Background
The MRP Type is a field on the Material Master in ERP which does two things:
- It controls the planning method (whether its MRP, MPS, Re-order Point Planning, etc..)
- It also serves as a “switch” which can prepare the ERP system to take a subordinate role (and can do so for any grouping of product location combinations), which can then allow an external planning system like APO or any other third-party system, to perform its own planning procedures.
One of the general misconceptions about MRP Types is that they only perform the first activity, when in fact the second activity is also important. A major problem with the MRP Type field is that it is not actually what it says it is and was misnamed from the beginning. Why I have never heard someone bring this up is strange because it is obviously the case. A simple example can prove this point. For instance, Time-phased planning and Manual reorder point planning, which are two of the MRP Types listed below, are not “types of MRP,” they are planning methods. Therefore calling the field MRP Type makes little sense. The only MRP types that are actual types of MRP are those colored in blue below:
Eleven MRP types are dedicated to both MRP and MPS. The four MPS are listed below in orange, and the 7 MRP are listed in blue.
M0 MPS, fixing type -0-
M1 MPS, fixing type -1-
M2 MPS, fixing type -2-
M3 MPS, fixing type -3-
M4 MPS, fixing type -4-
ND No planning
P1 MRP, fixing type -1-
P2 MRP, fixing type -2-
P3 MRP, fixing type -3-
P4 MRP, fixing type -4-
PD MRP
R1 Time-phased planning
R2 Time-phased w.auto.reord.point
RE Replenishment plnd externally
RF Replenish with dyn.TargetStock
RP Replenishment
RR Tmphsd. repl. w. dyn.trgt.stck
RS Time-phased replenishment plng
V1 Manual reord.point w. ext.reqs
V2 Autom. reord.point w. ext.reqs
VB Manual reorder point planning
VI Vendor Managed Inventory
VM Automatic reorder point plng
VS Seasonal MRP
VV Forecast-based planning
X0 W/O MRP, with BOM Explosion
The one above which is in red, says “MRP,” but of course it is without MRP. X0 does not perform MRP but does perform BOM Explosion. XO is the most common
These are the differences between the different MPS runs; these are the same differences between the 4 listed MRP runs.
Why So Many MRP and MPS Selections?
The reason there are so many MRP and MPS selections is because they are slight variations of each other that primarily have to do with firming and when procurement proposals are created.
0 – Procurement proposals are not firmed
1-Procurement proposals within the planning time fence are firmed automatically as soon as their date is at least one day before the end date of the planning time fence. The date of new procurement proposals created in the planning time fence is moved to the end date of the planning time fence. As a result, these new procurement proposals are not firmed.
2 -Procurement proposals within the planning time fence are firmed automatically as soon as their date is at least one day before the end date of the planning time fence. No new procurement proposals are created automatically within the planning time fence; that is, the shortage situation is not adjusted within the planning time fence.
3 – Procurement proposals within the planning time fence are not firmed automatically. All procurement proposals required to cover the requirements are moved to the end of the planning time fence.
4 -No procurement proposals are created automatically within the planning time fence; that is, the shortage situation is not adjusted within the planning time fence. - http://help.sap.com/saphelp_46c/helpdata/en/f4/7d30b644af11d182b40000e829fbfe/content.htm
Interestingly, the SAP documentation on this topic is incomplete. This is because some of these MRP types allow procurement proposals to be created in the past, which is not covered in the documentation. The graphic below shows the official SAP documentation converted to a matrix for better understanding.
The first five columns are from SAP documentation, and the sixth column is from observation of how the system operates. Obviously the SAP documentation does not explain all the differences between the firming types because if it did, some of the firming types would be duplicates.
MPS MRP Type?
MRP is one way of (sort of) implementing MPS, however MPS is not a form or type of MRP. In fact because MRP cannot be constrained, there is a question whether MRP can be a pure MPS. MRP can always be capacity leveled, but one of the requirements of MPS is that it is constrained. Constraining is one factor, but there are four factors that make up an MPS, which is listed in the link below.
http://www.scmfocus.com/supplyplanning/2011/10/02/the-four-factors-that-make-up-the-master-production-schedule/
Therefore, it is also inaccurate to list MPS as an MRP type, and in fact the field’s name is inaccurate in a number of different dimensions.
The APO Relevant Field
The APO Relevant Field controls if a product location combination will be “planned” in APO. However, its important to add more specifics to the term planned. This is because we generally speak of a product being planned in one system or another. For instance, the most common distinction is between critical products planned entirely in APO versus non-critical products being planned entirely (usually with MRP) in the ERP system. Under this design, the delineation between being “planned” in one system or another is very clear. However, this distinction becomes less clear when one of the planning stages is performed in one system and a second in another. This is because “planned in” is not a sufficiently detailed description to explain what is happening and where it is happening. A product can have the finished good planning performed in APO, but then the sub-components planned, either with MRP or with simple BOM explosion. For products with multiple nesting in their bill of material, the finished good could be planned in APO, with the semi-finished good and raw material planned in R/3, or both the finished good and semi-finished good could be planned in APO, and only the raw material planned in R/3.
Field Specifics
For a product to be planned in APO, the master data such as the product and location must be setup in APO, but also the transaction information must flow between APO and R/3. The APO Relevant Field sets this up properly for product locations that are not entirely planned in R/3 (again, a product location combination can be partially planned in APO and partially planned in R/3, however if any planning at all is to occur on a product location in APO, the APO Relevant Field on the Material Master in R/3 should be checked.) Without this field being checked, data will not flow between APO and R/3 as R/3 will assume all planning is being performed internal to R/3.
Conclusion
The MRP Type is not was it says it is, and has been misnamed. A better name would have been “planning method.” The frequent mis-naming of fields in SAP by people for which I can only suppose that English was a second language continues to cause large problems on SAP projects. I can think of no other supply chain vendor that continually mis-names its fields in this way, which is why it is important to describe the mis-naming for people on the project. The overall functionality of MRP and MPS could be explained better by SAP.
