Available-to-promise (ATP) is an order promising process that refers to the amount of inventory that is in stock to confirm an order.
SAP’s new solution for this is called SAP S/4HANA for advanced ATP (advanced ATP), which is the successor solution to global ATP in SAP Advanced Planning and Optimization (SAP APO). In this post, we’ll discuss how advanced ATP in SAP S/4HANA helps mitigate order processing challenges. First, let’s explore the challenges of order processing.
Order Processing Challenges
Order processing is when a company commits to its customer orders with reliable delivery schedules based on the availability of requested products. An efficient order promising strategy helps companies be resilient when facing supply chain disruptions and stay profitable considering all sales and delivery constraints.
Some of the typical challenges in the order promising process include confirming orders in real time, adhering to the promised timeline, keeping the customer informed, responding to changes, managing multiple distribution channels, dealing with supply chain restraints, and integrating between fulfillment units.
When it comes to SAP APO, there are a handful of challenges that prompted SAP to develop advanced ATP. SAP APO is a standalone solution, so it needs to be deployed outside of SAP ERP, and the data must be replicated and integrated via the core interface (CIF). Even if the CIF provides near real-time integration, inconsistencies could still arise due to unexpected integration errors. Also, global ATP still uses the old technology of SAP liveCache, and even if SAP APO could be deployed over SAP HANA, it wouldn’t benefit from the technology and utilities of SAP HANA. Now, let’s take a look at how SAP’s new approach to ATP solves these issues.
ATP in SAP S/4HANA
To address the limitations of SAP APO, SAP built advanced ATP into the SAP S/4HANA enterprise solution. The major focuses when developing the solution were a simplified architecture, faster response time, flexible deployment options, intuitive and user-friendly interfaces, new and enhanced functionalities, and integration to other modules.
Advanced ATP provides accurate and reliable order promise dates that consider the relevant supplies across the network and critical supply chain constraints in real time, such as inventory positioning, transportation, production, and procurement. At the same time, it also helps protect companies’ business priorities and profitability goals. Companies can mass-process orders in high volume, catering to customer priorities and changing supply situations with intuitive requirement classification and automated exception handling.
Often times, companies experience inventory shortage situations. Advanced ATP helps manage this by maintaining sales constraints in product allocation (PAL) while improving customer service levels by confirming orders based on delivery constraints.
Other capabilities of advanced ATP include:
- Establish fixed links between supply and demand elements until final delivery to avoid reassignment of dedicated supplies to competing demands
- Intelligently select alternative locations and/or substitutable products during stock outage in the requested delivery plant
- Protect quantities of a material in a specific plant for key customers and businesses against other competing demands
- Confirm orders based on real-time production and scheduling constraints when the requested finished product isn’t available in the full quantity
- Use the Review Availability Check Result app to get a comprehensive understanding of why an order is confirmed the way it is
- Reassign stock manually with impact analysis before release for delivery
ATP is an integral part of the order fulfillment process. It’s a vital tool when there are supply shortages and customers demand assured commitments. SAP’s new functionalities in SAP S/4HANA make it possible for companies to streamline this process and improve overall customer satisfaction.
About the Available-to-Promise with SAP S/4HANA Book
The challenges companies experience with order processing can negatively impact their customer satisfaction. We’ve published Available-to-Promise with SAP S/4HANA to show you how you can improve these processes.
The book begins with the big picture: the context of ATP functionalities in an organization’s processes and in different industries. It describes how ATP functionalities have evolved in the SAP space and how they operate in SAP S/4HANA at a high level. See how ATP data integrates with other solutions and how the master data and transactional data are used. Follow clear, click-by-click instructions to configure advanced ATP in SAP S/4HANA.
Explore both sales and distribution scheduling, along with the new business process scheduling functionality in SAP S/4HANA. Dig into the basic concepts of PAL, product availability checks (PAC), supply protection (SUP), alternative-based confirmation (ABC), backorder processing (BOP), supply assignment (ARun), and supply creation-based confirmation (SBC). Step-by-step instructions are offered for each of these functionalities for performing any additional configuration and using them in a productive system.
Need to understand how to use applicable BAdIs and APIs for advanced ATP? Chapter 11 will help you out with that! Then get examples of business cases that combine different methods of ATP. Each example outlines the scenario description, the basic setup, and the results.
You’ll close out the book with a review of SAP’s roadmap for the solution to take a peek into what you can expect from advanced ATP in the next couple of years.
Who Is This Book For?
This book is useful to IT professionals, business users, and consultants who are implementing advanced ATP or evaluating whether to implement the solution within their SAP S/4HANA enterprise application in any of the deployment options. Those in sales, production, and supply chain planning for companies using advanced ATP will also find value in this book.
About the Authors
Sujeet Acharya is a senior director in the digital supply chain solution management organization at SAP and is the solution owner of available-to-promise. He is a supply chain management professional with more than 20 years of experience in the IT industry. His areas of expertise lie in SAP's supply chain management portfolio, especially in the digital business planning and digital logistics areas that include SAP Integrated Business Planning for supply chain, SAP S/4HANA supply chain solutions, and SAP Advanced Planning and Optimization. Sujeet is the global solution owner for SAP’s order promising portfolio, which includes both SAP S/4HANA for advanced ATP and global ATP in SAP APO.
Sandeep Mandhana is a supply chain management professional working at SAP as the director of industries and customer advisory. Over the last 20 years, he has worked very closely with manufacturing organizations, helping them drive digital transformation in their manufacturing and supply chain processes.
Jibi Joseph Vadakayil is the central development architect for SAP S/4HANA for advanced ATP at SAP.
How to Purchase
If you’re interested in purchasing the Available-to-Promise with SAP S/4HANA book, follow this link and choose the format that works best for you: e-book, print edition, or bundle (both e-book and print).
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