access: Logistics Production Production Planning Demand
Management Planned Independent Requirements Create
Enter your finished good.
Verify your plant, and version = 00.
Change planning period to W.
Click enter.
Click on Schedule Lines tab.
Enter a date approx one month in the future, and a planned quantity of finished product to
produce (50).
Click save.
Run MRP Single Item, Multi level

From SAP Easy Access: Logistics Production MRP Planning Single Item/Multi-Level.
Enter the following:
Your finished good.
Your plant.
Processing key: NETCH
Create pur. Req.: 2
Deliv. Schedule: 3
Create MRP list: 1
Planning mode: 1
Scheduling: 1
Click enter.
You will see a warning which asks you to check your input parameters. Check to make sure you
values are entered correctly, and click enter again.
Review the MRP list.

If MRP does not work, recheck material type attributes.
Display Stock/Requirements List

From SAP Easy Access: Logistics Production MRP Evaluations Stock/Reqmts List
Enter your finished good and plant.
Click enter.
Conversion Planned Order to Production Order
From SAP Easy Access: Logistics Production MRP Evaluations Stock/Reqmts List
Enter your finished good and plant.
Click enter.
Double click on a planned orders (PldOrd).
Click the Prod. ord. button.
Accept all defaults, and click save.
Record your order number.
Click the refresh button. Notice the PldOrd changed to PrdOrd.
Goods Issue
From SAP Easy Access: Logistics Production Production Control Goods
Movement Goods Issue
Movement type: 261
Enter your plant.
Storage location: 10
Click the To order button and enter your order number. Click Adopt + Details. Click the adopt button
to accept details for each material and save.
Enter Completion Confirmation of Production

From SAP Easy Access: Logistics Production Production
Control Confirmation Enter For order
Enter your order number.
Click enter.
Click on final confirmation.
Yield to conf. Number of finished goods you produced.
Click save.
Goods Receipt of Production Order

From SAP Easy Access: Logistics Production Production Control Goods
movement Goods receipt
Enter movement type 101
Enter your production number, and plant.
Storage location: 30
Select adopt + Details.
Click on the adopt button, and save.
At this point you may encounter an error asking you to create a G/L account. Create this account as
a P/L account called finished goods. Make sure you check the post automatically box during
creation. This will also need to be a cost element. While creating the account, click the Edit Cost
Element button.
Make the CElem category equal to 1 and save.

You will now need to edit your account assignments.
From the IMG screen: Controlling Cost center accounting Actual postings Manual
actual postings Edit automatic account assignments
Click on new entries.
Enter your company code,

Cost element (the account you just created) cost center, and production order number.
Click save.
Now return to the Goods Receipt of Production Order exercise and try it again.
Settle Costs of Production Order

From SAP Easy Access: Logistics Production Production control Period-end
closing Settlement Individual processing
Enter your controlling area (if required).
Enter your production order number.
Settlement period: Current month. (1)
Posting period: Current month. (1)
Click execute.
Review the run.
Click the back button. Turn off the test run indicator, and click execute. Review the results by double
clicking on objects selected. To see how the displayed costs break down, highlight the dollar amount
total, and choose environment Report from the main menu.
Select Actual/Plan/Variance, and click enter.
Review report.
Create and Display Routing

Allow trading goods to be used in the production of finished goods. In addition, you will define a
routing for your finished goods. The routing is a list of the different individual processes used to
create the finished good. You will also designate which materials will be used for each process.
Allow Trading Goods to be Used in Production
This section only necessary if you created trading goods earlier.
From the IMG screen: Production Basic data Routing General data Define Material
Type Assignments
Select a HAWA TL Type.
Click on the copy button.
Change the TL Type to N.
Click enter, and save.
Create a Routing for Finished Products
From SAP Easy Access: Logistics Production Master

Data Routings Routings Standard Routing Create
Enter your finished good, and plant.
Click enter.
General data:
Usage: 1
Status: 4
Click on the operation button. Enter data for each manual operation required to assemble your
finished product. Work center will be the one created earlier, control key will be ASSY, enter a
description of the operation.
Click enter.
Enter Setup and Labor times for each item, click enter after each entry.
Click on the CompAlloc button.
Select the materials required to complete operation 010.
Click new assignment.
Allocate these materials to operation 010.
Click enter.
Repeat for each operation defined above.
Click enter, and save.
Create work center

This is where you employees will work to assemble your finished goods. In this example, a day shift
working from 8am to 5pm was created.
Create Work Center Person Responsible

From the IMG screen: Production Basic Data Work center General data Determine
person responsible
Click on new entries.
Enter your plant.
Enter work center person responsible: 1 _ _.
Enter a name for the person responsible.
Click save.
Create Work Center Location

From the IMG screen: Enterprise structure Definition Logistics General Define location
Select new entries.
Enter your plant.
Enter a location 00 _ _.
Enter a name for the work center location.
Click the address button.
Enter country: US
Enter Language: English
Click enter.
Create Work Center Control Keys

From the IMG screen: Production Basic Data Work center Routing data Define control
key
Select PP01.
Click copy.
Change Control key to ASSY.
Select Scheduling, and Cost.
Click save.
This only needs to be completed by one company in each client.
Create Capacity
From SAP Easy Access: Logistics Production Master Data Work
Centers Capacity Create
Enter your plant, SHIFT for capacity, and 002 for capacity category.
Click enter.
Capacity description: Normal Day Shift
Planner group: A
Base unit of measure: Hour
Start: 08:00:00
Finish: 17:00:00
Length of breaks: 00:30:00
Capacity utilization: 100
Number of individual capacities: 4
Check: Relevant to finite scheduling and long-term planning
Click save.
Create Work Center for Finished Good

From SAP Easy Access: Logistics Production Master Data Work Centers Work
center Create
Enter your plant.
Enter a Work center name: Area _ _
Work center category: 0003
Click the basic data button.
Enter a work center description: (example: main assembly area)
Enter your responsible person, and work center location.
Usage: 001
Standard value key: SAP1
Click enter.
Select Should Be Entered for Setup and labor.

On the Default Values tab:
Control key: ASSY.
Select MIN as defaults units of measure for standard values Setup and Labor.
On the Scheduling tab:
Scheduling basis:
Capacity category: 002
Capacity: SHIFT
Execution time:
Setup formula: SAP001
Processing formula: SAP003.
On the Costing tab:
Select cost center: P010
Activity type for setup: Labor
Formula keys for setup: SAP001
Activity type for labor: Labor
Formula keys for labor: SAP003
Demand Management
Demand Management is used to determine requirement quantities and delivery dates for finished
products. Demand Management provides a demand program which is used by MRP to generate
production plans. Depending on the planning strategy chosen in the material master, the demand
program can use forecasts of demand, actual demand, or combinations of both. Actual demand is
created in sales order management (customer orders) and materials management (warehouse
replenishment). Forecasts of demand are represented by planned independent requirementswhich
are copied from the Sales and Operations Plan
Demand Management Process
SOP plans are transferred to Demand Management as Independent Requirementsfor end

products
The actual sales orders are for information purpose only and are not considered in
planning.
In case the sales orders significantly vary from the forecasted demand; Planners revise the
demand before running MRP to generate manufacturing orders and purchase requisitions
Who is responsible for Demand Management

Responsible for managing the demand by comparing the actual demand with the forecast and
manipulate the plan based on the actual demand before executing MRP
Demand Management SAP Transactions
MM03 Display Strategy
MD63 -Display Independent Requirements
MD04 -Display Stock Requirements List
MD74 ReorganiseIndependent Requirements
MM / PP Process Flow
SAP Production Order Execution
The SAP production order is the main central data object in shop floor control and manufacturing
execution process. The production order contains every data relevant to the production objectives,
material components, required resources, and costs. A normal production order will cover the
demand for a single material or product, but you can also produce multiple products jointly in one
production order (co-products) and distribute incurred costs between the different products. In a
production order, you can also specify external operations that are to be processed in an outside
workshop. If you need to carry out a rework, you can create a separate rework order that is directly
assigned to the primary production order. Alternatively, you can insert specific rework operations into
an existing order. SAP Production orders are usually created from planned orders. The complete
process includes several steps:
Creation and release of a production order
Goods issues of components
Confirmation of production activity
Goods receipts of the finished good
Planning Process Overview in SAP

Multiple forecasting models and strategies can help you in making the best choice. Models are
selected by the system using the built-in intelligence, while continuing mySAP ERP checks the
durability of the model. You can include the effects of events, such as marketing promotions and
seasonal influences, with Forecasts. You can even override individual values of previous demands
and Forecasts. Full integration within mySAP ERP makes periodic easier to forecast possible with
ease. You can break down forecast demands from planning level of individual products. Rough-cut
capacity planning level planning provides a reality check of resource bottlenecks. Forecasts are
easily transferred to Demand Management and Master Production Scheduling (MPS), where they
may be offset by incoming sales orders. You can also add unexpected demands anytime.
Planning process in SAP is divided into several steps. These steps can be executed independent of
each other, or they can collaborated in one.
Sales and Operations Planning
Sales and Operations Planning (SOP) develops sales plans and production of plans using forecast
values and requirements from Sales Information System and costing / profitability analysis as inputs
for determining requirements. These requirements are reflected in the system as planned amount of
product within a given period, and are not required to create the basis for the requirements of the
Customer.
Demand Management
Management on Demand forecasting, functionality is connected to the production scheduling.
Requirement number and date for the finished products and assemblies based on plans from the
SOP is determined.
Master Production Scheduling
Master Production Scheduling (MPS) allows for critical resources or top-level things planned with
extra attention. The process ensures that the instabilities in planning are very minimal. MPS is an
just an another optional step in the process of planning.
Material Requirements Planning
Material Requirements Planning (MRP) is the detailed planning of replenishment schedules for
required elements. The output of MRP is either a planned order or a purchase request.
Production Overview in SAP

With support for all product strategy for companies in the discrete process and consumer products
industry, SAP ERP helps companies manage full range of production activities, from planning and
analysis for the execution in one end-to-end system. SAP ERP delivers all elements of customeroriented production management system and is fully compatible with just-in-time (JIT) and Kanban
methodology.
Combining information from different business processes (including planning, cost accounting,
Human Capital Management, materials management, warehouse Management, plant maintenance
and quality management), mySAP ERP supports the development and implementation of plans and
ensure efficient production of accurate, comprehensive information available in any time, with those
who need care. Company may share data through the production companies and the supply network
to co-ordinate the production processes and promote cooperation. In addition, data from the plant
process control and data collection systems can be included as well as improving decision-making,
including the production of accurate data.
Production and Manufacturing in the SAP ERP, in cooperation with all other integrated SAP
applications, not much more than just facilitate effective production. It establishes a connection
between the critical sales, production planning, as well as the factory floor. SAP integrates the supply
chain to make your company competitive as possible. On the seamless integration with external
real-time process control and laboratory information systems. This represents significant progress for
information systems in the production of repeated and industry. SAP offers a complete integration
between its design, material requirements planning (MRP), shop floor control system and module.
SAP standard interface connection to the external CAD, product data management, data collection
and plant systems. Therefore, SAP ERP is a state-of-the-art production systems for discrete
manufacturers and engineering in order to companies.
Questions to Ponder in Production Planning
1. Master Data
Organizational Structures
What are the various organizational structures in the R/3 System?
Which R/3 organizational structures are used primarily for PP?
What is the relation between controlling area, company code, valuation area, plant and storage
location
Material Master
What is the purpose of different material master views?
Which views are available?
Which views are used primarily for PP?
What is the relationship between material master views and individual organizational structures?
How does the industry sector influence the material master maintenance?
How does the material type influence the material master maintenance?
What is the difference between external and internal number assignment and how is it set up in
Customizing?
Which other factors can influence the selection of fields in the material master?
How can MRP profile and forecast profile be used to optimize material master maintenance?
How can a material master be reorganized (deleted/archived)?
Which units of measure can affect processing in the material master (base unit of measure,
production unit, order unit, etc.)?
What is the material status used for and on which levels could it be maintained?
Review the usage of the following settings?
MRP group
MRP type
Reorder point
Planning time fence
MRP controller
Lot size
Procurement type
Special procurement type
Production storage location
Backflush flag
Stock determination group
Bulk material
Scheduling margin key
Safety stock
Strategy group
Consumption mode and consumption period

Availability checking group
Alternative selection flag
Dependent requirement flag for individual and collective requirements
Production scheduler
Production scheduling profile
Underdelivery/overdelivery tolerance
In-house production time (lot size dependent/independent)
Valuation class
Price control indicator
Moving average price/standard price
Bills of Material
What is determined by BOM usage?
What technical types of BOM are available?
Can the technical type of a BOM be changed?
During which processes will BOM usage and status be considered?
When would it be useful to make use of a Group BOM?
What is meant by area of validity and effectivity of a BOM?
Which item categories are available and what are their specifications?
What is a sub-item?
Under which circumstances could a BOM be recursive and what the usage of the recursive
indicator?
What is the usage of the following BOM settings?
Explosion type
Relevant to production
Relevant to costing
Material provision indicator
Bulk material
Work Centers
What is a work center category?
What data can be maintained on the various views (basic, default, capacity, scheduling, costing,
etc.)?
What is the purpose of a standard value key?
What role does the operation control key play?
What does referencing mean?
Why to use a work center hierarchy?
What is a pooled capacity?
Analyze the usage of the following fields?
Backflush indicator
Capacity category
Formulas for determining capacity requirements
Rate of capacity utilization
Relevant to finite scheduling indicator
Overload
Formulas for scheduling
Location group (move time matrix)
Queue times (normal and minimum)
Cost center
Activity types
Formulas for costing
Routings
What does a routing define?
How is a routing structured?
What task list types are available in the R/3 System?
What is a routing group and group counter?
What is a routing sequence, and what types of sequence are available?
What could be reasons to use sequences?
What are the various options to assign materials to routings?
Under which conditions would it make sense to assign components to operations?
What is a reference operation set?
How could the lotsize-dependend inhouse production time be calculated and updated into the
material master?
Production Resources/Tools
What types of PRT are available?
What is the relationship between PRTs and a routing/operation?
Engineering Change Management
What are the objectives of Engineering Change Management?
What is the significance of changes with a history?
Which PP objects can be managed using Engineering Change Management?
What is the purpose of an engineering change request/order?
How is a change master record structured?
What is a revision level compared to engineering change master?
Other Issues
Which scheduling options are available, and how do they differ from each other?
Which time components are taken into account during scheduling?
How are basic order dates determined?
How are the scheduled dates determined?
Which scheduling types are available in lead time scheduling?
What role do reduction measures play in scheduling?
What types of scrap can be maintained in PP basic data and how would they be considered during
MRP repectively scheduling?
What is external processing, and what conditions must be fulfilled before external processing can
take place?
What are co-products?
2. Production Planning
General Issues
What are the various planning levels available in R/3 PP?
What are the dependencies between Sales and Operations Planning, Demand Management, LongTerm-Planning and Material Requirements Planning?
What is the purpose of Sales and Operations Planning?
What is the structure of product groups and how could they be used in SOP/DM/LTP/MRP?
What is the purpose of proportion factors and aggregation factors within product groups?
Which planning methods are available in SOP?
Which sources are available as input data for SOP?
Which options are available for creating a sales plan in SOP?
Which options are available for creating an operations plan in SOP?
What is disaggregation?
How could the result of SOP be passed on to different planning tools within the PP planning
environment?
Demand Management
What is the purpose of Demand Management?
At which points is Demand Management integrated with Sales and Distribution?
Explain the main strategies in Make-to-Stock as well as in Make-to-Order planning logic. Pay
attention to master data settings.
What does consumption respectively reduction mean in the context of planning strategies?
What role does the individual/collective requirements indicator in the material master have during
make-to-order production?
What is a stocking level, and how can it be influenced?
Which types of availability check are available (ATP and check against planning) and what are the
characteristics of these checks?
Explain the link between MRP group, strategy group, strategy and requirement class.
What settings could be made in requirements classes (on PP as well as on SD side)?
Explain the purpose of version management in Demand Management?
Under which circumstances would you recommend the usage of MPS?
Compare the functionality of MPS with MRP?
What is meant by the firming of procurement proposals, and how can this effect be achieved?
What is a planning time fence, and where is it defined?
What is a manual firming date, and where is it defined?
How can a planned order be firmed, and which firming indicators are available in a planned order?
What is the purpose of MRP and how does it fit into the PP planning environment?
How would you organize MRP runs? Discuss the different options
MRP for a plant online
MRP for a plant in background
MRP for a material (individual planning) online
Which planning types are available (NEUPL, NETCH, NETPL)?
Which planning parameters are to be set in the application itself?
What is the function of the planning file?
What is meant by single-level planning, multi-level planning?
What is meant by interactive MRP?
What are the characteristics of an MRP scenario that is performed in simulation mode?
What is meant by low-level code and how is it considered in MRP?
What is a net requirements calculation?
Which buffers can be taken into account for the net requirements calculation in MRP (quantity
buffer: safety stock, time buffer: safety time)?
What does lot-size calculation entail?
Which lot-sizing procedures are available in the R/3 System (static, periodic and optimizing
procedures)? What are the characteristics of these lot-sizing procedures?
How does the procurement type defined in the material master affect MRP?
What is backward scheduling? What are the characteristics of backward scheduling?
What is the difference between basic scheduling and lead time scheduling?
How are the order due dates determined in basic scheduling?
How are the order due dates determined in lead time scheduling?
How does the in-house production time defined in the material master affect scheduling?
How does the scheduling margin key affect scheduling?
How are BOMs selected in MRP? Which criteria are taken into account during BOM selection?
What is a BOM selection ID?

How are alternative BOMs selected?
What is a production version?
How are routings selected in MRP? Which criteria are taken into account during routing selection?
What is an MRP list? What is a stock/requirements list? How are these lists structured? What are
the differences between these lists?
What is the function of exception messages?
What are planned orders?
What is meant by the individual/collective conversion of planned orders?
What is meant by days supply and receipt days supply?
How can component discontinuation be managed in MRP?
3. Production Order Processing

General Issues
What are the characteristics of work-to-order production?
What is defined in a production order?
What is a document type, an order category and an order type?
What are the various elements that a production order contains?
Which functions are executed when an order is created?
What are the various options available for creating an order?
Describe the system logic during routing selection?
Describe the system logic during BOM selection?
At which point in time are reservations generated and what information does it contain?
What can be achieved by performing the Read master data function?
How could routing sequences be considered during production order creation?
Describe the conversion of planned orders into production orders with focus on scheduling
aspects?
Order Release
What happens when an order is released?
Which operations are made possible and which are prevented when an order is released?
What is meant by status management?
What are business transactions?
What are the differences between system status and user status?
At which points in time can availability checks be performed? Which settings can be made, and
which must be made? On which objects can the availability check be run?
What is meant by machine commitment?
What is meant by midpoint scheduling?
Printing
Which shop floor papers can be printed?

Which print modes are available (online, update, background)?
What does reprinting mean?
Which conditions must be fulfilled before order documents can be printed?
Which conditions must an operation fulfill before shop floor papers (and in particular confirmation
slips and time tickets) can be printed?
Goods Issue
Which control indicators influence the behavior of the components in the production order (bulk
material, backflush, phantom assembly, etc.)?
What is meant by picking?
What is meant by stock determination? Which settings have to be made for stock determination
during production order processing?
What is a goods issue posting?
How can goods issues be entered (reference to order, reference to reservation, unplanned, etc.)?
What is the purpose of movement types?
What are the effects of a goods issue posting from an integrational point of view (MM, FI, CO)?
What is meant by the backflushing of components and how can this be achieved?
Confirmation
Which conditions must be fulfilled before confirmations can be entered?
What is a confirmation?
Which functions are linked to confirmations?
Which confirmation procedures are available?
What data can be entered during confirmations?
What is a milestone confirmation?
What is an unplanned milestone?
What identifies a progress confirmation?
What role does the control key defined in the operation play during confirmation?
Is it possible to link a confirmation with a goods movement posting?
What is a goods receipt?
What are the effects of a goods receipt posting?
What is the relevancy of the delivery completed indicator?
What is the function of overdelivery/underdelivery tolerance in the material master play?
Order Settlement / Archiving and Deleting
What is meant by order settlement?
What causes a production order to be debited/credited?
What is the difference between prelimenary costing and actual costing?
Which are the usual steps during order settlement?
What means variance calculation?

How is an order settled if the header material is a standard price material?
At which points in time can an order be settled?
Which conditions must be fulfilled before an order can be archived?
How are orders archived/deleted?
What is meant by residence times?
Order Information Systems
Which information systems can be used for order management?
What are the characteristics of the order information system?
What are variable object overviews?
What are the special characteristics of a (multi-level) order report?
What is the difference between the order information system and the Shop Floor Information
System?
Which functions are available from the order progress report?
Automation Options
What options are available for automating the processing of orders?
What role does the production scheduling profile play?
Describe the most lean production order and the necessary settings to achieve it?
Which functions could be executed in the mass processing?
Collective Orders
What are the characteristics of collective orders?
How can collective orders be created? Which conditions must be fulfilled?
What are the advantages of working with collective orders?
Which functions can be performed on collective orders?
How is scheduling for a complete collective order done?
What happens if a date/quantity for an order is changed within the collective order?
4. Product Cost Planning

General Issues
What is a cost element (primary/secondary)?
What is a cost component?
What is a cost component split?
Explain the Costing Variant and the main settings in customizing.
What is a costing type?
What settings can be done in a valuation variant?

How is a costing sheet structured?
Base unit costing
Describe base unit costing
Which master data are required for base unit costing?
How can results of BUC be used in further calculations?
Cost estimation without quatity structure
What is meant by quantity structure?
Describe costing w/o quantity structure
Which master data are required for that costing logic?
Cost estimation with quantity structure
Describe cost estimation with quatity structure
How can the quantity structure be determined?
What is activity based costing?
How could results from standard cost estimation be updated into the material master?
What happens if stock is on hand during that price update?
5. Repetitive Manufacturing
General Issues
What are the differences between discrete manufacturing and repetitive manufacturing?
What are the characteristics of make-to-stock repetitive manufacturing and make-to-order repetitive
manufacturing?
Master Data for Make-To-Stock Repetitive Manufacturing
What master data are necessary in repetitive manufacturing (material master, bill of material,
production line, routing)?
Describe the the following material master data:
Repetitive manufacturing indicator?
Repetitive manufacturing profile?
Production versions?
Which object is used to collect the material costs and production activities?
What are the various options available for establishing a link between the cost collector and the
production version of a material? What role doe the repetitive manufacturing profile play here?
Planning Make-To-Stock Repetitive Manufacturing

What is the planning table in repetitive manufacturing? What functions can be executed from here?
Material Provision
Describe the usage of pull list and stock determination as one of its function.
Which other ways are available to make sure that sufficient components are provided to the shop
floor?
Backflush
What does backflush mean in a repetitive manufacturing context?
Explain the functions of final backflush.
How can production activities be entered in the system?
What is meant by post processing list?
What are the advantages and disadvantages of negative stock?
What does the reporting point backflush procedure entail?
Evaluations
Which evaluations are available?
What is a reporting point overview?
6. Logistics Information System

Data Warehouse
What is the concept behind the Data Warehouse?
Which individual information systems does the SAP Logistics Information System comprise?
What data are evaluated by the information systems?
What are info structures? What are the characteristics of info structures?
Is there any relationship between system transaction data and the data in the info structures?
Which reporting options are available in the SAP Information System?
What is the difference between evaluations in LIS and evaluations on system transaction data in
the PP component?
Standard Analyses
What are standard analyses?
Which navigation options are available in standard analyses?
Which options in standard analyses can be used to influence the way in which data is presented?
Which analysis functions are available in standard analyses (ABC analysis, comparisons,
classification, etc.)?
Early Warning System
What is an early warning system?
What are the various applications for the early warning system?
How can the early warning system be used in standard analyses?
What is an exception analysis?
Which options are available for defining that an analysis should be performed at regular intervals?
Which types of analysis are available in the early warning system (threshold value analysis, trend
analysis, planned/actual comparison)?
Flexible Analyses
What are flexible analyses? What is the difference between flexible analyses and standard
analyses?
What are evaluation structures? What are evaluations?
1. Master Data
What is the relation between controlling area, company code, valuation area, plant and storage
location
Material Master
What is the relationship between material master views and individual organizational structures?
What is the difference between external and internal number assignment and how is it set up in
Customizing?
How can MRP profile and forecast profile be used to optimize material master maintenance?
How can a material master be reorganized (deleted/archived)?

Which units of measure can affect processing in the material master (base unit of measure,
What is the material status used for and on which levels could it be maintained?
Review the usage of the following settings?
MRP group
MRP type
Reorder point
Planning time fence
MRP controller
Lot size
Procurement type
Backflush flag
Bulk material
Safety stock
Strategy group
Valuation class
Bills of Material
What is a sub-item?
indicator?
What is the usage of the following BOM settings?
Explosion type
Relevant to costing
Bulk material
Work Centers
What data can be maintained on the various views (basic, default, capacity, scheduling, costing,
etc.)?
Backflush indicator
Capacity category
Overload
Cost center
Activity types
Routings

How could the lotsize-dependend inhouse production time be calculated and updated into the
material master?
Production Resources/Tools
What types of PRT are available?
What is the relationship between PRTs and a routing/operation?
Other Issues
What types of scrap can be maintained in PP basic data and how would they be considered during
MRP repectively scheduling?
What is external processing, and what conditions must be fulfilled before external processing can
take place?
2. Production Planning
General Issues
What are the dependencies between Sales and Operations Planning, Demand Management, LongTerm-Planning and Material Requirements Planning?

environment?
Demand Management
Explain the main strategies in Make-to-Stock as well as in Make-to-Order planning logic. Pay
attention to master data settings.
What role does the individual/collective requirements indicator in the material master have during
make-to-order production?
Which types of availability check are available (ATP and check against planning) and what are the
characteristics of these checks?
Explain the purpose of version management in Demand Management?
What is meant by the firming of procurement proposals, and how can this effect be achieved?
How can a planned order be firmed, and which firming indicators are available in a planned order?

Which buffers can be taken into account for the net requirements calculation in MRP (quantity
buffer: safety stock, time buffer: safety time)?
What does lot-size calculation entail?
Which lot-sizing procedures are available in the R/3 System (static, periodic and optimizing
How does the procurement type defined in the material master affect MRP?
What is backward scheduling? What are the characteristics of backward scheduling?
What is the difference between basic scheduling and lead time scheduling?
How are the order due dates determined in basic scheduling?
How are the order due dates determined in lead time scheduling?
How does the in-house production time defined in the material master affect scheduling?
How does the scheduling margin key affect scheduling?
How are BOMs selected in MRP? Which criteria are taken into account during BOM selection?
What is a BOM selection ID?
How are alternative BOMs selected?
What is a production version?
How are routings selected in MRP? Which criteria are taken into account during routing selection?
What is an MRP list? What is a stock/requirements list? How are these lists structured? What are
the differences between these lists?
What is the function of exception messages?
What are planned orders?
What is meant by the individual/collective conversion of planned orders?
What is meant by days supply and receipt days supply?
How can component discontinuation be managed in MRP?
3. Production Order Processing

General Issues

What can be achieved by performing the Read master data function?
How could routing sequences be considered during production order creation?
Describe the conversion of planned orders into production orders with focus on scheduling
aspects?
Order Release
At which points in time can availability checks be performed? Which settings can be made, and
which must be made? On which objects can the availability check be run?
Printing
Which shop floor papers can be printed?
Which print modes are available (online, update, background)?
What does reprinting mean?
Which conditions must be fulfilled before order documents can be printed?
Which conditions must an operation fulfill before shop floor papers (and in particular confirmation
slips and time tickets) can be printed?
Goods Issue
Which control indicators influence the behavior of the components in the production order (bulk
material, backflush, phantom assembly, etc.)?
What is meant by stock determination? Which settings have to be made for stock determination
during production order processing?
What is a goods issue posting?
How can goods issues be entered (reference to order, reference to reservation, unplanned, etc.)?
What are the effects of a goods issue posting from an integrational point of view (MM, FI, CO)?
Confirmation

Is it possible to link a confirmation with a goods movement posting?
What is a goods receipt?
What are the effects of a goods receipt posting?
What is the relevancy of the delivery completed indicator?
What is the function of overdelivery/underdelivery tolerance in the material master play?
Order Settlement / Archiving and Deleting
What is meant by order settlement?
What causes a production order to be debited/credited?
What is the difference between prelimenary costing and actual costing?
Which are the usual steps during order settlement?
What means variance calculation?
How is an order settled if the header material is a standard price material?
At which points in time can an order be settled?
Which conditions must be fulfilled before an order can be archived?
How are orders archived/deleted?
What is meant by residence times?
What is the difference between the order information system and the Shop Floor Information
System?
Automation Options
Collective Orders
How is scheduling for a complete collective order done?
What happens if a date/quantity for an order is changed within the collective order?
4. Product Cost Planning

General Issues
Base unit costing
5. Repetitive Manufacturing
General Issues
What are the characteristics of make-to-stock repetitive manufacturing and make-to-order repetitive
manufacturing?
What master data are necessary in repetitive manufacturing (material master, bill of material,
production line, routing)?
What are the various options available for establishing a link between the cost collector and the
production version of a material? What role doe the repetitive manufacturing profile play here?
What is the planning table in repetitive manufacturing? What functions can be executed from here?
Material Provision
Which other ways are available to make sure that sufficient components are provided to the shop
floor?
Backflush
Evaluations
6. Logistics Information System

Data Warehouse
Which individual information systems does the SAP Logistics Information System comprise?
Is there any relationship between system transaction data and the data in the info structures?
What is the difference between evaluations in LIS and evaluations on system transaction data in
the PP component?
Standard Analyses
Which options in standard analyses can be used to influence the way in which data is presented?
Which options are available for defining that an analysis should be performed at regular intervals?
Which types of analysis are available in the early warning system (threshold value analysis, trend
analysis, planned/actual comparison)?
Flexible Analyses
analyses?
Learn about;
Obtain an overview of the process
Understand Concepts of Sales and Operations Planning (SOP)
Define how the SOP is integrated with other SAP modules
Understand the SOP processes
Perform SOP transactions
Understand the process of Flexible Planning
Production Execution
Production Planning is the process of aligning forecasts with manufacturing capability to create
production and procurement schedules for finished products and component materials. It also tracks
and records the detail of the manufacturing process, for example, the planned and actual costs and
material flows. It is fully integrated with the other SAP modules: SD, MM, LE, QM, CO.
Learn more about:
Production Planning Overview
Master Data
Production Execution Process
Process Manufacturing
Batch Management
Course Overview
Understand the purpose Batch Management
Understand different terminologies in Batch management
Batch Management in different modules
Traceability with Batch
Questions on Production Planning

Here are more than 100 questions (well just questions) on Production Planning. Go through it and
see as to how many you can answer.
Master Data
1.
2.
3.
What is the relation between controlling area, company code, valuation area, plant and
storage location
Material Master
1.
2.
3.
4.
What is the relationship between material master views and individual organizational
structures?
5.
6.
7.
8.
9.
What is the difference between external and internal number assignment and how is it set
up in Customizing?
How can MRP profile and forecast profile be used to optimize material master
maintenance?
10. How can a material master be reorganized (deleted/archived)?

11. Which units of measure can affect processing in the material master (base unit of measure,
12. What is the material status used for and on which levels could it be maintained?
13. Review the usage of the following settings?
MRP group
MRP type
Reorder point
Planning time fence
MRP controller
Lot size
Procurement type
Backflush flag
Bulk material
Safety stock
Strategy group
Valuation class
Bills of Material
1.
2.
3.
4.
5.
6.
7.
8.
What is a sub-item?
9.
indicator?
10. What is the usage of the following BOM settings?
Explosion type
Relevant to costing
Bulk material
Work Centers
1.
2.
What data can be maintained on the various views (basic, default, capacity, scheduling,
costing, etc.)?
3.
4.
5.
6.
7.
8.
Backflush indicator
Capacity category
Overload
Cost center
Activity types
Routings
1.
2.
3.
4.
5.
6.
7.
8.
9.
10. How could the lotsize-dependend inhouse production time be calculated and updated into
the material master?
11. Production Resources/Tools
12. What types of PRT are available?
13. What is the relationship between PRTs and a routing/operation?
1.
2.
3.
4.
5.
6.
Other Issues
1.
2.
3.
4.
5.
6.
7.
What types of scrap can be maintained in PP basic data and how would they be
considered during MRP repectively scheduling?
8.
What is external processing, and what conditions must be fulfilled before external
processing can take place?
9.
Production Planning General Issues

1.
2.

What are the dependencies between Sales and Operations Planning, Demand
Management, Long-Term-Planning and Material Requirements Planning?

1.
2.
3.
4.
5.
6.
7.
8.
9.
environment?
Demand Management
1.
2.
3.
Explain the main strategies in Make-to-Stock as well as in Make-to-Order planning logic.

Pay attention to master data settings.
4.
5.
What role does the individual/collective requirements indicator in the material master have
during make-to-order production?
6.
7.

Which types of availability check are available (ATP and check against planning) and what
are the characteristics of these checks?
8.
9.
10. Explain the purpose of version management in Demand Management?

1.
2.
3.
What is meant by the firming of procurement proposals, and how can this effect be
achieved?
4.
5.
6.
How can a planned order be firmed, and which firming indicators are available in a
planned order?

1.
2.
1.
2.
3.
4.
5.
6.
7.
8.
9.
Which buffers can be taken into account for the net requirements calculation in MRP
(quantity buffer: safety stock, time buffer: safety time)?
10. What does lot-size calculation entail?

11. Which lot-sizing procedures are available in the R/3 System (static, periodic and optimizing
12. How does the procurement type defined in the material master affect MRP?
13. What is backward scheduling? What are the characteristics of backward scheduling?
14. What is the difference between basic scheduling and lead time scheduling?
15. How are the order due dates determined in basic scheduling?
16. How are the order due dates determined in lead time scheduling?
17. How does the in-house production time defined in the material master affect scheduling?
18. How does the scheduling margin key affect scheduling?
19. How are BOMs selected in MRP? Which criteria are taken into account during BOM
selection?
20. What is a BOM selection ID?
21. How are alternative BOMs selected?
22. What is a production version?
23. How are routings selected in MRP? Which criteria are taken into account during routing
selection?
24. What is an MRP list? What is a stock/requirements list? How are these lists structured?
What are the differences between these lists?
25. What is the function of exception messages?
26. What are planned orders?
27. What is meant by the individual/collective conversion of planned orders?
28. What is meant by days supply and receipt days supply?
29. How can component discontinuation be managed in MRP?
Production Order Processing General Issues
1.
2.
3.
4.
5.
6.
7.
8.
9.
10. What can be achieved by performing the Read master data function?
11. How could routing sequences be considered during production order creation?
12. Describe the conversion of planned orders into production orders with focus on scheduling
aspects?
Order Release
1.
2.
3.
4.
5.
6.
At which points in time can availability checks be performed? Which settings can be made,
and which must be made? On which objects can the availability check be run?
7.
8.
9.
Printing
10. Which shop floor papers can be printed?

11. Which print modes are available (online, update, background)?
12. What does reprinting mean?
13. Which conditions must be fulfilled before order documents can be printed?
14. Which conditions must an operation fulfill before shop floor papers (and in particular
confirmation slips and time tickets) can be printed?
Goods Issue
1.
Which control indicators influence the behavior of the components in the production order
(bulk material, backflush, phantom assembly, etc.)?
2.
3.
What is meant by stock determination? Which settings have to be made for stock
determination during production order processing?
4.
What is a goods issue posting?How can goods issues be entered (reference to order,
reference to reservation, unplanned, etc.)?
5.
6.
7.

What are the effects of a goods issue posting from an integrational point of view (MM, FI,
CO)?
Confirmation
1.
2.
3.
4.
5.
6.
7.
8.
9.
10. Is it possible to link a confirmation with a goods movement posting?

11. What is a goods receipt?
12. What are the effects of a goods receipt posting?
13. What is the relevancy of the delivery completed indicator?
14. What is the function of overdelivery/underdelivery tolerance in the material master play?
15. Order Settlement / Archiving and Deleting

16. What is meant by order settlement?
17. What causes a production order to be debited/credited?
18. What is the difference between prelimenary costing and actual costing?
19. Which are the usual steps during order settlement?
20. What means variance calculation?
21. How is an order settled if the header material is a standard price material?
22. At which points in time can an order be settled?
23. Which conditions must be fulfilled before an order can be archived?
24. How are orders archived/deleted?
25. What is meant by residence times?
1.
2.
3.
4.
5.
6.
What is the difference between the order information system and the Shop Floor
Information System?
Automation Options
1.
2.
3.
4.
5.
Collective Orders
6.
7.
8.
9.
10. How is scheduling for a complete collective order done?

11. What happens if a date/quantity for an order is changed within the collective order?
Product Cost Planning General Issues
1.
2.
3.
4.
5.
6.
7.
Base unit costing

1.
2.
3.

1.
2.
3.

1.
2.
3.
4.
5.
Repetitive Manufacturing General Issues

1.
2.
What are the characteristics of make-to-stock repetitive manufacturing and make-to-order

repetitive manufacturing?

1.
What master data are necessary in repetitive manufacturing (material master, bill of
material, production line, routing)?
2.
1.
2.
What are the various options available for establishing a link between the cost collector and
the production version of a material? What role doe the repetitive manufacturing profile play
here?
1.
What is the planning table in repetitive manufacturing?
2.
What functions can be executed from here?
Material Provision
1.
2.
Which other ways are available to make sure that sufficient components are provided to the
shop floor?
Backflush
1.
2.
3.
4.
5.
6.
Evaluations
1.
2.
Logistics Information System Data Warehouse

1.
2.

Which individual information systems does the SAP Logistics Information System
comprise?
3.
4.
5.
Is there any relationship between system transaction data and the data in the info
structures?
6.
7.

What is the difference between evaluations in LIS and evaluations on system transaction
data in the PP component?
Standard Analyses
1.
2.
3.
Which options in standard analyses can be used to influence the way in which data is
presented?
4.

1.
2.
3.
4.
5.
Which options are available for defining that an analysis should be performed at regular
intervals?
6.
Which types of analysis are available in the early warning system (threshold value analysis,
trend analysis, planned/actual comparison)?
Flexible Analyses
1.
2.
analyses?
Matrix Management
he use of matrix organization structures in businesses of all sizes is not a recent phenomenon. Case
studies on the design and use of matrix hierarchies date back to the 1960s and early 1970s when
companies such as Xerox, General Electric, and Dow Corning were among the first to tout the
benefits of cross-functional, matrix-driven organizational structures. For these large conglomerates,

the allocation of key resources and functional roles across multiple business lines allowed greater
productivity with fewer resources, which ultimately translated into a more favorable bottom line.
SAP Production Planning Tips and Tricks

SAP Production Planning Tips and Tricks contains a huge collections of smart answers to get the
work done faster. Here is the list of tips this manual provides.
Download the SAP PP Tips and Tricks Manual.
Contains Tips and Tricks on the below topics.

1.
Table of the Order Production Operation
2.
Why used Planning tools like APO or I2?
3.
Difference between MRP vs MPS
4.
SAP Factory Calendar
5.
GR processing time in PP and MM
6.
Production Planning Extract data from MRP Table
7.
Calculation to determine the delivery date and release date
8.
Purchasing processing Time OPPQ
9.
Define Safety Stock Availability
10. Questions on MRP Group and MRP Controller

11. What if nothing happens when you run MRP?
12. Guide To Mass Replace Work Center
13. Planning separately via Storage Location or Vendor with MRP Area
14. The Common used Planning Strategy
15. Why Planning file entry still Exists?
16. Planning Strategy Selection
17. When do we use planning without final assembly strategy?

18. MRP Monthly lot size
19. Reservation Not Created During MRP Run
20. How to Configure Range Of Coverage Profile
21. Lose of link between sales order and production order
22. Batch Characteristics while Running MRP
23. What is Firming Type in the MRP Types
24. Functions of Production Version
25. What is Discrete Manufacturing, REM and Demand Management?
26. Rescheduling date does not take into account the GR Processing Time
27. Schedule Margin Key in Production Scheduling
28. Whats the function for Plan order convert to production order?
29. Work Scheduling View in Material Master
30. Scheduling Background Jobs for MRP
31. What is Finite and Infinite Scheduling
32. What Is Mean By Schedule Lines
33. Production Setup Time
34. Material Stock in Production Order
35. Automatic Conversion to Production Orders
36. Regarding Production Order Confirmation
37. How Costing takes place in Production Orders
38. SAP flow for REWORK activity
39. Serial Number For Component

40. How To Delete Old Production Orders
41. Checking Costs and Revenues from the Sales Order
42. PP Define the default components reservation movement type
43. Goods Receipt (101) for Process Order
44. Goods receipt and goods issue through a PI sheet
45. Steps for Subcontracting
46. Stock in Transit liquidation or remove the stock which is in transit
47. Restricting Good Receipt Unless Production Order Confirmed
48. How to link BOM component to storage location?
49. When is a Material BOM Not Exploded?
50. Creating a simple BOM
51. Explode BOM
52. Where used list for BOM
53. PP Controlling data for your Bill of Materials
54. Allocating BOM to Other Plant
55. Mass Change Bill of Materials
56. Multi-level configuration with variants
57. What exactly is a Phantom item or Assembly means?
58. Attachment Of Drawings in BOMs
59. Split In Routing / Difference Between Alternative And Parallel Seq
60. A basic SAP Engineering Change Management Setup
61. Capacity Leveling Profile Setup

62. Production Control System Messages
63. Production Order System Status
64. Explain System and User Status In Production Order
65. PP Year End To Do List
66. SAP Production Planning and Control Frequently Asked Question
67. The Overall Flow For SAP PP

Run MRP, Convert Planned Order To Production Order, Settle Costs of Production Order

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Run MRP, Convert Planned Order To Production Order, Settle Costs of Production Order

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Run MRP, Convert Planned order to Production Order,

Settle Costs of Production Order

Create Requirements for Finished Good

Enter your finished good.

Verify your plant, and version = 00.

Change planning period to W.

Click on Schedule Lines tab.

Run MRP Single Item, Multi level

Your finished good.

Processing key: NETCH

Create pur. Req.: 2

Create MRP list: 1

Review the MRP list.

Display Stock/Requirements List

Enter your finished good and plant.

Conversion Planned Order to Production Order

Enter your finished good and plant.

Double click on a planned orders (PldOrd).

Click the Prod. ord. button.

Accept all defaults, and click save.

Record your order number.

Click the refresh button. Notice the PldOrd changed to PrdOrd.

Movement type: 261

Enter your plant.

Enter Completion Confirmation of Production

Enter your order number.

Click on final confirmation.

Yield to conf. Number of finished goods you produced.

Goods Receipt of Production Order

Enter movement type 101

Enter your production number, and plant.

Select adopt + Details.

Click on the adopt button, and save.

Make the CElem category equal to 1 and save.

Enter your company code,

Settle Costs of Production Order

Enter your controlling area (if required).

Enter your production order number.

Settlement period: Current month. (1)

Posting period: Current month. (1)

Review the run.

Select Actual/Plan/Variance, and click enter.

Create and Display Routing

Select a HAWA TL Type.

Click on the copy button.

Change the TL Type to N.

Click enter, and save.

Create a Routing for Finished Products

From SAP Easy Access: Logistics Production Master

Enter your finished good, and plant.

Click on the CompAlloc button.

Select the materials required to complete operation 010.

Click new assignment.

Allocate these materials to operation 010.

Repeat for each operation defined above.

Click enter, and save.

Create work center

Create Work Center Person Responsible

Click on new entries.

Enter your plant.

Enter work center person responsible: 1 _ _.

Enter a name for the person responsible.