Navigating Production with Strategy 52 in SAP PP

In SAP Production Planning (PP), selecting the right strategy is key to optimizing your manufacturing process. Today, we’ll delve into Strategy 52, a make-to-stock approach with unique characteristics.

What is Strategy 52?

Strategy 52 falls under the umbrella of “planning without final assembly.” This means production decisions for finished goods (FG) are based on Planned Independent Requirements (PIRs) rather than individual sales orders. Here’s a breakdown of the workflow:

1. Create PIRs: You forecast demand for finished products and generate PIRs accordingly.
2. MRP Run: When you run Material Requirements Planning (MRP), it considers the PIRs and generates planned orders for both FGs and sub-assemblies (SFGs).
3. Production based on PIRs: Planned orders for FGs are not directly convertible to production orders. Production for finished goods happens based on the overall PIRs.
4. Sales Orders and Stock: When a sales order for a finished good arrives, the system consumes the relevant PIR quantity and updates stock levels. The sales order doesn’t directly trigger production.

Advantages of Strategy 52

• Proactive Production: Since production is based on forecasts, you can maintain a buffer stock of finished goods to meet anticipated demand.
• Reduced Order Processing: You need to generate production orders for every sales order, streamlining the process.

Disadvantages of Strategy 52

• Less Customer Focus: Production isn’t directly tied to specific customer orders, potentially leading to less responsiveness.
• Inventory Management: Maintaining the correct stock level based on forecasts is crucial to avoid stockouts or overstocking.

Who Should Use Strategy 52?

This strategy is well-suited for companies with:

• Predictable demand for finished goods.
• There is a need to maintain safety stock levels.
• A focus on production efficiency.

In Conclusion

Strategy 52 offers a production planning approach based on forecasts, enabling proactive inventory management. Consider your specific requirements and weigh the advantages and disadvantages before deciding if Strategy 52 fits your SAP PP environment.