SAP R/3 has highly integrated Production Planning System. The PP module is divided into two Sub-modules, ‘PP-PI’ and ‘Production General’.

PP-PI sub-module is designed for process industries like Oil and Gas.

Production Planning module of SAP takes care of Master data needed like Bill Of Materials, Routings and Work Centers and stores it in one separate component.

Various stages of planning system can be planned by using components like

– Sales and Operation Planning

– Long Term Planning

– Demand Management

– Materials Requirement Planning

SAP has distinguished various styles of production like Kanban, Repetitive Manufacturing and Production Order processing. It can take care of various planning strategies like ‘Make-to-stock’, ‘make-to-order’, ‘planning without final assembly’ etc.

SAP R/3 PP module can also plan Capacity. The capacity Planning sub-module is taking into account various capacities like pooled capacity etc.

Production Orders reporting has flexibility of confirming orders with or without backflush. The material can be staged to production site from the Warehouse after releasing order. Costing can be triggered automatically by integrating the module with Cost Accounting Module.

Integration with other modules like Material management, Financial Accounting, Cost Accounting, Human Resources & Development, Sales and Distribution etc adds on to reliability of the production planning system in SAP R/3. The system is a real time system. The changes in demand (cancelled or added sales order etc) and supply (high/low rejection, early/late supply from supplier, breakdown of facilities etc) are reflected in real time and the production controller can react fast to these changes.

SAP R/3 PP module is a very effective tool for production planning. As is gives many alternatives, it must be configured correctly to utilized optimum potential. The person configuring the system MUST have through understanding of the business needs as well as ‘PP’ and other modules of SAP R/3.