SAP IBP 1708 Release: What's New?

SAP came out with Integrated Business Planning IBP release 1708 last week. GitaCloud team attended a webinar from SAP Product Management team on 15th August 2017 that talked about what's new in 1708. Here is what you need to know.

Quick heads-up: We are launching our next IBP S&OP workshop starting August 26th, 2017. This workshop will be based on IBP 1708 release and we will be showcasing some of the new features listed below. Visit GitaCloud Products section on our website to learn more. 

 

IBP for Demand

  • Phase-in Curves: You can choose from 7 linear & non-linear functions to model how a new product ramp is likely to behave (Linear, Square Root, Cube Root, Fourth Root, Quadratic, Cubic, Fourth Power). It is possible to choose one of these seven functions along with validity from/to dates. 
  • Analyze Promotions: Calculate past promotion performance. Promotion Success = (Average Sales Volume in Promoted Periods - Average Sales Volume in Non-Promoted Periods) / Average Planned Promotion Uplift. 
  • Enhancements to Automated Exponential Smoothing Algorithm in Statistical Forecasting: IBP for Demand chooses the optimal algorithm based on trend or seasonality patterns in your sales history, and only calculates forecast for the chosen algorithm. Classic pick-best runs forecasts for each algorithm, evaluates error, and then chooses the best algorithm. You can also define upper / lower limits on the alpha, beta, and gamma coefficients as well as choose which error measure to minimize (MAPE, MSE) as you search for optimal coefficient values. The algorithm can also calculate the number of periods in a season in case of data with seasonality patterns, this does not have to be specified manually anymore.
  • Integration of Sales Opportunities from SAP Hybris C4C (Cloud For Customer) into SAP IBP: Opportunities that are planned in C4C which have reached a certain Sales Stage, Probability to Close  and are flagged as relevant for Forecasting are brought into IBP to be included as part of Demand Planning Process for Sales Forecasting and  Consensus Demand Plan. The Integration Guide provides the required steps to create Opportunity Report in C4C, setup Data Flows in CPI-DS to call C4C report using Analytical ODATA Service and run the HCI task to transfer Opportunities to SAP IBP.  Opportunities are aggregated in C4C based on Customer’s business criteria like Sales Phase, Probability to Close, Forecast Relevance and the forecasting horizon. These aggregated Opportunities are transferred as Time Series based Opportunities Key Figure and feed as input to the Demand Planning process in IBP.
  • The C4C - IBP integration architecture is shown below. 

 

IBP for Inventory

  • Improved Visibility into Drivers of Pipeline Inventory: With IBP 1708, pipeline inventory is now broken down into vendor in-transit inventory (this is typically owned by the vendor), production work-in-progress inventory (this is not part of Finished Product inventory pool yet), and pipeline inventory (transfers across internal locations). 
  • Long Tail Inventory Optimization: IBP 1708 now allows inventory optimization for hard to forecast products in the long tail (slow moving products with intermittent demand). It does this by calculating average historical demand and demand variability. See Managed Forecast Error App in Inventory Optimization. 

 

IBP for Response & Supply: Time Series Planning

  • Capacity Supply Expansion: This enables time-phased definition of optional production or storage resource capacity and cost rates (additional shifts, 3rd party storage facilities, etc.), that should only be used if the cost of using the additional capacity is lower than other costs (cost of non-delivery, cost of holding inventory in case of pre-build, etc.). 
  • Cross-Plant Production: IBP for Supply can now handle multi-location BOM, i,e,, some components may be produced at resources in different locations than the location in which final assembly or process step is performed to manufacture the Output Product. This does away with the need to maintain location source of supply between components and output products when more than a single location is involved. IBP Supply Optimizer cannot handle Cross-Pant Production, this feature only works with IBP Supply Heuristic. 
  • Forecast Prioritization with Demand Categories: Segment demand with demand categories and enable demand prioritization for different forecast types in IBP Supply Optimizer run, e.g., base forecast to have higher priority than promotion forecast. This takes the planning granularity from Product / Location / Period to Product / Location / Category / Period. Demand Prioritization is achieved in IBP Supply Optimizer by specifying different non-delivery penalty costs at Product / Location / Category level. 
  • Validity Intervals with Sources of Supply: It is also possible to have validity intervals associated with sources of supply now for both IBP Supply Heuristic and Supply Optimizer. You can also switch off a source of supply in the entire planning horizon. A new parameter is now available to initialize customer receipts or customer supply key figures for customer sources of supply during the lead time. 
  • Supplier Collaboration: Inventory Visibility Scenario with SAP Ariba - IBP Integration: Suppliers can use the Inbound Product Replenishment cXML message to provide inventory visibility on the strategic constrained parts or for subcontracted components as in the case of components provided to Contract Manufacturers. Suppliers can now provide the following (time-independent) key figures to an IBP Planner: Stock On-hand, Subcontracting Stock In-Transfer, Unrestricted Use Stock, Blocked Stock, Quality Inspection Stock, Stock In-Transit, Work-In-Process Stock, Scrap Stock. They can also provide parameters like Required Minimum Stock, Required Maximum Stock, Increment Quantity, Order Quantity, or Days of Supply. Keep in mind this is a B2B integration scenario, this information cannot currently be viewed in Ariba UI. On the outbound side, additional product attributes can now be shared with Suppliers using SAP Ariba: Product Family, Product Sub-Family, Internal / External Program Code, Part Category / Type, Material Group, Line of Business. Planners can now also communicate build priority to the Subcontractor. This is modeled as a time phased key figure, enabling suppliers to prioritize certain demand in case of a capacity constraint. 
  • Supply Chain Network Visualization: An exciting development is the dedicated Fiori App for Supply Chain Network. This Fiori Application provides a visual representation of the end-to-end supply chain network. This enables planners to validate the network has been modeled correctly and fully. This App does not support Planning Areas in IBP for Demand.

 

IBP for Response & Supply: Order Based Planning

  • Lot sizing: Lot sizing parameters like minimum lot size, maximum lot size, fixed lot size, and rounding value for transportation lanes and production data structures (as imported from SAP ERP via SDI) can now be taken into account during order based supply planning runs like constrained run, confirmation run, and deployment planning. Lot sizes by production version or purchasing vs. production vs. transportation are now supported.
  • Enhanced Forecast Consumption: Multiple forecast key figures enable splitting total forecast into segments enabling forecast prioritization. Also, forecasts as well as sales orders can now be viewed flexibly at any hierarchy level, not just product / location. This helps define forecast prioritization or write forecast consumption logic at a non-standard planning level, e.g., forecast consumption by customer group, delivery priority, sales region, business unit, or any other custom attributes. This  enables sales orders to get consumed and modeled as demand key figure during the Constrained Run (to develop constrained response to unconstrained forecast, which can lead to allocation planning, which drives downstream processes like sales order confirmations). 
  • Response Analytics outside IBP: Order confirmation data and detailed pegging can now be extracted from IBP for Response using extraction API (outbound SDI integration) if you would like to analyze pegging results outside IBP. 

 

Excel UI

  • Custom aggregates in flexible time axis: see monthly data as well as sum of last 6 months, see year to date or rest of the year. 

See cumulated numbers for last 6 months:

See cumulated numbers for months, quarters, year to date, rest of year, and entire year in the same view. You can define the x to date and rest of x flexibly by freezing the from or the to period in your display horizon. 

  • Mass Master Data Maintenance: VBA hooks. You can execute custom VBA hook before updating master data (changes sent from Excel Add-in to the HANA back-end), e.g., validate naming convention has been followed before saving data. You can also execute custom VBA hook after refresh when master data is loaded, e.g., to apply a specific formatting scheme to the data. 

 

If you would like to learn more or need help to evaluate / implement / run SAP IBP, you can reach out at connect@gitacloud.com.