SAP IBP Usage of ABC XYZ Segmentation

[200502517665]

Hello,

There's a lot of manuals how to Segment products in SAP IBP, but I'm struggling to find information, how you utilize it further..

1) Do you build different forecasting models depending on Segment? Are you using different methods or only parameters are adjusted to Segment?

2) Are your data cleansing algorithms depending on segments?

3) Are there any recommendations on how to adjust methods and/or parameters depending on Segment? Is ABC or XYZ dimension leading when selecting methods?

Thank you in advance,

BR,

Piotr

[vincentverheyen]

Hi 2005025176,

ABC/XYZ segmentation is the method of grouping planning objects based on the values of a selected key figure:

• ABC segmentation is the prioritization of planning objects based on their relative importance. For example, based on their revenue: the products contributing to 70% of the revenue are classified as A-products.
• XYZ segmentation is the classification of planning objects based on their demand volatility. For example, based on their actual quantity: products with a rather constant demand (reflected by a Coefficient of Variation lower than 0.3) are classified as X-products.

After completing segmentation, it can be used in a variety of processes:

• IBP for sales and operations – demand review (2BQ):

The ABC code calculated in the IBP – ABC-XYZ Segmentation (1S6) process can be used as a filter in sales-and-operations-related planning alerts, analytics, and planning views in the SAP Integrated Business Planning, add-in for Microsoft Excel.

• IBP for demand – demand planning (11V)

The ABC code calculated in the IBP – ABC-XYZ Segmentation (1S6) process can be used as a filter in demand-planning-related alerts, analytics, and planning views in the SAP Integrated Business Planning, add-in for Microsoft Excel.

• IBP for demand – time-series analysis (34Y)

The results of the IBP – ABC-XYZ Segmentation (1S6) process are used in time-series analysis charts.

• IBP for inventory (11Z)

The ABC code calculated in the IBP – ABC-XYZ Segmentation (1S6) process can be used as a filter in inventory-process-related alerts, analytics, and planning views in the SAP Integrated Business Planning, add-in for Microsoft Excel.

I can suggest reviewing "IBP - ABC-XYZ Segmentation (‏1S6‏)" in the Best Practices Explorer. Especially look at the attached Test Script (A procedure for testing the activated system according to the defined business process) which can be found under "Details".

Further reading in IBP 300 or IBP 600, or query ABC and/or XYZ Segmentation in the SAP Help Portal.