Specification for Extensions of S&OP on HANA:

Minimum Key Figures

Updated version: August 19th, 2019

Change-History:

19.08.2019: Kapitel 6 eingeführt und Korrektur eines Fehlers in Abbildung 1.

1. Introduction
S&OP on HANA can receive master and transactional data from an external planning
system, as for instance SAP SCM APO SNP or PP/DS. This specification describes
how externally planned supply key figures can be managed in S&OP and taken into
account by the SCM Planning Operator. (By the superordinate term SCM Planning
Operator we refer to SCM planning algorithms in S&OP, i.e. SCM heuristics and the
optimizer which are used to compute a supply plan.) S&OP on HANA will offer
several Minimum Key Figures (or Min Key Figures) which can store the received
supply data which will be considered by the SCM Planning Operator as minimum
values. The SCM Planning Operator can plan higher supply but not lower than a
given minimum value.

Besides externally planned supply to be considered as minimum supply by the SCM

planning algorithms, these key figures can also be used by a planner directly for
manual input to set a lower bound to the planned supply. If one wants to use the key
figure for both purposes, it is useful to define three sets of key figures to keep the
numbers apart:

1. Externally provided minimum key figures

2. Manually entered minimum key figures

3. Composite minimum key figures (for example the maximum of 1. and 2.)

Alternatively, one could also have the data import (periodically) override the manually
changed minimum key figures where they exist.

The Minimum Key Figures are in addition to the Adjusted Key Figures, which we
describe in a separate document entitled “Key Figures of the SCM Planning
Operator”. The difference is that Adjusted Key Figures fix a supply value to an
absolute value while Minimum Key Figures only set a lower bound.

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There are other key figures, not related to supply data, which are input to the SCM
planning operator as well and which are supposed to receive their data from an
external planning system (such as customer demand and all the master data related
key figures). These other key figures are also described in the general document
“Key Figures of the SCM Planning Operator”.

In the following this document describes how Minimum Key Figures are taken into
account by the SCM planning algorithms, i.e. the infinite heuristic and the optimizer.

Analogously to Minimum Key Figures, S&OP on HANA offers Maximum Key Figures
as well. Maximum Key Figures are not relevant for the upload process as described
above in the context of Minimum Key Figures. But, same as with Minimum Key
Figures the user can impact the supply computations of the SCM Planning Operator
by limiting transport or production quantities. Maximum Key Figures are described in
the document “Key Figures of the SCM Planning Operator, chapter 8.

2. Basic Concept of Minimum Key Figures

2.1 General Remarks

The values in the Minimum Key Figures are respected by the SCM planning operator
in the sense that these key figures define the minimum supply or transport quantity.
So for example, if key figure Minimum Transport Receipts has a value of 10 in period
t this defines that at least 10 will be transported (i.e. will arrive at the customer’s
location) in period t. Use Case: The external planning tool already has decided to
plan a transport of that quantity in that period t (by creating a fixed transport order)
and this decision is fixed in the sense that S&OP cannot plan to ship less. If the SCM
planning operator decides to transport more, for instance, 12 tons the resulting S&OP
supply plan will have a transport of 12. If an S&OP planning algorithm – without a
minimum value of 10 – would plan less, the resulting supply plan will still contain a
transport of 10.

To understand the functionality of Minimum Key Figures it is worth to see how the
S&OP heuristic treats them. The heuristic respects Minimum Key Figures as follows:
an initial value in a Minimum Key Figure has no effect. A non-initial value is
compared with the value computed by the heuristic for the corresponding output key
figure. (Transport Receipts, for instance, is the corresponding output key figure to
Minimum Transport Receipts.) If the minimum value is smaller than the computed
value, the heuristic takes the value which was computed by the heuristic. If the
computed value is smaller than the minimum value, the minimum value is taken.

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2.2 Minimum Customer Receipts

As mentioned in section 1, the system could be configured so that Minimum Key

Figure values can be entered manually by a user. The effect on the SCM planning
algorithms is the same for manually entered values as for values received by an
upload from another system.

If lead times are present, Minimum Key Figures have a different behavior for those
periods which are within the Lead Time Horizon. We are going to explain this with
figure 1.

In its upper half figure 1 depicts a supply plan (computed by the supply planning
heuristic) without any minimum values. The Dependent Customer Demand of
customer C1 for product P is 10, 20, 30, 40 and 50 units in the five periods of the
planning horizon. This causes Net Demands of the same amount which are passed
as Outbound Customer Demands to DC 1. As the lead time between DC 1 and the
customer C1 is three periods the first three periods (in grey) cannot be satisfied by a
transport (customer receipt) from DC 1, except if these customer receipts would have
been planned (and started) already in the past, i.e. during a previous planning run or
by another planning tool. Here, in figure 1, the assumption is that no transports are
planned for the first three periods resulting in Customer Receipts at C1 of 0 units in
all three periods within the Lead Time Horizon. Beginning with period 4 the Outbound
Customer Demands cause Dependent Demands at DC 1 (due to the lead time shift)
in the first two periods which can be satisfied by Customer Supply. (Based on a lead
time of three periods, a transport starting at DC 1 in period 1 arrives at customer C1
in period 4.)

In its lower half figure 1 shows the same situation as above but with minimum values
given by key figure Minimum Customer Receipts. Either uploaded from an external
planning tool or manually entered by a user, the minimum values are 4, 23, 0, no
value (null/initial meaning key figure doesn’t store a value for that period), and 41
units in the five considered periods. The minimum values given in the first three
periods (Lead Time Horizon) are taken as given values which will never be
overwritten by any time-series-based planning algorithm. The minimum values within
this Lead Time Horizon are just copied into the key figure Customer Receipts. In
period 4 no value exists in the Minimum Customer Receipts key figure. This initial
value has no effect. The planning algorithms are free to set any value according to
their logic. For period 5, in contrast, a minimum value (of 41 units) exists which is
treated as explained above, i.e. like a minimum value meaning the planning
algorithms must at least plan a supply of 41 or above, if required. As in period 5 the
actual demand is higher the planning result fulfills this higher demand of 50.
However, if there is insufficient demand the time-series-based supply planning
optimizer might not be able to even plan supply covering the value in the Minimum

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Customer Receipts key figure. Chapter 6 of this document explains how the optimizer
handles Minimum Key Figures in more detail.

Minimum Customer Receipts

C1 / Product P DC 1 / Product P
Outb. Cust. Dem. 10 20 30 40 50 Dep. Dem.: 40 50 _ _ _
Cons. Dem.: 10 20 30 40 50 Proj. Stock: 0 0 _ _ _
Lead Time: 3 Net Dem.: 40 50 _ _ _
Tot. Cust. Receipts: 40 50 _ _ _
Receipts: 40 50 Supply: 40 50 _ _ _
Cust. Receipts 40 50

C1 / Product P DC 1 / Product P
Outb. Cust. Dem. 10 23 30 40 50 Dep. Dem.: 40 50 _ _ _
Cons. Dem.: 10 20 30 40 50 Proj. Stock: 0 0 _ _ _
Lead Time: 3 Net Dem.: 40 50 _ _ _
Tot. Cust. Receipts: 40 50 _ _ _
Receipts: 04 23 0 40 50 Supply: 40 50 _ _ _
Cust. Receipts 04 23 0 40 50

Min. Cust. Receipts 04 23 0 41

© 2014 SAP AG. All rights reserved.

Figure 1: Minimum Customer Receipts

If in figure 1 (lower area) the value of key figure Minimum Customer Receipts in
period 5 would be set to, for example, 54 instead of 41, the resulting Customer
Receipts would be set to 54. The Outbound Customer Demand accordingly would be
set to 54 as well.

2.3 Minimum Key Figures in Conjunction with Adjusted Key Figures

If for a period there is a value in a Minimum Key Figure (like Minimum Customer
Receipts) and another value (for the same period) in the corresponding Adjusted Key
Figure (in this example, Adjusted Constrained Demand) only one of both can be
considered by the SCM Planning Operator. As Adjusted Key Figures are entered
manually by a user these key figures do have the highest priority the Adjusted values
are taken by the SCM Operator. This, however, does not apply for the Minimum
Transport Key Figures – as we will see in section. 4.

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3. Minimum Key Figures
S&OP on HANA offers the following Minimum Key Figures:

Minimum Customer Receipts

Minimum Customer Supply

Minimum Production Receipts

Minimum External Receipts

Minimum Transport Receipts

Minimum Transport Supply

3.1 Minimum Customer Receipts

Technical name: MINCONSTRAINEDDEMAND, key: Customer, Product, Location

This key figure is related to the arc-related supply key figure Customer Receipts. It
allows defining minimum transport quantities to customers. Lead times between
customer locations and own locations are respected as explained in section 2.

3.2 Minimum Customer Supply

Technical name: MINCONSTRAINEDDEMANDDS, key: Customer, Product, Location

This key figure is a Downstream Key Figure corresponding to the Upstream Key
Figure Minimum Customer Receipts (see section 3.1 above). More information about
the concept of Downstream Key Figures is available in the specification document
“Key Figures of the SCM Planning Operator”, section 9.

While loading data into an S&OP planning session the SCM Operator performs a
merge between the corresponding Up- and Downstream Key Figure. If – with regard
to the lead time – only one of these key figures contains a value the operator merges
this value (lead time shifted) into the other key figure so that both key figures contain
the same value (with a lead time difference, of course). If both key figures contain
values then the value of the Upstream Key Figure is merged (copied) into the
Downstream Key Figure. We therefore recommend to populate the Upstream Key
Figure (and not the Downstream Key Figure) when uploading data from an external
planning system.

Usually, a user displays either the Upstream (e.g. Minimum Customer Receipts) or
the corresponding Downstream Key Figure (e.g. Minimum Customer Supply) on one
screen, but not both. By switching screens/views he can enter values in both key
figures. If he enters numbers in both key figures (Minimum Customer Receipts and

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Minimum Customer Supply) for the same period (with respect to the lead time shift)
then the input to the Upstream Key Figure is taken by the SCM Operator and the
value entered into the Downstream Key Figure will be ignored. In fact, the value of
the Upstream Key Figure will be lead-time-shifted and then copied into the
corresponding Downstream Key Figure. This logic, however, is not applied for
Minimum Transport and not for Minimum Production Receipts – as Minimum
Transports do have a special functionality and Minimum Production Receipts is not
an arc-related key figure (i.e. not having an Up- and Downstream version).

3.3 Minimum Production Receipts

Technical name: MINPRODUCTION, key: Product, Location, SourceID

Minimum Production Receipts are related to the supply key figure Production
Receipts and they define minimum production quantities which are set, either
manually by a user or received during an upload process. For instance, the output
quantities of a production order which was planned by SAP SCM/APO PP/DS should
be reflected in this key figure. Again, this means that with such a minimum value
S&OP can plan an even higher, but not a lower production quantity.

3.4 Minimum External Receipts

Technical name: MINRECEIPT, key: Product, Location

A non-initial value in key figure Minimum External Receipts ensures that the SCM
planning algorithms plan a minimum External Receipt. As an example: if the Net
Demand to be sourced via a U sourcing rule is 8 units, the SCM planning algorithms
would set a receipt in exactly that quantity. If the user has defined a Minimum
External Receipt of 10 units, the planning algorithms would respect this by having a
receipt of 10 units. As this is more than needed, normally this will build-up inventory
which is in this example 2 units.

In case the Minimum External Receipt was 7 and not 10 the SCM planning operator
would still source a receipt of 8.

A value given in key figure Adjusted External Receipts, in contrast, would define a
fixed value which has to be respected by the planning algorithms. If in the example
above, the user enters an Adjusted Receipt of 7, the planning algorithms would take
this value without any change.

3.5 Minimum Transport Receipts

Technical name: MINTRANSPORT, key: Product, Location, Ship-From Location

This key figure is related to the supply key figure Transport Receipts. The
functionality is described in the section 4 below.

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3.6 Minimum Transport Supply
Technical name: MINTRANSPORTDS, key: Product, Ship-To Location, Location

This key figure is related to the supply key figure Transport Supply. The functionality
is described in section 4 below.

This key figure is a Downstream Key Figure corresponding to the Upstream Key
Figure Minimum Transport Receipts. More information about the concept of
Downstream Key Figures is available in the specification document “Key Figures of
the SCM Planning Operator”, section 9.

In contrast to Minimum Customer Receipts / Supply for which an external planning

system should populate only one of these two, which is Minimum Customer Receipts,
for Minimum Transport Receipts and Supply it is important that both key figures are
populated when uploading data from an external planning system – as described in
the next section.

4. Minimum Transport Key Figures

It is quite natural that things do not happen exactly as they have been planned. So,
for instance, even if a lead time of two periods is defined between two locations,
transports might take longer or might need less time. Planners would like their
planning system take into account expected ship and delivery dates based on most
recent information. So, for instance, if the arrival of a transport which is still on its way
will be delayed, so that it arrives in a later period than the one computed based on
the defined lead time, S&OP on HANA should offer the possibility to maintain this fact
accordingly. To be more general, it might happen in daily business that transport
durations can deviate from the defined lead time – for any reason. To be able to cope
with such deviations Minimum Transport Receipts / Supply have a different meaning
than Minimum Customer Receipts / Supply with regard to lead times (Minimum
External Receipts and Minimum Production Receipts are not related to lead time):
When a user or an external planning system populates Min Customer Receipts the
corresponding key figure Min Customer Supply is updated automatically by the SCM
Operator accordingly, based on the lead time defined for the corresponding
transportation lane. This automatic update is switched off for Min Transport Receipts
and Min Transport Supply. Instead, the system expects that a user or an external
planning system populates both key figures based on real departure and arrival
times. The underlying concept is illustrated by figure 2 below.

Figure 2 assumes that in the S&OP master data the lead time between DC 1 and 2 is
defined to be 3 periods. From an external planning system the shown values have
been uploaded into the two key figures – as mentioned above. These values have to
be interpreted as follows:

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Key figure Minimum Transport Receipts stores those quantities which do arrive in the
corresponding period, i.e. in figure 2, this is 5 units in period 1, 12 in period 2 etc. –
and there is no information about the departure time of these quantities.

Key figure Minimum Transport Supply defines per period the quantities which are
going to leave DC 2. In the example of figure 2, 10 units depart in period 1 and 20 in
period 2 – and there is no information available about the arrival dates of these
quantities.

The sum of arriving quantities does not have to match the sum of all departing
quantities. The reason is that some transports might have already started in the past
(which is in period 0, -1, -2 or even before) and therefore are not depicted in key
figure Min. Transport Supply. Another reason can be that the quantities stored in key
figure Min. Transport Supply do arrive in a future period beyond the planning horizon,
i.e. in the example of figure 2, in period 6 or later.

Minimum Transport Receipts / Supply

Lead time: 3
DC 1 DC 2

Min Trans. Receipts Min Trans. Supply

5 12 4 7 19 10 20

© 2014 SAP AG. All rights reserved.

Figure 2: Minimum Transport Receipts and Minimum Transport Supply

Figure 3 shows a simple situation, as a starting point. The values in Minimum

Transport Receipts (MTR) and Minimum Transport Supply (MTS) are given by an
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external planning system. In this case, they do not deviate from the defined lead time
of one period as the 10 pieces shipped at DC 2 in period 1 can be assumed to arrive
at DC 1 one period later, i.e. in period 2.

Minimum Transport Key Figure: No Lead Time Deviation

Lead time: 1

DC1 P1 DC2 P1

US DS
D: 00 15 10 D: 15 10 00
I: 00 00 00 OLD: 00 | 15 | 10 DLD: 15 | 10 | 00 I: 00 00 00
N: 00 15 10 N: 15 10 00
S: 00 15 10 TRR: | 15 | 10 TRS: 15 | 10 | S: 15 10 00
R: 00 15 10 DTR: | 05 | 10 DTR: 05 | 10 | R: 15 10 00
MTR: | 10 | MTS: 10 | |

US: Upstream
DS: Downstream
D: Dependent Demand R: Total Receipts DTR: DeltaTransport (SCM Operator internal)
I: Projected Inventory DLD: Dependent Location Demand MTR: Minimum Transport Receipts
N: Net Demand TRR: Transport Receipts MTS: Minimum Transport Supply
S: Supply TRS: Transport Supply ATR: Adjusted Transport
© 2014 SAP AG. All rights reserved.

Figure 3: Minimum Transport Receipts / Supply: No Lead Time Deviation

The SCM Planning Operator realizes that these 10 units arriving in period 2 are not
sufficient to satisfy the demand of 15 units and therefore it plans an additional arrival
of 5 pieces, so in total 15 units for period 2. This is indicated by key figure DTR (in
grey color) which is an internal key figure of the SCM Planning Operator and not
visible to a user. According to the lead time of one period, these 5 pieces have to be
shipped from DC 2 in period 1 so that the Transport Supply in period 1 is in total 15.
For period 3 there are no Minimum Transport Receipts defined. Consequently, the
entire demand of period 3 at DC 1 is satisfied by a regular transport of 10, starting at
DC 2 in period 2 and hence arriving at DC 1 in period 3.

The key figures shown on the right side of the DC 1 node in Figure 3 are called
Upstream Key Figures (US), those on the left side of DC 2 are called Downstream
Key Figures (DS). For the overall concept of Up- and Downstream Key Figures see
the document “Key Figures of the SCM Planning Operator”.

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The difference between figure 3 and the following figure 4 is that the transport
departing from DC 2 in period 1 arrives partly in time (i.e. 6 units in period 2) and
partly one period late, i.e. 4 units in period 3 (shown in red color).

Minimum Transport Key Figure: With Lead Time Deviation

Lead time: 1

DC1 P1 DC2 P1

US DS
D: 00 15 10 D: 19 06 00
I: 00 00 00 OLD: 00 | 15 | 10 DLD: 19 | 06 | 00 I: 00 00 00
N: 00 15 10 N: 19 06 00
S: 00 15 10 TRR: | 15 | 10 TRS: 19 | 06 | S: 19 06 00
R: 00 15 10 DTR: | 09 | 06 DTR: 09 | 06 | R: 19 06 00
MTR: | 06 | 04 MTS: 10 | |

US: Upstream
DS: Downstream
D: Dependent Demand R: Total Receipts DTR: DeltaTransport (SCM Operator internal)
I: Projected Inventory DLD: Dependent Location Demand MTR: Minimum Transport Receipts
N: Net Demand TRR: Transport Receipts MTS: Minimum Transport Supply
S: Supply TRS: Transport Supply ATR: Adjusted Transport
© 2014 SAP AG. All rights reserved.

Figure 4: Minimum Transport Receipts / Supply: With Lead Time Deviation

The SCM Operator computes additional 9 units to arrive at DC 1 in period 2 in order

to cover the Outbound Location Demand (OLD) of 15 units. This is shown as the
(operator-internal) key figure DTR. Based on the given lead time of one period, these
9 units have to leave DC 2 in period 1 – which is also shown in figure 4. So the total
Transport Supply (TRS) in period 1 is 10 + 9 = 19 units – from which 10 come from
the Minimum Key Figure and the remaining 9 are planned by the SCM Planning
Operator. Based on the Transport Supply of 19 units, the Planning Operator has to
set the Dependent Location Demand to the same value. Otherwise, from DC 2
upstream the heuristics would not ”see” sufficient Dependent Demand and would not
source enough quantity for the supply.

The situation in period 3 is analogous. Based on the given quantities in Minimum

Transport Receipts, S&OP must accept that 4 units arrive at DC 1 in period 3 –
without knowing when these 4 units are leaving or have left DC 2. As the demand in
this period is higher (10 units) it must plan the arrival of additional 6 units on top.

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These 6 units are planned based on the defined lead time of one period so that their
departure from DC 2 is planned for period 2.

Figure 5 shows another, similar example. The difference to figure 4 is just that in
period 1 only 8 units depart from DC 2. As in periods 2 and 3, in total 10 units arrive
at DC 1, it is not specified in which period the two remaining units depart from DC 2.
However, this information is not important to the planning logic.

Minimum Transport Key Figure: With Lead Time Deviation

Lead time: 1

DC1 P1 DC2 P1

D: 00 15 10 US DS D: 17 06 00
I: 00 00 00 OLD: 00 | 15 | 10 DLD: 17 | 06 | 00 I: 00 00 00
N: 00 15 10 N: 17 06 00
S: 00 15 10 TRR: | 15 | 10 TRS: 17 | 06 | S: 17 06 00
R: 00 15 10 DTR: | 09 | 06 DTR: 09 | 06 | R: 17 06 00
MTR: | 06 | 04 MTS: 8| |

US: Upstream
DS: Downstream
D: Dependent Demand R: Total Receipts DTR: DeltaTransport (SCM Operator internal)
I: Projected Inventory DLD: Dependent Location Demand MTR: Minimum Transport Receipts
N: Net Demand TRR: Transport Receipts MTS: Minimum Transport Supply
S: Supply TRS: Transport Supply ATR: Adjusted Transport
© 2014 SAP AG. All rights reserved.

Figure 5: Another example: With lead time deviation

Figure 6 illustrates an example for Minimum Transports in conjunction with a

Minimum Lot Size (of 10 units). In fact, the only difference to the example of figure 5
is that now a transport between DC 1 and 2 must transport at least 10 units.

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 Minimum Transport and Minimum Transport Lotsize

Lead time: 1
MinLotSize: 10 DC2 P1
DC1 P1

D: 00 15 10 US DS D: 18 10 00
I: 00 01 05 OLD: 00 | 16 | 14 DLD: 18 | 10 | 00 I: 00 00 00
N: 00 15 09 N: 18 10 00
S: 00 15 10 TRR: | 16 | 14 TRS: 18 | 10 | S: 18 10 00
R: 00 16 14 DTR: | 10 | 10 DTR: 10 | 10 | R: 18 10 00
MTR: | 06 | 04 MTS: 08 | |

US: Upstream
DS: Downstream
D: Dependent Demand R: Total Receipts DTR: DeltaTransport (SCM Operator internal)
I: Projected Inventory DLD: Dependent Location Demand MTR: Minimum Transport Receipts
N: Net Demand TRR: Transport Receipts MTS: Minimum Transport Supply
S: Supply TRS: Transport Supply ATR: Adjusted Transport
© 2014 SAP AG. All rights reserved.

Figure 6: Minimum Transport Receipts / Supply and Minimum Lot Size

The SCM Planning Operators applies the Minimum Lot Size logic to only those
quantities which it plans (i.e. to the fraction of transport shown in figure 5 by the
(internal) key figure DTR). No lot size rule is applied to the values given by the
Minimum Transport Key Figures, corresponding to the use case that these numbers
come from more precise externally planned numbers. Hence, only the 9 units
planned to arrive at DC 1 in period 2 (see figure 5) must be increased to that
Minimum Lot Size so that 10 units are planned to arrive in period 2 – in addition to
the 6 units given in Min Transport Receipts, so that in total 16 units do arrive in that
period. Based on the given lead time, the departure from DC 2 of these 10 units is
planned for period 1, adding up with the 8 units given in key figure MTS to 18 units.
Analogously, the 6 units needed at DC 1 to satisfy the demand in period 3 are
rounded to 10 (according to the Minimum Lot Size logic). This demand is propagated
due to the lead time to DC 2 in period 2.

The next example, shown in figure 7, is based on:

- A Minimum Transport Supply of 10 units in period 1 from which 5 units arrive in time
in period 2 and 5 units arrive delayed in period 3 and
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- An Adjusted Transport of 7 units in period 1 (departure) and arriving in period 2 (in
red color).

Minimum Transport and Adjusted Transport

Lead time: 1
MinLotSize: 10
DC1 P1 DC2 P1

US DS D: 17 00 00
D: 00 05 05
I: 00 07 07 OLD: 00 | 12 | 05 DLD: 17 | 00 | 00 I: 00 00 00
N: 00 05 00 N: 17 00 00
S: 00 05 05 TRR | 12 | 05 TRS: 17 | 00 | 00 S: 17 00 00
R: 00 12 05 ATR: | 07 | ATR: 07 | | R: 17 00 00
DTR: | 00 | 00 DTR: 00 | 00 | 00
MTR: | 05 | 05 MTS: 10 | |

US: Upstream
DS: Downstream
D: Dependent Demand R: Total Receipts DTR: DeltaTransport (SCM Operator internal)
I: Projected Inventory DLD: Dependent Location Demand MTR: Minimum Transport Receipts
N: Net Demand TRR: Transport Receipts MTS: Minimum Transport Supply
S: Supply TRS: Transport Supply ATR: Adjusted Transport
© 2014 SAP AG. All rights reserved.

Figure 7: Minimum Transport Receipts / Supply and Adjusted Transport

Again, the SCM Planning Operator applies the usual logic connected with Adjusted
Transports to only those quantities planned by the SCM Planning Operator and not to
the quantities given in key figures Minimum Transport Receipts and Supply.

With the Adjusted Transport set for period 2 (on DC 1 side) the user has fixed the
arriving quantity to 7 units (on top of the quantity given by the Minimum Transport
Receipts). So, in total 5 + 7 = 12 units do arrive in period 1. As the Net Demand of
DC 1 in period 2 is 5 units only the Total Receipts of 12 units will cause a Projected
Inventory at the end of period 2 of 7 units.

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5. Populating Minimum Key Figures
Based on the functionality of Minimum Key Figures, as explained above, it should be
clear that it is important to set correct values for these key figures when uploading
data from an external planning system. For Minimum Customer Receipts it must be
ensured that all data during the Lead Time Horizons are copied into the
corresponding periods. For Minimum Transport Receipts and Supply it must be
ensured that the quantities leaving from and arriving at a location are populated
correctly into the two corresponding key figures.

In addition, there might be additional minimum supply elements beyond the Lead
Time Horizons which are uploaded from an external planning system. The upload
procedure must ensure that these minimum values – and only those – are copied into
the corresponding buckets of the Minimum Key Figures. If, by mistake, all supply
data from the external planning system are copied into the Minimum Key Figures,
this would have a severe impact on S&OP as then all externally provided supply key
figures would be considered as minimum values.

6. Minimum Key Figures and the Optimizer

The optimizer follows a completely different approach compared to the heuristic:
Minimum Key Figures must be modeled as constraints. More precisely values of
minimum key figures should be considered as hard constraints because they are
defined by a user or an external planning system and hence must be fulfilled by the
planning algorithms. However, when treating them as a hard constraint such
minimum values might over-constrain the optimization problem so that the problem
might be unsolvable. If for instance, a minimum value requests to produce at least
1,000 tons but the required resource has a capacity supply of 600 tons only, the
optimization problem would not be solvable. To avoid this, the time-series-based
supply planning optimizer treats such minimum values as pseudo-hard constraints.
Pseudo-hard constraints can be violated, i.e. not or not fully fulfilled, but such a
violation causes a significant penalty cost in the objective function so that the
optimizer will try to avoid them. But it can happen that the supply plan computed by
the optimizer does not (fully) fulfill such pseudo-hard constraints which means that
the actual supply is below the given value of a related minimum key figure. In such a
case the optimizer log will show such violations.

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