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  • SAP IBP vs. <br/> SAP APO

    SAP IBP vs.
    SAP APO

    Compare two SCM planning systems

    SAP currently offers two systems for planning your supply chain. Successful and well-known: SAP Advanced Planning and Optimization – abbreviated as SAP APO – is used by many customers. In recent years, technical innovations (SAP HANA platform) and the need for cloud solutions have led to a powerful new planning tool that takes up the proven functions of APO and enriches them with a variety of new possibilities: SAP Integrated Business Planning – or SAP IBP. With features such as integrated financial KPIs, optimization of forecasts in the short-term horizon (demand sensing) S&OP, high performance, a variety of simulation options, configurable dashboards, and real-time visualization, SAP IBP not only revolutionizes the work of planners, but also integrates other influential stakeholders in the planning process.

    IBP

    SAP Integrated Business Planning (SAP IBP) is the state-of-the-art tool for supply chain planning in the world of SAP.

    In addition to quantity-based planning, IBP also takes financial key figures into account in the planning and optimization of the supply chain. SAP IBP helps you make efficient decisions based on real-time data for the supply chain – from suppliers to production and your own network up to end customers.

    New features like demand sensing and safety stock planning round out the planning options, while the Control Tower provides an overview of the complete, end-to-end supply chain.

    APO

    SAP Advanced Planning and Optimization (SAP APO) is the most frequently installed logistics planning tool in the world of SAP and is used worldwide across all industry sectors. Multiple ECC systems can be connected to one APO system concurrently.

    Particularly when very large supply chains with complex requirements for integration and planning scope are involved – from demand planning to transportation planning – the stable technical foundation together with the extensive intervention options through add-on programming, ensure reliable implementation. APO differs from IBP in the convenience of the user interface and the difficult integration of financial KPIs. According to current planning, regular maintenance will end in 2027.

    SAP Integrated Business Planning (SAP IBP)

    IBP for Demand

    Demand Planning in SAP IBP for Demandis the module for extensive, comprehensive demand planning. Demand Planning is based on SAP HANA technology and supports users with user-friendly planning front-ends and excellent integration with MS Excel.

    With new forecasting methods, (ARIMA models, gradient boosting), time series analysis, ABC/XZY classification, and campaign analysis, forecasting is largely automated and enables better predictions of product demand with less effort. Demand plans are created in an automated, exception-based planning process that takes all interactive and manual planning options into account.

    SAP IBP for Demand offers more functions than were ever available in SAP APO DP and more improvements and functional enhancements are being implemented every quarter. In addition to the well-known, classic demand planning for medium to-long term forecasts, the demand sensing function optimizes existing forecasts exact to the day, based on the latest sales data and identification of patterns for the short-term horizon.

     

    IBP for Response & Supply

    The order-based SAP IBP for Response & Supply is the successor to SAP APO SNP. Heuristics and optimizer-based solution methods enable you to synchronize forecast, orders, and target inventories across all stages of production. The new possibilities for simulating rescheduling and product allocation let your planners analyze critical bottlenecks and react to them much more quickly.

    The user-friendly user interface, together with the underpinning SAP HANA architecture, speeds up the planning process noticeably, so you can devote the time you save to improving planning.

    The results are then incorporated in the overreaching planning process with SAP IBP for S&OP, where they are available directly for advanced available-to-promise (aATP) or enhanced planning in SAP S/4HANA.

    This module is also functionally enhanced and improved every quarter.

     

    IBP for Sales & Operations Planning 

    In SAP IBP for S&OP, you can maximize your operating results through cooperative decisions along the supply chain. In this process, your sales and operations plans are synchronized, balanced, and optimized in accordance with your corporate strategy and targets such as sales growth, market share, and contribution margin.

    SAP IBP for S&OP delivers attainable plans across all departments and divisions. To identify the S&OP plan, this module consolidates and harmonizes the demand plan, stocks, shelf life, procurement plan, and production capacities. The result shows the effects on product mix, inventory, service level, and profitability.

    Thanks to user-friendly access through the MS Excel front-end and graphically prepared Fiori analyses and dashboards, both planners and managers can assess the S&OP plan in detail.

    The process management integrated in SAP IBP for S&OP enables you to monitor and control planning processes strictly and efficiently. Once all steps, tasks, deadlines, and persons responsible have been defined, the process flow can be automated. Authorizations in the planning process can be changed, operators executed, and persons notified for each process step or process milestone – completely automatically. Gantt charts are used to analyze process progress. This makes it possible to quickly identify changes in the process, such as longer terms in the demand forecast, and estimate the impact on the downstream processes.

    What-if simulations let you analyze, assess, and compare different planning approaches, scenarios, and their results interactively in nearly no time at all. SAP HANA guarantees fast calculation of the results of even complex plan changes, such as immediate update of the capacity utilization figures after changes to MRP.

     

    IBP for Inventory

    SAP IBP for Inventory supports optimization of inventories under consideration of the required service level by harmonizing the relevant factors on the supply and demand sides.

    The supply side considers supplier reliability, batch sizes, and other procurement details, for example, while planned service levels, structural forecast deviations, and seasonal factors are taken into account on the demand side, among other factors.

    The calculations are made for the entire chain simultaneously and provide particular support for inventory optimization in complex networks.

    The resulting inventory requirements minimize warehousing and production costs in downstream planning steps – for example, in SAP IBP for Response & Supply. What’s more, demand-driven material requirements planning (DDMRP) lets you switch from push to pull.

     

    Supply Chain Control Tower

    TheSupply Chain Control Tower lets you analyze your end-to-end process and monitor the performance and profitability of your supply chain in real time. Global transparency, which extends to data from multiple systems, and flexible alert management help you identify potential future problems in good time.

    Modern machine learning algorithms can detect unusual situations without having to define a complex set of rules beforehand. Case Management can be used to track the development of a situation or to analyze and document the effectiveness of the adopted measures. Collaborative further editing of the planning situation is possible through integration of the SAP JAM collaboration platform.

    The Supply Chain Control Tower enables you to act quickly and proactively instead of just reacting. Through integration with the ARIBA Supplier Network, this module enables agile collaboration between companies. The integrated KPIs from the SCORE model help you keep an eye on trends in every aspect of your supply chain.

    SAP Advanced Planning and Optimization (SAP APO)

    Demand Planning (DP)

    SAP DemandPlanning is a powerful, flexible tool for supporting demand planning and forecasting at your company. Customer-specific planning layouts and interactive planning books let you map your processes and integrate employees from other departments and even from other companies in the forecasting process. Forecasts can be generated based on static, causal analysis, or hybrid methods.

    Demand planning offers you a collection of statistical forecasting methods, together with an option to use your own custom macros for planning. Marketing information, in the form of campaigns, helps to improve forecasts. Life cycle planning supports the phase-in and phase-out of products and uses the historical values of previous products to generate the system-supported forecast.

     

    Supply Network Planning (SNP)

    SAP Supply NetworkPlanning uses highly sophisticated optimization methods to plan a product flow along the supply chain. Starting with the demand plan and existing sales orders, requirements within the entire network (from production plants and suppliers to distribution centers and customers) are calculated, using heuristic and mathematical optimization methods, and then covered by appropriate proposals for procurement and stock transfers.

    The deployment function lets you generate optimized distribution plans for delivering or distributing inventories to customers or distribution centers, based on capacities and defined rules. The TLB (Transport Load Builder) function helps you optimize transport load building taking account of the available transport capacities.

     

    Production Planning/Detailed Scheduling (PP/DS)

    SAP Production Planning and Detailed Scheduling (PP/DS) is the module for detailed production and external procurement planning, including resource scheduling and sequence planning. PP/DS helps you create and optimize production and sequence plans, while at the same time minimizing your production costs. Multilevel and cross-plant checks of orders let you generate a feasible production plan, either interactively or in the background, with checks of both capacity and component availability depending on the requirement. The system supports your planning by displaying alerts, enabling your planners to concentrate on deviations and outliers. Industry-specific requirements such as block planning, campaign planning, shelf-life planning, and rapid planning matrix are also supported.

     

    Global Available To Promise (gATP)

    SAP global Available To Promise (gATP) lets you make reliable statements about delivery dates and quantities during the creation of sales and production orders. The global ATP check is initiated during sales order entry in the ECC system and provides information about availability in real time. The ATP check is also possible for the components within production planning. Delivery dates can be calculated using complex check algorithms and a combination of different check methods, including rule-based ATP check, product allocation, and substitution of products or sources of supply. In addition, when integrated with production planning, new production orders can be triggered when enough components and capacity are available. Even cross-system checks across multiple ECC systems are possible. The gATP module is integrated with the other APO modules (DP, SNP, PP/DS).

    Your expert

    A profile of Scheer CTO Dr. Wolfram Jost

    Wolfram Busch

    Expert Supply Chain Management