Combine Product Interchangeability with Iterative Rules-Based Availability to Deliver the Right Quantity to Customers

  • by Alok Jaiswal, Consultant, Infosys Limited
  • December 28, 2015
Learn how to use the rules-based availability check method along with product interchangeability in SAP Advanced Planning and Optimization (SAP APO) Global Available-To-Promise (Global ATP). It allows you to substitute one product with another by following a list of rules for substitution at different product location combinations.
Learning Objectives

By reading this article, you will learn how to:

  • Configure master data objects needed in SAP Advanced Planning and Optimization (SAP APO)
  • Configure interchangeability-specific master data in SAP APO Global Available-To-Promise (Global ATP)
  • Execute a rules-based simulation to carry out product interchangeability
  • Configure a rules-based availability check to use product interchangeability
  • Execute ATP simulation in SAP APO using rules-based availability and product interchangeability directly
  • Execute an ATP simulation in SAP APO using rules-based availability and product interchangeability using rules
Key Concept

In product interchangeability, one product is replaced by another from a specific date – a process also known as a supersession chain. A rules-based availability check in SAP Advanced Planning and Optimization (SAP APO) Global Available-To-Promise (Global ATP) is an iterative process in which a set of rules is processed sequentially until valid results are obtained. For example, replacement of one product by another can be due to a new product that is a more advanced version of an existing product. Before using product interchangeability, you need to decide how to use existing stocks and how to carry out future planning.

SAP Advanced Planning and Optimization (SAP APO) provides a suite of options that controls the replacement of one product by another. This entire process is known as product interchangeability. In this article, I focus on how product interchangeability can be used and integrated in SAP APO Global Available-To-Promise (Global ATP) by using rules-based availability checks. Using rules-based availability checks helps to optimize the decision making process between different substitutions using list of defined rules. Different rules can be defined as per business requirements that control how product interchangeability can be carried out smoothly across locations.

Consider an example of a simple supply chain network of a manufacturer consisting of single plant and multiple distribution centers. Figure 1 diagrams the supply chain network that has been considered for discussion in this article. Products are manufactured at PLANTA and shipped to the distribution centers DC01 and DC02 based on demand and corresponding supply. Product B1 is an old product that is sold by a manufacturer and product B2 is a superior, advanced version of the same product. You need to plan to phase out Product B1, plan for Product B2, and determine a proper planning strategy.


Figure 1
An example of a supply chain network

Configure Master Data Objects Needed in SAP APO

Before using the product interchangeability, you need to have the master data configured in the system. The master data needs to be configured for the following objects:

  • Locations
  • Products

Note
I assume readers know how master data is set up and configured in SAP APO. For this article I include only the screenprints of the master data used in the article.

Locations

To configure the master data for locations, execute transaction code /SAPAPO/LOC3. For my example, create Location PLANTA of location type (1001) and DC01 and DC02 of location type (1002) as shown in Figures 2, 3, and 4. Steps to create the location are not included as it is assumed that readers know how to set up master data in SAP APO. These screenprints just display the location and location type via transaction code /SAPAPO/LOC3.

Alok Jaiswal

Alok Jaiswal is a consultant at Infosys Limited.

He has more than six years of experience in IT and ERP consulting and in supply chain management (SCM). He has worked on various SAP Advanced Planning and Optimization (APO) modules such as Demand Planning (DP), Production Planning/Detailed Scheduling (PP/DS), Supply Network Planning (SNP), and Core Interface (CIF) at various stages of the project life cycle.

He is also an APICS-certified CSCP (Certified Supply Chain Planner) consultant, with exposure in functional areas of demand planning, lean management, value stream mapping, and inventory management across manufacturing, healthcare, and textile sectors.


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