Data tips for Vendor Managed Inventory (VMI) in SAP SCM

Thursday, March 15, 2012, 11:21 AM

Categories: IT , IT Data Management , SCM , Planning and Forecasting , Inventory Management , SCM Reporting , Project Management , Project Management , SCM

This tip comes from a session by Thomas Brassøe of Implement Consulting Group, planned for the SCM 2012 conference, March 19-22 in Orlando, Florida.

In his session “Improve Order Fill Rates and Minimize Inventory Levels and Costs Using Vendor Managed Inventory (VMI) in SAP SCM 7.0”, Brassøe notes that “9 out of 10 VMI projects are initiated by the customer – demanding automation from the vendor.” Thomas Brassøe’s session covers key business drivers – other than process automation – for VMI, with steps and tips to create & support a VMI process using DP and SNP.

VMI can be implemented in SAP Advanced Planning & Optimization (SAP APO) as part of the “normal planning flow” using demand planning (DP) and supply network planning (SNP) or as a stand-alone solution on top of normal SAP ERP planning flow. When it comes to data exchange and integration, he provides a number of tips, including these:

Do Not Let Missing EDI Get in Your Way

Although EDI will greatly enhance the speed and reliability of the data exchange, there is no reason for letting missing EDI support postpone your VMI project
Electronic data can still be exchanged (e.g., using email) and can be manually updated into SAP APO

Forecast data is entered (e.g., by “Copy and Paste”) directly in DP
Stock figures can be entered by IDoc emulation, by a small program or in a modified stock key figure

Manually exchanging forecast and stock figures by mail can greatly speed up your VMI prototyping efforts

Integrate VMI Location with Product Master Data

With SCM 7.0 in SAP APO VMI, you are able to automatically create location products in the ship-to location (“customer location”)
The customer material info record in SAP ERP carries customer, material, and customer material. This info record is used as reference to create the location products in SAP APO.
A new Core Interface (CIF) integration model object for customer material has been created
After activating the CIF model, the ship-to location product in SAP APO will be created, and the customer material number is populated

Visit the SCM 2012 conference site for more details on conference sessions in both the US (Orlando, March 19-22) and Europe (Prague, April 24-27). Join the SCM Group on Insider Learning Network, and we invite you to post your questions in Insider Learning Network's SCM Forum .