Upload
chagantikiran
View
224
Download
0
Embed Size (px)
Citation preview
8/13/2019 Auto Cost and Penality Model
1/18
SAP AG 1
SAP AG 2005
Introduction
Features
Automatic Cost ModelGeneration for the
SNP and DeploymentOptimizer
ASM SCM
PTU Applications
SAP AG
8/13/2019 Auto Cost and Penality Model
2/18
SAP AG 2
SAP AG 2005
Introduction
SNP Optimizer working principle
Implicitly describe all feasible plans
Global search among all feasible plans for one with minimal costs
Compared to other SNP planning methods, optimizer behavior
heavily depends on maintained costs
Elementary plan properties have to be expressed by costs, e.g.
Non-delivery costs to trigger planning
Storage costs to trigger in-time demand satisfaction
Advanced business-logic properties have to be translated into costs
Transport, PPM/PDS costs to model priorities
Sufficient different storage costs to model push logic
Disadvantage compared to other SNP planning methods High entry-level for using the SNP Optimizer
Expert knowledge required for translating business logic into costs
To use the SNP or Deployment optimizer it is necessary to define cost. For instance, demandsare only satisfied, if penalty cost for non deliveries are maintained.
With the Automatic Cost Generation (ACG) it is not necessary anymore to maintain the cost forthe optimizer. The ACG generates the cost so that demands are fulfilled.
Additionally, the result of the SNP optimizer depends to a high degree on the cost values.Unfortunately, it is sometimes difficult to maintain the cost in the way that certain business rulesare respected. The ACG can use priorities (e.g. PPM or procurement priorities which are used bythe SNP heuristic, too) to derive cost according to the underlying business rules.
Please note that it is NOT necessary to maintain any properties in order to use the ACG.
As you can see, the advantage of the ACG is twofold:
Demands are satisfied even if no costs are defined -> avoidance of cost master data maintenance
Priorities can be used by the ACG to create cost in the way that the business logic is respected.
8/13/2019 Auto Cost and Penality Model
3/18
SAP AG 3
SAP AG 2005
Mission Statement
Goal:
Lower entry level for using the SNP/deployment optimizer by
providing functionality to automatically derive a cost model
Target Groups: Customers/Consultants
who want to try/use the optimizers but have insufficient
knowledge to translate the requirements
who quickly want to setup a cost model and possibly want to
refine it afterwards
8/13/2019 Auto Cost and Penality Model
4/18
SAP AG 4
SAP AG 2005
Automatic Cost Configuration: Requirements
Automatic generation of cost model consisting of
Storage costs
Production (PPM) costs
Product-specific transport costs Procurement costs
Safety stock penalty
Non-delivery penalty
Late-delivery penalty
while
Allowing expression of business logic
In terms of business, not in terms of optimization
Keep functionality simple
Ensuring certain cost model properties
Avoid anomalies
Stability with respect to small differences in the planning problem
Reasonable cost model ( in terms of economical interpretation)
The ACG derives the cost mentioned above. The functionality is kept simple, and the resultingcost ensure that the model is stable and reasonable. This will be explained at the end of thisdocument in more detail.
First, let us have a look how the cost are derived.
8/13/2019 Auto Cost and Penality Model
5/18
SAP AG 5
SAP AG 2005
Introduction
Features
Automatic CostModel Generation
for theSNP and DeploymentOptimizer
8/13/2019 Auto Cost and Penality Model
6/18
SAP AG 6
SAP AG 2005
Expressing Business Logic
Idea:
Let customer describe planning behavior of optimizer in terms of
business (and not in terms of Operations Research)
Keep functionality simple focus on preferences / priorities
source priorities
transportation priorities (lane)
production priorities (PPM/PDS)
demand priorities
Demand priority classes
Location-product priorities
On the next slides it is explained how the ACG uses the priorities to express certain businessrules.Please note that the ACG can also be used if no priorities are defined. Then, for example, eachsource has the same priority, or each demand has the same importance.
The ACG can use priorities to define the cost values. Regarding sourcing decisions, thetransportation and production priorities are used. For distinguishing between demand classes(sales orders, corrected forecasts, forecasts, and safety stock), priorities can be defined for thesefour categories. Furthermore, it is possible to use the location product priorities to distinguishbetween different location products.
Please note that priority 1 is always the highest priority, then priority 2 and so on.
8/13/2019 Auto Cost and Penality Model
7/18
SAP AG 7
SAP AG 2005
Express Business Logic: Source Priorities
Production:
Use Priority field at
PPM/PDS master data
Transport: Use priority field of procurement area of
lane master data
lane-product specific priority
Translate source priorities into costs
8/13/2019 Auto Cost and Penality Model
8/18
SAP AG 8
SAP AG 2005
Express Business Logic: Source Priorities
Resolving Priorities
No global priority space: For a location-product, production priorities
dominate transport priorities (same as for SNP Heuristic)
Time dominates source:
Bucket
Demand
Source1 Prio 1
Source2 Prio 2
1 2 3 4 5
100
Time dominates source
Higher prioritized sources will get lower costs
(for production resp. transport)
In-time fulfillment of
demand is more important
than sourcing from the
higher prioritized source
If we have both, a PPM priority and a lane priority, the cost are derived in the way that theproduction priority is more important, i.e. will have lower cost. The same behavior is true for theSNP heuristic.
Additionally, it is more important to deliver a demand in time than sourcing from the morepreferred source.
The optimizer tries to fulfill all demands in time with receipts of all available sources in this period(according to the sequence defined in the sourcing priorities). If this is not possible, the optimizerwill use receipts of previous periods, or even later periods, if late deliveries are allowed. Pleasenote that it cannot be guaranteed that the optimizer keeps the sourcing sequence according tothe priorities, when early or late receipts have to be used.
8/13/2019 Auto Cost and Penality Model
9/18
SAP AG 9
SAP AG 2005
Express Business Logic: Demand Priorities
Translate location-product and demand priorities into costs
1. Demand Priority Classes
Assign priorities to
Customer demand
Corrected forecast
Forecast
and Safety Stock
Demand and Safety Stock
may have same priority
The ACG derives the non and late delivery cost for the three demand categories customerdemand, corrected forecast, forecast and additionally the safety stock violation cost.
You can define in the ACG Tab of the optimizer profile which demand class has highest priority,second highest and so on. You can even say that all four classes have the same priority.
Please note that these cost are only derived if there is a demand for the corresponding locationproduct in the planning horizon for the optimizer.For example: if you have a sales order for location product A, and a forecast for location productB in the planning horizon, then only non delivery / delay cost for customer demand for A and nondelivery / delay cost for forecast for B are derived. For all other demand classes, no penalties arecreated.
8/13/2019 Auto Cost and Penality Model
10/18
SAP AG 10
SAP AG 2005
Express Business Logic: Demand Priorities
2. Location-Product Priorities
Use priority field of location-product master
Grouping of location-products (3 partitions)
A location-product (highest priority)
B location-products (medium priority)
C location-products (lowest priority)
-> to be defined by the user
-> reduce complexity
Additionally to the demand classes, the ACG can consider the location product priorities toderive the non and late delivery penalty cost for the three demand categories customerdemand, corrected forecast, forecast.
In the priority field on the SNP 2 Tab of the location product you can define priorities from 0 to255 (priority 0 is lowest priority). In the ACG Tab of the optimizer profile you can define whichlocation product priorities have highest priority (e.g. up to priority 10 you have A products),second highest priority (e.g. up to priority 50 B products) and the remaining ones (larger than 50)will have lowest priority.
Now the question is: which is more important the demand priority classes or the location productpriorities?
This can be defined by the user. It is explained on the next two slides.
8/13/2019 Auto Cost and Penality Model
11/18
SAP AG 11
SAP AG 2005
Express Business Logic: Demand Priorities
Modes of combination for resolving priority: Demand priority classes dominate location-product priorities
Location-product priorities dominate demand priority classes
Mode is configurable
Example:
Demand
Class 1
A Location-products
P1, P2
Demand
Class 2
Demand
Class 3
B Location-productsP3, P4, P5
C Location-products
P6, P7
Demand class dominates Product Priority
The default setting is that the demand class is more important than the location product priority.This means that the penalty cost are derived in the way that the cost for demand class 1 for Aproducts are highest, followed by the B and C products. Then, the cost for demand class 2 and 3are determined accordingly.
8/13/2019 Auto Cost and Penality Model
12/18
SAP AG 12
SAP AG 2005
Express Business Logic: Demand Priorities
Modes of combination for resolving priority: Demand priority classes dominate location-product priorities
Location-product priorities dominate demand priority classes
Mode is configurable
Example:
Demand
Class 1
A Location-products
P1, P2
Demand
Class 2
Demand
Class 3
B Location-productsP3, P4, P5
C Location-products
P6, P7
Demand class dominates Product Priority
Demand
Class 1
A Location-products
P1, P2
Demand
Class 2
Demand
Class 3
B Location-products
P3, P4, P5
C Location-products
P6, P7
Product Priority dominates demand class
If you define that the location product priority is more important than the demand class, then thepenalty cost are derived in the way that the cost A products are highest, followed by B and Cproducts. If you have defined different priorities for the demand classes, then of course thedemand class with the highest priority will get the highest cost etc.
8/13/2019 Auto Cost and Penality Model
13/18
SAP AG 13
SAP AG 2005
Priorities Settings in Optimizer Profile (ACG Tab)
Consideration of Priorities
You can define priorities from 1-4 for three different priority classes of the demand and the safety stock. 1 is thehighest,4 the lowest priority. You can also assign the same priorities for two or more priority classes.
The standard setting is that all priority classes and the safety stock have the same priority.
Consideration of Priority of Location Products
If you set this indicator, the system considers not only the priority for the priority classes of the demand, but also thepriority of the location products. You define this priority in the master data of the location product on the SNP 2 tabpage.
You must also subdivide the product priorities into three product classes with A, B and C. Otherwise all productswill have the same importance.
The optimizer can consider the product priority together with the demand priority. You can define which priority is moreimportant and should be considered by the system first, by setting the Prio.of Loc.Prod. more important than Prio. ofPrio.Classes indicator. Otherwise, the demand class priority is more important than the priority of the location product.
Consideration of Procurement Priority of PPMs/PDS
If you set this indicator, the system considers the procurement priorities of production process models (PPMs) orproduction data structures (PDS). You define this priority in the master data for PPMs or PDS.
Consideration of Procurement Prio.of Transportation Lanes
If you set this indicator, the system considers the procurement priorities of transportation lanes. You define thispriority in the transportation lane master data in the Product-Specific Transport section.
Consideration of Costs of Products without Input Products
To calculate the product value, the system automatically accepts the value 1 as the value of raw products (products
without input products). If you set this indicator, the system bases the calculation on the actual storage costsinstead. You define the storage costs in the master data of the location product on the Procurement tab page.
8/13/2019 Auto Cost and Penality Model
14/18
SAP AG 14
SAP AG 2005
Cost Model Properties
Avoid anomalies
Optimizer should not transport or produce without demand
Ensure supply close to demand date
Prevent non-delivery if demand can be delivered delayed
Safety cost should be higher than storage cost
Stability
Numerical stability
-> avoid big differences in the numbers (in terms of orders of magnitude)
Independence of transactional data
Independence of bucket granularity
Independence of discrete constraints (optimizer profile settings)
The resulting properties of the cost model ensure that anomalies are avoided. This means thatthe optimizer should not transport or produce without demand:
No transport should be activated due to cheaper target location cost
No production should be activated due to cheaper output location-product cost
No transport should start to save storage cost on the truck
No production should start to save storage cost by production in progress
Additionally, the supply should be triggered just-in-time, and non deliveries should onlyoccur if late demand fulfillment is not possible.
Moreover, the resulting cost guarantee that the model is stable.
8/13/2019 Auto Cost and Penality Model
15/18
SAP AG 15
SAP AG 2005
Cost Model Properties: Reasonable Cost Model
Economical interpretation desired
Transport/production costs increase proportionally to their duration
Value of products increase with production depth
Possibility to reflect different location-product values
Derive reasonable location-product values ( storage costs) Two modes are possible
All raw location-products have value 1 (default) ( to minimize
configuration)
Respect maintained costs for raw products
Regarding the storage cost. they can either be read from the master data (location product onthe Procurement tab) or they have a value of 1 (as default setting).Please note that even with the default setting, the storage cost increase with the value of theinput product. For instance, if you need two items of an input product to produce one item of theoutput product, the storage cost for the output product are 2 APO-$.
8/13/2019 Auto Cost and Penality Model
16/18
SAP AG 16
SAP AG 2005
Automatic Cost Configuration: Limitations
No cost model completion
No saving of generated costs to master data .
No generation of
Cost functions (production, transport, procurement)
Costs for means of transport
Costs for resource utilization
Costs for increasing resource capacity
Costs for minimum resource utilization
Some limitations are also valid for the ACG.
It is not possible to complete an incomplete cost model. For instance, if you already havemaintained production cost (in some PPM or PDS) and transportation cost (at some lanes), thenthe ACG will not consider these cost when the missing cost are derived. The ACG does notconsider any existing cost (except the storage cost, if this is desired).
It is not possible to save the generated cost into the corresponding master data. The cost arestored in the result log of the optimizer. Thus, they are available on the database in thecorresponding table.
8/13/2019 Auto Cost and Penality Model
17/18
SAP AG 17
SAP AG2005
You want to seehow the ACG is
working in the
system?
Please check out
the SAPTutors inthis Learning Map
8/13/2019 Auto Cost and Penality Model
18/18
SAP AG 2005
Copyright 2005 SAP AG. All Rights Reserved
No part of this publication may be reproduced or transmitted in any form or for any purpose without the express permission of SAP AG. The informationcontained herein may be changed without prior notice.
Some software products marketed by SAP AG and its distributors contain proprietary software components of other software vendors.
Microsoft, Windows, Outlook, and PowerPoint are registered trademarks of Microsoft Corporation.
IBM, DB2, DB2 Universal Database, OS/2, Parallel Sysplex, MVS/ESA, AIX, S/390, AS/400, OS/390, OS/400, iSeries, pSeries, xSeries, zSeries, z/OS, AFP,Intelligent Miner, WebSphere, Netfinity, Tivoli, and Informix are trademarks or registered trademarks of IBM Corporation in the United States and/or other
countries. Oracle is a registered trademark of Oracle Corporation.
UNIX, X/Open, OSF/1, and Motif are registered trademarks of the Open Group.
Citrix, ICA, Program Neighborhood, MetaFrame, WinFrame, VideoFrame, and MultiWin are trademarks or registered trademarks of Citrix Systems, Inc.
HTML, XML, XHTML and W3C are trademarks or registered trademarks of W3C, World Wide Web Consortium, Massachusetts Institute of Technology.
Java is a registered trademark of Sun Microsystems, Inc.
JavaScript is a registered trademark of Sun Microsystems, Inc., used under license for technology invented and implemented by Netscape.
MaxDB is a trademark of MySQL AB, Sweden.
SAP, R/3, mySAP, mySAP.com, xApps, xApp, SAP NetWeaver and other SAP products and services mentioned herein as well as their respective logos aretrademarks or registered trademarks of SAP AG in Germany and in several other countries all over the world. All other product and service names mentionedare the trademarks of their respective companies. Data contained in this document serves informational purposes only. National product specificationsmay vary.
The information in this document is proprietary to SAP. No part of this document may be reproduced, copied, or transmitted in any form or for any purposewithout the express prior written permission of SAP AG.
This document is a preliminary version and not subject to your license agreement or any other agreement with SAP. This document contains only intendedstrategies, developments, and functionalities of the SAP product and is not intended to be b inding upon SAP to any particular course of business, productstrategy, and/or development. Please note that this document is subject to change and may be changed by SAP at any time without notice.
SAP assumes no responsibility for errors or omissions in this document. SAP does not warrant the accuracy or completeness of the information, text, graphics,links, or other items contained within this material. This document is provided without a warranty of any kind, either express or implied, including but not limitedto the implied warranties of merchantability, fitness for a particular purpose, or non-infringement.
SAP shall have no liability for damages of any kind including without limitation direct, special, indirect, or consequential damages that may result from the useof these materials. This limitation shall not apply in cases of intent or gross negligence.
The statutory liability for personal injury and defective products is not affected. SAP has no control over the information that you may access through the useof hot links contained in these materials and does not endorse your use of third-party Web pages nor provide any warranty whatsoever relating to third-partyWeb pages.