By Kiri
SAP Advanced Planner and Optimizer (SAP APO) is a key application component of mySAP.com and forms a technical foundation for several mySAP.com solutions.
SAP APO is a robust tool designed to enable your organization to achieve the inconsistency between aspects or parts of a whole goal of improving customer service while reducing costs. By enabling visibility for and access to all stakeholders involved in generating a single, organization wide demand plan, the demand planning capability of SAP APO projects the needs of your organization’s customers.
Those needs, combined with the capacities of your organization’s capital assets and existing inventories, are then used as inputs for supply network planning, which converts them into a feasible plan for production, warehousing, and transportation. This plan accurately balances material, labor, and equipment constraints with the anticipated customer demand.
Together, demand planning and supply network planning
can support your organization’s entire sales and operations planning process.
The detailed, tactical decision support capabilities, which help turn the
plan into reality, are also handled by components of SAP APO, such as production
planning and detailed scheduling. It insures each of the production assets
is loaded to achieve maximum efficiency for the production line and facility.
The best use of fleet assets is determined through transportation planning
and vehicle scheduling. Finally, global available-to promise (GATP) allows
your company to get products to your customers as soon as possible, helping
you meet customer demand that exceeds current inventory positions.
What is the benefits of implementing SAP APO?
The benefits of implementing SAP APO, is that it provides
the basis for an end-to-end supply chain management solution, seamlessly
linking all key processes -- from order generation to production planning
to transportation.
Modules within the SAP APO are:
- Supply Chain Cockpit
- Demand Planning - a toolkit of statistical and collaborative forecasting techniques.
- Supply Network Planning - used to calculate quantities to be delivered to a location in order to match customer demand and maintain the desired service level.
- Global Available to Promise - uses a rule based strategy to ensure you can deliver what you promise to your customers.
- Transportation Planning / Vehicle Scheduling - optimizes transportation route and schedules vehicle resources.
- Service Parts Planning
- Production Plan / Detailed Scheduling - create procurement
proposals for in-house production or external procurement to cover product
requirements and optimizes the same.
Short Process Overview
Supply Chain Execution
From the moment a shipment to a customer leaves your organization’s
shipping docks, transactional data is being gathered through the use of
enterprise requirements planning solutions, such as mySAP ERP. This information,
whether it is about inventories, open customer orders, new product specifications,
existing production schedules, or numerous other details, is fed into SAP
APO to support ongoing planning. The combination of SAP’s real-time Core
Interface Functionality (CIF) and liveCache planning model allows for continuous
planning updates of this transactional and master data throughout the day.
Supply Chain Coordination
External information, such as the status of a purchase
order in a supplier’s manufacturing process or the expected delivery of
a key inbound shipment of raw materials, is also being continuously imported
into the system. Using tools like SAP Event Management, updates to plans
can be triggered by key events, such as a supplier’s production lot passing
final quality inspection. While event management tools monitor critical
pieces of the supply chain puzzle, other tools, such as SAP Inventory Collaboration
Hub, gather inventory data across the entire supplier base. Looking forward
in the supply chain, demand and inventory from a customer, or even a customer’s
customer, is brought into the mix.
Supply Chain Collaboration
With such a clear and precise picture of the state of
the entire supply chain at your disposal, it is possible to move from “what
is” to “what might be” for both suppliers and customers. Using out-of-the-box
Web collaboration capabilities, SAP APO enables organizations to share
demand and promotional plans in real time with customers, any of whom may
view, comment on, or even edit the plan. SAP APO supports intercompany
collaborative processes, such as vendor-managed inventory (VMI) and the
Voluntary Inter-industry Commerce Standards Collaborative Planning, Forecasting,
and Replenishment process (VICS CPFR), and it has been certified by the
Uniform Code Council as being interoperable with other vendors.
Conclusion
Although SAP APO is no longer marketed as a separate solution, its functionality underlies mySAP Supply Chain Management, mySAP Customer Relationship Management, and mySAP E-Procurement.
