Enhancing Production Planning (PP) Module for Manufacturing Finished Goods and Generating A Production Schedule Using SAP Application

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1 Enhancing Production Planning (PP) Module for Manufacturing Finished Goods and Generating A Production Schedule Using SAP Application Shruthi M 1, Priya D 2 1 Dept of ISE, R V College of Engineering, Karnataka, India 2 Assistant Professor, Dept of ISE, R V College of Engineering, Karnataka, India Abstract-- In modern Business world, an Organization must have a complete structure to maintain its management and system. In recent years, more and more organizations are switching to automated systems. The main challenge faced by corporate manufacturing plants is to respond to the dynamic requirements of the fast changing market. Enterprise Resource Planning (ERP) enables the users to integrate internal and external information across the organization. SAP is the leading ERP system in the world, which provides effective solutions for Business requirements. The basic idea is to design a Production Planning (PP) module using SAP (System, Application and Products) for producing the list of manufactured products along with their quantity on a daily or weekly basis with the available raw materials. The enhancement in this project will provide a planning schedule, to know the short term production schedule based on the demand and the raw material that is available. With the existing raw materials, we aim to produce maximum quantity of finished goods which can be delivered on a scheduled time without keeping the production hanging. This module involves identifying all the business requirements and analyzing these requirements with existing and new applications. Based on this analysis, we understand the gaps and bridge these gaps through development of new software and later test for the feasibility to deliver finished goods on time. Keywords-- Production Planning, SAP-ERP, Existing resources, internal tables, Finished goods. I. INTRODUCTION The rapid growth of information and communication technologies driven by computer hardware, software systems and microelectronics has influenced all faces of computing applications across organizations. Parallely the business environment is becoming more and more complex by requiring inter-functional data flow for efficiently scheduled procurement of product parts, decision making, accounting and distribution of goods and services [1]. Large complex business organizations use new software systems known as enterprise resource planning (ERP). These complex and powerful software systems are known as off-the-shelf solutions which require the developer to design and implement them based on the organization s requirements. These software solutions are not like the old and traditional in-house-designed companyspecific systems, but are the integrated multi-module commercial packages that are suitable for modifying and adding add-ons whenever required by the organization. Different ERP vendors provide ERP systems with various levels of speciality but the core modules are the same. The modules of an ERP system can work both as stand-alone units and as several modules that can be combined together to form an integrated system [2][3]. SAP AG is the largest ERP vendor which provides a number of modules with its famous R/3 ERP system [4]. SAP is an acronym for "System Application & Products" which creates a common centralized database for all the applications running in an organization [5]. SAP ERP is based on three-tier client-server architecture. SAP ERP can be subdivided into three main areas: Accounting, Human Resources Management, and Logistics as shown in figure 1, [6]. a.) Accounting: Accounting maps business transactions with their financial value. It is responsible for planning, controlling, and monitoring the data flow within the organization. The main components of accounting are Financial Accounting (FI), Investment Management (IM), and Controlling (CO). b.) Human resources management Human Capital Management (HCM) is divided into the areas of personnel planning and development, and personnel administration and payroll. The systematically and quantitatively managing the staff of an organization is supported by personnel planning and development. Personnel administration and payroll comprises all administrative and operational human resources activities. 317

2 c.) Logistics Logistics in terms of business controls the flow of information, materials and production from the supplier to the customer through production. The SAP ERP logistics modules enable organizations to plan, control, and coordinate their logistical processes based on the existing integrated data and functions.[4] Logistics contains the following individual application functionalities: Sales and Distribution (SD), Materials Management (MM), Production Planning and Control (PP), Quality Management (QM), Project System (PS), and Plant Maintenance (PM). [7][8] Figure I: Process Structure of Production Planning and Control II. RELATED WORK At its core, production planning represents the heart of any manufacturing process. Its purpose is to minimize production time and costs, efficiently organize the use of resources and maximize efficiency in the workplace. As per paper [9], the main aim of an ERP based integrated information system is to make the system user friendly, efficient and effective. Objective is achieved by implementing the modules of the schedule and notice manager that has increased the integrity and efficiency within the employees and processes. The Schedule Manager is the efficient way to maintain the schedule and also helps to prepare for the next coming events. Notice carries important message which is very important for the organization. As per paper [10], ABAP (Advanced Business Application Programming) is the programming language of the SAP system. ABAP programming plays an important role in the implementation process of the ERP (enterprise resource planning) system. The internal table in the ABAP program plays an important role. This paper discusses the type within the table, read mode within the table joins, etc., including the table on the join algorithm to improve the efficiency, hence the program's complexity increase exponentially. As per paper [11], effective management of material flows in the logistics system cannot be effective without functions information system, which is known for the logistics information system (LIS). The role of the Logistics Information System is to create an environment for the collection, evaluation, coordination and management of logistics activities associated with the management of material flow in the supply chain. The main module of the system is hierarchical balance sheet optimization model (HBOM), which coordinates the system at different levels of management. As per paper [6], it proposes a case study about a web business application implemented in three SAP (System Application and Products in Data Processing) UI (user interfaces) technologies: Web Dynpro (WD) ABAP (Advanced Business Application Programming), Floorplan Manager (FPM) and Customer Relationship Management (CRM) WebClient UI. Evaluating the results obtained by measurements, we observed that the application realized with the WD ABAP technology is the most efficient: the front end time to the user is the smallest. In existing application, SAP PP (Production Planning) module is used for carrying normal planning that is based on infinite planning. It is demand driven, which means that the user enters demand for finished products in the system and system will give a detailed plan as when to start procuring raw materials and when to start manufacturing sub-assemblies and final product so that it is available on the demand date. The standard SAP planning engine is long term planning engine and does not very well work on day to day basis due to long lead times The enhancement in this paper will provide a planning schedule, to know the short term production schedule based on the demand and the raw material that is available. 318

3 III. PROPOSED SYSTEM The basic idea is to design a Production Planning (PP) module using SAP with ABAP/4 programming language for producing the list of manufactured products along with their quantity on a daily or weekly basis with the available raw materials. Based on this demand reports can be built. With the existing raw materials, maximum quantity of finished goods are produced which can be delivered on a scheduled time without keeping the production hanging. The PP module involves identifying all the business requirements and analyzing these requirements with existing and new applications. Based on this analysis, understanding the gaps and bridging these gaps through development of new software and later test for the feasibility to deliver finished goods on time. The methodology followed in the proposed system contains several modules as follows shown in figure 2; 1. Requirements gathering Identifying and understanding all the requirements placed by the clients. Gathering all the components and raw materials required to further continue with the process. 2. Analysis Analysing the gathered requirements for feasibility in the existing system. Based on this analysis, understanding the gaps in the requirements such as differences in the user requirements and the existing system. Gaps are categorized into two; a. Gaps or requirements which are nice to have and are not critical to business, these can be scheduled for future and does need to be closed immediately as business can function without closing these. b. Gaps or requirements those are critical and without closing these, the objective cannot be met. These gaps must be bridged either through development or through application. 3. Specification Specification is carried out based on either the gaps are to be closed or left unaltered. Specifying the hardware and software requirements for the further process. Determining the existing internal tables to be used or creating new internal tables to support the system. Mapping of the customized internal tables with the standard tables. 4. Development Based on the specification the development is started in the development server. The user must be provided with a unique identification with an authorization from the development server to start the development. First level testing is carried out in the code inspector in the development server. 5. Testing After the development process in the development server Integration testing is performed by the Functional Testing team. Once it is approved from Business Team, it is moved to production. If any flaws or error encountered at any time it is sent back to development server for modification. 6. Production After testing is done at all the levels production is started. If any flaws or error encountered at any time it is sent back to development server for modification. Figure 2: Different modules of the Production Planning The system architecture shows the blocks required for the project. Figure 3 below shows the overview of the system; 319

4 Step 7: Calculate the Inspection Quality Check (IQC) stock and the Blocked stock. Step 8: Calculate the Open Purchase Order by considering the shortage quantity. Step 9: Display the output Can Build report with all the above calculated fields. The flowchart below in figure 4 represents the process; Figure 3: System architecture The customer places the demand which is moved to the Material Requirement Planning (MRP) block where the Bill of Material (BOM) is exploded to obtain the details about Semi-Finished goods (SFG), Raw materials (RM) and the shortage quantity. The shortage quantity is then analyzed in the Planning Purchase Order (PO) block and the order is placed to the Vendor based on the Contract between vendor and the company. Then the purchased stock along with the existing stock is sent to the Production department where the manufacturing of the finished goods takes place. Further it is sent to the Sales department which is responsible for the cost estimation and releasing it to the market. The high level description of the proposed system is given below; Step 1: Input the required Plant number, Material number and Quantity for which the Can Build report must be executed. Step 2: Check whether input fed exists or not. If it does not exist then pop up an error window else continue with the further process. Step 3: Explode the Bill of Material until the least level of raw materials through Functional Module. Step 4: Output of the functional modules is stored in two different internal tables. Step 5: Calculate the Vendor Confirmed quantity along with the On-hand stock and Gross quantity. Step 6: Calculate the Shortage quantity; Shortage quantity = On-hand Stock Gross quantity. Figure 4: Flowchart of the proposed system IV. SIMULATION RESULT Simulation is carried out to evaluate the proposed system. The simulation program has been written in ABAP/4 (Advanced Business Application Programming) programming language. Case 1: The input screen of the system is shown in figure 5; where the required Plant number, Finished Good (FG) material number and quantity is fed as input. The option for showing only the shortage list is not chosen. Based on the input the processing happens and the output report is displayed. 320

5 Case 2: The input screen of the system is shown in figure 7; where the required Plant number, Finished Good (FG) material number and quantity is fed as input. The option for showing only the shortage list is chosen. Based on the input the processing happens and the output report is displayed. Figure 5: Input Screen (Case 1) The input is processed with the above given logic and a output screen of Can build report is obtained as shown below in figure 6; The output report displays the details about the quantity of semi-finished goods (SFG) and raw materials used to build that initially entered FG. It also gives both the shortage quantity and the non-shortage list, blocked stock, IQC (Inspection Quality Check) stock and the vendor from which the materials have to be purchased. Figure 7: Input Screen (Case 2) The output report displays the details about the quantity of semi-finished goods (SFG) and raw materials used to build that initially entered FG. It also gives only the shortage quantity, blocked stock, IQC (Inspection Quality Check) stock and the vendor from which the materials have to be purchased as shown in figure 8. Figure 6: Output Screen with the expected results (Case 1) Figure 8: Output Screen with the expected results (Case 2) 321

6 V. CONCLUSION This project will be widely useful in corporate environment where production happens on a large scale. Production planning report gives the complete details of the quantity of products that can be manufactured with the existing resources thus reducing the time and manpower. Providing a planning schedule to know the short term production schedule based on the demand and the raw material that is available. Maintains the quality of production & processes so that improvements can be made to achieve the quality standards. An efficient production planning module enables the organization to efficiently utilize the resources and effectively raise its sales turnover, market share and profitability and provides a competitive advantage for the organization due to higher quality, flexibility and dependability and lower prices which are the performance factor for the organization. VI. FUTURE WORK The Production Planning (PP) system can be enhanced at any point of time based on the fast dynamic changes in the customer s requirements. The internal tables can be newly created or customized based on the functional specifications. REFERENCES [1] Dorack D, Strategic planning-development of a Strategic Plan in the Production Company, in Carpathian Logistics Congress 2012, p ISBN [2] Ashim Raj Singla, "Impact of ERP System on small and midsized public sector enterprises", Journal oj Theoretical and Applied Information Technology, New York: Publisher, Yr, ch. 3, pp [3] Purnendu Mandai and A Gunasekaran, "Issues in implementing ERP: A case study", European Journal of Operational Research 146 (2003), pp [4] Bernhard Zeller and Alfons Kemper, Benchmarking SAP R/3 Archiving Scenarios Proceedings of the 20th International Conference on Data Engineering (ICDE 04), /04 $ IEEE. [5] Antje Januschkowetz and Chris T. Hendrickson, Product and Process Life Cycle Inventories using SAP R/3, Annual IEEE International Computer Software and Applications Conference, /01/$ IEEE. [6] Tamas Orosz, Analysis of SAP Development Tools and Methods, 15th International Conference on Intelligent Engineering Systems, /11/$ IEEE. [7] Dusan Dorcak, The Logistics Information System in Production Company, th International Carpathian Control Conference (ICCC), /13/$ IEEE. [8] A.Selmeci and T. Orosz, SAP Logical Databases applications providing Business-requirements-driven solutions, IEEE 16th International Conference on Intelligent Engineering Systems, /12/$ IEEE. [9] Al-Imtiaz and Muhammad GolamKibria, Modules to optimize the performance of an ERP based Integrated Information System, IEEE/OSA/IAPR International Conference on Informatics, Electronics & Vision, /$ IEEE. [10] Ya Li Feng, Wen Wen Jiang and Qing Jun Tao, The Optimization Of Efficiency In ABAP Application Program Based On Internal Table, 2012 International Conference on Systems and Informatics, /12/$ IEEE. [11] A.D.Berdie, M.Osaci, I. Muscalagiu and G. Prostean, A case-study about a web business application implemented in different SAP VI technologies, 7th IEEE International Symposium on Applied (omputational lnteljigence and Informatics, /12/$ IEEE. 322