Reduction Strategy

What is Reduction Strategy Reduction strategy is applied to an Order when lead time(Scheduled dates) of an order isgreater than basic dates in order. Reduction strategy reduce the lead time of an order tries to shortenthe lead time by applying reduction measures.Reduction strategy Before getting into details of reduction strategy, we better understand how scheduling ishappening in SAP. Please refer the previous tutorial “PP Scheduling”.When system try to schedule a Production order, the following dates are determined.Basic Start dateBasic finish datesSchedule Start dateSchedule Start timeSchedule Finish dateSchedule Finish timeIn backward scheduling system calculates Basic finish date from the requirement date 1. Requirement date/Basic Finish date 2. Schedule Finish date/time 3. Schedule Start date/time 4. Basic Start date • Total Operation lead time = Inter operation times (Queue+Wait+Move) + Activity times in all Operations. • Queue time is defined in Work center and routing also. 1. Standard Queue time 2. Minimum Queue time • Wait time and Move time are defined in Routing operation detail. 1. Standard Move time and Minimum Move time 2. Standard Wait time and Minimum wait time

The reason is wait time is related to the process, for example drying time. After certain time beforemoving the material to next work station the material must be dried for 30 mins. This is known aswait time which cannot minimize or Ignore.Basic Start dates and finish dates are calculated based on material master data.1. Basic Start date2. Basic Finish date

Material Mater scheduling dataWhen we create Production Order

System calculates Basic start date as follow:Basic start date = Basic finish date – (GR Processing time (1 day) + Inhouse time (3 days)) = 12-DEC-2017 – (1 + 3) 12-DEC-2017 – 4 = 08-Dec-2017Similarly, Schedule start date and finish dates are calculated from Basic finish date.Schedule Finish date = Basic finish date - (GR Processing time + Schedule after production) = 12-Dec-2017 – (1 +0) = 11-DEC-2017Schedule Start date = Schedule Finish date – (Total operations lead time + Float before production)

When schedule start date is calculated before Basic start date, system try to perform below schedulingapproach and try to adopt schedule dates with in Basic dates. 1. After today scheduling also if system find schedule dates not lies within basic dates, it applies minimum time (wait, queue and move time) from routing. 2. After scheduling with minimum inter operation time also if system find schedule finish dates lies after basic finish dates, it try to apply “Reduction strategy” in 6 steps. 3. After Today scheduling: When schedule start date lies before basic start date, system start today scheduling i.e. It starts Basic start date as current date and try to schedule and calculated basic finish date and schedule dates. 4.We can define our own reduction strategy in customization. In all 6 steps system try to reduce the Interoperation time gradually except “Wait time” in order to adopt the schedule dates within basic dates. Asexplained previously Wait time can not be reduced as it is related to “Process”. The reason is wait timecannot be reduced is as it is related to the process, for example drying time. After certain time beforemoving the material to next work station the material must be dried for 30 mins.Overlap time and Minimum send ahead quantity: System also try to reduce the operation time by means of overlap time which means, nextoperation starts before the previous operation has finished when minimum send ahead quantity isproduced. The lead time of an operation also reduced by splitting the operation defined in work center.(number of splits) Let we look into the below reduction strategy defined in IMG. Reduction strategy in IMG

Reduction strategy assignment is Routing Operation.

As per this reduction strategy ,it applies reduction level still it find schedule dates are lies withinbasic dates.Reduction Level reduce the queue time by 30 % and reschedule.Reduction 1Reduction 2 reduce the queue time by 50 % and completely reduce Move time then reschedule.Reduction 3 reduce the queue time by 70 % , completelyReduction 4 reduce Move time and applies operation split then reschedule.Reduction 5 reduce the queue time by 100 % , completely reduce Move time and applies operation over lap then reschedule. reduce the queue time by 100 % , completely reduce Move time ,applies operation overlap and also applied operation split then reschedule.Even after reduction strategy also if system unable to fit schedule dates within basic dates, It givesscheduling log and schedule the order as per actual dates.Example of reduction strategy:This example is explained without screen shots as some of the screens may be difficult to understand forbeginners.Let say for manufacturing a Product “A” produced 100 KG/hourMRP 2 view of material master.Field Value Unit of MeasureIn house Production time 2 DaysGR processing time 1 DaysSchedule margin Key FBP – 1 Day day FAP – 1 Day Release period 1 daySettings in Routing: Time Unit 60 Min/ 100 KG Field 24 Hours Machine time 12 Hours Standard Queue time Minimum Queue time

Standard Wait time 24 HoursMinimum wait time 18 HoursStandard Move time 30 MinsMinimum wait time 10 Mins • Let say we have only one resource used to produce Product ‘A’ available all days(working day) and its available time (capacity) is - 24 Hours/day. • When we create Order with requirement dates of 30-JAN-2018 for 3000 KG for the product ‘A’ system calculates dates as follows.Basic Dates calculationBasic Finish date = Requirement date = 30-Jan-2018Basic Start date = Basic finish date – (GR processing time+ Inhouse production time) = 29-Jan-2018 – ( 2+1) = 26-Jan-2018Schedule dates calculation:Schedule Finish date = Basic Finish dates – (Float after production) = 30-Jan-2018 – 1 day = 29-Jan-2018 at 00:00 hoursSchedule Start date = Schedule finish date – (Total operation time + Float before production + Interoperation time)Total operation time = (60 mins /100 Kg) * 3000 Kg = 1800 minsInter operation time (Considering standard time) = Queue + Wait+ Move = 24 hours + 24 hours + 30 mins = 2910 mins.Float before production = 1 day = 24 hours = 1440 minsSchedule Start date = Basic finish date – (1800 + 1440 + 2910) Basic finish date – 6150 mins = 4 days 6 hours 30 min

= 29-Jan-2018 00:00 hours - 4 days 6 hours 30 min = 25-Jan-2018 18:30 hoursHere schedule start date is not lies between Basic dates. So system try to apply minimum Interoperation times instead of standard time.Inter operation time (Minimum time) = Queue + Wait+ Move = 12 hours + 18 hours + 10 mins = 1810 mins.Schedule Start date = Basic finish date – (1800 + 1440 + 1810) 29-Jan-2018 – ( 3 days 12 hours 10 minutes ) = 25 Jan-2018 11:50 hh:mmAfter using of minimum interoperation time also schedule start dates not lies between Basic dates, sohere system will try to apply reduction strategy level by level.Reduction Levels in Reduction strategy.For every reduction step the system will reschedule the order. When system find schedule start dateslies within basic dates, it stops reduction and schedule the order.