IT in Supply Chain

Management
Session III
 ERP- e-business suite
Advanced Supply Chain
Planning
 Oracle Advanced Supply Chain
Planning
It is a Planning Engine, which plans
end-to-end supply chain
management process using a
single plan. The process initiates
when we sense the demand and
then we shape it while comparing
the planned demand to the actual
demand, and respond to that
demand.
For planning using ASCP, we can
include all the manufacturing and
distribution organizations. The key
functionalities are as follows:
Achieve demand-driven planning
as well as reduce the risks and
threats that arise in the planning
process.
Sense the demand that is
generated from customers and
respond to that demand by
comparing the planned demand to
the actual demand.
 Provides the optimal level of
planning.
Provides a real-time sense of
demand and we can respond to
the demand in no time due to the
holistic supply planning available.
Create different types of plans
like Unconstrained plans,
Constrained plans (enforce
capacity constraints, demand due
dates, decision rules, and so on),
and optimized plans.
 Receive workflow-generated
exception messages and alerts.
The module stores its data in a
centralized location making it easier
to access the data using a web
browser. Due to its centralized and
web-based architecture, multiple
planners can access their plans from
multiple locations at the same time.
Has an extensive workbench,
which gives planners an easy way to
create, analyze, change, launch, and
edit their plans at the same time.
Design and architecture
Designed and structured to meet
complex demands in real time.
Process-based memory
allocation Materialized view
Multi-thread snapshot
Hot backup and recovery available
Ease of integration with Oracle E-
Business Suite & legacy systems
Centralized database for faster
and easier access from anywhere
Processing flow of Oracle ASCP
The process starts with the creation
of a new plan and ends at
implantation on the source
instance that is recommended by
the Planning Engine. Initially, a
new plan is created that contains
the information that matches the
business. This newly created plan
will then be launched, which
makes it available for the planner
to perform planning.
Processing flow of Oracle ASCP
In the next phase, the adjustments
that were recommended by the
Planning Engine are analyzed and
applied on the source instance.
Creation of a plan - We create a
plan as per our business need and
requirement. We select a plan that
resembles our work environment.
The plan may consist of maximum
number of inventory, safety stock ,
delivery and its need-by date.
Launching the plan
We launch the plan so that it can be
available in the planner's
workbench.We can perform
analysis and adjustment on the
basis of the plan. Upon launching
of the plan, the existing demand
and supply is available to us from
the source instance and
modification or adjustments can
be done using the result obtained
from the plan.
Analysis and adjustments
We get the recommendation from the
plan in the forms of exceptions and
can analyze the plan on the basis of
the Key Performance Indicators that
are set. On the basis of the
recommendation from the plan, we
make the adjustments. The supply
and demand process changes
accordingly. To achieve the
maximum out of the
recommendation, we run the plan in
the simulation mode.
Implementation of the analysis
In this phase we make the actual
changes in the transactional data
to define an accurate and optimal
process. For example,
modification of the sourcing rules,
changes in the orders and
cancellation on the orders,
changes in the inventory
according to the suggestions, and
simulation.
Planning in different business
environments
Different types of planning can be
done for different types of
business, manufacturing or
distribution. We can create plans
for both types of organizations
separately. If you are both a
manufacturing and distribution
company at the same time you
can perform planning for your
organization using Oracle ASCP.
There are various kinds of plans
that can be used.
Material Requirements Planning
(MRP) and Master Production
Scheduling (MPS) are mainly used
for manufacturing, where we can
streamline and schedule our
production. Distribution Plans
(DRP) are used for distribution.
These plans are driven by the
master production scheduling
plans and material requirement
plan.
Integration of Oracle ASCP
Oracle ASCP is integrated with
different Oracle E-Business Suite
modules. The Planning Engine
requires information related to the
supply and demand in order to
produce an optimized plan. It
receives information from Oracle
Purchasing, Inventory, Order
management, and Manufacturing
suites. in the case of production
scheduling, it returns planned
orders and forecasts.
Integration with Oracle Process
Manufacturing
ASCP enforces time offsets
between two processes. Operation
time constraint can be set between
two operations while multiple
operations can be executed at the
same time. We can plan raw
materials and finished goods in an
efficient manner. When pegging for
demand, ASCP takes care of lot
expiration and shelf life, which are
Integration with Oracle Project
manufacturing
We can plan supply and demand by
project. This can be achieved by
segmenting the supply and demand
by project. We can execute plans
by projects and planning group-
wise, we can generate plan orders
associated with project and task
numbers. We can also track our
inventories by project, so we can
get a clear visibility of supply and
demand.
Integration with Oracle Demand
Management
Oracle Demand Management
(Demantra) generates forecast
and demand priority for Oracle
ASCP. For producing the forecast
and priorities Oracle Demand
management and ASCP should be
on the same database instance.
Oracle ASCP can also be fully
integrated with the following
modules:
Integration with Oracle Demand
Management
Oracle Bill of Material
Oracle Shop Floor Management
Oracle Inventory Optimization
Oracle Purchasing
Oracle Order Management
Oracle Inventory Management
Production Scheduling
Strategic Network Optimization
Flow Manufacturing
Profile options for Oracle ASCP
The following profiles need to be set
MRP: Penalty cost factor for late
demands
MRP: Penalty cost factor for
exceeding material capacity
MSO: Penalty cost factor for
exceeding material capacity
MSO: Priority for substitute items
MSO: Cost of using a BOM/Routing
MSO: Penalty cost factor for late
forecasts
MSO: Penalty cost factor for late
sales orders
Setting up the source data
The source data contains purchase
orders, work orders, BOMs,
resources, routings, supplier data,
purchasing information, item
masters, and any other data
required by your plans.
Setting up the destination instance
Configuring the destination instance
where the actual planning process
takes place. The following
modules need to be patched:
MSC: Oracle Supply Chain
Planning, Oracle Global Order
Processing, Oracle Inventory
Optimization
MSD: Oracle Demand Planning
(Demantra),Oracle Constraint-
based Planning
Collections in ASCP
The process of transferring data
from the transaction instance to
the planning instance is called the
collection.The source of the
transaction can be from Oracle E-
Business Suite or a Legacy
system. The collection procedure
works on the Operation Data Store
and Data Pull programs. The
architecture of Collection is simple
and it works on the following logic.
The Application Data Store (ADS) is
basically the data tables that
contain the data for the planning.
Operation Data Store The
Operation Data Store (ODS) is
basically the destination tables in
which data from the source tables,
that is the Application Data Store
(ADS), arrives using the collection
process. The Collection process is
as shown in the following figure
Collection methods
Different types of collection methods
reduce the collection time span.
Complete Refresh method
Targeted Refresh method
Net Change Refresh method
The Complete Refresh method clears
all transaction data for all business
entities from the planning server and
copies the new information about the
user-selected entities. This method can
be time-consuming if there are many
planning-related activities.
Targeted Refresh method only
updates the targeted data. The
Targeted Refresh method clears
transaction data for the entities
that are selected by the users from
the planning server, and then
copies the entity information over
from the Source instance.
Information about unselected
entities remains intact on the
planning server.
The Net Change Refresh method
only copies the information that is
not already present in the planning
server. Thus it is very efficient and
quickly updates the planning
server with the new entries and
leaves the previous data as it is.
Types of collection process
Standard : is a manually generated
collection process through which we
can run the three types of collection
methods.
Continuous : is an automated process
with minimal human intervention. It
synchronizes the data on the
planning server by verifying that data
exists on the source and planning
instance in a continuous system
repeatedly running the type of
collection that is required.
Creation of plans
We can create different types of
plans, Unconstrained plans,
Constrained plans (enforce capacity
constraints, enforce demand due
dates, decision rules, etc.), and
optimized plans. The most crucial
thing is the accuracy and reliability
of the data. If our data is not
accurate and clean then the
suggestions of the Planning Engine
will not be accurate.
Different options of planning in
ASCP are as follows:
Material Requirement Planning
(MRP)
Master Production Scheduling
(MPS)
Master Production Planning
(MPP)
The data required for planning are:
Organization
Items
Bill of Material
Resource
Departments
Calendar
Organization is your business
facility; it can be your manufacturing
and processing plant or distribution
facility. Items are raw materials,
technical stores, or finished goods
that you buy, make, or sell from
your manufacturing and distribution
organizations. The Bill of Material is
the list of items that we use for the
manufacturing of goods and
calculations of forecasts and
configuration of the orders.
Resource is everything except the
material that we use for the
production. We can define the work
shifts and attach different
departments to them for tracking.
Departments The resource that we
use is assigned to different
departments. These departments
are usually called the work centers.
A calendar consists of the work
days. Using the calendar, we can
differentiate which are working days
and which are holidays.
Types of plans in Oracle ASCP
Constrained plans contain the
following: Enforce capacity
constraints: When capacity
constraints are enabled on any
constrained plan it strictly follows
the manufacturing, transporter, and
supplier. The supplies can be late in
enforcing capacity plans but the
resource and supplier capacity
cannot be violated. Demand can be
late when using a constrained
capacity plan.
 Enforce demand due date constraints:
Demand will always be on time.
Resource capacity and supplier
capacity can be violated and the pre-
processing, processing, post-
processing, and lead time can be
violated.
Decision rules: These are settings that
can be given to the Planning Engine
using the alternative routing for BOM,
alternate resource if required, and item
substitution for creating the plan orders.
In constrained plans, transportation
duration is added. .
Unconstrained plans
An unconstrained plan uses formula
and routings with high and low
preferences that are effective for
the date and quantity in range. For
a planned order, an unconstrained
plan uses only the primary Bill of
Material. There is no
transportation duration in
unconstrained plans.
Simulations and analysis
we can perform simulations to see
the results of our plans. Simulations
give us an idea and by changing the
parameters of the simulation we
can get near desired results and
requirements. While simulating the
plans we can add and subtract
resources and quantities. We can
change the machine hours and
work hours, add new orders,
discrete job orders, and purchase
We can use the Planner Workbench
to see the changes in orders along
with supplier and resource capacity.
While simulating, we can plan and
analyze the what-if scenario as to
what would be the result of the plan
if we change the supplier capacity
to this level, and resource and item
to this level. On the basis of the
simulation we can make
adjustments in our plan to view the
changed and updated information.
We can also make a graphical
comparison between different
scenarios in the plans and after
making the comparison we can
select the final plan. So the result
in the actual scenario gets more
accurate and meets the objective
of planning.
Net Change plan
Only the changed and updated plan
is considered. The Net Change
plan processes the outputs for
only those plans that have been
changed from the base plans. It
generates a baseline plan with the
help of the Planner Workbench
and we can make changes in the
plan. The Net Change process
gives us two different modes to re-
plan: Batch mode planner
Online mode planner
Batch mode planner The advantage
is that it is a public mode, so it gives
access to the other users as well
access to the plan at the time we
perform the simulations. The online
mode planner allows us to simulate
the plans. We can make the
changes in the data then plan again
to see the effect in the plan. Using
the online mode, we can see the
changes in the Planner Workbench.
We use the online planner for quick
simulations.
Full re-plan simulation mode
This works in a different manner. It
completely renews the plan unlike
the Net Change re-plan process,
which just processes the output for
the changed plan. In the full re-plan
simulation mode, we can compare
different types of plans with each
other. We can even compare a
constrained plan with an
unconstrained plan and we can
analyze the resultant output of both.
The simulation process
To start the simulation process, first
of all we will navigate to the Planner
Workbench and select the plan that
we have created. After we have
found our plan, we now have to
make a bookmark to keep track of
the changes that we have made in
our plan. This will help us review
the processes and the changes that
we have made in our plan.
Oracle ASCP exceptions
On the basis of plans and
collection, Oracle ASCP throws
exception messages. These are
normally system-generated alerts,
which are considered to be
recommendations from the
Planning Engine. The planning
server only throws exceptions for
those items on which we have
previously assigned an exception
set. Some common exceptions are:
 Item with excess inventory
Item with expired lots
Item with no activity
Late replenishment for sales order
Early replenishment for sales
order
Order to be cancelled
Orders to be rescheduled
Order sourced from alternate
supplier
Demand satisfied using end item
substitution
Key Performance Indicators
Key Performance Indicators (KPIs)
are a set of targets and exceptions
which we set in Oracle Advance
Supply Chain Planning. It
automatically updates and notifies
us when certain conditions meet.
KPIs are used to compare the plan.
Some common KPIs in Oracle
ASCP are: On-time delivery :
{(Total number of orders - Number of
late orders) * 100} / Total number of
orders
Inventory turns : Total Inventory
Turns = the Value of MDS demand
in the period [T1, T2] / Value of
Average inventory in Period [T1,T2]
* 365 / (T2-T1)
Cost breakdown: The cost
breakdown Key Performance
Indicator is the sum of the following
cost factors - Production cost,
Inventory carry cost. Penalty
cost, Purchasing cost .
Summary
The purpose of Oracle ASCP.
How demand and supply are
managed using Oracle ASCP.
How to balance the purchase,
production, and sales.
The logic behind the Oracle ASCP
Planning Engine, how different
types of Plans for production and
distribution can be made in Oracle
ASCP, and how they are managed
using the Planner Workbench.
 Deepak Jakate
Managing Partner
Envision Management Services
Supply Chain Excellence
BPR & Six Sigma
Training & Education
Business Consulting
Investment Advisory
Secondary Research

email : [email protected]
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