Make-to-Order for Material Variants: Understanding Planning Strategy 26 in SAP PP

In SAP Production Planning (PP), selecting the right strategy is crucial for efficient inventory management and customer satisfaction. Planning strategy 26, also known as “Make-to-Order for Material Variants,” caters to a specific scenario: production triggered by customer demand for product variations.

What is Planning Strategy 26?

Imagine you offer a customizable shoe with different colors, sizes, and materials. Each combination creates a unique variant of the base shoe. Planning Strategy 26 comes into play here. You wouldn’t forecast demand for every single variant – it’s impractical. Instead, you maintain a “generic” material (the base shoe) with strategy 26.

When a customer places an order specifying their desired variant (color, size, etc.), the sales order triggers production of that variant. The system plans and procures the necessary components to fulfill the unique customer requirement.

Key Points about Strategy 26

• Focus on Variants: This strategy excels in managing the production of product variations. It doesn’t forecast for individual variants but reacts to customer demand.
• Configuration Optional: Unlike strategy 25 (Make-to-Order with Configuration), strategy 26 offers optional configuration functionality. This provides flexibility for more straightforward variations that don’t require complex configuration.
• Individual Requirements: Set the “Individual/Collective” field in the Material Master record (MRP2 view) to “Individual” for strategy 26. This ensures the system plans for each specific variant based on sales orders.

Benefits of Using Strategy 26

• Reduced Inventory: By avoiding forecasts for every variant, you minimize unnecessary stockholding, leading to lower carrying costs.
• Improved Customer Response: Faster reaction to customer orders translates to quicker delivery times and enhanced customer satisfaction.
• Flexibility: This strategy adapts well to situations where variant demand is unpredictable or has a short life cycle.

Who Should Use Strategy 26?

This strategy is ideal for companies that:

• Manufacture products with a high degree of customization.
• Have short lead times and prioritize responsiveness to customer orders.
• Deal with variants that have unpredictable or short-lived demand.

Remember:

• Strategy 26 works best with accurate forecasting methods for the base product (the generic material).
• This strategy might only suit variants with short lead times or high-value components.

In Conclusion

Planning Strategy 26 is a valuable tool in SAP PP for managing the production of product variants driven by customer demand. It optimizes inventory levels, improves delivery times, and caters to the needs of companies offering customizable products. Understanding its strengths and limitations allows you to leverage strategy 26 to achieve a more responsive and efficient production process.