An Oracle White Paper September Understanding how to use the Demand Fulfillment page in Supply Planning Cloud

Transcription

1 An Oracle White Paper September 2018 Understanding how to use the Demand Fulfillment page in Supply Planning Cloud

2 Contents Scope... 3 Introduction to Demand Fulfillment... 3 Demand Fulfillment Output... 3 Order Value Calcuation... 3 At Risk Demands Selection... 4 Currency LOV and Conversion Rate... 6 A Business Use Case Reviewing Demand Fulfillment... 7 Using Demand Fulfillment output A Business Use case with Single Organization References... 13

3 Scope This whitepaper describes how you can interact with the Demand Fulfillment page. The paper will describe the various sections of the page, contents in the tables and graphs, and how you can use the information to communicate with other business teams within their organization such as manufacturing operations, purchasing and customer experience teams. Introduction to Demand Fulfillment Demand Fulfillment is a page in the Supply Planning work area that displays at-risk demands and their related recommendations. At-risk demands are prioritized based on order value weighted by the number of associated recommendations required to make the demand no longer at risk. Demand Fulfillment provides a summary of the plan s current demand fulfillment position, as well as potential for improvement, and where things actually stand based on accepted recommendations. In order for an at-risk demand to be considered no longer at risk, you must resolve all of the recommendations associated with that at-risk demand. Each at-risk demand will have one or more pending recommendations that need to be addressed. The at-risk demand will have an at-risk status until all the pending recommendations are either approved or accepted. Accepting the recommendation firms the related order using the expedite date as the firm date and updates the recommendation status to Accepted. The related at-risk demand s count of pending recommendations is reduced. However, the demand is still considered at risk until all related recommendations have been accepted or completed. For a recommendation related to increasing resource availability or supplier capacity, you can accept the recommendation to automatically increase resource availability or supplier capacity. You can rerun plan without refreshing current data to review the changes. Once there are no more pending recommendations linked to the at-risk demand, the demand s status is updated to display a green checkmark, meaning the demand is not at risk. Demand Fulfillment output To review Demand Fulfillment output, let s understand the underlying calculation which drives the at-risk demands. Order Value Calculation Order Value is the value of a demand order line (demand order line can be sales order line or a forecast for an item-organization) derived based on the quantity of the order/demand and the price associated with the order line / item for a specific currency.

4 Order Value = Order or Demand line quantity x Price of the item for a given currency Here price of the item can be either the list price of the item defined in item-organization attributes or the selling price for a given currency specified in the sales order line. Example : Item : AI-FG-1001, Organization : M2 List Price defined for the item in Item-organization attributes in Product Information Management Plan Inputs shows collected List Price of the Item in the Organization currency code Post plan run for Forecasts, Item selling price/list price from Product Information Management is considered for order value calculation. Plan output Items Demand Fulfillment UI Order Value In the above Example : Order Value (1010 USD) = Order quantity(101) x Selling Price/List Price of item(10 USD) At Risk Demands Selection At-risk demands are demands that have the following exceptions:

5 Late Replenishment for Sales Order - Demand is pegged to a supply that is late due to the planning time fence, or the supply is late because it is firmed and reserved to the sales order. This exception is appears for an end item. Late Replenishment for Forecast - Demand is pegged to a supply that is late due to the planning time fence. This exception is appears for an end item. Demand at Risk due to a Resource Capacity Shortage - Demand is pegged a supply that uses a resource which has a resource overload exception in the same time bucket as the supply. Demand at Risk due to Supplier Capacity Shortage - Demand is pegged to a supply which overloads supplier capacity. Demand at Risk due to Insufficient Lead Time - Demand is pegged to one or more supplies with lead time violations Late Supply pegged to Sales Order - This exception message appears when a supply due date is later than the demand due date to which it is pegged; the demand can be independent demand or dependent demand (which will eventually peg to a sales order). This usually occurs because of time fences. Late Supply pegged to Forecast - This exception message appears when a supply due date is later than the demand due date to which it is pegged; the demand can be independent demand or dependent demand (which will eventually peg to a forecast). This usually occurs because of time fences. Supply Planning derives the at-risk demands by calculating the demands of highest order value across the plan horizon which are impacted by delayed supplies Example :

6 In the above example, Demand fulfillment displays 81 at-risk demands sorted in descending order, order value weighted by the number of associated recommendations required to make the demand no longer at-risk. If there are two demand lines with same order value, the demand line with most associated recommendations will be higher on the list. Order number : AB-FC-01 has order value of 1010 USD, is the high risk demand in the plan. Although there are other demands whose due date is earlier, the above demand line is weighted with highest at-risk. Currency LOV and Conversion Rate Demand Fulfillment page shows the Currency LOV if the organizations included in the plan have different currencies and have at-risk demands. Example :

7 In the above example, we see that a currency LOV is displayed. The organizations included in this plan have following currency codes. In a multi-currency scenario, if you does not specify an organization filter in the Search panel, the Demand Fulfillment page displays order value of at-risk demands in a default currency. The default currency code is derived from the organization of the first at-risk demand in the Search results. Selecting USD from Currency LOV displays Order Value show as follows.. Similarly, Order value is updated based on different currency selections made from the LOV. Following example illustrates Order value calculation for multi-currency conversion Latest Currency Conversion rates collected are as follows.. New Order value is calculated and displayed as follows. A Business Use Case Reviewing Demand Fulfillment Section 1: Recommendation Summary

8 The Recommendation Summary section consists of a Summary graph and a Summary table, which helps you to prioritize actions required to resolve at-risk demands in the business. Review the displayed details for a selected currency. Example : currency selected : EUR In the summary table, actual demand fulfillment percentage is the ratio of fulfilled demand value (demands which are not at-risk) to the total demand value in the currency selected in LOV. In the above example, all the demands across organizations would have their order value converted to EUR based on latest conversion rate. The screenshot below displays change in demand fulfillment percentage when you select currency CNY. Currency selection : USD :

9 By looking at the recommendation summary graph, you can see that a significant 25% improvement in demand value of at risk demands can be achieved by implementing a limited number of recommendations. Having decided on this improvement target, select 25% of cumulative at risk demand by moving the slider bar to the left, which zooms in on the top at-risk demand. The Demand Fulfilment page displays twelve demands that account for 25% of the cumulative at-risk demand value. If you resolve risk for 12 demands, then you would be able to increase the demand fulfillment by around 80%, from 22.78% to 41.14%. Similarly, business users across organizations with different currencies can have organization level filters to perform the above actions in their currency, and communicate the final demand fulfillment percentage to the customer experience teams. Example showing use of Organization filter:

10 Section 2 : At-risk Demands The at-risk demands display is driven by the cumulative order value selected by you. In the earlier example, you selected around 25% of cumulative at-risk demand value. Details of associated at-risk demands are displayed.. Section 3 : Recommendations For resolving cumulative at-risk demand value of around 25%, you would need to resolve these 12 demands. You can select each demand, review the recommendations, and implement them to improve the accepted demand fulfillment percentage.

11 After accepting the recommendations, the Status column will show a green check mark to indicate that these demands are no longer at risk. Similarly, the Accepted column in the Summary section of the Demand Fulfillment page also reflects the actions taken.

12 Using Demand Fulfillment output A Business use case using Demand Fulfillment output Single Organization Business Planner reviews the output from Demand Fulfillment UI in Supply Planning, and follows the flow detailed below The business planner from Material Planning team, reviews at-risk demands for an organization. The Planner decides to address X% of cumulative at-risk demand value and its associated at-risk demands. The Demand Fulfillment page displays the list of at-risk demands for the selected X% of cumulative at-risk demand value and its associated supply recommendations. The Planner reviews the recommendations to resolve at-risk demands, and discusses with the corresponding supply chain execution business teams. For expedite buy order recommendations, the planner discusses with the purchasing team. The associated buyer, reviews the proposed expedite actions with the Supplier in question, and lets the planner know if the expedite action is feasible. The planner marks the expedite recommendation as accepted.

13 Similarly, the Planner discusses with other supply chain execution business teams such as Manufacturing and Logistics based on supply order recommendations and marks those recommendation as accepted based on feedback from these teams. In the event a business team is unable to expedite a supply or add resource, the recommendation is not accepted. Finally, after all possible actions have been taken, the Planner communicates the outcome of the demand fulfillment improvement process to the customer experience team. The customer experience team then works with specific customers to communicate revised ship or arrival dates for their sales orders. References o Oracle SCM Cloud Using Planning Central (release : 18.05) o Oracle SCM Cloud Implementing Supply Chain planning (release : 18.05) o Oracle Cloud Readiness - Supply Chain Planning (release : 18.05) o Oracle Cloud Readiness Supply Chain Planning(releases before 18.05)

14 Understanding how to use the Demand Fulfillment page in Supply Planning Cloud September 2018 Author: Srikanta Nanjundaswamy Oracle Corporation World Headquarters 500 Oracle Parkway Redwood Shores, CA U.S.A. Copyright 2018, Oracle and/or its affiliates. All rights reserved. This document is provided for information purposes only, and the contents hereof are subject to change without notice. This document is not warranted to be error-free, nor subject to any other warranties or conditions, whether expressed orally or implied in law, including implied warranties and conditions of merchantability or fitness for a particular purpose. We specifically disclaim any liability with respect to this document, and no contractual obligations are formed either directly or indirectly by this document. This document may not be reproduced or transmitted in any form or by any means, electronic or mechanical, for any purpose, without our prior written permission. Oracle and Java are registered trademarks of Oracle and/or its affiliates. Other names may be trademarks of their respective owners. Intel and Intel Xeon are trademarks or registered trademarks of Intel Corporation. All SPARC trademarks are used under license and are trademarks or registered trademarks of SPARC International, Inc. AMD, Opteron, the AMD logo, and the AMD Opteron logo are trademarks or registered trademarks of Advanced Micro Devices. UNIX is a registered trademark of The Open Group Worldwide Inquiries: Phone: Fax: oracle.com