SAP MRP Configuration

The following are the Major Configuration items explained in detail:

a) Activating MRP and Planning File Entry

b) SAP MRP Plant Level MRP Parameters Configuration
c) SAP MRP, MRP Group Level Parameters Configuration
d) Configuring SAP MRP Types
e) Configuring SAP MRP Scope of Planning for the Total Planning Run
f) Configuring SAP MRP Planning time fence and Roll Forward Period
g) Configuring SAP MRP Areas
h) SAP MRP Dynamic Safety Stock (Range of coverage Profile)
i) Configuring SAP MRP Days Supply and Receipt Days Supply

Activating MRP and Planning File Entry

a) Activating SAP's Material Requirements Planning (MRP)

This configuration allows you to choose the plant for which you would want to
activate SAP Material Requirement Planning (SAP MRP). Activating MRP for the
plant allows one to use the SAP MRP tool for the plant. SAP Transaction code
OMDU and the SAP path is Logistics > Production > MRP > Planning File Entry >
Activate MRP and Set up Planning File

b) Activating Planning File Entries for a Plant

Activating Planning file entry for the plant (through a variant that can be
rescheduled) allows you to collect all the material in a planning file list, which has
an MRP Type in the material master MRP 1 View (other than MRP Type XO)

The process of recording a planning file entry for a material, can be run periodically
using a batch job scheduling method. The transaction code to set up the variant
and period scheduling is OMDO and the Path for activating the planning file set up
is Logistics > Production > MRP > Planning File Entry > Activate MRP and Set up
Planning File

All the entries in the planning file will have a “change indicator” specifying that a
material has undergone a change (change in receipts elements or issues
elements). This indicator will help you to choose only those materials that have
undergone a change, through the use of planning key called “Net Change
Planning” when running MRP.

The planning file record for a material also has a “net change planning in the
current horizon” field which will be set if the change in the materials receipt or issue
element is valid in the planning horizon. This indicator will help you choose only
those materials which have undergone a change in the planning horizon; through
the use of a planning key, in an MRP run, called “Net change planning in the
planning horizon”.

Plant Level configuration for MRP

SAP MRP is run at plant level or at a group of plant level (called as scope of
planning), thus the MRP configuration is done at Plant level.

The configuration done for SAP MRP at Plant level would also be true for SAP
Consumption Based Planning (SAP CBP) settings.

Transaction code OPPQ takes you in to the SAP MRP configuration called as –
Plant Parameters for Material Requirement Planning. The Path which can be used
is Logistics > Production > Material Requirement Planning > Plant Parameters >
Carry out Overall Maintenance of Plant Parameters.

The Transaction code for Consumption Based planning is OMI8 and the Path is
Logistics > Materials Management > Consumption Based Planning > Plant
Parameters > Carry out Overall Maintenance of Plant Parameters.

Fig MRP - Config 1

In the transaction code for Plant level parameters for SAP MRP, you should first
input the plant and press the maintain button.

If you have already maintained the configuration for the parameters, then it states
so, if you haven’t then it simply says – “To Maintain” next to the parameter
 Fig MRP - Config 2

Following are the parameters that need to maintain as a part of SAP MRP/CBP
Configuration:

a) Number ranges

The number range ID’s are maintained for the following objects:

the Planned orders

the reservations,
the dependent requirements,
the simulative dependent requirements,
the purchase requisitions,
the MRP Lists,

In this section only the number range ID’s are maintained. While the actual number
range is configured, for the number range ID, using a transaction code OMI2 (for
the above mentioned objects created in the planning run). One can also use the
transaction code OMI3 for the objects created manually in the front end.
Every number range interval, created using OMI2 and OM13, has an ID, which can
be allocated to the objects at plant level, i.e., every plant can have a different
number range for the objects mentioned above.

b) Availability Check rule for Backorder Processing

As per standard SAP, the Availability checking rule for the backorder processing is
“PP”, though you can have your own availability check rules created or configured.

Every Availability checks rule (availability checking scope defined) has a set of
receipts (Purchase orders, Production orders) and issues (Sales orders, dependent
requirements, reservations, planned independent requirements etc) which are to
be considered or not to be considered during the SAP availability checks.

To have the checking rule work along with the configuration, you should have the
Availability checking groups maintained in the material master. The Checking
groups are configured to be associated with the checking rules (checking scopes).

The availability checking rule (checking rule scope) has to be maintained, for a
given SAP functionality and it has to be assigned to the availability checking group
maintained in the material master. The SAP functionalities that use availability
checks to check the availability of the header materials as well as components at
the plant at the time of sales order creation, the availability checks of the header
material at the time of sales order delivery, the availability checks for components
in production – thus reporting the missing parts list, the backorder processing etc.

c) Reporting

This configuration is used for the following purposes.

• To configure the objects, which are to be considered in the calculation of

the “receipts days supply” like the production orders/process orders, firmed
planned orders, purchase orders, assigned planned orders, firmed purchase
requisitions, QM Inspection lots, reservations, safety stocks

• To configure the reporting of “periods totals” in terms of a defined period

(day, week, month, periods as per planning calendar) of in Stock requirement
list, MRP list, simulative MPR or interactive MRP
d) MRP Controllers

This is a mandatory configuration. Here you can configure the list of MRP
controllers for the plant. A MRP Controller is a person or a group of people, which
is responsible for planning a material or a given list of materials.

You have to assign the MRP controller to the Material Master MRP 1 View, so as to
delegate the responsibility of the planning and evaluation of planning for that
material.

e) Floats

Floats are buffers in the total lead time, that are provided in production/process
order or in the planned orders created manually or during an MRP run. The
schedule margin key is used in the Material Master MRP 2 View. It is used in MRP
as well as in production order.

The floats are defined using the scheduling margin key.

Opening period: Number of working days between the date that the order is
created and the planned start date. This time is available for the MRP controller to
convert a planned order into a purchase requisition or a production order.

Float after production: Number of working days between the scheduled finish date
and the order finish date; used as a float in production scheduling.

Float before production: Number of working days between the order start date and
the scheduled start date; used as a float in production.

Scheduling release period: Number of workdays between the planned start date
and the date for releasing the order. If the order release indicator is set, the
production order is released by a background program that takes all dates into
account.

Plan Plant Margin Opening Fl. Before Fl. After Release

t Name Key Period (In Production (In Production (In Period (In
Days) Days) Days) Days)
0001 0001 001 5 2 2 5
 0001 0001 002 5 3 3 5
0001 0001 002 5 4 4 5

f) Special Procurement

The special procurement function helps you to configure and assign special
procurement to the materials which can be used during an MRP run while creating
the procurement proposal.

The special procurement functions are withdrawal from alternate plant, production
in alternate plant, subcontracting, direct production, phantom item planning,

https://sites.google.com/site/sapswords/home/learn-sap-pp/sap-material-
master/sap-mrp2-view

Example: For Stock Transfer from Plant C001 to Plant C002

Create the Special procurement key (Key number = 12 as an example) in the plant
C002 with the procurement type as “F” and special procurement as “U” (Stock
transfer) and the special procurement plant as “C001”. Normally when creating the
special procurement key use Z, Y or X to the Key number, so instead of having Key
number as 12, we could have something like Z2 or YA etc.
 Fig MRP - Config 3

Similarly for Withdrawal from Alternate plant, you could have a Configuration as
below:

Fig MRP - Config 4

Similarly for Subcontracting, you could have a Configuration as below:

Fig MRP - Config 5

Similarly for Production in alternate plant, you could have a Configuration as below:
 Fig MRP - Config 6

g) Conversion for Planned orders

In this configuration parameter, you can maintain the production order type or the
process order type, which the system should use as default during the planned
order conversion. Setting defaults in the plant parameters configuration allows the
system to fix and select the order type for a plant during the conversion process.

Note: This can be a useful tool when you are using one production order type and
one process order type, but if you are using multiple production/process order
types, then you should not be maintaining defaults here.

Also for the purchase requisition conversion, you are given an option in the
configuration to define the maximum number of planned orders that can be
converted in to Purchase requisition.

Fig MRP - Config 7

g) Dependent Requirements availability check

When carrying out the availability check for each of the components in a MRP
BOM explosion, the system needs to know the availability checking scope rule.
Again we would maintain the standard Checking rule as PP or you could
alternatively configure one for yourselves.

h) BOM/Routing Selection ID

This configuration parameter is really important and it is mandatory to maintain

one, since it helps selection of BOM and task lists in the planned orders. Though
there is one more place in the planned order Scheduling parameters MRP
configuration, where you can maintain the selection ID for selection of the Task lists
(Routing/Recipe/Rate Routing).

A selection procedure is set to select BOM or Routing/Recipe on priorities set for

the BOM usage or for the task list types and the task list status. Knowing the
selection procedures allows the MRP run to select the right BOM and task list for
the planned orders.

In other words, you could have the BOM Selection being set for selection of the
Production BOM Usage first and if a BOM for the material with the Usage –
production (Usage = 1), is not found, you could have the system search for a BOM
of universal Usage (Usage = 3).

Similarly, you could have a task list of type Routing or Recipe or reference
operation sets selected and set in priorities of selection (1 st – Routing, 2nd –
Reference operation sets, 3 rd, which has a Status Released for all purposes or
released for costing) etc.

h) Scheduling of Planned orders

This configuration parameter is really important and it is mandatory to maintain

one. It allows you to set the control parameters for scheduling of planned orders of
type LA at a given plant and for a given MRP Controller. You can leave the MRP
controller as “*” to have the scheduling parameters true for all the planned orders
across all the MRP controllers.

The following control parameters can be configured here:

 The Routing/Recipe Selection ID, specifying the routing/recipe that would

be selected for detailed scheduling, as per the priorities set for task list type
and task list status.

 The Detailed scheduling, using the task list is only carried for the
scheduling Horizon mentioned, i.e., if the planned orders dates lie beyond
the scheduling horizon, then the basic date scheduling is used where the in
house production times from the material master is used.

 Allow Scheduling Indicator allows the planned orders to be scheduled

using the detailed scheduling or basic date scheduling, either of the two,
depending upon the availability of the task list and scheduling type selected for
the MRP run.

 Generate Capacity requirements indicator allows generation of the

capacity requirements for the work centers and loads them accordingly. The
loading of the work centers is as per the use of the work center determined
through the scheduling carried out.

 The Task list selection, scheduling horizon, scheduling indicator and the
capacity indicator can also be set for rough cut planning used for Long term
planning purposes.

 The next configuration parameter talks about the configuration of the

selection of the type of scheduling level that should be used for adjusting the
basic dates of planned orders. The various options available are rate based
scheduling, lead time scheduling, scheduling using takt times.

 The Adjust planned order dates configuration option allows you to

readjust the scheduling results or the basic dates every time you carry out
Scheduling. Though there is one more scheduling configuration option
provided by the system for overwriting/adjusting the existing basic dates by the
new dates arrived at, through rescheduling (using the scheduling level as
mentioned).

The system not only offers an option to adjust the basic dates for the planned
order arrived at by using the scheduling level set, but it also setting the dates
of the dependent requirements to the operation start date or the order start
date.
This configuration not only adjusts or sets the dates of the header planned
order and the dependent planned orders, but it also generates capacity
requirements for the same.

See below for the details of adjusting dates in scheduling and adjusting dates
for capacity requirement generation:

 You can adjust the Basic Dates of the header planned order using
the scheduling level and adjust (or set) the dependent requirements to
the start of the header planned order

 You can adjust the Basic Dates of the header planned order using
the scheduling level and adjust (or set) the dependent requirements to
the start of the respective operation to which the dependent
requirements are assigned to

 You can decide not to adjust the Basic Dates of the header planned
order arrived at by using the scheduling level and at the same time not-
adjust (or not set) the dependent requirements to the start of the header
planned order

 You can decide not to adjust the Basic Dates of the header planned
order arrived at by using the scheduling level and at the same time not-
adjust (not set) the dependent requirements to the start of the
respective operations to which the dependent requirements are
assigned to

 You are also provided an option to configure the scheduling type –

whether forward or backward scheduling. It is a normal behavior for the
standard system to have this configured as “backward scheduling” so that SAP
MRP (material requirement planning) never misses the customer delivery date
or order availability date. An option is also provided to not-to-schedule, any
orders during the breaks set in the factory calendar.

 Start date in the in the past options allows you to push the start date of
the planned orders to a certain number of days in past. If the order start date
goes beyond the number of days allowed, then the system uses the concept of
‘today’s scheduling” and sets the start date of the planned order to today’s date
and carrying out forward scheduling there-after.

 One of the scheduling parameters is “reduction measures”, used to reduce

the total order lead time in circumstances designed. You can avoid
configuration of reduction measures, if you are not using it.
 Fig MRP - Config 8

i) Default Values for External Processing

For external purchasing, one can maintain the default lead time required for
conversion of Purchase requisition into purchase order, using the planned delivery
lead times from the purchase info record or purchasing agreement. So as to use
the planned delivery times from the purchase info record, one should also maintain
the source list for the material, with the same vendor in the source list and the
purchase info record.

Using the planned delivery times from the material master or from purchase info
record, is totally a decision of the consultant. It is indeed a nice additional option
provided by SAP for using the lead time from info records.
j) Planning Horizon

Maintaining a planning horizon helps the system to plan only those demands,
which fall in the planning horizon starting from today. When an MRP Run is taken,
the planning horizon is number of work days as mentioned (let’s say 180 days)
from today’s date; the system would not plan any orders whose start date lies
beyond this horizon.

k) Available stock for net requirement calculations

SAP MRP offers you a choice to select the most controversial stock types, in its net
requirement calculations. The stock types are – stock in transfer (stock in transfer
is considered as stock at the receiving plant as it is already issued from the
sending plant), blocked stock, restricted batch stock (stock of batches marked with
restricted batch)

Fig MRP - Config 9

l) Option to trigger direct Production in MRP or in production planning

j) Allowing start date in the past

MRP Group Level configuration for MRP

The entire configuration that is created as a part of SAP MRP Plant level parameter
in the above steps can be also set for an MRP Group. You can group materials
using MRP Groups. Each of the MRP Group can have its own MRP Parameter set.
You can set the MRP group in the material master MRP 1 View.

MRP Group can be maintained using transaction code OPPR or the transaction
path – Logistics > Production > MRP > MRP Groups >

Advantage of working with MRP Groups:

Working with MRP groups can be convenient for a plant or an organization, since
by assigning the MRP groups to a set of materials, would allow planner to
configure these materials (through MRP Groups) to behave in a certain manner for
planning purposes. In other words, all the materials in the group would then have a
unique planning method or unique planning features. Thus the organization can
device multiple MRP groups with their own planning features and characteristics
rather than having one set of planning features set at the plant level. The group
could have its own unique:

Strategy group,
Conversion order types,
Planning horizon,
Planning time fence and roll forward periods,
BOM and task list selection ID’s,
Direct procurement parameters,
Planned order scheduling parameters,
Start number of days allowed in the past
Availability checking groups,

Strategy Groups

The strategy groups can be set for a given MRP group at a given plant. The
strategy group consists of a number of planning strategies assigned in a sequence
of priorities. In other words, the strategy groups, groups together the relevant
planning strategies of a material. If you don’t see the default strategy groups, then
we would have to manually maintain the strategy groups on the materials MRP 3
view. Defaulting the strategy groups is a nice idea when the strategy groups would
remain the same across all the materials which would be assigned with a given
strategy group.

For example:
A material can have the priority 1 strategy as Made-to-Stock (planning strategy 40)
and then priority 2 planning strategy as Made-to-Order (planning strategy 20).
Assigning this “strategy group” for a MRP group in the MRP Group Parameters
configuration and then subsequently assigning the MRP Group to the material
master would make the material work on a planning strategy 40 and planning
strategy 20 in a sequence of priority.

The primary strategy for the material is 40 – Made-to-stock while the secondary
strategy is 20 – Made-to-order, which means that every time you plan or produce a
material or create a sales order for the material it will always primarily work as a
made-to-stock material. Nevertheless, you can also make to material work as a
made-to-order material, by changing the requirement type – “KE” of the material in
the sales order procurement tab, to suit for made-to-order, which the system would
allow since the material’s secondary planning strategy is made-to-order.

Configuration of SAP MRP Types

In all probabilities, MRP Types is not something which one should configure in
SAP; it is used as a standard configuration. Nevertheless, a consultant should
know the importance of MRP types and the involved pre-configured parameters.
 Fig MRP - Config 10

a) MRP Procedures

MRP Procedures defines the type of MRP to be used – Reorder point planning
methods, Material requirement planning or demand based planning methods,
Forecast based planning methods, Time phased planning methods, MPS and the
no planning procedures to mark a material with a MRP types that does not plan a
material at all.

b) Firming Type

In the category of MRP procedure called – MRP or demand based planning

method and MPS, SAP offers 8 different MRP types with Firming namely P1, P2,
P3, P4 and M0, M1, M2, M3, M4.

When working with the planning time fence, one needs to set the firming methods
& the scheduling methods of the procurement proposals within the planning time
fence.

0 1 2 3 4
Firming type

M0 P1 P2 P3 P4
MRP Types M1 M2 M3 M4

Firming Methods for Procurement Proposals in the Planning time fence

No Firming of Procurement Proposals X

within the planning time fence

Automatic Firming of Procurement X X

Proposals within the planning time fence

Manual Firming of Procurement within the X X

planning time fence (No Automatic
Firming of the procurement proposals )

Treatment with New Order Proposals in the Planning time Fence

 Automatic Creation of New Procurement X X
Proposals to cover the shortages within
the planning time fence. But the dates of
these new Procurement Proposals are
pushed outside the planning time fence

No New Procurement Proposals created X X

to Cover the material shortages within the
planning time fence

c) Include External Requirements

The inclusion of external requirements in net requirement calculations is available

to be set, when you are working with reorder point planning based MRP types.
Actually there are 2 options in this field, i.e., include external requirements in the
total planning horizon or restrict the inclusion of the external requirements only
within the replenishment lead time.

For example:

If the external requirements are set to be considered in the total horizon (of 7
weeks) then in the today’s MRP run, the Customer demand will be considered as it
falls in the planning horizon and it will reduce the warehouse stock proportionately
which would trigger the reorder point planning procurement once the stock falls
below the reorder point.

If the external requirements are set to be considered in the Replenishment lead

time, let’s say the Replenishment lead time is 1 week, then in that case, only in a
MRP run triggered one week before the start date of the external demand, this
customer demand will be considered, thus triggering reduction in warehouse
stocks.
 Fig MRP - Config 11

SAP also offers an option to select the additional external requirements that should
also be included in the net requirement planning calculations like the - components
supplied to the vendor in a subcontracting case, reservations set for the
components in a production order, reservations of components in plant
maintenance orders, requirements to satisfy the Stock transfer order to another
plant, stock transfer requisitions created for Stock transfer orders, requirements
raised because of stock transfer delivery schedules.

c) Forecasting for MRP

Forecasting MRP Types have a “forecasting indicator” as obligatory, unlike other

MRP types which normally have the forecasting indicator set to optional.

Also the historical data is updated in the material master as total consumption
(planned consumption plus unplanned consumption) or unplanned consumption.
When the consumption is planned as per the MRP reservations, planned
consumption is updated and when the consumption is not planned as per the
reservation or is greater than the reservation quantities, then unplanned
consumption is updated.

In MRP type configuration, you have an option of choosing the type of historical
consumption of a material to be used for planning whether total consumption
(planned + unplanned consumption) or unplanned consumption.

After choosing the historical date type, you should configure, the type of forecast
requirements to be considered in MRP planning run, whether total consumption
(planned + unplanned consumption) or unplanned consumption.

The reduction method for forecast requirements is also configurable. The default is
reduction by consumption.

d) Planning method
The MRP type offers you to plan the materials in an external system, like the MRP
Type X0. The indicator called the planning method allows you to choose external
planning so as to plan materials in the external system.

e) Automatic Calculations

You can have the safety stock and the reorder point calculated automatically by the
system, when you are using the automatic reorder point planning methods. In the
automatic calculations the system uses the forecast data.

Configuring SAP MRP Scope of Planning for the Total Planning Run

SAP provides an option to plan multiple plants together or multiple MRP areas in
one planning run in a sequence. Transaction code OM0E can be used for
configuration or the logical SAP path – SAP Customizing Implementation Guide >
Production > MRP > Planning > Define Scope of Planning for Total Planning, can
be used to configure.

Step 1 – Define the Name of the Scope of planning run

Step 2 – Define the plants or MRP areas to be included in the planning run
arranged in a sequence. The sequence is defined by the first field called

Configuring SAP MRP Planning time fence and Roll Forward Period

The transaction path to configure the planning time fence and roll forward period is:
SAP Customizing Implementation Guide > Production > Material Requirements
Planning > Planning > MRP Areas > MRP Calculation > Define Planning Time
Fence and Roll Forward Period

Planning Time Fence:

The planning time fence is the number of work days, within which you can protect
the master plan (or in other words the procurement proposals of a master plan)
from being disturbed or changed from any automatic changes (of an MRP Run).
The procurement proposals are firmed so as to protect them from any changes.
The firming of the procurement proposals (planned orders, purchase requisitions,
delivery schedules) in the planning time fence prevents the proposals in the time
fence from being adopted in the next planning run.

In other words, in the planning time fence, the system does not create or delete
any procurement proposals nor does it changes the existing proposals.

The system calculates the time fence from today’s date plus the “number of days
mentioned as planning time fence” in the material master or in the MRP
configuration (where you can define the planning time fence for plant or for a given
MRP group). It is needless to say that any new requirements are not included in
this time period nor the existing requirements are changed. MRP carries its usual
planning outside this fence without interrupting this fenced period.

Configure Planning Time fence and Roll Forward Period

Plant MRP Group Planning Time fence Roll forward Period

0001 0001 14 3-
0001 0002 14 2-

It is logical that any procurement proposal lying outside this fence would start
moving in to the fence one by one; when the fence moves ahead on the time scale.
When they move in to this fence, they are automatically firmed for protection.

Firming for automatically created procurement proposals:

The automatically created procurement proposals in the MRP Run are not firmed
by the system, so that they are available for adjusting dates and quantities in the
next planning run, in cases where there is change in BOM or task list.

You can though manually firm the planned orders individually or collectively using
transaction code MD19

Note - Automatically created planned orders in the planning time fence are only
remain firm till they are in the planning run.

Firming for manually created procurement proposals:

For manually created or changed procurement proposals or even when you
reschedule the planned order in the graphical planning table, the system always
marks them with a firming indicator. Though you can remove or delete this firming
indicator.

Firming for component’s planned orders:

In case of a planned order, you can manually firm it by selecting the “firming
planned order Indicator” in the planned order header. And in order to make sure
that the BOM levels below are not exploded or changed in a planning run, you
have to set the “firming components indicator”

See the below Example – Planning time fence is 3 days.

Plannin
g Start
Date
Today – Day 2 Day 3 Day 4 Day 5 Day 6 Day 7 Day 8
Day 1
Planning time fence
Planned Planned Planne Planned Planned Planned Planned Planned
Order 1 Order 2 d Order Order 4 Order 5 Order 5 Order 6 Order 7
3
Auto Auto Auto Not-firmed Firmed Not- Not- Not-
Firmed Firmed Firmed firmed firmed firmed
Next
Planning
Start Date
Planning time fence
Planned Planned Planned
Order 4 Order 5 Order 5
Auto Auto Auto
Firmed Firmed Firmed

Roll Forward Period

The Roll Forward Period adds the functionality of automatic deletion of firmed
planned orders, from the master plan. It also creates new proposals to cover any
requirements pending during the MRP run. This period can be defined for number
of days in past or future. The system deletes all the firmed planned orders that lie
before the roll forward period.
Using the roll forward period, you can have the system delete all useless old firmed
planned orders, which otherwise the system would never had deleted, since they
were firmed. This allows for reorganizing the planned orders.

Configuring SAP MRP Areas

Long ago, SAP MRP was only at the plant level or at MRP controller level
(activated through a user exit). Then SAP came up with the concept of running
MRP at MRP areas. You can define your own area for which you want to run MRP
without disturbing other areas.

Running MRP for MRP Areas: For running MRP at a MRP area, you would have
to create a scope of planning in MRP configuration, which contain the MRP area or
a set of MRP areas arranged in sequence of planning.

Assigning MRP areas: To have the “MRP Areas” work, you have to activate the
MRP areas and then create them and then assign them to the material master
MRP 1 view. If a MRP area is not assigned to the material, then it will work as per
the plant level MRP area.

Configuring MRP areas

Step 1: Activate MRP Area: Use the transaction path: SAP Customizing
Implementation Guide > Production > Material Requirements Planning > Master
Data > MRP Areas > Activate MRP for MRP Areas

Step 2: Define MRP Areas: Use transaction path: SAP Customizing

Implementation Guide > Production > Material Requirements Planning > Master
Data > MRP Areas > Define MRP Areas

Types of MRP Areas:

Plant MRP Areas: You can create one MRP area for several plants, so that when
you run the MRP for this MRP area, the run is for all the plants configured in the
MRP area.

Storage Location MRP Areas: You can create MRP areas for several storage
locations at a plant. You cannot use one storage location in multiple MRP areas.
Subcontractors MRP Areas: You can create MRP areas for several subcontractors
for a plant. You cannot use one subcontractor in multiple MRP areas.

Configuring SAP MRP Dynamic Safety Stock (Range of coverage Profile)

The Range of coverage profile is configured for the use of Dynamic safety stock for
a given material. The range of coverage configuration contains the parameters for
the calculation of the dynamic safety stock. The dynamic safety stock is a stock
calculated based on the average daily requirements for a period rather than the
actual requirements over the period, therefore it is more statistical value rather than
an absolute value.

Safety stock as we know is used to cover the fluctuations in the requirements, so is

the dynamic safety stock, the only difference being, the safety stock is an absolute
value provided directly for a material whereas the dynamic safety stock is
calculated by the system on the basis of the coverage period and average daily
stock calculated internally by the system.

The Dynamic safety stock is calculated in every planning run.

The transaction path is: SAP Customizing Implementation Guide > Production >
Material Requirements Planning > Planning > MRP Calculations > Define Range of
Coverage Profile (Dynamic Safety Stock)

Range of coverage Configuration:

 Fig MRP - Config 12

Configuration for calculation of average daily requirement for a period

Period indicator - Indicate the type of period, whether week or month or according
to PP planning calendar. (Let’s say it is W – Week)

Number of Periods – Number of periods used to calculate the average daily

requirements (Let’s say it is 13 Weeks)

Type of Period length – It defines the number of days in the period, if the period
length is in terms of workdays, then the factory calendar work days are considered,
if the period length is in terms of calendar days then it is considered in terms of
Gregorian calendar, and if it is terms of standard days, then you would have to
enter the number of days in a period in the configuration (Let’s say that the
configuration was done with workdays and the factory calendar has 7 days per
week)

Therefore Average daily requirement =

= Requirements in the period (Requirements in 13 Weeks – Lets say 910 Units) /

(Number of Periods – Lets say 13 Weeks) * (Number of days in the period – Lets
say 7 days)

= 910 / (13*7)
= 10 Units

Configuration parameters for calculation of Dynamic Safety Stock for the

Range of Coverage

You can define 3 different range of coverage – minimum, maximum, and target
range of coverage, which is used to calculate 3 different stocks using the average
daily requirements (range of coverage multiplied by the period length). The Target
range of coverage defined here would be used to calculate the Dynamic Safety
Stock for the period of the coverage.

The Period of the coverage is specified in the configuration. The coverage’s and
the periods for which they should work for, are defined for 2 separate period
lengths and the 3rd period length is for the rest of horizon.

In the example, we have defined the safety stock to cover a period of 7 days
(minimum, target and the maximum range of coverage). The minimum, target and
the maximum stock is calculated for the average daily requirement over the
respective coverage periods.

You can check the minimum, maximum, target stock levels, minimum range of
coverage, maximum range of coverage, target range of coverage in the MRP List
or Stock requirements list’s “Period Total Display” Section.

As per our example, for the first period of 13 weeks, all the 3 stocks levels –
minimum, maximum, and target stock levels would be 70 Units and for the next
period of 26 weeks it will be 70 units as well and for the rest of the horizon it will be
70 units again.

Normally when the available stock falls below the minimum stock level, SAP
planning run, would immediately create planned orders to suffice at least the target
stock level. For example if the minimum stock level is 30 and the maximum is 80
and the target stock is 50 units, then if the available stocks fall below the 30 units
mark, SAP creates a procurement proposal for 50 units to reach back to the target
stock level. Whereas in the example below, all the 3 stocks types are 70 units,
therefore when the stocks fall below the 70 units, the system will try to raise a
procurement proposal to reach back to 70 units.

As per our example in the configuration screen shot –

Dynamic safety Dynamic safety

Dynamic safety stocks for the 1st stocks for the 2nd Dynamic safety
stock formula period of 13 period of 26 weeks stocks for the rest
summarized as = weeks of the Horizon
Average Daily Stock
* Range of coverage

70 Units 70 Units 70 Units

Minimum safety
stock

70 Units 70 Units 70 Units

Target safety stock

70 Units 70 Units 70 Units

Maximum safety
stock

Another Example of Dynamic Safety Stock

Fig MRP - Config 14

Step a) Demand for 8 Weeks = 800

Step b) Average Daily Requirements

= 896 Units of Demand for 8 Weeks / (8Weeks * 7 Days Per Week)

= 896/(8*7)
= 896/56
= 16 Units

Step c) Calculation of Safety Stock for the coverage period

As per our example in the configuration screen shot –

For the first period, when the stock falls below 32 units (minimum Stock Level), the
SAP MRP run would create the procurement proposals (Let’s Say planned order)
for a quantity to suffice at least the target safety stock level or the dynamic safety
stock level = 8 Units.

Dynamic safety Dynamic safety Dynamic safety Dynamic safety

stock formula stocks for the stocks for the 2nd stocks for the rest
summarized as = 1st period of 8 period of 8 weeks of the Horizon
Average Daily Stock weeks
* Range of coverage

= 2 * 16 = 32 = 2 * 16 = 32 = 2 * 16 = 32
Minimum safety
stock

= 5 * 16 = 80 = 5 * 16 = 80 = 5 * 16 = 80
Target safety stock

= 7 * 16 = 112 = 7 * 16 = 112 = 7 * 16 = 112

Maximum safety
stock

Configuring SAP MRP Day's Supply and Receipt Day's Supply

The days of supply is not a mandatory configuration, you can only configure the
days supply if you feel the SAP pre-configured ones are not what you want.

SAP offers 2 types of evaluations in SAP, the days supply and the receipt day’s
supply.

In the SAP MRP Evaluation transactions such as stock requirement list or MRP list,
the days supply would calculate the number of days on the time axis, till the
material requirements can be satisfied purely by the current available stock.

While the Receipt Day’s supply would indicate how long would the current stock
and the expected receipts would cover the requirements. There are 2 receipt day’s
supply evaluations offered by SAP called as the receipt day’s supply 1 and receipt
days supply 2. SAP offers a configuration to select the receipts elements for receipt
day supply 1 and 2 evaluations. There is also an option to have the receipt day’s
supplies to be calculated when the stocks fall below the safety stock or below the
current available stocks.

The days supply values or the receipt days supply values can be correlated with
the range of coverage concept. These tools comes with traffic lights – red, yellow
and green which offer warnings to the MRP Controllers/users and lets him/her
strategically know when the material stock would be totally consumed out, which
would help the planner to foresight and take necessary actions in advance.

The transaction path for the same is SAP Customizing Implementation Guide >
Production > Material Requirements Planning > Evaluations > Define Receipt
Elements for Receipt Days' Supply

Fig MRP - Config 13

Day’s Receipt Receipt

Number of Days Stocks will Cover the Supply Day’s Day’s
Requirements Supply 1 Supply 2

Consider Current Stocks only in calculation of Days Supply

X
Only Consider Current available Stocks to
cover Requirements
 Consider Receipts also along with Current Stock in Calculation of Days Supply

Firmed Planned orders, Planned orders assigned with Production versions, Purchase
orders, Schedule lines, Firmed Purchase Requisitions, Receipt Reservations,
Shipping Notifications

X
Consider all the possible receipt elements
along with the plant stock

Example – Firmed Planned orders, Planned

orders assigned with Production versions,
Purchase orders, Schedule lines, Firmed
Purchase Requisitions, Receipt Reservations,

X
Consider all the Most Certain receipt elements
along with the plant stock

Example - Production order, Shipping

Notifications, QM Inspection Lots

Example for Days Supply and Receipt Days Supply:

Days’ Supply for Material M1 on Today = 3 days

(Receipts are not considered)

Day Requirements Available Qty

Stock Balance Left after
covering Requirements

Today - 20 Current Stock = 100 100 – 20 = 80

2nd Day - 30 Stock Available = 80 80 – 30 = 50
3rd Day - 50 Stock Available = 50 50 – 50 = 0 (Stock = 0)
4th Day - 52
5th Day - 40
6th Day - 20

Days’ Supply on Today = Coverage’s Considering without the receipts = 3 Days

Exactly
 Receipts Days’ Supply for Material M1 on Today = A little more than 4 days
(Receipts are also considered – This example can be for Receipt Days supply 1 or 2)

Day Reqmts Expected Receipts Available

Stock Stock Balance
Left after
covering
Requirements

Today - Available = (100 + 15) -20 =

20 Firmed Planned order = 100 95
10
Production order = 5
Total Receipts on day =
15

2nd - (95 + 0 ) – 30 =
Day 30 Total Receipts on day = Available = 95 65
0

3rd - (65 + 25) – 50 =

Day 50 Production order = 25 Available = 65 40
Total Receipts on day =
25

4th -
Day 47 Planned order = 8 Available = 40 (40 + 13) – 47 =
Production order = 5 6
Total Receipts on day =
13

5th - Available = 6 (1 + 5) – 40 = -
Day 40 Planned order = 5 34
Total Receipts on day = Shortage
0

6th -
Day 20

Receipt Day’s Supply on Today = Coverage’s Considering the receipts

= 5 – 1 + (6/40) = 4 + 0.15 = 4.15 Days