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Make to Stock Strategies – Strategy 11

March 9, 2014 | 2,027 Views |

Kyatam Vinamrath Kumar

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MAN Production Planning (PP)

Manufacturing

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Introduction:
Planning Strategy ’11’ is one of the most widely used and one of the
important strategy of the MTS strategies. This strategy is also called
as Gross Requirements Planning.
Strategy ‘11’ is particularly useful for make-to-stock scenarios and
the sales orders have no effect in the production with out considering
the plant stock in to consideration . This strategy is particularly useful if
you need to produce the Product, regardless of whether you have stock or

not. The production is based on production plans transferred from

SOP to demand management or with manually entered PIR’s.

Few important features of this strategy are:

Plant stock and Sales Order requirements do not affect the
production.
No concept of PIR consumption through customer
requirements, since customer requirement is not relevant for
make-to-stock production.
PIR reduction happens during Goods receipt of the Production
Order.

Master Data:

You need to maintain the following master data for the finished product:

Maintain strategy group 11 on the MRP screen.

Set the Mixed MRP indicator to 2 on the MRP screen.
Maintain the item category group (for example, NORM) on the Sales
Organization screen.
Maintain the Availability check field so that you perform an availability
check without the replenishment lead time (checking group 02 in the
standard system).
Process Flow :

Creation of Planned independent requirements (PIR’s) for the production

plan (MD61)

MRP Run .(MD02)

Procurement requisitions are created in the MRP run

Planned order conversion to Production Order

Production Execution and goods receipt for the order, the

stock/requirements list display (MD04)

Reduction of Planned Independent Requirements during Goods Receipt of

the Production Order

Sale order creation (VA01)

Goods Issue for Delivery (VLO1N)

Detailed Process Flow :

Initial situation of material with stock 100

Creation of Planned independent requirements (PIR’s) through MD61

Now save
Carry out MRP planning Run…with MD02
Planned Orders created for the material.. here it can be observed that
plant stock is not considered in net requirement calculation…

Now convert the first planned order to production order and release
Complete Goods Issue, Confirmation and Goods Receipt of the
Order……after the goods receipt of the Production Order stock gets
increased by 100 and First PIR gets consumed….

then save
Creation of sale order for the Product….
Now it can be observed that Sale order does not have any influence on
the planning situation it will be on display only as shown below…
Now Goods delivery against the sale order through VL01N….
Now final situation of the material….

Thanks

Kumar

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 4 Comments
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Ramagiri Srinivas Rao

March 9, 2014 at 11:05 am

Hi Kumar,

Nicely explained. You can also add where this type of strategy is used. For
Eg:Cement Industries use this type of strategy where they do not consider the
available stock.

Thanks & Regards,

Ramagiri

Kyatam Vinamrath Kumar Post author

March 28, 2014 at 2:57 am

Hi,

Thanks for your compliment…

Regards

Kumar

Sharma rakesh

April 25, 2014 at 12:46 pm

Hi Kumar,
 Informative and great explanation. This Doc- would be helpful for young
consultants like me .Expecting few more Doc’s in future.

Thanks & Regards

Rakesh

Raja Rajan Chokkalingam

February 7, 2017 at 6:48 am

Hi Kumar,

Thank you so much for this blog.

I have a question, will this work the same way for process orders as well ?

(in the blog you have demonstrated with production order)

Thanks,

Rajan.

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