Production SAP PP

Creating a SAP Production Order / Process Order

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Methods to Create a SAP Production order / Process Order

Methods to Create a Production order / Process Order

The following are the methods through which a production order is created:

a) Planned order conversion: When a planned order (Planned order is created through
MRP or manually through MD11) is converted to an Order to execute the production
activities.

b) Order is created manually: When you create a Production order or process order
manually with reference to a material code or with reference to a reference to a Sales
order (in Process order there is no option to create with reference to a sales order).

Production order creation transaction codes

Stock Requirement List Individual Display: MD04

Stock Requirement List Collective Display: MD07

Creation of Production order from planned order: Individual Conversion: C040

Creation of Production order from planned order: Collective Conversion: CO41

Creation of Production order from planned order: Partial Conversion: CO48

Creation of Production order from planned order: Individual Display Screen: MD13

Creation of Production order from planned order: Collective Display Screen: MD16

Creation of Production order using a material code: CO01

Creation of Production order using a sales order reference: CO08

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Process order creation transaction codes

Stock Requirement List Individual Display: MD04

Stock Requirement List Collective Display: MD07

Creation of Process Order from planned order: Individual Conversion: C0R7

Creation of Process Order from planned order: Collective Conversion: COR8

Creation of Process Order from planned order: Partial Conversion: COR7_PC

Creation of Process Order from planned order: Individual Display Screen: MD13

Creation of Process Order from planned order: Collective Display Screen: MD16

Creation of Process Order using a material code: COR1

Creating a Production Order / Process Order in SAP

Creating a Production Order / Process Order in SAP

Following Text boxes, one by one, will explain SAP Production order / Process Order creation

SAP Order Creation - Order Creation Selection Screen & Order Header Screen

Enter the following in the Order Creation Selection Screen

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When you are converting a planned order to a SAP production/process order, there is no necessity to
enter anything on the selection screen. The selection screen entries are required for entry if you are
manually creating an order.

Material

Enter the Material for which you are creating a Production Order for

Production Plant

Enter the Plant code where the production order is to be created.

Planning Plant

This is the plant where order is executed and produced. If the production plant is equal to
planning plant there is no need to enter the planning plant.

If you wish to use the special procurements key like “production in alternate plant”, you can
use the planning plant as the plant where goods receipt is to take place and the production
plant is the plant where the actual production happens.

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Order type

Order type is a like a document type against which you will be producing the order. Order
type contains a list of controls that decide how the order is to be created and processed.

An order type decides the number range of the order, the method in which the
Routing/Recipes and/or the BOM is pulled in the order, documentation of order information
and goods movements, Batch determination search procedures, reservation creation
possibilities and the order costing controls.

Production / Process order number

If the Production order number and the process order number are defined for external
numbering, then in that case you need to provide a number up to 12 characters.

Copy from Option

SAP has provided options to copy from an existing Production order, when it does this it
creates one more order with the same order type, header material code and the same plant. It
copies the component list, the operation list and all the field values from the reference order.

Enter the following in the Order Header Screen : General Tab

If you are converting a planned order to production order, the order is created with the entire
order header fields pre-populated (field values pulled in from the planned order)

If you are manually creating a production order, you would have to enter the values for all the
fields.

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Total Quantity

Enter the quantity that is required for production. This quantity is inclusive of the scrap
quantity. The entered order quantity increases by the percentage of scrap entered in the scrap
field.

Any assembly scrap percentage maintained in the MRP1 View increases the total quantity and
enters a percentage and quantity in the scrap field. Assembly scrap allows you to produce
more than the ordered quantity to cover for scraps that may occur in the production process
during order execution.

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Delivered Quantity

An amount is populated in this field, which is equal to the amount received in to stock for the
order.

Scheduling Types

Forward Scheduling: If Order Start date is entered, the Order Finish Date is derived by the
system.

Backward Scheduling: If Order Finish date is entered, the order Start Date is derived by the
system.

Current Date Scheduling: The System plans the order on today’s date, both start and finish
date are today’s date.

Only Capacity Requirement Scheduling: This option allows you to enter the start and finish
dates as you wish.

Schedule Margin Keys

The Schedule Margin Keys holds the Floats before and after production, the release period
given to the users to release the order from the order start date and the opening period given to
the users to convert the planned order to production order.

The floats in production increase the total lead time of production by adding the floats or
buffers to the lead time.

Order Dates/Times and scheduling types

When you are creating a production order from a planned order, the dates are borne in from
the planned order.

But if you are creating an order manually then these dates are calculated from the task list
(Routing/Recipe) pulled in the order. You can choose a scheduling type as required (or have it
preconfigured in the order type scheduling parameter)

Order Start and Finish date/time & Forward Scheduling

If an order start date is entered and Forward Scheduling is chosen, then the system calculates
the order finish date by adding up the Routing operations standard value times (the system
schedules forward in such cases).

Derivation of the dates based on Routing/Recipe is called lead time scheduling.

Forward scheduling is fit for use when you always have enough capacity available or in the

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case of made-to-order when the customer is not so hesitant over the delivery dates (in other
words delivery dates are flexible)

Steps SAP Uses in Calculating the Dates :

Step 1: Enter the Order Basic Start Date

Step 2: Adds the “Floats before Production” to derive the Schedule Start Date

Step 3: Uses the Routing/Recipe for lead time scheduling to derive the Scheduled Finish Date

Step 4: Add the “Floats after Production” to derive the Order Basic Finish Date

For example:

If there are 2 operations with some standard values as below and the order quantity is 15
Units:

Routing/Recipe Master Data:

Operation 0010: Casting: 1 HR/Unit
Operation 0020: Finishing and Packaging: 1HR/Unit

Therefore:
Total time at 0010 for executing the order : 1 HR X 15 Units = 15 HRS
Total time at 0020 for executing the order : 1 HR X 15 Units = 15 HRS

Schedule Margin Keys:

If Floats before production = 2 Days and Floats after production = 1 Days

Calculating Dates:
Enter Order Basic Start Date/Time as = 25th Dec 2010 (00:00 AM)
Add 2 Days as Floats before Production: 27th Dec 2010 (00:00 AM) which is equal to
= Order Scheduled Start Date/Time.
Derive the Order Scheduled Finish Date from Lead time forward scheduling :28th Dec
2010 (06:00) as calculated below :
Add 1 Day of Floats after production : 29th Dec 2010 (06:00) = this is the Order Basic
Finish Date

Example illustration :

Operation Scheduled Operation Start Total Operation Scheduled Operation Finish

Number Time

10 25th Dec 2010 (00:00) 15 HRS 25th Dec 2010 (15:00)

20 25th Dec 2010 (15:00) 15 HRS 26th Dec 2010 (06:00)

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Order Basic Start Floats Order Scheduled Order Scheduled Floats Operation Finish
Date start date Finish date

25th Dec 2010 2 27th Dec 2010 (00:00 28th Dec 2010 (06:00) 1 29th Dec 2010
(00:00 AM) Days AM) Days (06:00)

Order Finish Date /time & Backward Scheduling

If an order finish date is entered and Backward Scheduling is chosen, then the system
calculates the order Start date by adding up the Routing operations standard value times (the
system schedules forward in such cases).

Backward scheduling is fit for use when you always have enough capacity constraints or in
the case of made-to-order when the customer is hesitant over the delivery dates (in other
words delivery dates are fixed)

Steps SAP Uses in Calculating the Dates :

Step 1: Enter the Order Basic Finish Date

Step 2: Subtract the “Floats after Production” to derive the Schedule Finish Date

Step 3: Use the Routing/Recipe for lead time scheduling to derive the Scheduled Start Date

Step 4: Subtract the “Floats before Production” to derive the Order Basic Start Date

For example :

If there are 2 operations with some standard values as below and the order quantity is 15
Units:

Routing/Recipe Master Data:

Operation 0010: Casting: 1 HR/Unit
Operation 0020: Finishing and Packaging: 1HR/Unit

Therefore:
Total time at 0010 for executing the order: 1 HR X 15 Units = 15 HRS
Total time at 0020 for executing the order: 1 HR X 15 Units = 15 HRS

Schedule Margin Keys:

If Floats before production = 2 Days and Floats after production = 1 Days

Calculating Dates:
Enter Order Basic Finish Date/Time as = 29th Dec 2010 (06:00)
Subtract 1 Days as Floats after Production: 28th Dec 2010 (06:00 AM) which is equal

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to = Order Scheduled Finish Date/Time.

Derive the Order Scheduled Start Date from Lead time forward scheduling: 27th Dec
2010 (00:00) as calculated below.
Subtract 2 Day of Floats before production : 25th Dec 2010 (00:00 AM) = this is the
Order Basic Start Date

Operation Scheduled Operation Start Total Operation Scheduled Operation Finish

Number Time

10 25th Dec 2010 (00:00) 15 HRS 25th Dec 2010 (15:00)

20 25th Dec 2010 (15:00) 15 HRS 26th Dec 2010 (06:00)

Order Basic Start Floats Order Scheduled Order Scheduled Floats Operation Finish
Date start date Finish date

25th Dec 2010 2 27th Dec 2010 (00:00 28th Dec 2010 (06:00) 1 29th Dec 2010
(00:00 AM) Days AM) Days (06:00)

Order Start/Finish Dates and Current Date Scheduling

When you do not enter any value for the order start date or orders finish date and choose the
scheduling type as “Current Date Scheduling”, the system enters the start and finish dates as
“today’s date”.

Order Start/Finish Dates and Only Capacity Requirement Scheduling

When you choose to enter both the order start date and orders finish date manually then in that
case you should choose the scheduling type as “Only Capacity Requirement Scheduling”.

Order Start/Finish Dates and Forward in Time Scheduling

If order start date/time both are entered and Forward in Time Scheduling is chosen, then the
system calculates the order finish date and time by adding up the Routing operations standard
value times (the system schedules forward in such cases).

The only difference here is that along with Order Start date you can also enter the order start
time and allow the system to calculate the order Finish date and time.

Order Start/Finish Dates and Backward in Time Scheduling

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If order Finish date/time both are entered and Backward in Time Scheduling is chosen, then
the system calculates the order Start date and time by adding up the Routing operations
standard value times (the system schedules forward in such cases).

The only difference here is that along with Order Finish date you can also enter the order
finish time and allow the system to calculate the Order start date and time.

Scheduled Start Date

The Scheduled start date is always equal to the Basic Order start date, if floats don’t exists.
But if you include schedule margin keys with a value of “Floats before production”, the
scheduled start date is calculated.

Scheduled Finish Date

The Scheduled Finish date is always equal to the Basic Order Finish date, if floats don’t exists. But if
you include schedule margin keys with a value of “Floats after production”, the scheduled finish date
is calculated.

SAP Order Creation - Order Header Assignment Tab

Enter the following in the Order Header Screen: Assignment Tab

Not a Mandatory Tab for Data Entry: The fields in the assignment tab are not mandatory for entry by
a consultant or user while creating an order.

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MRP Controller / Production Scheduler:

Automatically Pulled in: MRP Controller and the Production Scheduler is pulled in from the
header material master. MRP Controller is the person who plans and converts the planned
order in to production order.

If you haven’t maintained the data in the Material Master of the order material, then you still
have an opportunity to enter it right away in the order.

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Supposedly, the job of the MRP controller ends there and the job of the Production scheduler
comes in.

The production scheduler is supposedly the person who manages the order and executes it in
the shop floor. A production scheduler can be the shop floor supervisor.

In many cases the MRP controller and the Production Scheduler is kept as the same.

Configuration: You can configure MRP controllers and Production Schedulers in Transaction
code OPPQ and OPJ9 respectively.

Production Plant / Planning Plant

The Production plant and the planning plant is brought in from the selection screen.

Sales order number / Sales order Line item

If you are in a Made-to-Order Scenario and the production order is created from a requirement
arising from Customer Sales order. You can trace the production order or process order for
the customer sales order, for its progress.

In a made-to-stock scenario there is no connection at all with the customer order or the
customer number. In a made-to-stock situation the production is carried out to stock and
supply from that stock to satisfy any incoming sales order.

Business area

The business area is determined via the division defined in the material master record.

An organizational unit of financial accounting that represents a separate area of operations or

responsibilities within an organization and to which value changes recorded in Financial
Accounting can be allocated.
You can create financial statements for business areas, and you can use these statements for
various internal reporting purposes.

Inspection lot

When you are carrying out inspection at GR from the order, an inspection lot is created at
goods receipt, this inspection lot is updated here.

Planned order

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When you are using Material Requirement planning to plan the header material and a planned
order is created to cover the demand and subsequently converted to an order; this planned
order which is used to convert to this order is populated here.

The planned order once converted to production order is deleted from the system and also
removed from the tables. Thus if you try to see this planned order in MD12 or MD13, you
wont be able to see it.

Production Version

When the BOM and the Routing/Recipes are selected in the order from a valid material
production version, then that production version is populated in the order here.

Reservation Number

Once you create the order, even before releasing the order, the system creates a “reservation
number” for the order which contains the list of components (dependent requirements) which
would be used to manufacture the product. This reservation list reserves these components for
production.

Configuration: You have an option to use these reservations as hard reserving or soft
reserving through the scope of availability settings.

Normally the reservations on components are not hard reservations and these components can
be used across orders.

Uses of Reservations: Reservation list can be used by the warehouse or the materials
department to keep the components ready for production order or process order. Subsequently
the same reservation list can be used for staging the materials to the shop floor for issue to the
order.

Transaction code: You can see the reservation in MB23 (you cannot change reservations
created through an order).

Stock Overview: You can see a column in the MB52 or MMBE that suggests the total
quantity reserved for the material.

SAP Order Creation - Order Header Goods Receipt Tab

Enter the following in the Order Header Screen : Goods Receipt Tab

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Not Mandatory Tab for Data Entry: This tab is not mandatory for entry by a consultant or user
to create an order.

Stock Type

Automatically populated: Stock type field specifies where the stock would be posted when
you create a goods receipt for the order through MB31 or MIGO transaction codes.

If Quality management is active for the header material master and there is an inspection type
maintained in the material master to support ‘inspection at goods receipt from order’, the
proposed stock type in which case is “Quality Inspection” and if not, the system would always
propose unrestricted stock type (free for use stock type).

The default GR stock type is “unrestricted stock type” where the stock is free for use.

You can also decide to receive the goods into blocked stock (this can be done manually in the

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production order).

Think over it: Though it is also possible that the “GR storage location” is designed to book
receipts into “blocked stock only” in which case, the goods will always be posted into blocked
stock, no matter what.

GR Processing time

It is pulled in from the MRP views of the Header Material Master

Goods Receipt Indicator / delivery Complete Indicator

Once GR is done for the order, the indicators are automatically updated.

Goods receipt Storage location

Automatically Updated: If you have included a Production storage location for the header in
the material master MRP 2 View, the same is populated here during order creation.

The second option is to get the Production Storage Location from the Production Version.

If there is no Storage location maintained in Material Master or the Production Version, you
can enter one directly here, though it’s not mandatory. In which case you will not find any
Storage location defaulted at the time of GR from Order, and you have an opportunity to enter
one there.

Batch

If you are creating a Batch Master for the header material at the order header level, i.e., all the
goods receipts which will be created from the order will be mandatorily for this batch.

Why do you create batch at header level : When you are damn sure that you will always use
only one batch to receive goods from an order, then you have an opportunity to fix the batch
number in the production order release or create mode itself. You can also classify this batch
with values which are required to be populated prior to production start. The creation of batch
at the header level may also be required in cases where the product labels are printed prior to
goods receipt and they require the batch number to be on it.

Automatically created : This batch is automatically created when you create or release the
order. But if you want to overwrite it with another batch number you can certainly do so.

Configuration required: For creating a batch at the header level, you have to use SPRO
transaction code CORW, where you can set-No automatic Batch creation, Automatic Batch
creation at order release or Automatic Batch creation at order create. At the same time you
can decide to have the batch classified in the order or not and if you decide to classify the
batch it can be either in the foreground (in the production order screen itself) or in the

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background. Note that this configuration is done at a plant & production Scheduler Profile
level.

Order Delivery Tolerances

The “tolerance value” is automatically pulled in from the material master.

These are tolerances with which an order quantity can be received in stock or confirmed in
SAP.

If you maintain under-delivery tolerance: This means that the order can be received in stock
or confirmed with a quantity lesser than the order quantity as decided by the under-delivery
tolerance percentage entered in this field.

The final confirmations and the order GR only allows the quantity allowed by the under-
delivery tolerance. For example if the order quantity is 100 and the under-delivery tolerance is
20%, then the system allows only 80 units to be confirmed in the confirmation screen and
once you reach 80 units a CNF status is assigned (fully confirmed status) at the same time
once you receive 80 units in GR, the system assigns a fully delivered (DLV status) to the
order and you can receive no more now.

If you maintain over-delivery tolerance: This means that the order can be received in stock or
confirmed with a quantity more than the order quantity as decided by the over-delivery
tolerance percentage entered in this field.
The final confirmations and the order GR only allows the quantity allowed by the over-
delivery tolerance. For example if the order quantity is 100 and the over-delivery tolerance is
20%, then the system allows only 120 units to be confirmed in the confirmation screen and
once you reach 120 units a CNF status is assigned (fully confirmed status) at the same time
once you receive 120 units in GR, the system assigns a fully delivered (DLV status) to the
order and you can receive no more now.

If you maintain unlimited delivery: You can receive more or less than the quantity required.
This is very risky and must be used when the business is damn sure of what they are doing.
This can be a situation, when the organization does not know how much more or less they
might receive from the order (use this sensibly).

SAP Order Creation - Order Header Control Data Tab & Dates Tab

Enter the following in the Order Header Screen: Control Data Tab

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Not mandatory for data entry: This tab is not mandatory for entry by a consultant or user to create
an order.

All the fields in this tab are brought in from order type dependent parameter configuration or
order type scheduling parameter configuration. You don’t have to do much here ☺

Fields values pulled in from “Order type dependent parameter” configuration

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Create Reservations/Purchase Requisition: Defining when the reservations and purchase

requisitions for non-stock material should be created.

Costing Variant Plan:

Costing Sheet ID:

RA key:

Planned Cost Calculations: determines when the planned cost should be created, to be created
at the point of saving or saving after release.

Costing Variant for Actual Costs:

Overhead Key:

Variance Key:

Fields values pulled in from “Order type scheduling parameter” configuration

The below configuration values are pulled in from the order type scheduling parameters
which is used to control the scheduling and capacity generation for the order.

Calculate Capacity Requirements: If this is selected, then the capacity requirements are
generated for each of the operations/work centers/resources in the order.

Exact Breaks: If this is selected, then Scheduling should consider breaks.

Schedule Automatically: This indicator is set at release, and it means that the order will be
scheduled at the time of saving the order, every time you make a change to the operations
details.

Production Scheduling Profile

The Production Scheduling contains a set of control for the production order, it is not
mandatory to maintain a scheduling profile in the order.

Normally a profile is pulled in from the Material Master of the production material. If you
have not maintained one, you still have a chance to maintain one here, in the order.

Actions and control included in the Scheduling profile are:

• Automatic Release on Creation

• Automatic Linking documents on Creation

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• Automatic Printing of Order on Release

• Automatic Scheduling of Order on Release
• Automatic Linking of documents on Release
• Automatic Creation of Control Recipe on Release
• Automatic Goods Receipt from order during Confirmation of last operation
• Allowing confirmation or reservation of only an available partial quantity for components in
component list of an order.
• Assign a Capacity Leveling Profile, if you are wishing to use “Availability check for Capacity” in
the order.
• If you wish to use capacity Availability checks in order, then you also need to maintain the
Finite Scheduling indicator.
• Controls for Automatic Batch creation in an order and batch classifying settings if required
(specifying automatic batch creation at release or save and classifying in the foreground or
background).
• Allowing entering a default order type for the plant while creating an order.

Enter the following in the Order Header Screen: Qtys and Date Tab:

This tab gives you an overview of the quantities and Dates

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SAP Order Creation - Order Header Dates, Master Data, Long Text & Admin Tab

View the following in the Order Header Screen: Master Data, Long Text and Adminstrative Tab

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The dates/quantities tab will go on filling in the order specific dates and quantities
information. This is self explanatory.

The master data tab contains the BOM and the Routing/Recipe information which is used to
create the order.

There is one more tab at the end which is called the administrative tab which is stores the
information on who created the order and on which date.

Enter the following in the Order Header Screen: Long Text Tab

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The order header, long text tab is free for use to insert any order specific information in it.
Long text is an unlimited space to enter process or production related values. Unlike the short
text, the long text has no limitation of characters that can be used. The short text normally has
only 40 characters to use from.

View the following in the Order Header Screen: Administrative Tab:

This tab gives you information on the date the order was created and the user who created the order

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SAP Order Creation - Operation Overview and Detail Screen

Enter the following in the Order Operation Overview Screen & Operation Detail Screen

Operation Overview Screen:

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The order operation overview screen contains the list of operations assigned with work
centers/resources and arranged in a sequence of processing.

You can see the operation list only when the Routing/Recipe is pulled in to the order.
Nevertheless you can change the operation list in the order as required.

Adding or Removing Operations:

You can add “+” you own operations in the order or you can remove operations “-”, if
required. When you add an operation, it is not mandatory at all the add a work center or
control key or a description, thus you can escape without entering any field values in the
operation overview or the operation detail screen.

Atleast one operation should exist in the Order Operation list: The selection of
Routing/Recipe in an order can be configured as any one of the option in the table below. But
when you have chosen the option where the selection of Routing/Recipe is Mandatory, a task
list has to be pulled in the order, or else the creation of order aborts. But when you have
chosen the option of Routing/Recipe selection optional and a task list selection is not
mandatory and the order can still be created provided you have configured a default operation
for the order type. Therefore we can say that the operation overview of an order requires
atleast one operation in it for the order to get created.

0 No routings or reference operation sets to be used

1 Always reference operation set (no routings selected)
2 Routing/ref. op. set mandatory (automatic selection)
3 Routing/ref. op. set optional (automatic selection)
4 Routing/ref. op. set optional (manual selection)
5 Routing/ref. op. set mandatory (manual selection)
6 Routing mandatory (automatic selection)

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7 Routing mandatory (manual selection)

8 Routing optional (manual selection)
9 Routing optional (automatic selection)

The relevance of all the field in an operation overview and operation detail screen is explained
in detail in the SAP Routing/Recipe section of this website:
http://www.sapsword.com/home/learn-sap-pp/sap-routing-recipes

Operation Overview fields in a Production Order:

Operation Number
Sub operation
Work center
Control Key
Standard Text
Operation description
Current Operation Status
Operation Start Dates
Operation Finish Dates
Indicator: whether components are assigned to it
Indicator: whether PRT’s are assigned to it
Indicator: whether Trigger points are assigned to it

The Operation Overview field in a Process order contains:

Operation number
Phase number
Resource
Control Recipe Destination
Control Key
Standard Text
Operation/Phase Description
Current Operation/Phase Status
Operation/Phase Start Dates
Operation/Phase Finish Dates
Indicator to show for each operation, whether components are assigned to it
Indicator to show for each operation, whether PRT’s are assigned to it
Indicator to show for each operation, whether Trigger points are assigned to it

Operation Detail Screen:

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The Operation detail screen can be accessed to edit or view, in an order by selecting the
operations/s or phase/s, using the following path:

When you add an operation to the order, you have to enter the field values included in the
operation overview screen. These field values in an operation overview or in the operation
detail screen are not mandatory for entry when you add an operation.

All the fields of the operation detail from the Routing/Recipe are pulled in the order and are
arranged in a “tabular” fashion.

The relevance of all the field in an operation detail screen is explained in detail in the SAP

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Routing/Recipe section of this website: http://www.sapsword.com/home/learn-sap-pp/sap-

routing-recipes

Sub-operation dates

This is a display only tab in the operation detail screen and it shows the start dates and finish dates
for the sub-operations assigned to the operation. This option is not included in the process
manufacturing. In process manufacturing you have phases assigned to operations and there is no
trace of sub-operations in process manufacturing.

Quantities/activities

This is a display tab in the operation detail screen and it shows the quantities that are to be
confirmed and that which are already confirmed. It also shows the scrap quantities, both planned
and confirmed.

Confirmed dates

It shows the operation start and finish dates, both planned and confirmed dates.

Assignment of capacity requirements:

At the operation detail level you make assignments of the individual capacities declared in the work
center, i.e. you can actually decide which machine or labor is to be actually used to execute the
operation and also split up the total operation quantity between the capacities. Splitting the
operation quantities between the individual capacities reduces the total operation lead time and
gives you accurate information on the machine or labor that was used for execution. This facility is
only available for discrete manufacturing or repetitive manufacturing (if you use production orders
there).

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Scheduling and Capacity Generation in an order:

Operation Scheduling and Capacity Generation: The operation standard values derived (machine
time, set up time, teardown time, utilities consumption) is a direct proportionate of the order
quantity. When you schedule an order, the scheduling formula and the capacity generation formula
for each operation derives the total lead time for each operation. When we add the operation lead
times we get the total order lead time. Note that this has been explained in several topics before.

Planned Costing Requirements: At the same when the system calculates the operation lead times
(scheduling and capacity requirement generation) using the standard values like machine time, set
up time and teardown time, it also calculates the planned cost for each of the standard value (if a
costing formula is assigned to the standard values in the work center/resources).

Planned cost generation example:

For an operation which is assigned to a work center/resource called “Finishing”, the following
standard value are assigned for a base quantity of 1 Unit

Operation Data Brought in from the Routing/Recipe for Operation 0020 - Finishing
Operation Standard Standard Costing Formula assigned to the Activity Rate
0020 Value Value for a work center/resource in the assigned to the
Parameters base qty costing tab cost center for the
work center
Finishing Setup Time 1 HR (Setup time X Operation qty) / $10/HR
Base qty
Finishing Machine 1 HR (Machine time X Operation qty) / $100/HR
Time Base qty
Finishing Water 100 L (Water Required X Operation qty) $1/L
Required / Base qty
Finishing Electricity 1 KWH (Electricity X Operation qty) / $20/KWH
Required Base qty

Costs derivation at the operation 0020 - Finishing

Standard Value for a Order Costing Formula Total Activity Cost for
Value base qty Qty the operation
Parameters
Setup Time 1 HR 100 Units (1 X 100) / 1 HR = 100 HR 100 HR X $10 = $ 1000
Machine 1 HR 100 Units (1 X 100) / 1 HR = 100 HR 100 HR X $100 =
Time $10000
Water 100 L 100 Units (100 X 100) / 1 L = 10000 L 10000 X $1 = $10000
Required
Electricity 1 KWH 100 Units (1X 100) / 1 KWH = 100 $100 X $20 = $2000
Required KWH
Total Planned Cost at the $ 23000
Operation

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Similarly the costs are calculated at all the operations in the routings.

SAP Order Creation - Component Overview Screen

Enter the following in the Order Component Overview Screen

Component Overview Screen:

Component Detail Screen:

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The Component overview screen contains the List of components pulled in from the BOM. The
quantities are proportionate to the Order quantity. The Quantity required of each component is
called the requirement quantity.

Every component that is pulled in from the Standard BOM would be represented as a Line Item in the
Component overview screen.

When you are in the creation mode of the order, the standard BOM is pulled in and a reservation list
is created by the system which contains these components. A reservation list is a direct copy of the
component list.

Adding or Removing Components

You can add “+” you own component in the order component overview screen or you can
remove components “-”, if required. When you add an components, the system forces you to
enter the following:

• Operation number to which it should be assigned to

• The Item category of the component
• The Component quantity required for production of the order quantity
• The Unit of Measure of the component if the same is not maintained in the Material Master
or BOM
• The Plant of the component is defaulted to the Production Plant of the order, in cases where
you are issuing a component from alternate plant, it would pick up the same from the
material master's Special procurement key - withdraw from alternate plant
• If the Component added is a Phantom Header Material, the system needs you to choose
addition of component with BOM Explosion or without BOM explosion. If you add the
Phantom Material with BOM explosion then the components of the Phantom Material BOM
are pulled in the order and if you add the Phantom Material without BOM explosion, only the
Phantom Material itself is pulled in the order

Every Line item in the Component Overview screen contains the following:

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Line item number

The line item number normally increases in an increament of 0010. This is configured in the order
dependant parameters.

b) Component

This is the component number brought in from the Standard BOM.

c) Component Description

The component description is the standard component's material master description.

This description cannot be changed in SAP. It can only be changed in the material master change
transaction code.

d) Component quantity required for the order & UOM

Component quantity or the requirement quantity, is the standard BOM quantity multipled by the
Order quantity. Though if there is a scrap quantity maintained at the order level or the component
level, this requriement quantity is increased by the scrap percentage.

You can manually change this quantity in the productin order.

UOM : The component UOM is fetched directly from the standard BOM. This is also know as the
issue UOM. The material when it will be issued to the order, it will be issued in the UOM mentioned
here.

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e) Component Storage location as brought in from

This is the component storage location from which the material would be issued to the order.

- the material master: Issue Storage location field or

- the standard BOM: Issue storage location at component level

you can change the issue storage location manually in the order.

f) Component Item Category

- "L" for Stock Item

- "N" for Non Stock Item

- "C" for Class item used in Variant Configuration

If the item category for the component is "N" then the system creates a Purchase requisition (PR) in
the order for the component procurement. This PR is inturn converted to Purchase order (PO). The
item category is also changeable in the order.

Configuration Dependancy for creation of Purchase Requisition:

This setting is also relevant for creation of reservations. Thus we can say that for creation of
reservation and PR, you can configure as following:

-If the Order dependant parameters settings allow for creation of PR/Reservations at order creation,
the option 3 - "immediately" will be choosen.

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-If the setting allow for creation "at release", then the PR/Reservations are created at order creation
stage itself.

-If you set it to "Never", the PR/Reservations are never created.

1Never

2From release

3Immediately

g) Component Plant

The component plant in most of the cases is production order plant unless and untill you are using
withdrawl from other plant for the component. To Use Withdrawl from other plant you have to mark
the special procurement key of the component in the material master as "Withdrawl from alternate
plant".

h) Component BackFlush Indicator

If the Component is marked as Backflush component in the material master or in the work center
where it is assigned to, the backflush indicator would be selected.

Though you can select this indicator manually.

If this indicator is set, the component would be issued automatically in the background during
operation or order confirmation.

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i) Operation assigned to

The operation to which the component is assigned to will be defaulted in the production order, if you
have done a component allocation in the Routing or Recipe or in the BOM.

If you have not allocated the component to the operations, the system will default to the first
operation number.

j) Requirement date

The Requirement date equal to the operation start date (to which the comopent is allocated to) is
populated for the component. This date can be changed if the operation start date is changed or
rescheduled.

k) Withdrawn Quantity

The Withdrawn quantity is the amount of quantity of the component issued to the order till date.

l) Component Usage Probability

The component usage probability is brought in from the standard BOM.

If the component are placed in an Alternate group with prorities and strategies, the usage probability
will be calculated in the order component overview.

You can nevertheless change this percentage allocation manually.

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j) Reservation number & Reservation Item number

Every component in the component overview screen becomes part of the reservation list. Therefore
every component will contain the Reservation number and Reservation Item number.

The Production order reservations cannot be changed. They are only for display.

Configuration Dependancy for creation of Reservations:

If the Order dependant parameters settings allow for creation of Reservations at order creation, the
option 3 - "immediately" will be choosen.

If the setting allow for creation "at release", then the reservations are created at order creation stage
itself.

If you set it to "Never", the reservations are never created.

1Never

2From release

3Immediately

Reservation List and Picking List

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The Reservation list created from a production order can only be viewed through the use
of transaction code MB23. You cannot change the order reservation nor create one.

You can use the reservation list to Stage material from Inventory Warehouse to Shop Floor Issue
storage location.

Picking List - For every production order or for every reservation list, a picking list is created. You can
use the picking list to issue material to the production order. Picking list is included in Tcode MB26.

SAP Order Creation - Releasing the order

Releasing an order:

When the order is under the creation mode or the order is under a change mode, you can release an
order. The Production order header screen or the Operation Screens or the component screens have
a "Green Flag" button on the top to release an order as shown below:

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Releasing an order will trigger the following activities:

• Releasing an order would change the "CRTD status of the order to "REL"
• Releasing would start allowing order confirmations
• Releasing would start allowing goods issues to the order
• Releasing would start allowing goods receipts from an order

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Before Release, the system would carry out an material availability check, if configured:

The Material Availability checks would check the stock availability of all the components and if the
materials are not available the system would generate a "missing part list" showing the shortage
quantities.

As per the Order availabillity checking rules and controls configuration, the system allows or
disallows the Release of order, incase of shortages.

Before Release, the system would carry out an Capacity availability check, if configured:

You can also configure the system to carry out capacity availability checks before release of the
order, through the order avialability checking rule and controls.

But to have the capacity availability checked, you should mark the work centers as relevant to "Finite
Scheduling" and the Production Scheduling profiles and capacity profiles should be configured for
capacity availability checks.

The Capacity Availability checks works only in Orders and through the use of this functionality you
can decide on loading the work centers when they are free and available for use. The system would
prompt the free spaces also.

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SAP Order Creation - Saving the order

SAP order creation - Saving the order:

When you are ready to save the Order, you should press the save button at the top of the screen.

Saving the order would save all your changes.

If you have not given any external numbering to the order, SAP will generate an internal number as
shown below.

The following screens would explain you the same:

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