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SAP SCM: Applications and Modeling for Supply Chain Management (with BW Primer) by Wood, Daniel C.

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Chapter 10. Supply Network Planning

The APO SNP module may be employed to meet the needs of either sales and operations planning (SOP) or master scheduling: in the former case for medium-range organizational planning and in the latter for medium-range product-family (or more detailed) planning for sites on the production route for the product family or else for individual productive sites including factories, distribution centers, ports, and so forth. Whichever way it is applied, supply network planning (SNP) is primarily a medium-range planning tool. As APO modules come, it is the most pure planning tool, where detailed planning (DP) may be applied for forecasting and production planning and detailed scheduling (PP/DS) may be applied for some level of execution control; APO lies strictly in the planning space.

The medium-range horizon that is the province of APO is inclusive of the horizons found within it. That is, while subject to organizational requirements, the most common horizons for APO will be 3 to 6, 3 to 9, and 3 to 12 months, with the tactical horizon falling within the first three months in either case but with specific applications (i.e., two to four months) varying normally according to the length of product delivery lead-time (i.e., the amount of time required to acquire inventory for use in production through purchasing). The tactical horizon, whether two, three, four months, or whatever, is visible to SNP. The caveat is that while ordinarily visible, the tactical ...

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