Sales and Operation Planning Process

Sales and Operations Planning (SOP) is the process of aligning forecasts of customer demand with manufacturing capability.SOP is used for the annual planning processes of budget preparation and the rolling monthly execution plans.

There are three principal sources of data in Sales and Operation Planning Process:

  • Annual plan of capacity including maintenance shutdown
  • Sales forecast by region, country, and grade
  • Profitability Analysis

The plans are prepared in calendar months. Capacity is checked using Rough-Cut Capacity Planning and adjusted where necessary. The budget and the rolling plans both use a hierarchical representation of products and product groups:

  • Adjustments to demand and production are made at the lowest level (i.e. packed products)
  • Planned production quantities are aggregated up the hierarchy to allow the loading to be checked for Rough–Cut Capacity Planning at product group levels

planning

The rolling plan moves forward each month and the Planner will check and confirm the detail for the next 3 months. Plant Planner is responsible for creating and controlling Sales & Operation Planning, taking the sales forecast via profitability analyses, checking the loading using rough capacity planning and adjusting the S&OP as necessary Sales.

Frequently used transactions in SAP by SOP Planner.

  • MC82 Change SOP Plan
  • MC76 Disaggregate SOP Plan
  • MC8G Mass Process –Aggregate Plan
  • MC78 Copy Planning Version
  • MC8G Mass Transfer to Demand Management

Flexible Planning provides a detailed way of planning based on our own characteristics.

Examples of planning on our own characteristics:

  • Production line
  • Product Size
  • Market

Understanding Planning Hierarchy and Planning Type:

Planning hierarchy is a combination of characteristic values based on the characteristics of one information structure. Planning hierarchies provide a frame work for planning.

An example of Planning hierarchy.

  • For information structure S755, sales quantity is planned for below characteristics
  • Production line –characteristic
  • Product Size –characteristic
  • Market –characteristic

Planning type is a customized view on the planning table. Planning type defines the content and the layout of the lines in the planning table. Planning data is saved in the information structure and planning type acts as a mere template on the information structure.

  • MC63 Display Planning Hierarchy
  • MC93 Create Plan
  • MC8V Copy Planning Version
  • MC8G Transfer to Demand Management
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