What Is It?

A statistical forecast based on sales history is not the only type of forecast that is used in SPP. Sometimes the forecast needs to be based upon factors other than history such as installed base. For instance in A&D, the forecast can be more accurately executed based on installed base rather than historical sales. Leading indicators is a causal forecasting method. (This could be flight hours, or other equipment utilization numbers. These are also called causal factors, or non-demand factors and are notoriously hard to find in company databases.)

If you have information about the failure rate, you can define that in a coefficient. The system then multiplies this coefficient with the equipment that is on the market and can thus forecast how many service parts you will require in the future. The steps generally are:

1. Equipment source must be tapped and extracted (equipment BOMs, installed based key figures, equipment master data from the BW)
2. We then bring this into BW, perform a LI preparation service.

Then we select leading indicator folder.

SAP supplies the following leading indicators

1. Installed base
2. Operation time
3. Number of users

You can also define your own leading indicators in addition to the ones provided by SAP. (You must assign the same leading indicator to all locations of a BOD.)

SPPLFISERVICE for Coefficient Determination

These leading indicators are then assigned to a planning profile. You need to select the SPPLFISERVICE. This service is the coefficient determining service. The system generates the demand histories for the leading indicators used. It then uses these histories to determine a value for the coefficient for each period in the past. To do so, it executes the planning service SPP: Preparation Service for Leading Indicator Based Forecast (SPPLFISERVICE).However, you do not need to run the LFI service. If you select either CONSTANT VALUE or MANUALLY ENTERED off of the Leading Indicator tab of the forecast profile. This leads us to an intermediate topic – the Foreast Profile Leading Indicator Tab. Goto this link to read this related topic. Then return to this post. Alternatively, open both posts and read them side by side.

http://www.scmfocus.com/sapplanning/2008/10/02/spp-leading-indicator-forecast-profile-tab/

Here is the SPPLFISERVICE, it is a standard service and can be accessed by creating a planningprofile and by attaching the service to this profile.

/N/SAPAPO/480000009

The service is in the product simple category.

Now we have selected the correct Process Profile category we can go to the next step and select the SPPLFISERVICE.

Now we can access this service by selecting this Leading planning profile that we just created.

If you use period based planning, SPP generates the forecast for a product either on the basis of past sales values or on the basis of leading indicators. If you can not meet your demand within your BOD, SPP covers demands either through external procurement or repair.

SPPFCSSERVICE for Forecasting

This generates the demand histories and performs forecasting. However, you can use the interactive forecasting screen instead. /N/SAPAPO/SPPFCST

On the other hand you can also tie up this service in a planning profile.

STEPS

1. Based on the demand history generated in step one, the system generates the forecast for the leading indicator and the coefficient. For this you can either schedule the planning service SPP: Forecast Service (SPP_FCS_SERVICE) which generates the demand histories, or you can start the forecast manually in the interactive forecasting screen. This generates the forecast for the leading indicator. In doing so, it proceeds as specified by you in the Leading Indicator Values field on the Leading Indicator tab page in the forecast profile. You have the following options.

a. Forecasted – In this case the system performs the forecast on the basis of the demand history and takes into account the forecast profile that you have defined for the leading indicator

b. Determined from the Installed Base – In this case the system performs a naive forecast. I reads the values from the demand history from the InfoCube SPP: Installed Base Key Figures (9AIBASKF), and copies the value of the current period as the forecast value for future periods

c. Upload / Manually Entered – In this case you can either enter the forecast values manually in the Interactive Forecasting screen or upload them with a BADI

3. The system determines the leading indicator based forecast for your location product on the basis of the forecast values for the leading indicator and the coefficient. As in step 2, this step is either part of the planning service SPP: Forecast Service (SPP_FCS_SERVICE) or part of the interactive forecast that you can start manually in the Interactive Forecasting screen. To generate the leading indicator forecast for your location product, the system multiplies the forecast values of the leading indicator determined in step 2a by the forecast values of the coefficient determined in step 2b. it does so for each period in the future

4. You can display the calculated forecast values on the Interactive Forecasting screen.

Equipment Data

You can load equipment data into SCM from ECC via BI. In the standard, the system transfers equipment data from ECC into the characteristic 0EQUIPMENT in SAP BI. You must schedule this transfer in SAP BI with an InfoPackage.

Overall Sequence

1. The preparation service for leading indicator based forecasting checks all products of the product selection as to whether they are part of a supersession. If a product is part of a supersession, the preparation service checks whether the supersession is a one to one replacement. It is only in this case that the preparation service takes into account this supersession in leading indicator based forecasting. The preparation service for leading indicator based forecasting of the predecessor and successor product then generates a demand history as described below. The preparation service checks whether you have set the read BOM of LI flag in the service profile for the preparation service.

a. If you have set this flag, the system reads all equipment BOMs for the ERP system and check how often a product occurs in which equipment BOMs

b. If you have not set this flag, the system sets an equipment equal to a product.

2. The preparation service checks whether you have restricted your equipment with a selection in customizing or whether you want to take into account all equipment in leading indicator based forecasting. If you want to restrict the equipment taking into account in leading indicator based forecasting, you can define an equipment selection in Customizing. You can specify the semantics and values or value ranges for these semantics that the system is to take into account or not take into account in the selection.

3. The preparation service determines an entry location for all products of the product selection and checks, which leading indicator group you have assigned to this entry location. The system only performs step 4 for those leading indicators that are included in this leading indicator group.

4. If the installed base leading indicator occurs in your leading indicator group, the preparation service distinguishes between the installed base leading indicator and all other leading indicators as follows.

a. The preparation service determines the demand history of the installed base leading indicator form the information from step 1. To do so it counts how often a product occurs in total in all checked equipment BOMs. If you are not using equipment BOMs and an equipment corresponds to a product, the system only counts the equipment.

b. The preparation service determines the first stockholding locations for the product. To do so, it determines at which location the demand for the equipment occurred. If this location is a stockholding location, it determines this location is the first stockholding location. If this location is not a stockholding location, it goes up in the BOD until it finds a stock holding location and determines this location as the first stockholding location.

Whether a location is a stocked location is set here in the SPP Inv. Planning tab on the product location master.

Here the tab for leading indicator has a number of selections which determine if the leading indicator forecast is to be selected from installed based or are manually entered. The coefficient is then used to adjust your mean time between failure.

Forecast Service Profiles

Now we will discuss the planning service indicator.

For details on the Planning Service Manager goto our post on the topic at….

http://www.scmfocus.com/sapplanning/2008/09/28/spp-planning-service-manager

Just some initial screen shots which will be commented further from the forecast profile.

BADI

To define your own logic of wish to use the ATP check for determining the first stockholding location, you can implement the BADI /SAPAPO/EQUIPFIRSTSTOCK_PREP