Dynamic Safety Stock

[Former Member]

I am using dynamic safety stock  with following config.

Period indicator     W Week

Number of periods    13
Type of per.length   1                               No. of Days per Period

Min.        Tgt   30    Max.                         Number of Periods        4

Min.        Tgt         Max.                         Number of Periods

Min.        Tgt         Max.

I have material which has following requirement in MD04..Lead time is 130 days.I run the MRP and it calculated the dynamic stock. Please check the screen shot.

09/02/2014 IndReq VSF   100.00- 100.00-

10/01/2014 IndReq VSF   100.00- 200.00-

11/03/2014 IndReq VSF   100.00- 300.00-

12/01/2014 IndReq VSF   100.00- 400.00-

01/02/2015 IndReq VSF   100.00- 500.00-

02/02/2015 IndReq VSF   100.00- 600.00-

03/02/2015 IndReq VSF   100.00- 700.00-

04/01/2015 IndReq VSF   100.00- 800.00-

05/01/2015 IndReq VSF   100.00- 900.00-

For month of September it's running standard MRP which I understand but for October I can't understand how it's calculated 245.17.I have period 13 weeks that means 65 days. I am not sure how many days system is considering to calculate the daily requirement.

Can  you please help me  to understand ?

[marianoc · Accepted solution]

Hi MM KS,

The coverage only applies for October.

The system will not calculate any coverage for Novemeber, December, January, etc.. because in your coverage profile settings you said that you only want to consider the coverage for the following 4 periods (4 weeks).

So the MRP will generate a PurReq for 245.17 CS for Oct 1st. At the end of Oct you will have 145.17CS.

Because you don't want to have coverage for Nov, then you will see that the MRP is not creating any requisition for November (note that the PReq 0019945520 has an rescheduling message for 10.01.2014 and then following requisitions PReq 0019945521 has a scheduling message for 12.01.2014). So the system skip November.

At the end of Nov your projected stock would be 45.17 CS, so if you are going to have sales for 100CS, you have to buy 54.83 additional CS.

Hope this is clear for you.

Kind Regards,

Mariano

[Former Member · Accepted solution]

Mariano glad you replied.

I think system  is considering total requirement 300 and Total number of days =Remaining days of September+October

(300*30)/37=245.17....Is that right  ? If it's how come system calculating 37 days.It shouldn't be 65 days=13 weeks ?

[marianoc · Accepted solution]

HI MM KS,

No. The system is considering Total Demand = 300, this is divided by 62 days (13 weeks of your factory calendar). So the daily demand is: 4.8387 CS / day. This is multiplied by your target, that is 30 days. As a result, your safety stock is 30 x 4.8387 = 145.17 CS. Then the system buy 100 CS to cover the PIR + 145.17 CS to cover the safety stock, so the PurReq is 245.17CS.

Kind Regards,

Mariano

[marianoc · Accepted solution]

Hi MM KS,

Have you been able to solved your problem?

Do you have any further question? If not please, could you please close the thread by indicating the correct answer or resolution.

Kind Regards,

Mariano

[Former Member · Accepted solution]

Mariano,

I was able to figure out the logic after your explanation .I still have 2 questions.

First thing which I couldn't not figure out is number of days... It's considering October 62 days,November 61 days and December 63.days and my 13 weeks goes till 19th December .I have 3 holidays in November.No holiday in October and  December till week of 19th.

It's not a big deal but was just trying to understand the logic.

Second is we are using rounding value 48 days..it's creating a total requirement of 240 ...My guess it should create total requirements 288 as requirements are 145.16+100=245.16.I have the 2 screen shot one with rounding value and another one with out.Planned delivery time is 10 days.

Thank you again !

[marianoc · Accepted solution]

Hi MM KS,

I can not review how the system calculates your working days.. I would need to review your calendar, how many working days you have, the holidays and even to debug the system to see what is calculating in case I can not reproduce the number.. Now it seems to be a reasonable number what you have.

Regarding the second question, without the rounding value you had two requisitions on 10.07.2014, one for 100 CS and the other for 245.17 CS. now with the rounding the first requisition is increased to 144CS and the second one to 240 CS... This is correct. You don't buy 288 CS, because instead buying 100 CS you bought 144 CS in the previous order.

Let me know if this explain your doubts and please close the thread in case your main question was answered.

Kind Regards,

Mariano

[Former Member · Accepted solution]

Mariano ,

I know thread is closed ...but this number of days logic still not clear. With following parameter I am running the MRP.

Period indicator     W Week

  Number of periods    13
  Type of per.length     1                             

    Tgt   30                       Number of Periods        26

Please see the result ...For February calculation is going out of the way Please check following

1. Forecast in the past , safety stock does not
   apply, system generated PR enough to cover need
2. Forecast next 13 weeks 300 / 62 days = 4.838 per
   day *30 days = 145.16 safety stock +100 normal req =245.17 PR
3. Forecast next 13 weeks 300 / 61 days = 4.918 per
   day *30 days = 147.54 safety stock +100 normal req =247.54  - 145.17 qty
   OH = 102.37 PR
4. Forecast next 13 weeks 300 / 63 days = 4.762 per
   day *30 days = 142.86 safety stock +100 normal req =242.85  - 147.54 qty
   OH = 95.32 PR
5. Forecast next 13 weeks 300 / 64 days = 4.687 per
   day *30 days = 140.63 safety stock +100 normal req =240.63  - 142.86 qty
   OH = 97.78 PR   

[marianoc · Accepted solution]

Hi MM KS,

Your logic is ok, but for the first period: October the system calculates 400 weeks as total demand.

This is because today is Sep 29th, and when calculating the daily requirements, the system considers the incoming 13weeks and also considers the PIR that you have in the current month. This is very weird, but you can read SAP help:

The system takes into account all requirements in the current period, even requirements that lie in the past but are still in the current period. For example, if the planning run is carried out in the middle of the month, then those requirements that were planned at the beginning of the month are also included in the calculation of the average daily requirements.

Calculating the Average Daily Requirements - Planning Process - SAP Library

So you should make again all your maths, but considering:

     b.  Forecast next 13 weeks 400 / 62 days = 6.4516 per

          day *30 days = 193.55 safety stock +100 normal req =293.55 PR

Then you will be able to reproduce the calculation...

Kind Regards,

Mariano

[Former Member · Accepted solution]

Mariano ,

I am sorry if I didn't explain you clearly. My question was more for month of February...suddenly the number became 143.98 for the month...It's a sudden increase...I think system is getting funky number of days for that month for calculation .

[marianoc · Accepted solution]

Hi MM KS,

If you repeat your calculation, you will get this:

1. Forecast in the past , safety stock does not apply, system generated PR enough to cover need
2. Oct: Forecast next 13 weeks 400 / 62 days = 6.4516 per day *30 days = 193.55 safety stock +100 normal req =293.55 PR - OH = 293.55 PR
3. Nov: Forecast next 13 weeks 300 / 61 days = 4.918 per day *30 days = 147.54 safety stock +100 normal req = 247.54  - 193.55 qty = 53.91  - OH = 53.91 PR
4. Dec: Forecast next 13 weeks 300 / 63 days = 4.762 per
   day *30 days = 142.86 safety stock +100 normal req =242.85  - 147.54 qty - OH = 95.32 PR
5. Jan: Forecast next 13 weeks 300 / 64 days = 4.687 per
   day *30 days = 140.63 safety stock +100 normal req =240.63  - 142.86 qty - OH = 97.78 PR
6. Feb: Forecast next 13 weeks 400 / 65 days = 6.1539 per day *30 days = 184.615 safety stock +100 normal req = 284.615  - 140.63 qty - OH = 143.98 PR

The system is considering 400 EA for February calculation, this is maybe because February has less days, and then 13 weeks cover still May 3rd...Look at the weeks:

W01	2-Feb	8-Feb
W02	9-Feb	15-Feb
W03	16-Feb	22-Feb
W04	23-Feb	1-Mar
W05	2-Mar	8-Mar
W06	9-Mar	15-Mar
W07	16-Mar	22-Mar
W08	23-Mar	29-Mar
W09	30-Mar	5-Apr
W10	6-Apr	12-Apr
W11	13-Apr	19-Apr
W12	20-Apr	26-Apr
W13	27-Apr	3-May

Note that you have forecast in Feb 2nd, Mar 2nd, Apr 1st and May 1st. 

Kind Regards,

Mariano

[Former Member · Accepted solution]

Mariano ,

You are great ! Can't say enough thanks ! Your concept about MRP PP are very clear...I am in the process to learn more on MRP. ..If you any document please share with me..

[marianoc · Accepted solution]

Hi MM KS,

Thanks!

You can find everything thru google. I have lot of documentantion, but believe me, everything is already available in the web.

I would recommend to navigate the PP space in SCN. There are lot of very valuable documents and blogs loaded here by the different PP experts.

Here you will see different articles loaded by different SCN memebers...

If you know what you want, you can search in the SCN space or in google and you will get what you want.

Of course if there is something that you can't find after trying, you can open a thread.

Kind Regards,

Mariano

[Former Member · Accepted solution]

Hello Mariano,

hope you are doing good.We implemented dynamic safety stock.I have hard time to understand calculation of 1 material.

Following is the configuration we use for dynamic safety stock.

Period indicator     W Week

Number of periods    13

Type of per.length   1                               No. of Days per Period

Min.        Tgt  30    Max.                         Number of Periods        26

If you see following example I can't understand how the requirement for 76 is coming.Material has rounding value 76 but still how the requirement is coming for 1 ?

[Caetano]

Hello

Please check my explanation on thread below:

http://scn.sap.com/thread/3558681

BR

Caetano