Long-Term Planning

The LTP is used to simulate and evaluate planning results in long/short-term periods. It does not mean that after the run it will affect the planning data (MPR), but if the results from simulative planning of LTP are satisfactory, we can transfer them to operative planning in standard MRP.

• In long-term planning, create own versions of the demand program, which are only used for simulative planning to calculate and compare the effects of various versions of the demand program in a simulative mode in Material Requirements Planning (MRP) and in Capacity Planning.  
• To simulate short and mid-term planning, get a realistic representation of the current planning situation. Therefore, transfer the fixed receipts, the firm planned orders and purchase requisitions as well as the sales orders from operative planning to long-term planning.

Why is it useful?

• Capacity planners are better able to plan their machine resources and manpower resources.
• The purchasing department uses information on the future requirements quantities to estimate and plan future procurement orders.
• The inventory controller gains greater comprehension of warehousing requirements.
• Vendors are able to get a preview of a company’s future procurement needs 
• The product costing team can get a preview of the associated costs of producing products

What data must be available in the system?

Master data

Material for LTP (i.e., material to be planned using LTP), BOM, and routing of the material. The planning scenarios are also part of the master data that you need to set up. 

It is a recommendation to consider creating a new BOM exclusively for LTP simulation. This provides greater visibility from a planning perspective. A dedicated BOM for LTP not only eliminates the chances of error while creating a normal production BOM of material but also ensures that it’s used for LTP purposes only. A special LTP BOM can be created. In customizing “ Define BOM usage” (OS20) and “Define order of priority of BOM usage”(OS31) has to be defined.  

Planning data

• The planning quantities of the material are entered as PIRs. LTP will simulate the production and procurement requirements based on this information (PIRs). The purpose of having multiple versions of PIRs is to account for various planning situations and scenarios.

Planning scenario

• MS31: The planning scenario that forms an integral part of the master data setup for LTP. By creating a scenario, the system automatically creates planning file entries.

How does the Long-Term Planning Business Process look like? 

1. Enter the PIR in a simulative version (already covered in Section 14.1.3).
2. MS02 Run LTP (simulative MRP), and save the results.
3. MS04 Evaluate the LTP stock/requirements list.

What are the additional features?

• MS11: Manually creating a simulative planned order ( ~ you need to account for additional demand for a specific component )
• MS04: Firming the simulative planned order using a firming date ( During the next LTP run, these manually firmed simulative planned orders aren’t changed or deleted )
• MS29: Calculating average plant stock
• MS64: Copying PIRs or firmed planned orders from LTP to operative planning
• Copying Source Version 02 to Target Version 00 of a PIR
• Delete or reorganize old or inactive PIRs on a regular basis using the Transaction MD74

How to set up and evaluate the results of the information systems for purchasing and inventory controlling in LTP?

• Logistics \ Production \ Production Planning \ Long-Term Planning \ Evaluations \ Purchasing Information System \ 
• Set Up Data, or use Transaction MS70
• Material, or use Transaction MCEC
• Logistics \ Production \ Production Planning \ Long-Term Planning \ Evaluations \ Inventory Controlling 
• Setup Data, or use Transaction MCB&.
• Evaluation, or use Transaction MCB).
• Logistics \ Production\ Production Planning \ Long-Term Planning \ Evaluations \ Capacity Requirements \ Work Centers, or use Transaction CM38

Where to find more information about LTP? 

• LTP documentation on SAP Help