Replenishment

If the supply chain behaves exactly as planned – i.e. neither changes in the demand nor unpredicted deviations of the supply happen – deployment is not necessary. Since we are living in an imperfect world, both demand and supply will usually differ from the planned quantities when it comes to execution. If the demand exceeds the supply, it has to be decided which demands – in case of the supply chain network: which locations – will be covered and to what extent. This is exactly the scope of deployment. Depending on the supply chain structure these decisions are more or less complex. In a hierarchical, single sourcing structure a simple fair share rule is sufficient. In a multi-sourcing structure however the decisions become more complex. This case is dealt with later on in this chapter concerning deployment optimisation. The basic idea of deployment is to convert planned stock transfers into confirmed stock transfers (confirmed distribution requirements resp. receipts) according to the available supplies, the demands, the deployment strategy and the fair share rule. The available supplies are defined by the difference between the ATD (available-to-deploy) relevant receipts and issues. The ATD-receipts and the ATD-issues are category groups which are assigned to the location master and/or to the locationproduct master. If an entry exists for the locationproduct it is used, else the entry from the location is taken. Stock usually contributes to the ATD-receipts, whether other receipt elements as production orders or purchase orders are included in the ATD-receipts as well depends on the business scenario. Regarding the ATD-issues, deliveries and confirmed distribution requirements should be included in any case. If a location serves for the supply of warehouses as well as for the direct shipment to customers, an important issue is the question whether (third party) sales orders are included into the ATP-issues category group or not. Including sales orders means that they are prioritised over distribution requirements, since the available quantity for distribution is reduced by the confirmed quantity of the sales orders. On the other hand, an exclusion of the sales orders means that the total available quantity is used for distribution, i.e. sales orders have the lowest priority. Depending on the categories in the check mode for deliveries for the ATP check (cf. chapter 7), this leads either to a lower prioritisation of the sales orders or to conflicts because quantities are planned one way in deployment but handled ‘first come first serve’ for delivery. A workaround to handle both distribution requirements and sales orders with the same priority is described later on. Having the ATD-quantity defined, it is distributed according to the deployment settings defined in the locationproduct master. Safety stock is ignored by deployment (at least by the deployment heuristic). Since safety stock is modelled in SAP APO™ as a demand and not a supply element, this means that safety stock settings do not have any impact on the available quantity.