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Former Member

CTM -the rationale behind it

When there are multiple options available for material and capacity planning why do you opt for CTM for my business scenario what is the rationale behind it ?

This would be a definite question I anticipate during a high level client meeting for which I need to give a rationale answer (most of them know something about everything in SAP here and there but not really experts but masquerade as experts there lies the hitch ),if you real experts sense something is inadequate in my below answer I need a supporting hand in fine tuning it.

Ideally my presentation would go like this

ECC- material planning is carried out in sepearte step and the resulting planned orders are taken to capacity planning table and capacity planning is done in CM11 to CM25 screens in most cases this has not worked adequately so I am skipping it.

SNP heuristics –this will plan the unconstrained demand released from MC90 across the location and/or locations or multilevel ,no constraints like capacity or cost will be taken into account so I am skipping it

SNP optimizer-this will plan the unconstrained demand released from MC90 but we can apply constraints to it like cost (like in my case production cost and transport cost by referring to the cost directory) and capacity constraints too can be applied.but it will not address plant level operations planning so I am skipping it

PPDS hiuristics-this will plan but very vaguely but not to the point also it will not take capacity into account so I am skipping it

PPDS optimizer-this will plan resources and material simultaneously but this will be specific to some objective like set up time /lead time etc. I tried it doesn’t appear accurate so I am skipping it.

SNP CTM-here I can match demand ,supply and resources accurately and also I have this option of feeding PPDS planned orders into CTM and conduct a CTM run, I mean those PPDS planned orders trickling into RRP3 arising out of PPDS heuristics run or any planned order coming from any segment like SNP optimizer or heuristics or PPDS optimizer or ECC planned order coming via PDS. And finally planned orders arising out of CTM run I can release it to shop floor managers directly for execution .

So CTM is the best bet .

Guess my rationale behind CTM is almost correct .if any absurdities anywhere I wish your help in straightening it

.i remember reading treasure island in my school days your inputs will be a real treasure to me

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3 Answers

  • Best Answer
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    Former Member
    Sep 20, 2014 at 04:11 PM

    RO,

    <Sigh> Here we go again.....

    ECC- material planning is carried out in seperate step and the resulting planned orders are taken to capacity planning table and capacity planning is done in CM11 to CM25 screens in most cases this has not worked adequately so I am skipping

    ??????? Surely you are joking. Hundreds of companies are very happy with their PP/CRP solutions. Such solutions can be perfectly adequate. Normally, the client decides this, not the consultant.

    SNP heuristics –this will plan the unconstrained demand released from MC90 across the location and/or locations or multilevel ,no constraints like capacity or cost will be taken into account so I am skipping it

    Again, hundreds of companies have satisfactorily used SNP to run their businesses, and these solutions can be designed to consider capacity. As with most first generation planning solutions, SNP heuristics do not consider capacity and material constraints in a single solve, it takes multiple solves. In the end, though, the problem is still solved.

    SNP optimizer-this will plan the unconstrained demand released from MC90 but we can apply constraints to it like cost (like in my case production cost and transport cost by referring to the cost directory) and capacity constraints too can be applied.but it will not address plant level operations planning so I am skipping it

    You obviously have not grasped the basic concepts of Optimizing software. When 'costs' are mentioned, these costs are not real costs, they are costs that are assigned solely for the purpose of creating the optimization solution. These costs are only created such that one can have a common unit of measurement (cost) so that the optimization problem can be solved. Plant level; even material level assigned costs can be and are considered. You may elect to 'skip' optimization, but don't give such reasons to your client as justification. If he understands these topics at all, he will immediately detect that you don't know what you are talking about.

    PPDS heuristics-this will plan but very vaguely but not to the point also it will not take capacity into account so I am skipping it

    I am so dumbfounded that anyone could actually say such a thing, that I am rendered speechless.

    PPDS optimizer-this will plan resources and material simultaneously but this will be specific to some objective like set up time /lead time etc. I tried it doesn't appear accurate so I am skipping it.

    Same answer as PP/DS heuristics.

    SNP CTM-here I can match demand ,supply and resources accurately

    Yes, this is possible

    I mean those PPDS planned orders trickling into RRP3 arising out of PPDS heuristics run or any planned order coming from any segment like SNP optimizer or heuristics or PPDS optimizer or ECC planned order coming via PDS.

    Well, all of these statements are technically true, but you have just described a CTM/SNP solution that is extremely complex to actually execute and have the whole thing be internally and externally consistent. Only an insane person would attempt such a solution if it were their first CTM implementation attempt.

    And finally planned orders arising out of CTM run I can release it to shop floor managers directly for execution .

    Well, yes, of course, this is possible. You can release ANY supply plan to the shop floor managers for execution. Also remember that CTM can actually be integrated with PP/DS instead of SNP (CTM supply proposals can be copied to LC as PP/DS orders).

    In closing, CTM MAY be your best bet, but I suggest clean up your 'pitch' that you make to your client. Actually, I further suggest you restrict your statements to those things about which you actually have a little first-hand knowledge. Most client companies have someone on their staff who has a pretty good BS detector, and being 'caught' in factual errors or inadvertent misstatements is a sure way to lose the confidence of the client. If you had appeared before me with such a collection of statements, the interview would be over in less than 10 minutes.

    Best Regards & Good Luck,

    DB49

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    • Former Member Former Member

      its Ok DB...chill..chill...its all in a game..if some x,y,z has said this i wouldn't care for it,but this coming from an expert -was a bit taken aback..homework , hardwork,persistence makes an expert ,i always respect you for that...usually i dont take anything seriously including my own job but i had taken you too seriously thats why i was a bit taken aback with your comments .. lets be will be friends once again ..cheers

  • Sep 20, 2014 at 08:37 PM

    Hi Rahul,

    I completely agree with the comments of the expert Dogboy 49.

    Just let me add some additional comments:

    • I noted a confusion about what is SNP and what is PPDS. Note that PPDS should not be replaced by SNP. PPDS plans the short term planning in a different time bucket than SNP which plans the entire supply chain network in the medium and long term in order to get the product on time according to the safety stock policies.
    • Optimizer and CTM required more master data and not all the business are prepared to deal with CTM or Optimizers. If your business users do not maintain the master data, keep the system updated, I would never try with CTM or Optimizers.
    • CTM and Optimizer require additional servers.
    • Even when in CTM you can assign priorities to your demand and supply, CTM should be designed when more focus is on the demand side and not on the supply side. In fact, if the complexity is on the production side versus the demand side, I would not use CTM.

    I would make focus on how is your business, what is the complexity of your business, how well the system is used, etc.. Then do not use Optimizers and CTM if the company is not running processes in the system, is not cleansing master data, is not following procedures, etc.. For some companies ECC could be a perfect simple solution..

    Read a bit more about SNP, PPDS, CTM, before your meeting..

    For CTM I recommend this article:

    CTM - Capable to Match - SAP Planning

    For SNP & PPDS, read these:

    http://www.scmfocus.com/sapplanning/2012/08/19/where-ppds-stops-and-snp-starts-with-respect-to-time-and-location/

    Kind Regards,

    Mariano

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    • Former Member

      yup mariano ,i myself knew I talked something crazy ,but I want to experiment with CTM, there lies the crux ,my clients think I am an expert and they are prepared to listen to me .What can i do about it ? tell me? I do not want to go and tell them "believe me, I am not an expert " but real experts knew me better.

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    Former Member
    Sep 21, 2014 at 11:52 AM

    Rahul, your question is well placed but your conclusions are a bit abrupt. Just like you, SAP too sells its wares based on some purported benefits depending on who the client is, what industry, what managerial maturity and what money they have on the table. When it comes to ERP apps, It is generally very hard to sell something as a 'better' alternative given there are just about too many options (and too many non SAP software that claim to be better than everyone else on 'most' dimensions) to solve the same 'fundamental' problem. It will pay if you stick to the MAIN problem and not the paraphernalia that is more a by product of some MAIN underlying problem.

    CTM is strictly speaking not a netting-planning tool. It is a noble program to match supplies to demand. SAP calls it first feasible solution. This means CTM is a not a fully (cost) optimal supply planning solution but it does consider constraints of capacity (finiteness) if latter is deemed very important by your client. CTM solves the problem (of assigning supplies to demand) sequentially which means it works through the list of demands one by one across the network if you so wish. Well it makes sense only if done across the network and at multiple levels!!

    Another way to gauge the fitment of a solution is by making note of the frequency of key words used by the client, with or without a complete knowledge. If the word "priority" or 'customer priority' or "allocation" or "reservation" implying the dire need for customer service in the event of limited availability of products, there may be a case for CTM as a viable solution that at least solves their current problem.

    Another way to gauge can be based on how inward (supply side) or outward looking (demand side) does the client sound! Some firms may care a damn about how and where the stuff is made or may be their supply side has no serious care takers. The only thing they love may be the idea of delighting customers at ANY cost but some more than others. CTM can fit in well here. Similarly if your client's supply chain has very very large number of end customers (in the supply chain model) e.g. order of magnitude higher than factories and warehouses then there arises a natural need for prioritization of all kinds. So CTM may have a prima facie case.

    Historically speaking firms with expensive finished products in discrete industries like consumer electronics, semi-conductors have embraced CTM and benefitted from it but that said there are firms in Agri business and chemicals too where CTM is being used.

    I do not have any implementation experience of CTM but have heard people taking about it. esp. those masquerading as supply chain experts on just about everything. I am not one of those. I advise you to trust YOUR OWN wisdom when it comes to open ended questions likes these.

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