IBP for MRO (spare parts) —Demand-generating "installed base" drivers for spare parts forecasting

[vincentverheyen]

In "IBP for MRO", is it possible the demand-generating-"installed base"⭐ drivers as input for the spare parts forecasting, instead of using the historical demand [of the Spare Parts] as input?

⭐ installed base = capital assets, such as manufacturing equipment or heavy infrastructure (the demand for spare parts originates from the part replacements of the installed base of machines)

For more information, see for example " Forecasting Spare Part Demand with Installed Base Information: A Review".

The article also refers to Croston & Croston TSB as classic methods that forecast based on historical demand/consumption [of spare parts] (instead of observing the " installed base").

Does " IBP for MRO" (corrective maintenance) indeed typically work with intermittent demand forecast models (Croston &/or Croston TSB) to determine forecast for the spare parts, since the historical data is sparse (see also Integrated Business Planning for Maintenance, Repair & Operations (MRO)- What’s New ? | SAP Blogs)? And does it thus not observe the " installed base"?

It seems in "IBP for MRO" (preventive maintenance) there is an option to work with “conditions-based” maintenance plans (see for example SAP S/4HANA Cloud 2202 for Asset Management: Condition-Based Maintenance in SAP S/4HANA Cloud 2202 Maintenance Management | SAP Blogs). Can this help us arrive at utilizing data on the "installed base"?

I know this is possible in SAP eSPP:

• "The Leading Indicator Forecast generates a forecast that is not (only) based on historical sales values but on other factors like the installed base, operation time, or the number of uses."

How could one do so in "IBP for MRO"?

Or is it perhaps necessary to utilize "Installed Base Management (CS-IB)" from SAP PM &/or SAP CS?

[vincentverheyen · Accepted solution]

IBP for MRO does not offer "full" Installed Base functionality:

The SAP9 Sample planning area which covers the MRO process is delivered together with the operators with the forecast model Croston TSB to determine the forecast for the spare parts for the corrective/reactive maintenance since the historical data is intermittent. There is no out-of-the-box integration content and objects in SAP9 planning area for the “installed base” information for the spare parts, and “installed base” information is not considered during forecasting future spare parts requirements as a part of SAP9, but SAP IBP is a flexible solution which provides great opportunities to configure additional key figures in different ways to consider various input parameters. Moreover, the external forecasting algorithms can be configured and connected to the Planning area.

Using the out-of-the-box integration of SAP PM and IBP for MRO planning area SAP9, it is possible to extract maintenance plans for which there is a schedule, e.g. as in time-based strategy maintenance plans. As for “conditions-based” maintenance plans there is no forecasted schedule, and there are no maintenance call objects (a schedule) to integrate to IBP.

However, there is Installed Base functionality for corrective maintenance only:

There is the following key figure with the ID “MROPARTNRINSTALLEDBASE” and with the name “MRO Part Installed Base” at the base planning level WKPRODLOC as a part of the SAP9 sample Planning Area, but it is not involved in the future demand forecasting of MRO parts for corrective maintenance.

This key figure is used to scale the Original Equipment Manufacturer’s Mean Time Between Failures (MTBF) values when there is insufficient historical MRO parts consumption data. The importance of this key figure is not considered when the MTBF is calculated from historical consumption.

Key Figure “MROPARTNRINSTALLEDBASE” (MRO Part Installed Base) for “Original Equipment Manufacturer’s Mean Time Between Failures” values. So, the “MRO Part Installed Base” key figure is not used for preventive maintenance. It is used for corrective maintenance to scale the OEM’s (MTBF) values when there is insufficient historical MRO parts consumption data.

“MRO Part Installed Base” key figure in SAP9 planning area is used in this KF calculation: “Part Usage Avg Weekly Rate from MTBF (Corr. Maint.)” in the following way:

If there is no Original Equipment Manufacturer’s Mean Time Between Failures (MTBF) value integrated to IBP for the part or MTBF = 0, then “Part Usage Avg Weekly Rate from MTBF (Corr. Maint.)” will be 0 in IBP. But in all other cases (when MTBF is not empty or 0) we divide the value of the “MRO Part Installed Base” KF by “MRO Part OEM MTBF in weeks” KF.

We do it to scale the Original Equipment Manufacturer’s Mean Time Between Failures (MTBF) values when there is insufficient historical MRO parts consumption data.

The “Part Usage Avg Weekly Rate from MTBF (Corr. Maint.)” KF can be used in the final KF “Part Usage Avg Weekly Rate Final (Corr. Maint)” calculation which is planned to be considered in the MRO Inventory operator in 2308 release and that calculates SS, ROP, TIP for the MRO parts with the intermittent demand pattern using the Poisson distribution.

The “Part Usage Avg Weekly Rate Final (Corr. Maint)” KF is calculated in this way:

If the value of the attribute “MRO Part Demand Pattern (Corr. Maint.)” is one of these (based on the Forecast Automation Profile execution results):
• “ ”
• ''NO DATA''
• ''INSUFFICIENT DATA''
Then we take the value of the “Part Usage Avg Weekly Rate from MTBF (Corr. Maint.)” KF for our “Part Usage Avg Weekly Rate Final (Corr. Maint)” KF, because that means that we have insufficient historical consumption data for this part and we cannot use “Part Usage Avg Weekly Rate from History (Corr. Maint.)” KF value due to this.

In all other cases the value of the “Part Usage Avg Weekly Rate from History (Corr. Maint.)” is used for the “Part Usage Avg Weekly Rate Final (Corr. Maint)” KF.

But as was mentioned before, the values of the “MRO Part Installed Base” key figure are not considered during any forecasting of the future demand in the SAP9 planning area as of now.