1. Materials Requirement Planning ECC 6.0 Rev. 03/05/10 1
SAPtips Sample Material Requirements Planning MRP Planning
This segment from our 390 page Material Requirements Planning (MRP)
manual is being made available as a sample of our training manuals. Please
contact David.Haynes@ERPtips.com if you have any SAP training needs, or
visit www.ERPtips.com for more information.
Written by Alexis DeStaffany Parker
Published by Klee Associates, Inc.
Copyright Klee Associates, Inc., 2010
Unit 4: Materials Requirement Planning
The goal of materials requirement planning is to produce an optimal supply of
material for the customer demand. The customer demand might be for an actual
customer or for an internal customer in the case of sub-assembly production or
externally procured materials. The following are the goals of materials
requirement planning:
Maximizing availability of materials for internal and external customers
Minimizing warehouse stock
Minimizing logistics costs for both procurement and production
In order to achieve these goals materials requirement planning must balance
inventory with service of the customers. Materials requirement planning provides
the ability these goals in the following ways:
Providing gross and net requirement calculations
Providing bill of material explosion for all components
Providing lot size determination to optimize purchasing and production
Providing safety stock strategies for optimizing inventory levels
In this unit, we will review the following:
Materials Requirement Planning Calculation
Materials Requirement Planning File
Materials Requirement Planning Sequence Review
Materials Requirement Planning MRP Types
Materials Requirement Planning Processing
Materials Requirement Planning Configuration
Materials Requirement Planning Business Add-Ins
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Materials Requirement Planning Calculation
Materials requirement planning calculation is performed during the run of
materials requirement planning. The system uses the settings in configuration,
master data, demand and supply to determine where there are shortage and
overages to determine the most optimal plan based on the defined settings. As
reviewed in the overview, we discussed the process of calculating the supply
requirements based on the demand elements. In the diagram below we see the
demand requirements and the supply requirements, in this section we will review
all of these components, perform a demonstration of the calculation in materials
requirement planning and perform and exercise in materials requirement
planning calculation.
The following demand items are found in materials requirement planning
calculation:
Sales Orders
Sales Scheduling Agreements
Dependent Requirements
Reservations
Planning Independent Requirements
The following supply items are found in materials requirement planning
calculation:
Planned Orders
Purchase Requisitions
Schedule Lines
Purchase Orders
Production Orders
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Inbound Deliveries
Stock
Demonstration: Materials Requirement Planning
Calculation
In this demonstration, we will perform the following steps:
Create a material master record
Assign the lot size for monthly lots and enter a rounding value
Create demand for the material
Run single-item, single-level on the material
Evaluate the results of materials requirement planning
Step 1: Create Raw Material Master Record
1. To create a raw procured material, perform one of the following:
Enter transaction code MM01.
Select the SAP menu path: Logistics Materials Management
Material Master Material Create (General) Immediately
2. Enter the Material Number, Industry Sector, Material Type, and Copy from
material, and press Enter.
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3. Highlight the views required for the material and lick the button.
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4. Enter the Plant and Storage Location for both the organizational levels, and
Copy from, and click the button.
Make sure to enter the copy from for plant and storage location, otherwise,
the defaults from the copy from material will not copy over to the creation of this
material.
5. Press Enter through all the views of the material master until the save screen
is prompted as seen below.
6. Click the button.
Step 2: Assign the lot size for monthly lots and enter a rounding
value
1. To change a material using the stock requirements list for a material, perform
one of the following:
Enter transaction code MD04.
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Select the SAP menu path: Logistics Production Production
Planning MRP Evaluations Stock/Requirements List
2. Enter the Material Number and Plant and press Enter.
3. Select the menu path Environment Change Material.
4. Enter the Lot Size for Monthly lot size and the rounding value, and click the
button to return back to the stock requirements list.
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Step 3: Create Demand for Material
1. To create demand for a material, perform one of the following:
Enter transaction code MD64.
Select the SAP menu path: Logistics Production Production
Planning Demand Management Planned Independent
Requirements Create
2. Enter the Material Number and Plant and the press Enter.
3. Enter the demand for the next six months and click the button.
Step 4: Run single-item, single-level on the material
1. To run the MRP for a material, perform one of the following:
Enter transaction code MD03.
Select the SAP menu path: Logistics Production MRP Planning
Single-item, single-level
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2. Enter the Material and Plant and press Enter.
3. This message is supplied to indicate that the input parameters need to be
verified. Press Enter.
Step 5: Evaluate the results of materials requirement planning
To review the results of the MRP run display the stock requirements list for a
material, perform one of the following:
Enter transaction code MD04.
Select the SAP menu path: Logistics Production Production
Planning MRP Evaluations Stock/Requirements List
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4. Enter the Material Number and Plant and press Enter.
Here you can see that materials requirement planning used monthly lot size to
calculate the purchase requisitions in quantity rounding values at intervals of 100.
Step 6: Change the rounding value, run single-item, single-level and
review the results.
1. To change a material using the stock requirements list for a material, perform
following (still in MD04):
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2. Enter the Material Number and Plant and press Enter.
3. Select the menu path Environment Change Material.
4. Enter the new Rounding value and click the button to return back to the
stock requirements list.
5. Run single-item, single-level.
6. Evaluate the results in the stock requirements list.
The results of the calculation of the materials requirement planning used the
rounding value to generate the supply requirements to meet the demand
requirements.
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Exercise: Materials Requirement Planning Calculation
In this exercise, you will perform the following steps:
Create a material master record
Assign the monthly lot size and rounding value
Create demand for the material
Run single-item, single-level on the material
Evaluate the results of materials requirement planning
1. Create a raw procured material master record.
Field Value
Material A-100-E-XXX (XXX is number assigned
by your instructor).
Industry Sector Mechanical Engineering
Material Type Raw Material
Copy From A-100-M
Views Basic Data
Purchasing
MRP
General Plant Data / Storage
Accounting
Costing
Plant 1000
Storage Location 1000
2. Change the material master record.
Field Value
Material A-100-E-XXX (XXX is number assigned
by your instructor).
Plant 1000
Lot Size Monthly
Rounding Value 1000
3. Create demand requirement for the raw material.
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Field Value
Material A-100-E-XXX (XXX is number assigned
by your instructor).
Plant 1000
Demand Enter demand for the next three months
of 1500 pieces.
4. Run Single-Item, Single-Level on the material.
Field Value
Material A-100-E-XXX (XXX is number assigned
by your instructor).
Plant 1000
5. Review the stock requirements for the raw material in the stock requirements
list.
Field Value
Material A-100-E-XXX (XXX is number assigned
by your instructor).
Plant 1000
Procurement
Proposals
Do you have an overage in stock after
the requirements?
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Material Requirements Planning File
The material requirements planning file is used to determine which materials to
plan and how to plan each material within the planning file. As previously seen,
below is the flow of the planning file within materials requirement planning.
The flags set in the planning file determine the status of the material for materials
requirement planning. The following flags are set in the planning file:
Record Type – defines if the material is an MRP material or a phantom
assembly.
Code – is the low level code used to determine the level of the material
during bill of material explosion and thus determines the sequence of
planning the material during materials requirement planning.
Material – is the material number.
MRP area – is the area in which the material is planned.
MPS Indicator – defines the material to only be planned using master
production scheduling.
Net Change Planning Indicator – determines when there is a change to a
material so the material will be planned during a net change run of materials
requirement planning. This flag is set if the a goods receipt occurs for the
material, if a reservation, purchase order or production order exist and if the
goods movement takes place in a MRP storage location.
Net Change Planning Indicator in the planning horizon – determines when
there is a change to a material in the planning horizon so the material will be
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planned during a net change planning horizon run of materials requirement
planning. This flag is set if the a goods receipt occurs for the material, if a
reservation, purchase order or production order exist and if the goods
movement takes place in a MRP storage location.
Reset Procurement Proposals – defines that a change has occurred to the
procurement elements to trigger materials requirement planning for these
elements.
Re-explode BOM – controls that a bill of material has changed and the bill of
material should be re-exploded during the next run of materials requirement
planning.
Planning Date – is the next date to plan the material in time-phased planning.
In this section, we will review the planning file entries and will review the
configuration to activate the system to use the planning file and we will also
review the conversion program if MRP areas are turn on in an environment.
Demonstration: Material Requirements Planning File
The materials requirements planning file demonstration displays the planning file
entries to review the selections available and to review the flags in the planning
file.
Planning File Entries
1. To display the planning file entries, perform one of the following:
Enter transaction code MD21.
Select the SAP menu path: Logistics Production MRP Planning
Planning File Entry Display.
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2. Enter the Plant, leave the defaults, and click the button.
Configuration: Material Requirements Planning File
In this configuration demonstration we will review the activation step for the
planning file, determine goods movements for the planning file and review
options for the planning file when converting to MRP areas.
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Activate MRP and Set Up Planning File
This setting activates the planning file and activates materials requirement
planning.
1. From the IMG, select the menu path: Production Material Requirements
Planning Planning File Entries Activate MRP and Set Up Planning File
Define Planning File entries for goods movements
This setting allows you to always set a planning file entry for any goods
movement or set over and under delivery tolerances for setting goods
movements to flag the planning file.
1. From the IMG, select the menu path: Production Material Requirements
Planning Planning File Entries Define Planning File entries for goods
movements
Convert Planning File entries for MRP areas
This program allows you to convert existing planning file entries with MRP areas.
There is a test option and a conversion option.
1. From the IMG, select the menu path: Production Material Requirements
Planning Planning File Entries Convert Planning File entries for MRP areas
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