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Optimization Techniques in Supply Chain Management: A Comprehensive Overview

This overview presents an in-depth look at supply chain management (SCM) optimization techniques, focusing on the role of Advanced Planner and Optimizer (APO) tools within SAP. It covers common linear programming (LP) problems, formulation steps, and graphical solutions, along with practical applications for transportation and network issues. Additionally, various SAP modules like SAP ECC, SRM, and PLM are discussed in the context of SCM processes. This guide aims to equip professionals with the knowledge to effectively implement and optimize supply chain operations.

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Optimization Techniques in Supply Chain Management: A Comprehensive Overview

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  1. Enterprise Systems OptimizationSpring, 2012

  2. SCM Overview

  3. APO Core Interface (CIF)

  4. Common Supply Chain Processes

  5. Common Time Horizons for SCM Processes

  6. Linear Programming (LP)

  7. Five common types of LP problems

  8. Five common types of LP problems

  9. Define the objective • Define the decision variables • Write the mathematical function for the objective (objective function) • Write a one- or two-word description of each constraints • Write the right-hand side (RHS) of each constraint, including the unit of measure. • Write<=, =, or >= for each equation • Write all the decision variables on the left-hand side of each constraints • Write the coefficient for each decision variable in each constraint. Steps in Formulating LP Problems

  10. Graphical Solution

  11. Transportation (Network) Problem

  12. Enterprise Systems OptimizationSAP Implementation

  13. SAP Business Suite SAP NetWeaver SAP PLM SAP ECC SAP SRM SAP CRM SAP SCM

  14. Level of Detail and Time Horizon for SAP APO Modules

  15. SCM Processes in SAP APO Modules

  16. SAP APO System Structure and Integration with SAP ERP

  17. SAP SCM Functionality THEORY AND PRACTICE OF ADVANCED PLANNER AND OPTIMIZER IN SUPPLY CHAIN DOMAIN by Sam Bansal

  18. SAP SCM Modules THEORY AND PRACTICE OF ADVANCED PLANNER AND OPTIMIZER IN SUPPLY CHAIN DOMAIN by Sam Bansal

  19. Alternative Scenario Base Scenario Two planning Scenarios for SAP SCM

  20. Tasks • Identify sources for finished products • Plan and consider safety levels in any location • Distribute production over plants • Choose production resources in plants • Explode bill of materials in plants • Identify sources for supply of raw materials and components • Outputs • Purchase requisitions • Stock transport purchase requisition • Planned production orders Supply Planning Tasks and Output for SCM

  21. Work Flow for our Exercises

  22. SCM Sample: US-DC2 DE-DC2 US-Customers DE-Customer US-DC1 DE-DC1 US-Vendors DE-Plant DE-Vendor • USA: • 2 vendors • 1 plant • 2 DCs • 2 customers • Germany: • 1 vendors • 1 plant • 2 DCs • 1 customers Author:

  23. One plant (DL) • Two DC’s (CA and FL) • Two Vendors (NY and MI) • Two Customers (WA and MS) North American Supply Chain

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