Define Settings for Purchase Delivery Schedules
This document explains how you define the settings for purchase delivery schedules.
Outcome
The parameters that control purchase delivery schedules are defined.
The following files are updated:
- Delivery schedule prints (MPDEPR)
- Planned Purchase Order (MPOPLP)
- Purchase Order – Header (MPHEAD)
- Purchase Order – Line (MPLINE)
- Purchase Order Transactions (MPLIND)
The parameters defined are used to create delivery schedules manually or automatically in 'Purchase Delivery Schedule. Open' (PPS210).
Before you start
- An item must exist in 'Item. Open' (MMS001).
- The item must be connected to a warehouse in 'Item. Connect Warehouse' (MMS002).
Follow these steps
Define purchase order type
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Start 'PO Type. Open' (PPS095). Select order category 30 or 40. Select New.
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On the E panel, enter the 'Number series – PO' and press Enter.
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On the F panel, select the 'Mandatory item/supplier record' and 'Agreement check - PO entry' (optional). Press Enter.
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On the G panel, select the 'PO type check' (optional) and press Enter.
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On the H panel, select the parameter 'Representative price' and press Enter.
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On the I panel, select the parameter 'Use buyer from agreement first' (optional) and press Enter.
Settings for Item. Connect Warehouse
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Start 'Item. Connect Warehouse' (MMS002).
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On the E panel, enter the acquisition code, period frame, planning policy, planning horizon, lead time, order type, and supplier. Press Enter.
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On the F panel, enter the order policy and press Enter.
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On the G panel, enter the buyer and the distribution/supplier calendar check and press Enter.
Settings for Supplier. Connect Item
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Start 'Supplier. Connect Item' (PPS040).
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On the E panel, enter the order type and the goods receiving method.
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Press Enter.
Parameters to set
| Program ID/Panel | Field | The field indicates … |
|---|---|---|
|
Settings for Purchase Order Type |
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| (PPS095/E) | 020 Number series - PO |
...the number series used while entering purchase order numbers for the purchase order type. You can define alternative number series for different facilities. |
| (PPS095/F) | 110 Mandatory item/supplier record |
…the connection between an item and supplier in (PPS040). This is mandatory in order to enter the order lines. Select the check box if the connection is mandatory. Automatic order proposals are assigned a lower status when item numbers are not connected to a supplier. |
| (PPS095/F) | 160 Multiple agreements per PO |
…that the purchase orders are allowed to contain more than one agreement number. For a rolling delivery schedule this must be set to 1. For a time limited delivery schedule this must be set to 0. If you do not select the check box, automatically created purchase orders will be divided, and manually created orders will be locked for entry. |
| (PPS095/G) | 190 PO type check |
…whether the purchase order should be reconciled for each supplier against the table of approved purchase order types. The valid alternatives are: 1 = No. 2 = Yes, warning which can be overridden. 3 = Yes, warning which cannot be overridden. |
| (PPS095/H) | 320 Representative price |
…that the specified purchase price is representative. The valid alternatives are: 0 = No. The price should not affect the price history analysis. It can, for example, contain expensive support purchases. 1 = Manually specified price. 2 = Price according to agreement. This code is always displayed by default on the purchase order line. However, if the purchase price is changed on the line and the value in this field is 2, the code is automatically set to 1. |
| (PPS095/I) | Get buyer from agreement |
…how the system prioritizes the buyer involved in the purchase agreement when you select which buyer is the default buyer for purchase orders. If you select the check box, the system uses the following priority: The buyer entered in the purchase agreement in (PPS100). The buyer entered for the item/warehouse combination in (MMS002). The parameter; responsible entered for the item/supplier combination in (PPS040). The buyer entered for the supplier in (CRS624). If you do not select the check box, the system uses the following priority: The buyer entered for the item/warehouse combination in (MMS002). The responsible entered for the item/supplier combination in (PPS040). The buyer entered for the supplier in (CRS624). The default buyer can be overridden when purchase orders are processed. |
| Settings for Item. Connect Warehouse | ||
| (MMS002/E) | Acquisition code |
…how the acquisition must be performed in case of requirements (immediate or planned) for each item/warehouse. The valid alternative for a delivery scheduled item is: 2 = Purchasing |
| (MMS002/E) | Period frame |
...a period frame template that is used to group days into appropriate periods. Each template ID is user-defined and can include up to 50 periods/columns with varying lengths. The period frame template entered per planning unit is also used for forecast distribution, if appropriate. Each period template is defined by entering three pieces of information in four intervals: - Number of periods/columns - Unit multiplier, that is the number of units that will form the period/column - Unit, expressed in one of the following alternatives: The valid alternatives are: 1 = Days 2 = Weeks 3 = System periods In addition, it is possible to determine the way in which eventual changes from one unit to another are processed by specifying whether overlapping should be used. |
| (MMS002/E) | Planning policy |
...the rules that determine how to use the generation of planned orders, action messages and warning messages. A delivery scheduled item normally uses a planning policy set with automatic release (status 60 if A1, A2). |
| (MMS002/E) | Planning horizon |
...the planning horizon, which is entered for each item/warehouse and indicates the number of days covered by the requirements planning from the current system date. There may be requirements beyond the date fixed by the planning horizon, but these are not considered when orders are generated. To support long-term planning, it is possible to override the planning horizon for each simulated version of the requirements planning. |
| MMS002/E | Lead time |
…the lead time for each item. This is the time required to meet a requirement from the time acquisition activities are started to the time the requirement is fulfilled. Lead time includes: - Administrative time - Transmission time - Supply lead time - Transportation time - Inspection time For a delivery scheduled item, this lead time determines when the purchase proposals will be released automatically or receive action message A1/A2. This lead time will also normally correspond to the number of days defined in the purchase agreement as "firm days." |
| MMS002/E | Order type |
…a combined ID for settings that determine how the order is processed during order entry and in the processing flow. Order types for purchasing are defined per order category in PPS095. |
| MMS002/E | Supplier no | …the supplier who is considered the main supplier for an item. |
| (MMS002/F) | Order policy |
…the process to calculate order quantity for each item/warehouse. The alternatives are described in more detail below. Normally method 11 = "Lot for Lot" is used when using delivery schedule. Fixed quantity/variable period. The valid alternatives are: 00 = Manually entered quantity 01 = Fixed quantity calculated from run-out time. 02 = Economic order quantity - Wilson's formula. Variable quantity/fixed period. The valid alternatives are: 11 = Discrete order quantity 12 = Manually entered run-out time 13 = Economic run-out time 15 = Run-out time using point-of-time table Variable quantity/variable period. The valid alternatives are: 21 = Least unit cost 23 = Period-based order quantity without balance check 24 = Period-based order quantity with balance check 25 = Up to maximum on-hand balance Regardless of the order policy (OP) you use, the expected requirements are converted into one or more replenishment orders. All of the methods can be used when material requirements planning (MRP) is used. MRP is a time-phased method, which means that a time dimension is added to the traditional inventory status information. Since all requirements and inventories always relate to a specific date, planning can be accomplished with greater precision. |
| (MMS002/G) | Buyer |
…the buyer normally responsible for purchasing. The buyer can, for example, be responsible for purchase orders, agreements, item/supplier combinations, or item/warehouse combinations. The specified buyer for each item/warehouse is copied to the planned orders generated by M3. |
| (MMS002/G) | Distribution/supplier calendar check |
…how the distribution and supplier delivery calendars are checked when an order's delivery date is determined. The valid alternatives are: 0 = Calendars are not used 1 = Back scheduling 2 = Forward scheduling 3 = The closest date possible is selected, regardless of whether a previous or later delivery date is selected The acquisition method determines which calendar is used. For distribution orders, this field is selected for the item/warehouse (MMS002) |
| Settings for Supplier. Connect Item | ||
| (PPS040/E) | Order Type |
…a combined ID for settings that determine how the order is processed during order entry and in the processing flow. Order types for purchasing are defined per order category in PPS095. |
| (PPS040/E) | Goods receiving method |
…the method that controls processing of the goods receiving flow. Depending on the method, quality inspection might be performed; certain documents can be printed, and so on. On the purchase order line, a default goods receiving method is proposed. This method can be overridden. The proposal comes from one of three sources according to the following priority ranking. The valid alternatives are: 1 = Combination of item and supplier 2 = Item 3 = Purchase order type |
Order policy methods
All methods are maintained manually. These three pieces of information are: 1. Order multiple - the order quantity must always be a multiple of this quantity. 2. The minimum order size - the minimum quantity that can be ordered. 3. The maximum order size - the maximum quantity that can be ordered.
For those methods based on a fixed-order quantity, the quantity is always increased when the daily requirement is greater than the fixed-order quantity (increases to the order multiple).
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00 The quantity is manually entered. 01 Fixed quantity calculated from run-out time - the number of run-out days is entered either per item/warehouse or per sales volume class - the requirement is based on the selections made in connection with the calculation, which include: - Yearly requirements - Running yearly usage - Historic usage - Forecasted usage.
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02 EOQ according to Wilson's formula. 2 * Year's required * Ordering cost Square root ____________Carrying cost * stock/costing price
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11 Discrete order quantity - when using this method, an order is created for each requirement even if there are several requirements for the same day.
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12 Manually entered run-out time - the order quantity is calculated dynamically according to the logic used in MRP - as requirements arise, orders are placed that cover the number of days entered manually as the run-out time.
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13 Economic run-out time - the order quantity is calculated dynamically according to the logic used in MRP - as requirements arise, orders are placed that cover the number of days entered manually as the run-out time The following formula applies: The order quantity is calculated according to Wilson's formula, and then divided by the average usage per calendar day. This average usage is based on the yearly volume or on running yearly usage. The run-out time= EOQ/daily requirement. The run-out time is calculated in the same function which calculates the fixed quantities.
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15 Requirements are summarized according to the planning points specified in the Point of Time table - example: If the planning points specified are set up as every day at 10:00, then the system will summarize all requirements between day one 10:01 to day two 10:00, then summarize requirements between day two 10:01 to day three 10:00, and so on.
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21 Least unit cost - this method estimates different order quantities by accumulating one daily requirement at a time - afterwards, the order receives the quantity that has the least unit cost - the following formula applies: Interest lay days.
Inv. cost ------- *-------- *(price * ord. qty.) 100 365 (ordering cost + Inv. cost).
Unit cost --------- Number of units in the order.
Interest Inv. interest according to parameter.
Lay days Number of calendar days that elapse from the order's delivery date, up to and including the last requirement's date the order covers.
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23 Period-based order quantity without balance check - this method is developed specifically for environments where a requirements-determined order initialization is desirable, while at the same time production should be balanced and evenly distributed according to the max/min order quantities per day - the method requires that a production rate is established for the product.
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24 Period-based order quantity with balance check - this method is based on the same principle as method 23, with a few exceptions - the method considers the opening balance for each period and evens out the surplus requirements both backwards and forwards - as with the other cases, neither released nor fixed planned orders may be rescheduled automatically.
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25 Up to maximum on-hand balance - this method is mainly designed for reorder point determined ordering, which means that the order quantity is always calculated so the calculated balance after the transaction is the same as the maximum on-hand balance minus one.