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Extended Supply Chain Management with SAP Integrated Business Planning and SAP SNC

by Dr. Christian Butzlaff, Senior Director, SAP and V. Krishna Anaparthi, Process Architect, SAP Labs India Pvt Ltd.

November 17, 2016

Learn how to use SAP Supply Network Collaboration (SAP SNC) and SAP Integrated Business Planning to enable collaboration scenarios in extended supply chain management to monitor your supply chain more efficiently and be alerted in case of irregularities.

In addition to the internal planning process, companies use tools such as SAP Ariba or SAP Supply Network Collaboration (SAP SNC) to collaborate with the extended supply chain partners (for example, suppliers, customers, contract manufacturers, and third-party service providers). We discuss a use case in which the business can monitor its extended supply chain and be alerted about any issues potentially affecting the delivery capability by using advanced solutions such as SAP Integrated Business Planning.

SAP Integrated Business Planning provides unified planning across sales and operations, demand, inventory, supply and response planning, as well as the Supply Chain Control Tower for dashboard analytics and monitoring. It allows companies to engage stakeholders across the organization in a truly integrated planning process (see http://help.sap.com/ibp-ref and http://scn.sap.com/community/scm/ibp).

Business Scenario

As shown in Figure 1, the scenario considered in our example refers to a business that distributes computers. The business receives the computers from a sub-contractor who has been contracted to assemble the components and then the business stores the finished computers at a business site. The business provides the sub-contractor the components required to produce the computer by directly coordinating with suppliers and having suppliers directly ship the components to the sub-contractor.


Figure 1
Scenario overview
 

For such a scenario, we explain how a combination of SAP SNC and SAP Integrated Business Planning can increase the visibility into the extended supply chain and allow the business to react to any issues that occur. Besides the architecture and configuration of the scenario, we also describe the technical implementation of the integration between the two solution components.

Business Scenario: The Technical Landscape and Process Modelling

As depicted in Figure 2 (technical landscape overview), we have modelled the business’s supply chain using SAP ERP Central Component (ECC), SAP SNC, and SAP Integrated Business Planning. While ECC is modelled to take care of execution processes, SNC is modelled to enable the communication and collaboration link with external business partners, and SAP Integrated Business Planning is modelled to handle the internal planning and monitoring challenges considering the inputs from suppliers.


Figure 2
Technical landscape overview
 

Technical Landscape

ECC and SAP SNC are integrated via the Core Interface (CIF) for master data and SAP Process Integration (SAP PI) for transactional data such as purchase orders, purchase order confirmations, or advanced shipping notifications (ASNs). The sub-contractor and the suppliers can access SAP SNC via a web interface or via a message interface.

The SAP Integrated Business Planning tenant sits in the cloud, but does not currently provide the functionality required to allow for direct access by the sub-contractor or the suppliers (such as a visibility concept for different business partners, accessing the same system such as SAP SNC). The integration to SAP SNC uses SAP HANA Cloud Integration Data Services. (For more details on the integration setup between SAP SNC and SAP Integrated Business Planning for master data and transaction data, refer to the “Technical Implementation” section of this article.)

In addition, we use an SAP JAM tenant integrated to SAP Integrated Business Planning to enable the Control Tower case management functionality.

Process Flow

The process flow consists of the following steps:

  1. The orders and demand for computers are captured at the business site and are modelled in ECC.
  2. Upon material requirements planning (MRP) in ECC (or alternatively in SAP Advanced Planning and Optimization Production Planning [SAP APO PP]) at the business site, sub-contracting purchase proposals are generated onto a sub-contractor. Component requirements are generated on suppliers, with the delivery location as the sub-contractor for components, as shown in Figure 1.
  3. A quota arrangement is used to distribute the components requirements across the suppliers.
  4. The purchase proposals and the orders created in ECC against the sub-contractor and suppliers are then propagated to SAP SNC to enable supplier collaboration.
  5. Business performs the purchasing and delivery collaboration with suppliers and sub-contractors through SAP SNC to execute the procurement-to-pay process. This collaboration can be either business to business (B2B, such as electronic data interchange [EDI] or XML message-based interfaces) or web UI based. B2B stands for business-to-business integration, and the interaction between the business happens with EDI or XML messages. Web UI stands for web user interface and the business entities involved directly access the web interface of the collaborating system.
  6. Sub-contractors and suppliers also provide their inventory information to the business through an inventory update to SAP SNC, so the business has a regular update on the stock situation in its extended supply chain. Inventory, demand, and receipt information at a business site, as well as at supplier and sub-contractor locations, is propagated from SNC to the SAP Integrated Business Planning control tower to monitor the extended supply chain on a continuous basis and to alert users in case of potential issues.
  7. Figures 3 and 4 show data between SAP SNC and SAP Integrated Business Planning.


Figure 3
Data overview in the SAP SNC Supply Network Inventory (SNI) details screen for material M30 at plant 1000


Figure 4
Data overview in the SAP Integrated Business Planning chart for material M30 at plant 1000

For the material M30 at site 1000, the data in Dec 2016 can be seen with the demand as 2,500 units and the receipts as 1,500 units.

This data is eventually pushed to SAP Integrated Business Planning and in SAP Integrated Business Planning, the data can be seen in the chart for the same material M30 and site 1 (Figure 4).

The Business Challenge

Consider a situation in which one of the suppliers of the components has problems with its manufacturing, resulting in negative future-projected stock of components. The problems will eventually have a cascading effect in terms of delivery of goods to the sub-contractor and eventually cause a delay in the delivery of computers from the sub-contractor to the business site.

The Solution

With the SAP Integrated Business Planning control tower, the business can effectively handle the following situations:

Alerts can be configured to be created in SAP Integrated Business Planning whenever the projected stock for components at the supplier turns negative or falls below a certain threshold quantity. To complete this step in SAP Integrated Business Planning, click the triangle icon (circled in Figure 5) and from the drop-down list of options, select Custom Alert Definition. You then can define a new alert by populating the fields shown in Figure 5 (Name, Description, and Calculation Level. You also can select Planning Area, Time Horizon, and Severity from the respective drop-down lists of options for these fields. After you have selected your settings, press the Enter key to save them.


Figure 5
New alert definition

The system then creates the alert based on the alert definition in Figure 5. To view the new alert, click the icon in the blue circle shown in Figure 6.


Figure 6
Alert created

Once the alerts are created in SAP Integrated Business Planning, you can then create a case to handle the situation and involve the relevant stakeholders to handle and resolve the case (Figure 7).


Figure 7
Case creation against alert

With SAP Integrated Business Planning collaboration, scenario management, and simulation capabilities, the stakeholders involved in handling the case can devise alternatives to handle the situation by collaborating over the SAP JAM platform and then find the best possible resolution by simulating various solution approaches with multiple what-if scenarios.

After finalizing the best possible solution approach from various simulation alternatives, they can take steps to take the necessary actions to mitigate the problem (for example, shifting demand to another supplier, working through in-house production, or onboarding a new supplier).

Technical Implementation

In this section we go into a more technical, detailed description on how the actual integration is achieved. We briefly describe the standard integration between ECC and SNC and go into more detail for the integration to SAP Integrated Business Planning.

ECC to SAP SNC

The implementation of the integration scenarios between ECC and SAP SNC is all based on standard integration content delivered by SAP. Master data is exchanged via the CIF. Purchase orders, purchase order confirmations, or ASNs use SAP PI for the transfer.

We used the SAP SNC SNI scenario that is time series based and stores the data accordingly. To populate the data to the SNI scenario in SAP SNC, we used the standard reports ROEMPROACT2 and RCMPROACT2 from ECC to transfer the purchase order, purchase order confirmations, and ASNs.

Integration of SAP SNC to SAP Integrated Business Planning

In this section we describe the integration between SAP SNC and SAP Integrated Business Planning, in particular the integration of time series data.

The master and transaction data between SAP SNC and SAP Integrated Business Planning is handled via SAP HANA Cloud Integration Data Services. Standard content is available for master data integration between the SCM system (which houses SNC) and SAP Integrated Business Planning.

(Note: The details of setting up the SAP HANA Cloud Integration tenant, configuration of the agent, creation of data stores, creation of the project, and the creation of tasks are beyond the scope of this article, as these are the basic steps involved in using SAP HANA Cloud Integration Data Services.)

Figure 8 is an overview of steps involved in setting up the system and projects.


Figure 8
Overview of the steps

The Control Tower in SAP Integrated Business Planning is based on time series data. Hence, in SAP SNC, we used SNI, which has the time series representation of purchase orders, confirmations, and advanced shipping notifications. Once this data is in the SNI monitor, it can be transferred to SAP Integrated Business Planning without major transformation requirements.

Table 1 shows the key figures used in SAP SNC and the corresponding key figures in SAP Integrated Business Planning.

Data

SNC key figure (KFTYPE)

Mapped to SAP Integrated Business Planning key figure

Purchase order

ORDERTS

DISTRECEIPTCONF

Purchase requisitions

PLANSHIPTS

DISTRECEIPTPLND

ASN

INTRANSITTS

DISTTLBRECEIPT

Sales order

FIRMDEMAND

SALESORDQTY

Table 1
Key figures used in SAP SNC and corresponding key figures in SAP Integrated Business Planning

In addition, we extracted the inventory information from SAP SNC stored in the Light Inventory Management Engine (LIME).

Rather than accessing the database tables directly, you can more easily extract data from SAP SNC by using the corresponding standard access methods. For example, to extract inventory data from LIME, use function module /SCA/DM_INV_DATA_GET. The same holds true for the data stored in TSDM, where we use function module /SCA/TDM_TSDM_TS_GET. By using the function modules rather than accessing the underlying data base tables directly, you do not need to deal with the often very complex database structures.

Using an ABAP routine as the source allows for more flexibility in transforming source data before the actual mapping and transfer occurs. Therefore, for our example, you define the source in SAP HANA Cloud Integration as an ABAP source rather than as a database table.

We now provide some insights into the definition of the ABAP source on the source system (in this case SAP SNC). There are some naming conventions that need to be followed. First of all, a form routine with name form2 needs to be defined. This form routine needs to be stored as a text file with extension .aba in the directory of the SAP HANA Cloud Integration agent installation. Inside of the form routine a table with name itab1 needs to be used. A simple example of a routine can be found in Figure 9.


Figure 9
An example of a form2 file used to extract data from a source system through SAP HANA Cloud Integration Data Services

In the simplified routine shown in Figure 9, only the material number is selected. It is important to note that the declaration of table itab1 is commented out. The structure of itab1 can be freely defined in the routine itself

Figures 10, 11, and 12 show the data flow definition for purchase orders in SAP HANA Cloud Integration. You can see the ABAP endpoint defined as a source for the purchase order data in Figure 12.


Figure 10
The project task dealing with the transfer of purchase orders


Figure 11
The details of the project task


Figure 12
Source definition for purchase orders with an ABAP routine defined as the source rather than a database table

Once the data is extracted via the routine and passed into a suitable data structure of itab1, the transformation on SAP HANA Cloud Integration itself becomes straightforward. The source is the structure of itab1 versus the target being the target structure in SAP Integrated Business Planning. In addition to the field-by-field mapping, a filter is defined, selecting only the specific key figure to be transferred. The data has to be loaded to a staging table on the SAP Integrated Business Planning side. From the staging table, SAP Integrated Business Planning moves the data into main table through its standard procedures.

Figure 13 shows the SAP HANA Cloud Integration mapping of the purchase order data.


Figure 13
SAP HANA Cloud Integration mapping of a purchase order

Note in Figure 13 that you can see that the filter enabled for type ORDERTS retrieving purchase order data only. You navigate to this screen from Figure 12 by clicking Target_Query.

Note that for each key figure to be integrated a separate task needs to be created under the project. Each task contains a data flow definition and needs to include the transfer of the key figure data as well as the key itself (location, product, product location). Therefore, the only difference in the task definitions is the filter on the key figure type (KFTYPE).

In Figure 10, you can see that a task exists for each transaction’s data along with master data (i.e., the sales order, purchase requisition, and purchase order).

Other Scenarios: Forecast Commit from Supplier

A common scenario, not discussed in this article, is the sharing of a forecast with suppliers and receipt of a forecast commit from suppliers. This allows companies to include the supplier’s capacities early on into the planning process and to look for alternatives if required. This scenario could be developed in a similar way as explained in this article. SAP SNC provides the functionality for forecast collaboration.

A forecast calculated in SAP Integrated Business Planning can be shared with the supplier via SNC and a forecast commit provided by the supplier is integrated back into SAP Integrated Business Planning for further consideration. The latter can be implemented the same way as shown here. The integration from SAP Integrated Business Planning to SNC can be accomplished by using SAP HANA Cloud Integration Data Services to extract the time series data from SAP Integrated Business Planning and calling a web service for the PROACT inbound interface on the SNC side.

In this article we demonstrated how, with a combination and integration of SNC and SAP Integrated Business Planning, users can extend the SAP Integrated Business Planning Control Tower capabilities (or SAP Integrated Business Planning in general) into the extended supply chain. Companies that are using SNC today and have spent a significant effort to integrate their business partners into SNC might want to leverage this solution to easily extend their SAP Integrated Business Planning implementation beyond their company’s boundaries. Companies using Ariba should look at similar scenarios using Ariba instead.

Credits

We want to give credit to the great contributions provided by our student interns for setting up these scenarios…

  • Cara Damm and Marco Doerfler for the initial setup of ECC and SNC
  • Max Kuchenbecker for the master data integration to SAP Integrated Business Planning
  • Jana Lang for the great work on setting up the final scenario).
  • Special thanks goes to Johannes Lust, who solved all the technical difficulties in defining an ABAP endpoint in SAP HANA Cloud Integration. It looks easy at the end but involved a lot of trial and error to get it done.
  • Last not least we would like to thank Praveen Kumar Balasubramanian for his great support in guiding the students on any technical questions related to SAP HANA Cloud Integration.

Without all of this help, we would not have been able to finalize our vision of an integrated SNC/ SAP Integrated Business Planning scenario, extending the capabilities of SAP Integrated Business Planning beyond the company boundaries.

Disclaimer

The demonstrated integration scenario is a prototype only. Some additional effort would need to be added into the development of the extraction routine in order to make it available for a live implementation. A selection profile should allow you to define the exact location of products and key figure information to be shared with SAP Integrated Business Planning. In addition, the handling of null values would need to be considered.

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Dr. Christian Butzlaff

Dr. Christian Butzlaff (c.butzlaff@sap.com) is responsible for SAP Value Prototyping services at SAP America. In his current role he works with customers on prototype engagements, for example, in the area of SAP Integrated Business Planning.

Christian holds a PhD from the University of Hamburg, Germany. He is PMI certified and is currently pursuing a specialization in machine learning.


V. Krishna Anaparthi

V. Krishna Anaparthi is a process architect at SAP Labs India Pvt. Ltd.



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