Top SAP Production Planning (PP) Interview Questions and Answers-(2024)

1 .

SAP Production Planning(PP) is the process of aligning demand with manufacturing capacity to create production and procurement schedules for finished products and component materials.

SAP PP is an important module of SAP. SAP Production Planning (SAP PP) is the component of ERP Central Component (ECC) that helps businesses plan the manufacturing process flows, for example, the planned and actual costs. Also, goods movements from the conversion of raw material to semi-finished goods.

A part of SAP ECC's logistics function, SAP PP plays a vital role in a manufacturer's supply chain and integrates with other ECC components, including Materials Management (MM), Sales and Distribution (SD), Plant Maintenance (PM), Quality Management (QM), Finance (FI), Controlling (CO) and Human Resources (HR).

2 .

Explain Organization Structure in SAP PP.

In any live Production Planning module, locations of manufacturing plants and storage within the plants, should be available in the system.

Importance of Plant and storage locations in Production Planning :

* All Production master data is created at Plant level.

* Planning activities are also performed at Plant level.

* Production Confirmation process and related goods movement occur at plant and storage location level.

3 .

What is difference between Discrete and Repetitive Production?

Discrete production is known as industry where produce materials changed with each lot and costs are calculated as per orders and lots.

In Repetitive production, product is not changed for longer time period and production is done as total quantity and not in the form of individual lots.

4 .

Explain SAP Production Planning life cycle?

The Production Planning and Control consist of 2 obvious processes of Planning and Execution :

Planning : Production planning is generally done from budgeted sales plan. Planning is based on the Sales plan to meet the sales requirements as per the production cycle times. Demand for the Product is entered through demand management in the form of Planned Independent Requirement (PIR). This data from demand management becomes the input to Material Requirement Planning (MRP). MRP checks for the availability of various raw materials used for production at different stages using the master data such as Bill of Material (BOM) and available current plant stocks.

* In case of material shortage, Purchase requisitions are created for materials which are externally procured, and planned orders are created for in-house produced materials.

* These purchase requisitions and planned orders initiate the Procurement Cycle and the Execution Cycle of Production respectively.

* As MRP works with infinite capacities, capacity leveling must be done in order to avoid any capacity bottlenecks.

Execution : These Planned orders are converted to Production orders, and are scheduled as per the production timings using master data such as routings.

* Production Orders are released by the Production Supervisor on the shop floor, and material availability checks can also be carried out to check if there are any missing components.

* Production is carried out based on the activities maintained in the Routing where the master data like Work Center is mentioned against each operation in the Routing.

* Once the production is completed, the Confirmations of orders are executed, and goods movement for material consumptions & goods receipt are posted against the Order. Hence, the Order gets the Delivered (DLV) status, and the material is received into desired storage location.

* Usually at the month end before doing order settlement, production order needs to be set to technically completed status in order to calculate production variances by the controlling personnel.

5 .

What is SAP Sales and Operations Planning(SOP)?

The Sales and Operation Planning (SOP) component in SAP manages sales, production, and other supply chain targets of the organization. This is done through a planning tool that uses historical and current data to set up the future supply chain targets in the system.

Information passed through sales and operations planning is passed into Master Production Scheduling (MPS) and Material Requirement Planning (MRP). SOP is also connected with profitability analysis, cost center accounting, and activity-based costing. There are two main planning methods available in SOP and we can customize further methods based on the requirement.

* Consistent planning

* Level-by-level planning

6 .

What do you mean by the term production?

It is basically the manufacturing of goods and services or shaping them in a form that is required by the users. There are certain things that the product or the services has to go through and each step aims to make the product or services better than the previous. Production can be in-house or outhouse.

7 .

What do you mean by the term Batch production? Do you think the SAP PP is good enough to be trusted for the same?

For organizations, it is not always easy to build a project easily. They, therefore, build it up in small slots which are also known as a batch. Each section of the product is built by a specific team with a similar objective. Batch production simply makes sure of error elimination at the right time. It is one of the best production methods that are widely adopted. SAP PP has dedicated features for this and it is possible for the users to keep an eye on all the batches with the help of this tool.

8 .

How the SAP PP tool is good enough to be considered for production planning in an effective manner?

This tool assures a diverse array of benefits to those who go for it. It brings a very large number of benefits and can simply enable the users to keep up the pace with all the right strategies in a delightful manner. Some of the best things about this tool are spotlighted below.

* It makes sure of effective utilization of resources

* It enables a business to capture the market in a very delightful manner

* Organizations can make sure of a steady flow of production

* Resources can easily be estimated with it

* The overall productivity of the labor can easily be enhanced

* It always makes sure of optimum inventory

* It simply facilitates the quality improvement

* A lot of production cost can be saved easily

9 .

Which all modules SAP PP is integrated with? Explain the integrated activities that are performed with each module under PP?

To perform Production Planning and Control activities, SAP PP is closely integrated with other SAP ERP modules: SAP Sales and Distribution SD, SAP Material Management MM, Quality Management, Finance Accounting and Project System.

You can find list of below activities from Production Planning that are related to other SAP modules and integration with other modules.

SAP PP and SAP Material Management MM

* This involved movement of goods, auto goods receipt.

* It includes creating reservation for Production Order/Planning.

* Raising Purchase orders with MRP Run.

* Quotations and Vendor selection.

SAP PP and SAP SD

* This is used to check the availability of material for production order.

* To perform MRP Run, Requirement Types.

* Bill of Material components and operation.

SAP PP and SAP FICO

* Updating price in material master data

* Defining activity Type in the Cost center

* Assigning activity type to Work Center

* Cost Estimation

* Production cost controlling

* Posting accounting activities related to goods movement, material request, etc.

SAP PP and Project System

* Assigning planning activities to WBS in the Project.

* Running Material requirement planning at Project level (MD51). The procured material attached to WBS are reserved as project stock against the particular project.

* The component attached to network are planned at plant level and are reserved as plant stock.

SAP PP and Quality Management

* Inspection Type 03 for discrete and repetitive manufacturing.

* Inspection Type 04 for both Discrete and Repetitive Manufacturing

10 .

What is BOM?

Bill of Material(BOM) master data is related to material requirement planning and provides the list of components to produce the product.

To produce a product with different variants, you can create super Bills of Material that has list of components to manufacture different variants of a product and selection of component depends on details mentioned in planning order.

11 .

What is the difference between Material and Sales order BOM?

Material BOM : When a Bill of Material is created for a material is known as a material BOM in the SAP. Material BOMs are mainly used to represent the structure of products manufactured within your company.

Sales order BOM : Sales Order BOM is used when you specially tailor the make-to-order production of products as per requirements of the customers. To meet the customer requirements, you make sales order specific modifications to various assemblies.

12 .

What are the key charactertics of BOM?

* You can create Bill of Material as single level or multiple level.

* BOM type depends on the size, validity dates and production method.

* You can create up to 99 Bills of Material as per material type.

* You can use material Bill of material for the material available in PP module and equipment Bill of Material are used in Plant Maintenance module.

* As mentioned you can create super BOM for different variants of a product.

13 .

What is Long-Term Planning?

Long-term planning is used to check the future demands of materials based on the bill of material (BOM). Long-term planning can be carried out in simulation mode. It will check the capacity availabilities, material forecast, and delivery timelines, and if the requirements can be fulfilled, simulation can be transferred into an operational mode.

Long-term planning can be executed based on an existing production BOM. It is also possible to define BOM and routing specifically for long-term planning.

14 .

What is Master Production Scheduling in SAP PP?

Master production scheduling (MPS) enables the planning of critical materials of an organization with special tools. MPS increases material availability, reduces storage costs, and increases planning stability. MPS materials are planned independently and will not be considered in the regular MRP runs.

15 .

What is Material Requirement Planning in SAP PP?

Material requirement planning (MRP) is the heart of the production planning process. MRP matches the demand and the supply and proposes the best methods for executing the production process. The output of the MRP run is the procurement proposals.

There are two main procurement proposals in SAP. These are the plan order and purchase requisitions.

Plan order is generated through MRP for materials that are produced in-house. Plan orders are converted into production orders when the manufacturing starts. The second procurement proposal which MRP generates is the purchase requisitions. Purchase requisitions are generated for materials that are procured from external parties. These include mainly the raw materials. Purchase requisitions are converted into purchase orders.

When the MRP is executed, the BOM will be exploded. Based on the planning strategy of the materials, a procurement proposal will be generated. There are three processing keys used for MRP.

NETCH : net change planning considers materials that have undergone an MRP relevant change after the last MRP run. An example of MRP relevant change is the increase of stock in the system.

NETPL : net change in the planning horizon is similar to NETCH but it works for a defined planning period.

NEUPL : regenerative planning executes MRP for all the materials in the system, irrespective of MRP relevant changes.

16 .

What is Capacity Planning in SAP PP?

Capacity planning is essential for the supply chain management process. Demand vs supply capability is based on the available manufacturing capacity. The manufacturing capacity is dependent on the capacity of the work centers. A work center can be a person, a group of people, or a machine.

For each work center, individual capacities can be defined. Capacities are generally defined in minutes or hours. Based on the work center capacity and the standard values of the product, schedule dates will be determined for production. Scheduling determines when the production can start and when it can end based on the work center capacity and other defined constraints.

17 .

Explain Master Data in SAP PP.

Master data is generally static for any company and is very rarely changed depending on the requirement. There are 5 master data to be maintained in Production Planning module.

1. Material Master

The material master contain information on all the materials that a company procures, produces, stores, and sells. It is a number uniquely identifies a material master record, and hence a material.

Materials with the same basic attributes are grouped together and assigned to a material type such as finished, raw material, etc.

It is used for the following purposes:

* To purchase materials

* For Goods Movement postings such as goods issue or receipt in inventory management and also for physical inventory postings

* In invoice verification for posting invoices

* In sales and distribution for sales order fulfillment process

* In production planning and control for material requirements planning, scheduling, and production confirmation processes.

2. Bill of Material (BOM)

A bill of material is a complete, formally structured list of the components together with the quantity required to produce the product or assembly.

BOM’s are used in material requirement planning and product costing.

You can also create up to 99 alternative BOMs for a single product.

For Products having variants, you can create Super BOM, which has all possible types of components used to manufacture different types of variants, and the appropriate component is selected based on characteristic chosen in the sales Order.

For example, Product Cycle can contain all types of frames (with different colors and sizes) and desired frame is selected in production order based on color and size chosen in the sales order.

3.Work Center

A Work Center is a machine or group of machines where production operations are performed. Work centers are used in task list operations (Routings).

It contains the data for :

* Scheduling

* Capacity

* Costing

4. Routing

Routing is nothing but a sequence of operation performed at the Work Center. It also specifies the machine time, labor time, etc. for the execution of operations.

It is also used for scheduling of operations and used in standard cost calculation of the product.

5. Production version

The production version is a combination of BOM and Routing data for production. It is a linkage between BOM & Routing and determines the manufacturing process.

There can be multiple production versions as per different manufacturing process to produce the product.

18 .

What are the reports generated in product cost controlling information system?

Product Cost Controlling information system generates information for following areas

* Product cost planning

* Cost object controlling with the subcomponents

* Product cost by period

* Product cost by order

* Product cost by sales order

* Costs for intangible goods and services

* Actual costing / Material Ledger

19 .

Explain what is "work center" in SAP PP and what is the use of Data in Work Centers?

“Work Centers” are business objects in SAP-PP that is used in task list operations ( routings, maintenance task lists, inspection plans) and work orders.Data in work center is used for

Scheduling : Formulas and operating time are entered, so that the duration of an operation can be calculated

Costing : Formulas are entered so that the costs of an operation can be calculated

Capacity Planning : The available capacity and formulas for capacity requirements is entered

Simplifying operation maintenance : Various default values can be included in the work center

20 .

Mention what is the purpose of using Capacity Planning?

Capacity Planning supports planning in all phases :

* Long term rough cut planning

* Medium term planning

* Short term planning

It can be integrated with various SAP applications like SAP-SD, PP, PP-SOP, PP-LTP, PP-SFC, etc.

21 .

What is Material Requirement Planning under Production Planning?

MRP run or planning run is an engine which is used to fill demand and supply gap. Issues & Receipts are called MRP Elements. Issues include PIRs, Dependent Requirements, Order Reservations, Sales Orders, Issuing Stock Transfer Orders, etc. and receipts include Production Orders, Purchase Requisitions, Purchase Orders, Open Production Orders, Receiving Stock Transfer Order, Schedule lines, etc.

22 .

Is it possible to create Production order without Routing and Work center? How?

Yes, by changing the configuration in OPL8- Order type dependent parameters as routing optional. When we try to create an order using C001 it may ask for a sales order.

23 .

What do you mean by the term planning horizon?

It is basically a defined time period of a production plan. Depending on the type and nature of the product, its overall duration can vary largely.

24 .

Does Resource allocation have a role in the proper implementation of the Product planning approach?

Resource allocation is one of the prime necessities for the same. It simply makes sure the right employees and human resources are assigned for tasks that are complex and need additional attention. With proper resource allocation, it is possible for the organizations to avoid several hassles that declare their presence in the production.

25 .

Compare in-house and out-house production processes?

In-house production is when an organization or a business develops its products or services in its own arena through its own tools, skills, and technology. In-house production needs huge costs in the initial stage but it offers large-scale benefits for the long run. Out-house production means getting a product or a service ready by an organization from a third-party source. This is also known as outsourcing. This is done when an organization lacks the basic or the advanced requirement for production such as required skills, experience, technology, investment, and so on. Both in-house and out-house have their own pros and cons associated with them both together.

26 .

What is Production Order? How do you determine the list of components and operational data in the order?

A Production order is used to define the material to be produced, plant location where production has to be done, date and time of production, quantity of goods required. A Production Order also defines which components and sequence of operations are to be used and how the order costs are to be settled.

BOM and routing data of the materials are copied into the production order which determines the list of components and operational data in the order.

27 .

What are the key steps under Production Order confirmation?

First step is to convert a planned order to production order. When you create a Production Order, type is defined in SAP PP system.

To start the production process, it is necessary to issue Production order. Till a production order is not released, execution of production process is not started.

Issuing goods is required for providing the goods to execute the Production order. Once goods are issues, document number can be updated in the system.

All the sub processes are executed in accordance with required operations to confirm the production as per Production order.

28 .

Mention what is the difference between stock transport order and stock transfer order?

Stock transfer order : It is referred to the transfer of stock for the usage in the same company

Stock transport order : It is referred to the change of title of stock in the name of the buyer

29 .

Explain what is PRT (Production Resource Tools) in SAP PP?

PRT (Production Resource Tools) are moveable operating objects used to perform repeated activities in plant or production maintenance, for example, documents such as drawings or programs for which document management functions are used. Various other PRT components include

* Engineering drawings

* Jigs

* Fixtures

* Measurement Instruments

30 .

Explain how to create PRT master records?

To create PRT master records you have to follow the following steps

* Choose logistics/Accounting -> Project System -> Basic data -> Master data -> Production resources and tools -> Create

* The initial screen for creating a PRT appears

* Enter a number for the PRT and choose continue

* The basic data screen appears

* Maintain the basic data

* Choose Goto -> Defaults and enter the default values

* Save the PRT

31 .

What is capacity planning and capacity leveling?

Capacity Planning is done to balance the load at work center and you can calculate production capacity based on requirement of product as per available capacity.

Capacity leveling is performed for performing detailed production planning purpose. This is done through planning table which is used to carry detailed planning of capacity requirements over time in future.

32 .

How do perform capacity leveling under PP?

You can perform Capacity Leveling using Planning table and orders are processed as define in work center to meet the Production process.

To perform Capacity leveling, use T-Code : CM21

33 .

When do you perform Goods Receipt under PP? What is the movement type?

Good receipt is performed when material is produced as per Production order and goods is placed at storage location. The stock quantity is increased and movement type 101 is entered.

34 .

Mention what is the t-code for changing production order and to display production order?

T-code to change the production order = C002

T-code to display the production order = C003

35 .

Explain what is PLM (Product Lifecycle Management) in SAP PP and what is the use?

It is a collection of solutions with which you digitally create, maintain and make product information, available in the whole company and for the entire life cycle of the product.

PLM provides you the function with which you do following things

* The workplace is an open portal in the world wide web and allows you to access all application and information that you need to work with all external and internal business partners

* It can link with other internet applications like program management, change and configuration management and engineering collaboration.

36 .

Why do we use Stock Overview?

You can use Stock overview to check the available stock at any point of time. Stock overview can be checked using T-Code : MMBE

37 .

What is the difference between MD4 and MD05?

MD04 : This is used for Stock / Requirement list this is dynamic list which reflects even any small change is made in Master Data, Planned Order & Production order etc. for respective material for which you have executed stock / requirement list.

MD05 : is used to view MRP list which displays results of last MRP run for the material for which you have executed MRP list.

38 .

What is SAP Production Planning for Process Industries PP-PI?

SAP PP-PI provides an integrated planning tool for batch-oriented process manufacturing and is used in pharmaceutical, food and chemical industry to support planning of production, waste disposal in the plant.

39 .

What is Plan cost, Actual cost and Target cost?

* Plan Cost = Planned Quantity X Planned Price

* Actual Cost = Actual Quantity X Actual Price

* Target Cost = Actual Quantity X Planned Price

40 .

How a mass production is a good approach according to you?

It is basically the manufacturing or production of a very large amount of units. Not all the products are required to be produced in bulk actually except the ones which are higher in demand. The users are free to simply make sure or favorable outcomes through this method of production because bulk production always helps in cost-cutting.

41 .

What do you know about the Product analysis?

It is basically an approach of testing a product after its development and before its delivery to the customers. Product analysis makes sure of the quality and better customer relations. In addition to this, it enables organizations to save the cost which they have to bear for faulty or wrong product delivery.

42 .

How the production cost can be eliminated? Can SAP PP help in this matter?

There are several methods of cutting the overall cost from a development or a production process. The first thing could be outsourcing the specific or an entire project to another company or an organization that has specialization for the same. Another method is to buying the raw material in bulk and assuring the things are going smooth. One more method that can help in this matter is investing in technology that promises favorable results. The production cost can also be eliminated by adopting various standards of production.

SAP PP is a powerful tool that has some basic features to get the right information and reporting on how the overall production cost can be eliminated.

43 .

How do you check if any work center is overloaded?

Capacity Planning is done to balance the load at work center and you can calculate production capacity based on requirement of product as per available capacity.

You need to check capacity load on work center and if any work center is overloaded, we need to move orders to different work centers.

To check Capacity Loads

Use T-Code CM01 or go to Logistics → Production → Capacity Planning → Evaluation → Work Center View → Load.

44 .

Do you have any idea about SAP QM?

SAP Quality Management is part of SAP R/3 system and is integrated with other SAP modules like SAP Material Management MM, Production Planning PP and Plant Maintenance. QM is integral part of logistic management and is used to perform quality functions at incoming material, in process manufacturing process and raw material as well in the facility.

45 .

What are different inspection under QM for Production Planning?

Inspection Type 03 for discrete and repetitive manufacturing.

Inspection Type 04 for both Discrete and Repetitive Manufacturing.

46 .

What are the types of Master Views for Production and Planning?

For production and planning types of Master Views are :

* SAP MRP1 View

* SAP MRP2 View

* SAP MRP3 View

* SAP MRP4 View

* SAP Work Scheduling View

47 .

Difference between discrete and repetitive production?

Discrete manufacturing	Repetitive manufacturing
It is Order based production /Lot based production	Period based production
Product changes frequently	The product remains unchanged over a period of time
Cost is calculated as per lot or prod order	Period based cost controlling.
GR movement type -101	GR movement type – 131

48 .

Difference between Customer Independent requirement (CIR) and Planned Independent requirement (PIR)?

PIR : Planned Independent Requirements are planned production or sales quantities that are based on some sort of forecast procedure (e.g. Material Forecast or SOP procedure). These values are used in MRP to calculate procurement and production quantities for a material. As the name suggests, PIR is not dependent on any requirement. We use T-code MD61 for maintaining the quantity based on the forecast (Past history and future trend). It is mainly used in MTS scenario

CIR : In Customer independent requirement the customer details are not required, only details like date and requirement type are required and when planned order gets created has assigned to the CIR and the material you receive to Stock goes to special stock E. it is created by using T-code MD81 and It is mainly used in MTO scenario. The customer requirements that you create in MD81 have the same requirement as the customer order created in VA01. This option is mainly used to simulate or when you don’t have the SD module.

49 .

What is Schedule Margin key?

Schedule margin key is used to define the production order floats to determine the production dates in Production Order /Planned Order.

Opening period : The opening period represents the number of workdays that are subtracted from the order start date in order to determine the order creation date.

Float before production : It represents the number of workdays that are planned as a float between the start date (planned start date) and the production start date (target start date).

Float after production : The float after production should provide a float for the production process to cope with any disruptions so that there is no danger that the planned finish date will be exceeded.

Release period : The release period represents the number of workdays that are subtracted from the order start date in order to determine the production order release.

50 .

What are different Planning strategies?

Make-to-Stock Production (10/11 ) : As the name implies, Make-to-Stock Production is a strategy that utilizes forecasts as the basis to drive production of end items and components. It is particularly useful for mass production environments. Make-to-Stock Production is defined in SAP as two different Planning Strategies, 10 and 11. They differ in the way they treat Available Stock. Planning Strategy 10 will consider Stock (net requirements planning) while Planning Strategy 11 will not (gross requirements planning).

Make-to-Order Production (20/ 21/ 25/ 26) : As the name implies, Make-to-Order Production is strategies that utilize Sales Orders as the basis to drive production of end items and components. These strategies are useful when production orders need to be directly linked to sales orders. The differences between the several MTO strategies are combinations of how costs are settled (in all cases to Sales Orders versus stock) and the degree with which configuration of the Sales Order (for a configurable material) is required. Strategies 20 and 21 do not allow configuration, 25 requires it, and 26 makes it optional.

Production by Lot Size for Sales and Stock Orders (30) : This strategy is particularly useful for companies that mainly produce for major customers but who also require the option of selling smaller requirements from stock. Several sales orders, depending on the dates, can be grouped together to be produced in one single lot. In addition to the recognition of Sales Orders, this strategy will also plan to cover Planned Independent Requirements like the Make-to-Stock Strategy.

51 .

List out the basic procedure for dispatching operations in capacity leveling?

For dispatch operations basic procedure includes :

* Either the user determines the date of dispatch or else it is specified by scheduling

* A dispatching sequence needs to be determined if several operations need to be dispatched

* The systems checks for

* The dates to which operations are to be dispatched

* The work center to which operations are to be dispatched

* Finite scheduling is performed

* Operation check is performed

* Status for the operation is set as “dispatched.”

* System carries out midpoint scheduling.

52 .

What is the use of t-code CS20 in BOM?

CS20 t-code (mass change BOM) used to change items in several BOMs at once.

In this transaction code, you can :

* Mass Change BOM item data

* Mass Create materials etc.

* Mass Replacing it with another material

53 .

What is Backflush and the places where the backflush is used?

In simple word, Backflushing is automatic goods issue. The system will automatically post the goods issue when you confirm the operations. You have no need to make the manual issue. Basically, backflush is used where it is having a fixed relationship.

In SAP, backflushing can be carried out in 4 ways :

* Material Master-MRP 2 View

* Work Centre- Basic data

* Routing-component assignment

* Production Order- Component overview

Out of the above 4 options, the material master takes the highest priority if the backflush indicator is set at multiple places.

54 .

What is COGI Report/Error?

COGI stands for Controlling Goods Issued and is a standard SAP transaction which shows a report of automatic goods movement errors. Automatic Goods Issues are carried out by the production confirmation if the Backflush indicator is set on the MRP1 View.

Common COGI Errors are :

* Storage location field empty

* Material does not exist

* Deficit of SL Unrestricted-use of material

55 .

What are all the steps involved in Variant Configuration?

Variant Configuration is a special feature of SAP which helps to simplify the complex manufacturing of a final product with more varieties and variation of the input material.

* Create a material (MM01) – KMAT type with Item category (002)

* Create a Characteristic (CT04)

* Create a class (CL01) and assign characteristics to class – In the variant configuration class type (300) is used.

* Attach the above class to KMAT Material.

* Create a Configuration Profile (CU41) – It contains control data for the configuration process and result.

* Create a super BOM (CS01) – Contains all the component required to manufacture all variants of the product.

* Create a super routing (CA01) – Contains all the operations for producing all variants of the product.

* Create dependency (CU01) – Create dependency for all the material of BOM.

* Assign the dependency to material in BOM.

* Assign the same object dependency to the super routing operations.

* Scenario testing (CU50) – Check whether the system is selecting appropriate BOM material and operations for given characteristic values.

* Maintain pricing and condition record for each variant – use T-code VK11. Create a sales order for variant material and select its characteristic value assignment in the sales order.

* Run MRP for the sales order, you will get planned order. Convert it to production order.