BLOGSUPPLY CHAIN MANAGEMENTSAP S/4 HANA
Henk Keijzer

Say Goodbye to Product Surplus: Introducing pMRP

Are you struggling to balance supply and demand? Meet predictive Materials and Resources Planning (pMRP). The successor to Long Term Planning (LTP), pMRP is now available for S/4HANA On Premise, Cloud, Private Edition, and Cloud, Public Edition. It predicts demand, plans available capacity in your own factories, and checks if suppliers are able to deliver on time. In this blog, we explain the tool and its capabilities in depth.

The Right Tool for the Right Scenario

So what is pMRP and what can it do for you? pMRP is an advanced system that helps you better align supply and demand. The goal is to ensure that you produce just enough products to meet demand, without excess or shortage.

To determine this, the tool sets scenarios for the initial demand plan, also known as unrestricted demand plan. This plan is loaded as a requirement - Planned Independent Requirements (PIR) - in SAP. With PIRs, you have active and inactive PIRs. Our tip: use the inactive PIRs, so you still have enough time to plan and evaluate whether supply and demand match.

Based on the PIRs, you create different scenarios. You enter which components should or should not be included in the app Schedule pMRP Simulation Creation. Key components include:

  • Current plant-to-plant stock transfer requirements

  • Available inventory (predicted or not)

  • Inactive and/or active independent demand

  • Current sales demand

  • Restrictions on production master data in BOMs, task lists, or routings

Once the simulations are complete, it is important to evaluate the results. You can do this in the Process pMRP Simulations app. In the app, you can also easily make a copy of the existing scenario and compare and evaluate various scenarios side by side.

Overcome Issues with pMRP

The various scenarios immediately reveal bottlenecks and capacity issues. Of course, the scenario clearly shows what the delivery reliability is and the impact of this. All supply chain problems, both internal and external, are displayed and can be evaluated directly.

For each period, you can see which part of the material list (Bill Of Materials), or at which stage in the production process, capacity problems occur. In the following example, capacity problems are found in the finished product and in the intermediate product. In the intermediate product, there is a problem with only one machine. It is the planner's job to solve this problem. This may mean that the planner needs to think about ways to make production more efficient on that machine, increase production speed, extend production time, find another supplier, or reduce demand.

How to Proactively Respond to Predictions

The above options are quickly visible via pMRP. A change in one of the above points immediately leads to a new image within pMRP, and all the choices you make are clearly displayed in the report. In this way, you always choose the best scenario with the best result. And that ultimately turns into an active PIR, which the MRP tool takes into account. The active PIRs provide an overview of the planned needs that are linked to demand. They are used to plan production and procurement of materials. With this tool, supply and demand are always aligned, and you can efficiently meet demand.

Next steps?

pMRP provides a full-fledged alternative to the well-known Long Term Planning tool. By adding pMRP to the planning process, you can perfectly match supply and demand. No more uncertainties about demand and available (internal and external) capacity. Finally, you can use pMRP to better develop the production plan within production planning and detailed scheduling. But more on that in the next blog.

Contact us

Want to know more about pMRP or how this solution can support your business? Contact Henk Keijzer.