Optimize SAP Procurement While Balancing Vendor Restrictions and Excess Inventory in Your Network
Procurement in SAP is a manual, time-consuming exercise requiring multiple steps. In a perfect world, your only task would be to purchase exactly what is required to maintain inventory or meet production schedules. But purchasing does not take place in a vacuum. In reality, vendors have restrictions; and buyers are faced with a variety of variables to consider before making a purchase. How much? How heavy? How voluminous? How soon? Failure to consider any one of these factors can greatly hinder the procurement process and lead to delays, higher material and freight costs, and even penalties.
When factoring in the inventory levels across your entire organization, the task only becomes more complicated. Should you buy the 4,000 units needed for one plant from a vendor when another plant has a surplus of 6,000? What would happen to your vendor purchase order (PO) if you transferred those units in from another plant instead? Would you incur freight charges because the vendor minimum was missed?
Finding the right balance between meeting vendor restrictions and relieving excess inventory in your network is crucial to optimizing production and inventory. If you are struggling with these challenges today, you are not alone. There is no “easy button” in standard SAP ERP when it comes to balancing and optimizing POs and stock transfer orders (STOs) to achieve high material availability, low inventory, and low material and freight costs.
Streamlining Your PO and STO Processes
Fortunately for SAP customers, there is an affordable, easy to implement solution to these complex challenges. G.I.B Dispo-Cockpit Operations (DCO) with enhanced Purchase Optimization delivers the central purchasing and optimization platform buyers need to create perfect POs and STOs.
From one screen, buyers can easily review the supply and demand positions for their material sets. The net requirement results from the latest MRP run are available with a multitude of drill downs to better understand the full supply picture. From this central cockpit, more than 20 SAP transactions can be launched and viewed within the frame of the central cockpit. Once requirements are understood and action is required, the Purchase Optimizer logic executes and creates the recommended vendor PO along with the recommended stock transfers with the goal of balancing vendor restrictions and removing excess inventory from the network.
Saving Time with DCO
A task that would normally take hours and multiple manual calculations to complete in standard SAP can now be completed accurately within minutes. Even more impressive, all this valuable logic and functionality is delivered within your SAP ERP instance, with no extracting, translating or loading of data into external systems. Your SAP ERP instance already has that data stored and structured, so there’s no need to spend time and money moving it around and keeping it synchronized outside of SAP.
Organizations with large volumes of materials, vendors and plants need better tools to plan, optimize and execute procurement to deliver high availability and low costs. The G.I.B Dispo-Cockpit Operations with Purchase Optimizer is the best way to bring affordable procurement optimization into your SAP ERP system today.
This is part four in an NTT DATA Business Solutions blog series exploring supply chain solutions inside SAP ERP. Follow the series: