Use Global ATP to Trigger Time-Based Location Substitution in a Consolidation Environment

  • by Ranjan Sinha, Senior Managing Consultant, IBM
  • February 13, 2015
Learn how to implement time-based location substitution using rules-based Available-to-Promise (ATP) in a consolidation scenario. An example from the chemical industry demonstrates how to set this up.
Learning Objectives

By reading this article, you will learn how to:

  • Configure the inclusive, exclusive, and alternate rules in a rule strategy sequence to have time-sensitive location substitution in a consolidation environment
  • Set up various rules in the Global Available-to-Promise (Global ATP) master data
Key Concept

Inclusive rule strategies are used to determine the domain of products and the location substitutions that are possible based on the rules defined within the inclusive rule strategy. Exclusive rule strategies narrow the list of products and location substitutions determined from the inclusive rule strategy and delete the ones that are not possible. An exclusive rule strategy can have both exclusion and alternate rules. While exclusion rules within the exclusive rule strategy delete the products locations that are not possible, alternate rules can be defined to determine the alternates to those product locations that were deleted based on the exclusive rule. When inclusive and exclusive rule strategies are combined within a rule strategy sequence, the products and locations can be determined flexibly in a rules-based scenario.

There are key points of difference between SAP ERP Central Component (ECC) and SAP Advanced Planning and Optimization (SAP APO) functionality from a location substitution standpoint. Different rule types, such as inclusive, exclusive, and alternate rules, can be combined in a rule strategy sequence. When combined, these rules offer a wide range of flexibility in managing the substitutions in a rules-based Available-to-Promise (ATP) environment.

I describe a step-by-step approach on how to set up such a complex environment inside SAP APO based on my implementation experience in the chemical industry. The setup of inclusive and exclusive rule strategies with inclusive and exclusive rules is confusing with a lot of similar-sounding names. Setting up this strategy requires a real-life example to clarify and demystify the concepts and the data that is required to support it. I explain the concepts and guide you through a step-by-step approach in setting up the location substitution functionality in a time-sensitive way with the use of inclusive and exclusive rule strategies.

Note
In this article I refer to the ATP functionality and the Global ATP module that enables the ATP functionality.

The Consolidation Scenario

As previously explained in the SCM Expert article “Accurate Order Promising through Global ATP in a Consolidation Environment,” in an export scenario in which products are shipped in containers across the ocean with different manufacturing sources, the products are usually consolidated near a port location to be shipped to the customer. In some chemical industries, the consolidation locations also perform some value-added packaging operations in addition to receiving some of the products shipped from other manufacturing locations.

This example deals with the following scenario: Bulk is moved from the manufacturing location to the consolidation location (which is the port plant itself) in containers that are loaded onto a ship and then shipped to the customer. The usual source of supply for a particular bulk material is manufacturing plant 1 as shown in Figure 1.


Figure 1
A supply chain scenario


However, for certain durations in a year, with an effective start and end date, the bulk cannot be supplied from manufacturing plant 1 (even though it may be available). Instead, it has to be sourced from manufacturing plant 2. All sales orders with a material availability date less than the specified start date are sourced from manufacturing plant 1; all sales orders with a material availability date falling between the start and end dates are sourced out of manufacturing plant 2; and all sales orders with a material availability date greater than the end date are sourced out of manufacturing location 1 again.

Ranjan Sinha

Ranjan Sinha is a senior managing consultant at IBM. He has vast experience implementing SAP APO functionality in various industries, including electronic and chemical.

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