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The main task of material requirements planning is to ensure material availability, that is, to procure the requirement quantities for in-house production and for sale on time.
The logistics chain starts off with sales and distribution and demand management. Sales and distribution receives requirements in the form of customer requirements from the market and demand management will plan sales via a sales forecast. The resulting independent requirements trigger materials planning.
In order to satisfy demand, the order quantities and dates have to be determined and the appropriate procurement elements need to be dispatched. The procurement elements of materials planning and of external procurement are the planned orders and the purchase requisitions (for external procurement). Both are only internal elements. 
For materials produced in-house, the dependent requirements are determined by BOM explosion. Dependent requirements are the quantity of components necessary for the production of a finished product or an assembly.
When materials planning has finished volume planning and time scheduling, the internal procurement elements must be converted into real procurement elements: the procurement element for production is the production order, the one for external procurement is the purchase order.
Material requirements planning takes place at the plant level, that is in order to determine material shortages it includes the available stock in all storage locations of a plant during planning.
In order to carry out material requirements planning for a plant:
You have to activate MRP at the respective plant,
You have to maintain the MRP parameters at this plant,
You have to maintain the MRP data of the materials that are subject to automatic planning.
Automatically planned materials are materials that are not assigned the material type ND (= no planning).
As opposed to MRP, consumption-based planning procedures are only based on material consumption.
In reorder point planning, the system checks whether the available stock level falls below the reorder point defined for the material. If it does, procurement must be triggered. You can determine the reorder point manually or, it can also be calculated automatically using the material forecast.
In forecast-based planning, historical data is used in the material forecast to estimate future requirements. These requirements are known as forecast requirements and are immediately available in planning.
In time-phased planning, historical data is also used in the material forecast to estimate future requirements. However, in this procedure, the planning run is only carried out according to predefined intervals.
For all consumption-based planning procedures, sales orders, planned independent requirements, reservations, and so on are not relevant to planning.
In MRP, sales order, planned independent requirements, reservations, and so on are planned directly as requirements.
The MRP procedure is defined per material and plant. Therefore, the same material can be planned in different plants using different MRP procedures.
Material requirements planning is based on current and future sales. The planned and precise requirement quantities trigger requirements calculation. In MRP, the requirement elements are sales orders, planned independent requirements, material reservations and so on, as well as the dependent requirements that are created by BOM explosion. 
MRP is especially useful for the planning of finished products and important assemblies and components (A materials).
The planning procedures of consumption-based planning are easy-to-use methods of requirements planning which assist in achieving certain aims with relatively little effort. Consumption-based planning procedures are preferably used in areas without in-house production or in manufacturing plants in order to plan B and C materials and operating supplies.
Consumption-based planning is based on historical data and uses material forecasts or statistical procedures to determine future requirements. Consumption-based planning procedures do not refer to the production plan, i. e. requirements calculation is not triggered by independent or dependent requirements. It is either triggered by the available stock level falling below the reorder point or by forecast requirement calculated from historical data. 
One prerequisite of consumption-based planning is a smooth and up-to-date inventory management.
For components planned using MRP, dependent requirements are determined by BOM explosion based on the requirements for the finished product. No dependent requirements are created for materials planned using any of the consumption-based planning procedures.
An MRP type indicator controls whether external requirements (sales orders or manual reservations) are included in consumption-based planning procedures.
You can decide whether these external requirements are to be included in the complete planning horizon or only within the replenishment lead time.
The MRP type is a key which controls the MRP procedure to be used for planning a material.
The MRP type belongs to the plant-specific data of a material. 
The MRP type controls which planning parameters must/can be entered when maintaining the material master record.
You can customize the parameters of the MRP types delivered with the SAP standard according to your own requirements. You can also add new MRP types.
MRP relevant data are stored at plant level in the material master record.
MRP data in the material master record can be subdivided into the following categories:
General data which you must/can always define for a planning material,
Data dependent on MRP procedure,
Data required for scheduling,
Data required for lot-size calculation,
Data required for storage location MRP.
The MRP profile is a key in which you can store MRP parameters that do not depend on the material master record.
The following is specified in the MRP profile:
Which fields are to be completed when entering MRP data in the material master record,
With which values these fields are filled,
Which of these values can be overwritten (default values) and which cannot (fixed values).
The information contained in the profile is standard information which is is needed again and again in a similar combination when maintaining material master records. The MRP profile simplifies maintenance and administration of MRP data.
When changing a profile, the system not only updates the changed profiles in the profile but also creates a background job (RSPROFILE) which updates all material master records that are allocated to a changed profile. Note: The system only considers changes that affect fixed values. 
You can list the material master records that use the same MRP profile. You can limit the selection by plant and by MRP controller.
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