Planning Without Final Assembly: Mastering Strategy 50 in SAP PP

Manufacturers leverage various planning strategies in SAP Production Planning (PP) to optimize their production processes. Today, we delve into Planning Strategy 50, also known as Planning without Final Assembly.

What is Planning Strategy 50?

This strategy caters to a Make-to-Order (MTO) production environment. Here, production is triggered by customer demand, and finished products are unique for each sales order. Strategy 50 shines when the final assembly stage holds the most significant value addition in your production process.

How it Works

Imagine this: you manufacture custom furniture. Raw materials like wood and hardware are stocked beforehand. When a customer orders a specific design, Strategy 50 comes into play.

• Sub-assemblies are planned: The system generates plans to manufacture components and sub-assemblies needed for various finished products. These are stocked in the warehouse.
• Final assembly waits: The final assembly of the furniture, with its unique customizations, is triggered only after the sales order is received.

Benefits of Strategy 50

• Reduced inventory: You don’t hold finished product stock, minimizing storage costs and the risk of obsolescence.
• Increased flexibility: Respond swiftly to customer requirements by customizing final assembly based on sales orders.
• Improved cash flow: Defer production costs until actual customer demand arises.

Mastering the Setup

To leverage Strategy 50 effectively, ensure you have:

• Strategy Group 50: Assigned on the MRP screen of your finished product material master.
• Consumption Parameters: Defined for the finished product to identify independent demand sources like sales orders.
• Item Category Group: Set on the Sales Organization screen of the finished product (e.g., NORM).

In Conclusion

Planning Strategy 50 is a powerful tool for MTO manufacturers in SAP PP. Understanding its core functionalities and setup requirements allows you to optimize your production processes, reduce costs, and deliver a superior customer experience.