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221 ADVANCE PLANNING AND
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Thursday, October 31, 2019

 Agenda
 Business Issues in Supply Chain

 SAP APO Overview

 SAP APO Planning Capabilities

 Key Learning Points

 Summary

 Questions & Answers

2
 Typical Business Issues

• Variations in monthly forecasts and actual demand

• Promotions in one product may be cannibalizing another
• Difficulty in adapting the dynamics of market in the demand
planning process
• Inventories may pile up in one depot while others may run
short of stocks which leads to lost sales
• Transportation costs going through roofs while transportation
resource utilization is poor
• Mismatch in planned and actual material requirement

3
 Business Issues contd…

• Increased frequency of planning (Monthly to weekly, weekly to

daily)
• Discontinue use of disparate legacy systems across sites/BUs –
centralized single global instance of Supply Chain
• Increasing trust in planning process
• Operation Excellence
 Reduced average order-planning cycle time
 Improved forecast accuracy
• Financial Excellence
 Reduced inventory carrying costs
 Improved productivity
 Increased margin on top-line growth by optimizing product
mix

4
 Agenda
 Business Issues in Supply Chain

 SAP APO Overview

 SAP APO Planning Capabilities

 Key Learning Points

 Summary

 Questions & Answers

5
 APO Overview
What is APO ?
• APO – Advanced Planner and Optimizer

• SAP application used to enable real time

decision support, advanced constraint based
planning and optimization

• APO provides optimization of the total supply

chain and seamlessly links all key
processes/modules (from order generation
to transportation)

• Capable of real time integration between

APO and ECC for master and transactional
data via Core Interface (CIF)

6
 SAP APO Application
A system capable of
 Demand planning having features like advanced statistical tools for
forecasting, promotional planning, product life cycle planning ,
collaborative planning and management by exception.
 Optimized design of supply chain network.
 Planning for supply network components like Distribution centers,
Manufacturing plants, C&F agents, suppliers& vendors considering
constraints. Dynamically match supply & demand
 Perform what if analysis.
 Optimized Planning & Scheduling of production facilities taking into
account of the availability of parameters like resource capacity and
component material etc.
 Carry out Order Fulfillment though location and product substitution.

7
 SAP APO Components

Demand Planning
Demand Planning is used in the creation of forecast towards
generation of a Demand Plan
Interactive Demand Planning is used to provide an user interface to
access/edit and manage data towards creation of a demand plan
through use of planning book
Other functionalities include Statistical Forecasting, Lifecycle,
Promotion Planning and Collaborative Planning.
Supply Network Planning
Supply Network Planning is used to create a tactical sourcing plan
based on the demand and supply situation
SNP uses the demand plan to determine a supply plan in the short
to medium-term based on constraints and penalties.
A single global consistent model of the supply chain is the key
towards an effective sourcing, production and distribution plan.

8
 SAP APO Components

Production Planning Detailed Scheduling

PP/DS is used with other APO components as well as execution
system typically SAP ECC to create a production plan
Production Planning - create procurement proposals for both in-
house production and external procurement to cover
requirements
Detailed Scheduling - schedule orders on resources based on
planning conditions like component or resource availability
Optimization tool available to improve planning solution based on
constraints
Global Availability to Promise
Functionality of ATP check is an online search to ensure that
requested product can be provided at requested time in the
quantity requested by the customer

9
 SAP APO Components
Global Availability to Promise
Enhancement of basic ATP functionality in ECC to include Capable-
to-Promise (CTP), Multi-level ATP, Rules-based ATP, Correlation
Calculation
CTP and Multilevel ATP check calls PP/DS to cover the
requirement, while in Rules-based ATP check, substitutions can
be checked to confirm the requirement based on pre-defined rules
Transportation Planning / Vehicle Scheduling
Component to plan and optimize shipments for orders and
deliveries.
Tightly integrated with SAP ECC Logistics Execution, SAP BW to
evaluate transportation management process and SAP Event
Management to monitor transportation execution.
Optimization tool available assigning orders to vehicles in a cost-
effective manner considering hard and soft constraints.

10
 Agenda
 Business Issues in Supply Chain

 SAP APO Overview

 SAP APO Planning Capabilities

 Key Learning Points

 Summary

 Questions & Answers

11
 SAP APO Planning Capabilities
Strategic
Demand Planning Long-term
Tactical
Supply Network Planning Medium to Long-term

Collaborative Planning (Demand and Supply) Operational

Short to Medium-term

Production Planning Detailed Scheduling

Global Availability to Promise

Transportation Planning Vehicle Scheduling

12
 Typical Demand Planning Process
6. Review
7. Incorporate Transfer to ECC
Forecast with
Marketing Demand
Marketing
Input Management
(SKU Level)

1. Set-up
2. Evaluate 3. Generate 8. Consolidate 9. Hold Consensus Unconstrained
and
Demand Statistical & Distribute Demand Planning Demand
Maintain DP
History Forecast Demand Plan Meeting Plan
Structure

5. Sales 10. Track

4. Send Forecast to
Reviews, Updates, & Report
National and Field Sales
& Returns Forecast Forecast
(Customer/Geography/SKU Level) Accuracy

11. Sales 13. Advise

12. Monitor
Communicates Product
& Update
Exceptional Supply of
Demand Plan
Changes Change(s)
Monthly

14. Manage
Weekly/Daily Exceptions
13
 Typical Supply Planning Process

5. External Procurement – 6. Review 11. Execution of

7. Change Supply
Check Due Date Supply Purchase Orders
Source if reqd.
& Source of Supply Plan in OLTP system

1. Set-up
2. Generate 10. Convert
and 8. Production 9. Transfer Orders
Supply Plan to Purchase Reqs.
Maintain SNP Planning (PPDS) to OLTP system
match Forecast to Purchase Orders
Structure

12. Convert 13. Scheduling /

4. Review Planned to Re-scheduling
3. In-house Production –
Production Production Orders of activities
Component Material
Plan
& Capacity Check

14. Execution of
Production Orders
Monthly / Weekly in OLTP system

Weekly/Daily

14
 SAP APO with SAP ECC

SAPECC
ECC SAP APO
APO SAP
SAP BW
BW

Supply Chain Cockpit

LIS, CO/PA Historical

Historical
Demand Planning
HR, FI Data
Data

Customer
Production
Orders Planning and
Detailed Supply Key
Production Global
Scheduling Network Performance
Control ATP
Planning Indicators
Inventory ( KPIs )
Management TP / VS

Transportation
Processing Collaboration & Optimization

TCS APO Capability

15
 Agenda
 Business Issues in Supply Chain

 SAP APO Overview

 SAP APO Planning Capabilities

 Key Learning Points

 Summary

 Questions & Answers

16
 Complete SAP SCM Solution

Measure
Supply Chain Performance Management

Plan

Customer
Customer
Vendor
Dyn. Supply Chain Cooperation

Dyn. Supply Chain Cooperation

Demand Planning Supply Network
(DP) Planning
(SNP)
Private
Exchanges
Private
Source Make Deliver
Exchanges
Inventory Collaborative Availability Check
Production Planning/
Hub (GATP)
Detailed Scheduling
(ICH) Transportation Planning
(PP/DS) Partner
(TP/VS)

Partner

Monitor

Supply Chain Event Management

17
 Training Structure
Introduction SAP & BW
to SAP and Basic PC Detailed
Literacy Navigation Role Specific Learner
Business Skills Process Transactional Competency
Process Training Training
Training Training Assessment
overview (as required)
(e-learning)

Training consists of 4 phases

This course is the fourth phase of training: you should have completed the other
training activities prior to attending today’s session
The fourth phase of training is facilitated classroom based learning, supported by:
Overview Training Materials
Process Training Materials
Transactional Training Materials
System simulations
Work instructions & cue cards
On-line simulated competency assessments

18
 Systems Landscape

Legacy ERP
& APO

7 6
SUMI
9
Demand & Supply Plans
Transaction
RS Stock

8
Distribution
s

SAP ECC Planning Results Requirements Production Planning/

6.0 Planning Detailed Scheduling

Master & Trans 5 Supply

Data Network
Planning

1 SAP 4
Historical Data

via CIF MDM Demand

Planning
1
via XI

2 Forecasting

SAP BW History and Orders 3

7.0 APO
BW SAP APO
BI-IP
(SCM 5.0)
DP & SNP Planning
Results
19
8
APO Overview
Master and Transactional Data ECC APO
ECC Master APO Master
Data Data

•Plant •Location
•Material •Product
Master Data: Periodic (Daily •Contract/ Info CIF •Transportation
Record Lane
Background Job) •Work Center
Periodic •Resource
•Routing & BOM Integration •Production Data
Structure
(Prod. Version) model •Product &
•Product &
Customer Customer
Hierarchy Hierarchy

ECC APO
ECC Transaction APO Transaction
Data Data
•Storage Location •Storage Location
Stocks/Intransit Stocks/Intransit
Stocks CIF Stocks
•Sales Order
Transactional Data: Real-Time •Process Order Real-Time •Sales Order
•Process Order
•Purchase Integration •Purchase
Requisitions
•Purchase Orders
model Requisitions
•Purchase Orders
•Planned Orders •Planned Orders
•Sales History* •Sales History*

* Sales History is transferred from ECC to BW & then to APO every week & not on real time basis
 DP Process
Set-up DP master data
(mainly Characteristic Value Combinations [CVCs] for new products)

Generate Proportional Factors (where the disaggregation values used to break higher
level forecast down to the lowest level are updated)
automated

Clean Base Historical data

Generate Baseline Forecast interactively at key Channel and SKU level

Generate
By default, generate baseline
Baseline forecast
Forecast monthly
quarterly as background
as background job
job (78 (104 Future)
Weeks weeks)
automated

Adjust Baseline Forecast

Capture Events
21
 DP Process (continued)

Calculate Agreed Unconstrained Demand [AUD]

automated
(Adjusted Baseline + Events)

Add Sample Stock (if it exists)

Calculate Total Demand automated

(Adjusted Baseline + Events + Sample Stock)

Split Total Demand using Proportional Factors to locations automated

Release AUD & Split Total Demand to SNP, BW, SUMI , ECC
automated
(Weekly on Friday night)

22
 APO DP Terminology
InfoCube
Data storage for historical information used for forecasting or to store planning results.

Characteristics
are the objects by which you plan, aggregate, disaggregate and report on business data.

Key Figure
is a numerical value that is either a quantity or a monetary amount.

Planning Book
defines the content and layout of the interactive planning screen. It enables you to integrate
people from different departments into the forecasting process.

Macro
user-defined formulas that can be executed within the grid of a planning book. It provides
23
 APO DP Terminology
Planning Area

Central data structure of DP & SNP. (Live Cache)

Master Planning Object Structure

contains plannable characteristics for use in one or more planning areas.

Storage Bucket Profile

defines the time bucket in which data based on a given planning area is saved in DP or
SNP
Select Variant / Profile

groups together a specific selection of characteristics for easy selection.

Forecast Master Profile

defines the settings for statistical forecasting.

Univariate Profile

defines the settings for univariate forecasting.

24
 InfoCube
¤ Two Types of Infocubes used in DP : Basic Cube & Remote Cube

¤ Basic Cubes - Central data storage for reports, evaluations and

transaction data used in DP.

¤ Remote Cubes – Used for Reporting data from Planning Area/

LiveCache. It does not store any data.

¤ Contains three types of data:

• Key figures (Actual Sales, Statistical Forecast, etc.)
• Unit Characteristics (Category, Brand, Packsize, Product,
Channel, Customer, etc.)
• Time characteristics (week number, book month etc)
¤ Used for:
• Loading data into a Planning Area from external sources
• Backing up data & storing data from a Planning Area
• Integration to other source systems 25
InfoCube

Characteristics

Key Figures

26
 Key Information
Planning Object Structure
Planning Object Structure stores the Characteristic Value Combinations (CVC’s) for
demand planning defining the characteristics for the planning areas.
Characteristic are objects by which you aggregate, disaggregate and evaluate
business data.
The Planning Object Structure is divided into three dimensions namely:
• Product Dimension.
• Customer Dimension
• Location Dimension

Product Type and Country has been defined as a Navigation Attributes and these can
act like characteristics but are not a part of the data tables. For Example in addition to
the product number we need what its color and as such color further describes a
product number.

27
27
DP Planning Levels - Product

Planning Level Code Description

P1- Division 3 Foods Category

P2- Subdivision 31 Foods excl ICFF

3101 Spreads and Cooking Product
P3-Category
P4- Market 310101 Yellow Fats

P5- Brand 310101001 Blue Band

P6- Sector 310101001J3 Margarines

P7- Corporate PG 310101001J301 Blue Band Regular Margarine

PS000021 250G
P8- Subbrand
310101001J3011902 Blue Band RGLR Margarine
P9- Base Pack With Salt 250G
Product 20001661 #48 '‫גר‬250 ‫מרגרינה דקל‬x ‫פסח‬
28
DP Planning Levels – Customer

SALES ORGANISATION RETAIL - LOCAL

Planning Level Code Description

C1 D01146 EGYPT

C2 D01146 EGYPT

C3 D01146 EGYPT

29
 Planning Object Structure – POS 1

Characteristics
Product &
Customer
Related Only

30
 Planning Object Structure – POS 2

Characteristics:
Product &
Location Related
Only

31
 Planning Object Structure – POS 3

Characteristics:
Product, Customer
& Location Related

32
 Key Information
Planning Area
A Planning Area is the central data structure of Demand Planning and groups the
parameters that define the scope of the planning activities. The planning area
determines where and how the planning results are to be stored in respect to live
Cache.

There would be one planning area for demand planning purpose for the whole region to
allow displaying and managing planning data across countries including all necessary
key figures to support the demand planning processes such as baseline generation and
event forecasting.

It contains the following parameters :

• Default demand planning unit of measure : CASE
• Periodicity (Time granularity) : Week
• Calendar : None
• Time Horizon : 3 years past, 2 years future always

33
33
Planning Area 1

34
Planning Area 2

35
Planning Area 3

36
Maintain Master Data and Planning Parameters

Key concepts in Maintain Master Data and Planning Parameters

Time Horizons
• Periodicity is defined as time granularity in which DP data will be kept. It is defined as weeks
such that DP data would be generated and displayed in weekly buckets. All planning books will
be in weekly buckets. The regional definition is starting from Monday and ending on Sunday.
• For Israel :-The sales data is extracting from SAP BW with IL country week definition i.e.
(Sunday to Saturday)
• For monthly values (Gregorian month), SAP BW will be used. Transition from weeks to months
will be done according to number of days.
• No holidays will be defined in the Demand Planning Calendar in support of the fact that
consumption does not stop due to holidays. Exception case of a country having a holiday
which has a significant impact on actual sales, this history data should be cleaned up
(automatically by triggering outlier correction or manually by using key figure Data Cleaning
Adjustment) by the demand planner.
• Where sales patterns change in holiday periods, seasonality function will be used to cater to
irregular sales pattern in these periods.
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37
Maintain Master Data and Planning Parameters

Key concepts in Maintain Master Data and Planning Parameters

Planning Books and Data Views:

• Planning Books are planning tables in which users display and change data interactively. It is
based on a planning area. Planning Books are common for all countries. They will be defined
separately for each process (like Baseline and Event Forecasting) and in some cases for
different users (demand planner, category and customer manager) due to the fact that different
users must have authorization to different books. In a data view you choose your planning
books and planning views. For e.g. Data View “Add Incremental Event Volume-Demand
Planner” or “ Add Incremental Event Volume-Category

• A planning book contains:

• Key Figures

• Characteristics

• Macros

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38
Maintain Master Data and Planning Parameters

39
Maintain Master Data and Planning Parameters

Key concepts in Maintain Master Data and Planning Parameters

Forecasting Profiles:

• Forecasting Profiles will determine how the statistical forecast for a CVC will be calculated. It
contains forecast parameters like forecast model, horizon, forecast and history key figures etc.
The regional defaults for statistical models are:
• Linear Regression
• Seasonal Linear Regression

• There are two key figures to store system generated baseline: ‘Stat Forecast 1’ and ‘Stat
Forecast 2.’ Stat Forecast 1 can be either Linear Regression or Seasonal Linear Regression.
For Stat Forecast 2, any model can be selected.

• The criteria for measuring forecast error is set to “Mean Absolute Percentage Error (MAPE) as
the regional default for statistical model performance measure.

40
40
Forecasting Profiles

41
Maintain Master Data and Planning Parameters

Key concepts in Maintain Master Data and Planning Parameters

Selection Profiles

• Selection Profile defines the set of CVCs assigned to a user for demand planning purposes. It
is a combination of characteristic values used for selecting data in planning books. Sales
Organization will be mandatory at the selection screen.

• There will not be any fixed selection profiles. Demand Planners need to set selection profiles
for their product range i.e. product and customer groups for which they are responsible.

• Regional naming standard has been defined which must be followed by demand planners.

42
42
Maintain Master Data and Planning Parameters

Key concepts in Maintain Master Data and Planning Parameters

Selection Profiles

43
Maintain Master Data and Planning Parameters

Key concepts in Maintain Master Data and Planning Parameters

Lifecycle Planning

• Like Profile allows to create demand forecast of a product using the historical input data of a
product or products whose demand behavior is the same or similar. The Like Profile can be
used for New Products or for products with insufficient historical data.

• Phase In Profile is used to represent the product during the launch or phase in stage. A phase
in profile changes in demand history or demand forecast of a product by a given percentage
during a specific period. The aim is to have the forecast mimic the upward sales curve that you
expect the product to display during the phase in stage.

• Phase Out Profile represents the product during the phase out or discontinuation stage. A
phase out profile changes in demand history or demand forecast of a product by a given
percentage during a specific period. The aim is to have the forecast mimic the downward sales
curve that you expect the product to display during the phase out stage.

44
44
Maintain Master Data and Planning Parameters
Roles
Who
Demand Planner

Create CVCs and Proportional Factors basis various business

situations:
Introduction of New Product.
Delisting of Product (change of status)
Changes to products forecasting hierarchy
New Customers.
Customer hierarchies values to be changed
Splitting forecast to specific locations for regional sourcing and
promotions.

Check for consistency of DP Master Data with respect to the planning

levels defined in the country with respect to customer hierarchy and
product hierarchy.

When
Before Executing the Forecast Run.
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45
 Rules & Guidelines
Standard rules and guidelines related to manage Maintain Master Data and
Planning Parameters are recommended for proper control and management of
data and processes.
Rules
The Obsolete Characteristics are deleted by the Help Desk to ensure no performance
issues.
Maintenance of Selection Profile and following standard naming convention ensuring
traceability while loading selection profile

Guidelines
Cleaning up of history data to get a good quality baseline forecast.
Maintenance of forecast profiles as per forecast methods and parameters
recommended.

46
46
 System Demonstration & Hands-On Practice
A system demonstration will be performed for all
the transactions listed below, followed by a
hands-on practice of the transactions. A system
demonstration on how create Maintain Master
Data and Planning Parameters will be conducted.

o /n/sapapo/mc62 – Create CVCs.

o/n/sapapo/msdp_admin - Planning Area and
Planning Object Structure

47
47
 Key Learning Points
This is a summary of the key learning points of this training session.
o The Characteristic Value Combinations (CVC’s) are available in the
Planning Object Structure and are Master Data for Demand Planning.

o The Planning Area includes all the necessary key figures to support
the demand planning processes.

o No Holidays are defined in the Demand Planning Calendar supporting

the fact that consumption does not stop due to holidays.

o The Periodicity is the time granularity in which DP data will be kept. It

is defined in weeks.

o Default planning unit of measure for DP is CASES.

o Demand Planning is done in product and customer dimensions. The

regional recommendation for forecasting is first at SKU and then pack
size.

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48
How to Log on ?

49
 Standard Menu

To Create additional APO

Window in parallel

To end the current session

To enter Transaction Code

To check transaction code

To log off of APO System

50
 SAP Overview
SAP ECC

SAP ECC is a client server model, using 3-tiered architecture. The three layers are:
 Presentation Layer- Presentation Layer allows user to interact with the system. eg.- SAP GUI
 Application Layer-In this layer business logic is executed. The application layer can be installed
on one machine, or it can be distributed among more than one system.
 Database layer- The database layer holds the data.SAP supports any RDBMS. The database
layer must be installed on one machine or system.

51
 Glossary of terms
SAP ECC (Enterprise Core Component) – SAP’s main transactional processing system.
Formerly called SAP ECC and SAP ERP.
SAP APO (Advanced Planner & Optimizer) – SAP’s planning module
SAP BW (Business Warehouse) – SAP’s data warehouse
SUMI (Sourcing Unit Managed Inventory) – Unilever’s 3rd party, web-based, regional sourcing
management tool
BPCS (Business Planning and Control System) – Legacy transaction processing system or
ERP used in most of Asia
SAP ICH (Inventory Collaboration Hub), also called SAP SNC – SAP’s module for customer
collaboration/VMI and supplier collaboration/SMI
SAP SCM (Supply Chain Management) – group of SAP modules that includes APO and ICH,
etc.
SAP MDM (Master Data Management) – SAP’s module for managing single version of Master
Data across multiple systems
SAP BI-IP (Business Intelligence-Integrated Planning) – SAP’s module for Financial Planning.
Formerly called SAP SEM.
CIF (Core Interface Function) – SAP native integration tool used to transfer data between
SAP’s modules such as APO with ECC and ECC with BW and APO with BW

52
 Questions & Answers

Questions…

53
 Thank You !

TCS. Beyond the Obvious.TM

www.tcs.com

54
Agenda

 TCS Overview and Airline Offerings

 PSS Migration Approach and TCS Offerings

 Service Integration and TCS Offerings

 TPF Capabilities Overview and Delivery Model

 Discussions of Follow-up Plans

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