In this highly competitive world with ever increasing focus on achieving higher service levels, lowering inventories and eliminating waste while reducing costs and maximising profit, it becomes essential that the distribution of goods through the supply chain must be equally effective and efficient and must be optimised to achieve business goals. Products must be available in the right amount, at the right time, at the right place!

A lot of companies use SAP's Advanced Planning & Optimisation (APO) to optimise their production plan in the mid to long term and some are on their IBP Supply journey. However, having an optimised production plan without an optimised distribution plan may not yield business benefits, especially when the supply chain is complex.

When it comes to a tool, the supply optimiser from SAP is the best in class supply chain network optimisation engine and is highly powerful if modelled in the right manner.

In this blog, I will cover various aspects of using Supply Optimiser (APO or IBP)  for distribution planning / deployment optimiser which can help businesses achieve full value out of their investment in this great tool! I will also cover a case study from one of our recent implementations.

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Master data is an important pre-requisite for achieving good planning results. Like any other system, a successful SAP Advanced Planning & Optimisation (APO) implementation relies on having good quality master data. When projects go-live we always get good results but over a period of time, the quality of results tend to deteriorate due to poor master data hygiene. This is especially true when the SKU churn is significant and the supply chain networks are large.

In this blog, I will outline the features of the Master Data Check Tool developed by Olivehorse.

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Supply Planning is an important function in every industry which tries to achieve a balance between customer service, inventory targets and resource utilization. A supply planner’s primary role is to deliver a tactical plan which meets the demand on time, covers safety stock targets at the distribution centres in the supply chain network while also ensuring that resources in the factories are utilized efficiently. A supply planner basically works on integrating the manufacturing and sales side of business and aims to optimize both ends.

The Manufacturing or Production function always prefers to produce according to cost effective lot sizes, minimal changeovers, production cycles and sometimes other constraints like labour or semi-finished material. On the other hand, Sales or Customer Fulfilment functions have different priorities which mainly include meeting customer demand in full and on time, and meeting inventory targets without going below or above targets significantly. These two sides of business often contradict each other and achieving a plan which has been optimized from both angles is challenging.

Usually, a medium term tactical supply plan is generated periodically (weekly, fortnightly or monthly). This plan is normally capacity constrained and contains decisions regarding production, sourcing and distribution of products through the supply chain.

A lot of companies who purchased  SAP’s Supply Chain Management (SCM) application use the Advanced Planning and Optimisation (APO) Supply Network Planning (SNP) Optimizer as a tool to generate the capacity constrained mid-term plan. It is a powerful tool which delivers a plan that respects resource contraints and optimizes the supply chain within a given cost framework. If implemented correctly, it can result in big cost savings for any organization. In this blog, I will try to cover several aspects related to the SNP Optimizer.

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Short-term production scheduling is a key business process that ensures efficient use of scarce manufacturing resources, alignment of raw materials and flexibility when tackling manufacturing challenges. Whilst scheduling of Finished Goods (FG) is common place in SAP Advanced Planning & Optimisation (APO) Production Planning/Detailed Scheduling (PP/DS) implementations, an area often overlooked is the scheduling of Intermediates or Semi-Finished Goods (SFG) production.

Quite often this is a manual process, or is controlled by spreadsheets and/or third party/non-SAP systems which makes it challenging to manage the alignment between the SFG and FG schedule.

This blog is intended to highlight the main challenges and importance of the SFG scheduling process and present an overview of the capability within APO PP/DS that can be used to deal with these challenges.

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