MTO Process query

[Former Member]

Dear Gurus,

As part of our client we are using MTS process and creating the  Scheduling Agreement delivery line releases for MRP run to communicate the requirement to supplier. Now we need to follow MTO process for one plant as part of Business Requirement (Sales order àProduction Order). In this case as per SAP standard the MRP run will creates only PR’s.

Please suggest us if it possible to create a scheduling Agreement delivery lines with reference to Sales Order instead of PR’s to receive the stock as Sales Stock .  I am aware we can create a new scheduling line with reference to Sales order but the delivery lines will not get update. Also the PR’s which triggers from MRP run with reference to sale order will be remains open.

Anyone could you please provide the details of MTO best practice link and solution for this scenario (I am not sure it is possible to create the SA delivery line with reference to PR in SA without impact all other plants).

Regards,

Sada

[Prasoon · Accepted solution]

Hi,

   You may create new schedule lines based on the PR created through MRP from MTO order - as shown below in ME38:

    In addition, you may check the KBA:  1967840 - MRP does not create schedule lines

Regards,

AKPT

[Former Member · Accepted solution]

Hi

Thanks for the update.

Business wants to go with SA process instead of PR. If we create a new schedule lines for each PR's what will happen to the PR(I believe this PR's are always with open). Also as per our logic our SA's should have only 25 lines and we are unable to create more than 25 lines in Single SA.

Please suggest me is it possible to create delivery lines with reference to sales order. I am sure it is not a proper MTO process.

Please provide the link or document of SAP best practice for MTO process with respect to Procurement.

Regards,

Sada

[tomasz_domanski · Accepted solution]

Hi Sada,

I think you are writing on too general level - usually business does not say "we want MTO" but there is more inside probably.

MTO vs MTS would mean you does not build your stock and then sell but you build your products for each sales order (you can also build them using variant configuration so each product for customer might be different). For both processes you can buy raw materials and parts for stock and plan them same way regardless it is MTO or MTS production. So unless you state otherwise you might not need anything else then Sch Agreement as MRP relevant object. 

See also:

Make to Order (MTO) and Make to Stock (MTS) - ERP Operations - SCN Wiki

BR,

Tomek

[Prasoon · Accepted solution]

Hi,

   If you follow the method mentioned, the PR status will be updated as "PO created" once its referred in ME38. Test the same and revert back.

   In addition, refer the KBA mentioned in my previous comment.

Regards,

AKPT

[Former Member · Accepted solution]

Tomek / AKPT,

Thanks for the update.

Sorry for the delay in response.

All our earlier plants are MTS scenario and we have used Scheduling Agreement process (Based on MRP run schedule lines are created). But for the new plant is related to MTO with Variant configuration process. In this case whenever MRP runs it will triggers only PR (based on strategy group – 20 Make to order Production in MRP 3 view). 

For this reason we are suggesting to the business to go with PR to PO approach to receive the stock with reference to sales order based on business requirement.

But our client IT team is asking us is it possible to create a schedule delivery line instead of PR. Per my knowledge it is not possible (we can create new line item in the SA with reference to Sales order but not a delivery line). In this scenario we need to change source list line item each to receive the stock. I believe this is not a good approach.

Please suggest me is it possible to create a new schedule line item with reference to Sales order from MRP run and the same can be update to schedule line.

Regards,

Sada

[tomasz_domanski · Accepted solution]

Hi Sada,

Even if you have variant conifgured product and you produce this product with MTO (and set up 20 in this product's MRP view), does not mean you need to buy components to sales order stock. MTO in your production means your production order will be dedicated for the sales order and the stock of finished good will end up on sales order stock. The components for production can still be managed with MRP generating unrestricted use stock requirements and schedule lines - there you do not need special proc at all.

Only if you actually want to buy parts for particular order, not in aggregated mode and keep component stock per sales order separated, it makes sense. And then it is not possible to use Sch Agreements with lines - then PR - PO scenario is applicable.

BR,

Tomek

[Former Member · Accepted solution]

Tomek,

Thanks for the update.

Yes ours is second scenario because business wants to track the stock with reference to sales order and they don't want to issue this component to any other sales order .

Also I had a discussion with my PP team and they confirmed me the Header Material (FG-FERT) will have the strategy group 20 and the Buy parts will have strategy group 10. Please suggest me is this will make any impact on procurement.

Regards,

Sada

[tomasz_domanski · Accepted solution]

Hi,

OK, so if you want to track the component stock using Sales Order stock in SAP I guess you can't use Schedule Lines as on SL level you can put Sales Order reference information, which is normal in Purchase Order item level.

Of course you can try to have this assignment on Schedule Agreement item level but it will mean creating SAgr item per each order which sounds ridiculous.

I only can share that we use internal batches to track goods for particular Sales Order, still using regular procurement type, not for Sales Order stock. In Inbound delivery we force batch split and track which particular finished product should the part be dedicated to.

Best Regards,

Tomek

[Former Member · Accepted solution]

Tomek,

Thanks for the update and all your support.

Could you please explain the last point in more detail with steps. It might help me to analyse and provide the solution to my customer. If they are not ready for the PR process.

Your help and support will be greatly appreciated.

Regards,

Sada

[tomasz_domanski · Accepted solution]

Hi again,

Well, I can briefly do it - we use it for our sequential deliveries - we send it to the suppliers as and additional information to the delivery schedule ( the sales order item numbers ) so they can organize the parts in the way that enables usage directly for particular orders on particular work centres in the factory. The Inbound Delivery is filled up with these references as batches and once received they are held in stock as such and then it is controlled during goods issue.

It is only for the parts that need to be handled like this. The rest is going with regular Sch Agr and unrestricted stock.

BR,

Tomek

[Former Member · Accepted solution]

Tomek,

Thanks for the update.

You mean you have made the custom development to include the sales order item number to vendor release. I believe this details are pulled from MD04 is it correct. Also please suggest me are you using EDI to send the delivery line releases to vendor.

Regards,

Sada

[tomasz_domanski · Accepted solution]

Hi Sada,

Yes, on top of regular schedule lines we send additional output with sales order item related grouping. This second part is custom development and custom message. (it is first generated based on reservations and then sent out).

We have EDI for first one, the second is incoming into EDI with one of our new enhancements.

BR,

Tomek

[tomasz_domanski]

Hi Sada,

I guess you want to have above, to GR and keep the stock from vendor separated per each sales order item you have with your customers? With purchase order, referencing to sales order item, this will end up with sales order stock in your system and possibillity to consume these goods only by production order related to the same sales order.

With Scheduling Agreements this looks as something not possible to do as the same level you have in PO will go here on item level. It means, that you will need new item each time you want to call for material for another sales order. That does not sound feasable.

Have you considered using something else than sales order stock for MTO? Wouldn't smart batch management strategies secure the same while you still can do your purchasing with single Sch Agreement item and multiple schedule lines?

Best Regards,

Tomek

[Former Member]

Hi Raghavendra Sai,

I have received the e-mail notification but when I am checking the thread no update is available .

Please suggest me if you have posted any details on this thread.

Regards,

Sada

[JL23]

Moderator message, I had removed the reply as the link just pointed to this discussion itself instead to another discussion, also link only replies are not allowed. A link shall not replace an own answer, should be used as reference to emphasize an own answer, otherwise you will end up hoping through another page which has a link in the answer and from there to a discussion with a link etc etc.  That is the reason why we want original answers instead of links.

If a question can be answered by link then this is also a kind of evidence that no diligent search was done before posting the question.

[Former Member]

Jurgen L,

I have done the complete search in SDN portal. But nothing is suitable for my scenario due to that reason I have raised in the SCN community.

Regards,

Sada

[former_member197616]

This message was moderated.