Material substitution

Hello,

I am just writing an essay at university about lot sizing models with product substitution and thereby want to give a short look at the possibilities in SAP.

I already found some topics in the SAP Help Portal concerning giving a customer a substitution product when the preferred one is out of stock. What I could not find is wether it is possible to substitute components/ materials in the production process. That means if SAP (perhaps APO PP?) can choose the cheapest component according to given setup cost and per unit production and substitution/conversion costs. E.g. using other available half-finished products that need more conversion but that avoid setting up the prefererd half-finished product, so that the total costs are minimized.

I hope you understand my problem and someone can help me. Thanks in advance.

Kind regards,

Kari