SAP APO DP

What is SAP APO module?

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. 

Demand Planning – Accurate Forecasting

• A toolkit of statistical forecasting techniques
• Tightly linked to the R/3 System and the SAP BW SAP (data can be automatically transferred)
• Tree selection and drill-down capabilities facilitates navigation through multidimensional data structures
• Uses the Alert Monitor to report exceptions.

APO Demand Planning within Supply Chain Planning 

SAP APO Demand Planning Architecture

• Demand Planning is composed of three layers:
• Graphical user interface
• Planning and analysis engine
• Data mart

• Performance is of vital importance in any demand planning solution if users are to fully benefit from available information

• DP architecture includes several features to ensure high performance:
• Dedicated server 
• Multidimensional data mart based on the star schema that supports efficient use of storage space and of CPU cycles, minimizing query response time
• Batch forecasting so do not impede online performance
• The size of the information treated depends on:
• Number of characteristics: many characteristics will let the user more flexibility to define the planning level and to review the information but it makes the system works slower
• Number of key figures: many key figures will give the user a lot of information related to forecast but it makes the system works slower
• Number of characteristic combinations: the time consuming for any calculation (e.g. macros) depends directly on the number of characteristic combinations
• Number of planning versions: two planning versions needs double capacity than one
• Type and number of temporal periods

Data Storage and Representation :

• Multidimensional Data Storage in the data mart allows to:
• View data and plan from many different perspectives
• Drill down from one level to the next
• Info Cubes:
• A multidimensional data structure
• The primary container of data used in planning, analysis and reporting
• Contains two types of data, key figures and characteristics (or dimensions):
• Key figures are quantifiable values (e.g. sales in units, orders, shipments, POS…)
• Characteristics or dimensions determine the organizational levels at which you do aggregation and reporting (e.g. products and customers)
• Info Cubes also share master data and descriptive text, which are stored in different tables.
• The Online Analytical Processing processor :
• Models the business rules considering the aggregational behavior of key figures (e.g. sales summed by product and time)
• Guarantees that all business rules are met and the computed views present valid results.
• Hierarchies are modeled as combinations of characteristic values (e.g. product are grouped into product family hierarchies) using proportional and temporal factors, in order to be used as the basis for aggregation, disaggregation and drilling down.
• The DP planning level is based on the characteristics definition. In order to be more integrated with R/3 data, the dimensions and characteristics are usually based on R/3 hierarchies:
• Product dimension and characteristics are usually based on R/3 product hierarchy
• Customer dimension and characteristics are usually based on a R/3 customer hierarchy
• Geographic dimension and characteristics are usually based on the supply network,
• Time Series Management:
• Based on catalogs: time series data with related attributes (e.g. promotional patterns and life cycles)
• SAP DP allows to reuse time series saving time and ensuring consistency (e.g. reuse a past promotional pattern to estimate the impact of a similar future promotion)
• Notes Management maintains all notes entered by planners to create an audit trail of all demand planning activities, which is specially helpful when multiple sources and people are involved (such as in consensus forecasting).

Advantages of SAP APO Demand Planning :

• Global server with a BW infrastructure
• Integrated exception handling, creation of user defined alerts
• Integration with Production Planning (S&OP scenario)
• Main memory based planning
• Flexible navigation in the planning table, variable drill down
• Extensive forecasting technique
• Promotion planning and evaluation
• Collaborative planning via the internet
• Supports Sales Bills of Material (BOMs)