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
Contents

1. 1 SAP MRP
Configuration
SAP MRP Configuration
1. 1.1
Activating
MRP and
Activating MRP and Planning File Entry 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

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.

Plant Plant Margin Opening Fl. Before Fl. After Release

Name Key Period Production Production Period
(In (In Days) (In Days) (In
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,

[Link]
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 (1st –
Routing, 2nd – Reference operation sets, 3rd, 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

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.

Configuring SAP MRP Types

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.

Firming type 0 1 2 3 4

P1 P2 P3 P4
MRP Types M0
M1 M2 M3 M4

Firming Methods for Procurement Proposals in the Planning time fence

No Firming of Procurement
Proposals within the planning time
X
fence

Automatic Firming of Procurement

Proposals within the planning time
X X
fence

Manual Firming of Procurement

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

Treatment with New Order Proposals in the Planning time Fence

Automatic Creation of New

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

No New Procurement Proposals

created to Cover the material
shortages within the planning time X X
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

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

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 Roll forward

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

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

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)

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

Minimum
70 Units 70 Units 70 Units
safety stock

Target safety
70 Units 70 Units 70 Units
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
stock formula
safety stocks Dynamic safety Dynamic safety
summarized as =
for the 1st stocks for the stocks for the
Average Daily
period of 8 2nd period of 8 rest of the
Stock * Range
weeks weeks Horizon
of coverage

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

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

Maximum
= 7 * 16 = 112 = 7 * 16 = 112 = 7 * 16 = 112
safety stock

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

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

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

Consider Current Stocks only in calculation of Days Supply

Only Consider Current available Stocks

X
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

Consider all the possible receipt

elements along with the plant stock

Example – Firmed Planned orders,

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

Consider all the Most Certain receipt

elements along with the plant stock
X
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)

Stock Balance Left after

Day Requirements Available Qty
covering Requirements

- Current Stock =
Today 100 – 20 = 80
20 100
nd
2 - Stock Available
80 – 30 = 50
Day 30 = 80
3rd - Stock Available
50 – 50 = 0 (Stock = 0)
Day 50 = 50
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)

Stock
Expected Available Balance Left
Day Reqmts
Receipts Stock after covering
Requirements

Firmed Planned
order = 10
- Production order = Available (100 + 15) -20
Today
20 5 = 100 = 95
Total Receipts on
day = 15

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

Production order =
3rd - 25 Available (65 + 25) – 50
Day 50 Total Receipts on = 65 = 40
day = 25

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

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

Next Step >>> Creation of Material Master MRP Views and Assignment of MRP
Types

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