Advanced Safety Stock Planning Methods

[Former Member]

Hi Group,

We are implementing Advanced Safety Stock Method BS. We are however confused about how the safety Stock is actually being calculated when we try to validate the safety stock . We are entering values manually in the APO Product Master for

Demand Fcast Error :

RLT Fcast Error (%)

Replen. Lead Time

Is there some documentation which gives more details on the advanced safety stock method ? how you decide the basis on which to enter the values etc . How to interpret the results log once the safety stock heuristic is executed.

We have tried to look at several notes and other resources but they do not seem to help a lot !!

Regards,

Ranjini.

[Former Member]

though i have not used extended SS method BS i have used AT. The fundamentals being the same....

values you have entered are enough (hope u r using service level)

optionally Target Days’ Supply is used to calculate the purchase order qty

dont have documentation other than general help and some release notes from SCM 5 thats has references to Extended SS

in addition to setting the master data also set the safety stock profile SFT1 to look at the masterdata (and not supply chain) and in your case it also does not look at the historical data

if you have set up the safety stock planning run to generate a log you will be able to look at it (there is a transaction in the menu for this) - it has almost all the breakup of the values and the errors it has considered and the final calculation

what you will get in the log after the safety stock run is a bit difficult to explain at some points. you will not get a SAP reply to this since it is supposed to be consulting

there is something called a safety factor that comes into play in the calculation which i dont know how to explain till date but its a constant factor that is multiplied in the last but one column to get the final safety stock

also there is a relative forecast error that you enter but there is also anther calculation for

absolute forecast error on demand that calculates, beside the relative forecast error of demand and the demand forecast for the current period also the relative forecast error of replenishment lead time is used. In other words: the uncertainty of replenishment lead time is transformed into an equivalent uncertainty of demand.

i had to play around with some masterdata till i got the numbers i needed (calculated exernally)

also check macro SB_BETA_POINT() to get some clues... it should do the same calculation as the safety stock planning should. maybe you can get someone to get through to the function module that calulates this and find what it actually does

SB_BETA_POINT( service level ; demand forecast ; forecast error demand (%) ; replenishment lead time ; forecast error replenishment lead time (%) ; days' supply ) returns the safety stock level for the Beta service level according to the point method.

[srinivas_krishnamoorthy]

I dont think the formula being used is different from APICS recommended or standard Matl Mgmnt ones.

The calculation will be internal to APO, but do check

http://help.sap.com/saphelp_scm50/helpdata/en/16/7c1342eb11de2ce10000000a1550b0/content.htm

and the APO document

http://help.sap.com/saphelp_scm50/helpdata/en/be/016e3973ed8c18e10000000a114084/content.htm

usually gamma or normal distribution is standard while quantifying the spread on variables such as forecasts or RLT.

the log of Adv Safety stock plng could be long. Can you specify which part you are unclear about ?