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Chapter 3: Forecast and MPS

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CHAPTER 3: FORECAST AND MPS Objectives

The objectives are:

• Explain what the Production Forecast involves. • Define Netting Actual Demand and Forecast. • Examine the Planning Approach . • Explain forecasting sales items and components. • Describe how MPS output provides input to MRP.

Introduction To fulfill the customer's needs, companies must foresee the future demand and plan in advance accordingly.

Forecast and Master Production Scheduling (MPS) goes into detail about production forecasting and explains how to net actual demand to forecasts. Additionally, the Planning Approach is explained, and how to forecast for components and sales items. The course also describes how Master Production Scheduling (MPS) provides input to Multi-Resource Planning(MRP ) in Microsoft Dynamics® NAV 2009.

Microsoft Official Training Materials for Microsoft Dynamics ® Your use of this content is subject to your current services agreement

Manufacturing II in Microsoft Dynamics® NAV 2009

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Production Forecast Long Term Planning

When the cumulative lead time of a product is longer than the customers' delivery time expectations, a problem exists. Late customer deliveries lead to bad customer relationships. To make deliveries on time, companies need to plan for the future, determine what needs to be bought or what is currently manufactured, and then consider lead time.

Lead time depends on a department's point of view.

• In the sales department, lead time is the time elapsed between when the customer order is taken and when the product is delivered.

• In purchasing, lead time is the time between the recognition of the need for an order and the receipt of the items, and includes: o Order preparation time o Processing time o Delivery and inspection time

• In manufacturing, the cumulative lead time is the longest planned

length of time to accomplish an activity, and includes: o Purchasing o Production o Related processing time

Customer expectations can be stated in the form of forecasted quantities:

• Item by item • Period by period

Normally, the demand is forecasted for a given span of time (for example, one year), and is maintained continuously.

The sales management part of the system provides options to have sales budgets displayed at an overall item group level. The system can express sales budget as expected amounts and quantities that concern all items in the group.

For planning purposes, users must state the forecast as a quantity of each individual item that is covering expectations for a given period.



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The following figure shows an example of how a forecast can be entered in Manufacturing in Microsoft Dynamics NAV 2009.

FIGURE 3.1 PRODUCTION FORECAST

Looking at Demand and Forecasts

Forecasts are not perfect. Companies need to deal with differences between actual demand and forecasted demand.

• If the forecast is greater than actual demand, it may require moving the remaining forecast to the next period. (This is acceptable if the uncertainty only concerns timing; however, if even the forecasted quantity is uncertain, this can cause accumulation of inventory. A standard system must not support that situation.)

• An overly optimistic forecast causes an increase in inventory if production of a period is carried out in accordance with the forecast. A surplus causes a larger opening inventory of the next period, and the remaining forecast is moved to the next period. However, if calculation of net requirement uses the inventory to fulfill forecasted or actual demand of the next period, then the surplus is not added to the forecast of the next period.



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The opposite scenario, where the sale is larger than the forecast, is more serious. Since a forecast is only made if cumulative lead time is larger than the customer expected delivery time for sales orders, the consequence of an overly pessimistic forecast is that shipments to customers will be late.

• Since the system does not push customer orders, it has to propose orders to fulfill the demand even though the orders cannot be carried out in due time.

• If the shipment dates of those customer orders are changed to reflect reality, the orders are consuming forecast from the next period.

The production forecast can differ from the sales forecast, including:

• Seasonal variations in a sale call for flexible production planning occur as expectations of customer demand vary.

• The Production Planner can have other reasons for adjusting or supplementing the sales forecast. Use of the production forecast can be close to that of a Master Production Schedule.

Forecast Types and Considerations

To access the production forecast window, go to Departments > Manufacturing > Planning > Reports > Production Forecast.

When users process the production forecast in Microsoft Dynamics NAV 2009:

• It is entered manually by item number. • Results criteria such as production forecast name, forecast date and

location code can also be used. • The Forecasts option is also available using the following path from

the sales and marketing menu: Departments > Sales and Marketing > Reports and Analysis > Analysis and Reporting > Production Forecast. A company can use the forecasting function without using manufacturing.

Forecasting can be done by sales items and by component items. It is important to understand the difference between dependent and independent demand:

• Independent Demand - Demand for an item that is unrelated to demand for other items. This is, for example, a top item in a BOM structure.

• Dependent Demand - Demand that is directly related to or derived from the BOM structure for other items or end products. This is typically a component item.

Independent demand is based on the customer's demand and can be forecasted. Depend and demand can always be calculated from the independent demand.



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When an item has both independent and dependent demand, the case is a little more complicated. This type of item is used to make a finished good but it is also sold by itself, probably as a spare part. Forecasting for this item must be done in sales for the spare part sales, and must be included when components are calculated.

If you plan to net demand against forecast for each location individually, use the location filter in the header of the form before entering a quantity. Normally, forecasts are entered company-wide and not by location, but this is a company decision.

Enter Data in the Forecast Form

Forecasts mainly involve the following roles:

• Sales Representatives • Master Production Planner • Materials Planner

The forecast is:

• The Sales department's best estimate at what is sold in the future. • Specified item for each item and period by period, for example,

monthly.

The forecast can, for example, be transferred to a spreadsheet, as shown in the following table.

Forecast as of September 10 , 2008

2008 2009

Item Descrip-tion

October November December January February March April

1000 Bicycle 800 600 3500 200 200 300 500

1001 Touring Bicycle

900 600 3300 200 200 200 200

1200 Back Wheel

5 5 5 5 5 5 5

1500 Lamp 40 60 100 80 80 80 20

and so on

The Production Planner then takes the sales forecast and modifies it to fit production constraints.



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The most important part of the forecast is on end items. However, if the end items are assembled to order, the forecast might be on the main-parts, which can be used as components in the final assembly. The same reasoning can be used in a make-to-order environment, for example, in a rapidly changing product area, such as home computer sales. This method allows for the flexibility of both individual orders and to quickly replace an outdated part with a new, improved part.

Spare parts or options can also carry a separate forecast. In the previous example, the lamp is an option and the rear wheel a spare part.

The gross requirement for components also sold as spare parts might be much larger than the sales forecast indicates, but most of the demand is dependent. In the example, both the bicycle and the touring bicycle use one rear wheel for each bike. The sales forecast on the wheel shows just the expectations of direct sale for spare parts. The total amount of rear wheels for production is 1705 (800 for the bicycle, 900 for the touring bicycle, 5 sold as spare parts).

Demonstration 1

The following demonstration shows how to enter three months of forecast for Part A.

Before entering the production forecast, create an item or choose an item to use in this demonstration, which is also the basis for later demonstrations.

1. In the navigation pane, click the Production Forecast button. 2. Click New. 3. Enter a Name and Description. For example, type a name of 2009

and a description of 2009 Forecast. 4. Click OK. 5. Double-click 2009 Forecast to open it. 6. In the Forecast type field, select Sales Item. 7. In the View by field, select Month. 8. In the Column Set field, check that May2007..Dec 2009 shows. If

not, click Previous Set. 9. Click Show Matrix. 10. Move the date section on the right forward or back until October

2009 is showing. 11. Choose an item to enter the production forecast. For example, choose

item 1000 (Bicycle). 12. Enter the following information for the item for the 2009 fourth

quarter.



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Create sample item based on Cronus.

Item No Description Date and Year Quantity

1000 Bicycle Oct 2009 800

1000 Bicycle Nov 2009 600

1000 Bicycle Dec 2009 3,500

Based on the information, the production forecast must appear as shown in the following figure.

FIGURE 3.2 PRODUCTION FORECAST FOR BICYCLE (OCT. - DEC. 2009)

When you enter a forecast in Microsoft Dynamics NAV 2009, the figure is always placed on the first date of the period. (The production forecast form functions similar to the Accounting Budget form, which is shown when you continue to the next step.)

13. Put the cursor in one of the fields that holds a quantity, such as November 2009.

14. Click the AssistButton to view the Production Forecast Entries window.

15. Verify that the Forecast Date field is November 1, 2009.

The time interval window gives the planner multiple choices to insert the demand at a specific date in a period.



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NOTE: The definition of forecast periods states that a forecast on a given (starting date) is valid until the next forecasts start.

Avoid changing the forecast period scope unless all forecast entries are moved to the starting date of this period.

An unlimited number of forecasts can be created and copied, and the user is able to work with alternative forecasts.

You can copy a forecast from the Production Forecast Matrix window. Go to Related Information > Actions > Copy Production Forecast.

Only one production forecast can be used in the Material Requirements Planning (MRP) process. The default production forecast is set up in manufacturing setup, and the user is allowed to choose another production forecast when he or she runs the planning worksheet.

16. In the navigation pane, click the Departments button. 17. Go to Manufacturing > Administration > Setup > Manufacturing

Setup. 18. In the Planning FastTab, select the new forecast, 2009, in the

Current Production Forecast field.

NOTE: When you run the planning worksheets, the system bases the calculations on the sales unit of measure and the forecast entries in the valid forecast form. If no sales unit of measure is given in the item card, the system uses the base unit of measure.

Netting Actual Demand against the Forecast The planning process treats gross requirement from forecast as any other gross requirement. If the gross requirement causes the available projected inventory to pass below the reorder point, the system proposes a replenishment order for the planning parameters of the item.

The planning system can calculate Master Planning Schedule (MPS) or Material Requirements Planning (MRP) on request, or it can calculate both at the same time.

• MPS: Calculation of a Master Production Schedule (MPS) based on actual demand and the production forecast. The MPS calculation is carried out for items with a forecast and a sales order line. These are called MPS items and are dynamically identified when the calculation starts.



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• MRP: Calculation of material requirements based on actual demand for components and the production forecast on the component level. The MRP is calculated only for non- MPS items, as previously defined.

FIGURE 3.3 CALCULATE PLAN – PLANNING WORKSHEET

MPS and MRP can be combined each time the planning worksheet is run.


Setup. 3. In the Planning FastTab, verify that the Combined MPS/MRP

Calculation check box is selected.

When they are combined, the system does not stop at the MPS level, and the production forecast must reflect the same type of production conditions as the MPS.

The planning algorithms are identical for both MPS and MRP. The planning algorithms effect the following:

• Netting • Reuse of existing replenishment orders • Action messages



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The following figure also shows this process.

FIGURE 3.4 NETTING PROCESS

Additional information on this issue is discussed in the Planning chapter.

In the planning procedure, the production forecast is a part of the gross requirements, but not at the same time as actual demand. When you calculate the gross requirement of an item, actual demand neutralizes the forecast. This process is called forecast consumption or netting demand and forecast.

Demand within a forecast period consumes the production forecast of that period. The forecast of a period is regarded as a gross requirement due on the forecast date. If actual requirements appear within the forecast period, it reduces the forecasted quantity.



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Actual requirements substitute the forecast. If the actual requirements of a forecast period surpass the forecast, the forecast is removed from the gross requirements.

FIGURE 3.5 FORECAST CONSUMPTION

The result is a line of gross requirements starting with the remaining forecasted quantity of the period, if any, followed by actual requirements, then the remaining forecasted quantity of the next period followed by actual requirements of that period, and so on.

Independent demand only consumes the sales item forecast and dependent demand consumes only the component forecast.

The netting procedure:

• Does not actually delete the production forecast; it only reduces the impact of the forecast. The production forecast is left unchanged and it has the original effect next time a plan is calculated.

• Regards forecast records for previous periods as expired by the starting date of the first valid forecast. If previous forecast records exist, the first valid forecast is the one with the closest date to the starting date of the planning period.

After you determine total demand by reviewing all of the dependent and independent demand for an item, the demand is netted against the forecast. If demand is greater than the forecast, then planning uses the demand quantity.


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Demonstration 2

The following demonstration shows you how to net the forecast for the example.

1. Forecast type filter: First, a filter is set to deal with independent demand and sales item forecast. This demonstration deals with independent demand for Item 1000 (Bicycle).

2. Find first valid forecast: The first valid forecast is the one with a forecast date preceding, or at, the planning date. The order date is 10-15-09 and the first valid forecast is the forecast for 800 with a forecast date of 10-01-09.

3. Define current forecast: The first forecast is transformed to gross requirement as current forecast. It is a quantity of 600.

4. Define forecast period: The next forecast is read. The result is the next period starts 11-01-09. The current forecast period ending date is (the next forecast date, 1) 10-31-09.

5. Consume and insert forecast: All demand (unreserved or not) between forecast starting and ending date is read. The total demand in the example is 200. The total demand quantity is subtracted from the current forecast quantity (600 minus 200). Reaching the end of the period the remaining current forecast is inserted as gross requirement (400).

6. Prepare for next forecast period: The next forecast becomes current forecast. This period starts with 11-01-09.

The procedure continues from step 4 until the last forecast is read. The planning includes forecast period 12-01-09 - 12-31-09 in its last step since planning is run until 12-15-09.

Due date (2009) 10-01 10-15 11-01 12-01

Forecast qty for Item 1000 (Bicycle) 800 600 3,500

Sales order 200

Inventory

Netting 400 800 3,500

Planning line 1000 400 200 800 3,500

Planning Approach Microsoft Dynamics NAV 2009 planning worksheet is used to run MPS and MRP.

To find the planning worksheet (from the navigation pane), go to Manufacturing > Planning > Tasks > Planning Worksheets. There are several options. The Calculate Regenerative Plan option is used throughout this course.



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The Calculate Regenerative Plan:

• Investigates demand and supply. • Projects the available balance. • States the net requirement for the item. • Creates a replenishment plan to fulfill net requirements.

When the calculate regenerative plan is chosen, the:

• Demand is net against the forecast. • Component option on the forecast determines which type of

requirements to take into consideration in the netting process.

If the forecast is for a sales item, and not a component forecast, only sales orders net the forecast. Otherwise the netting comprises dependent demand.

Demonstration 3

The following demonstration shows you the Production Forecast and MPS functionality. Use Item 1000 (Bicycle) and place 300 pieces in inventory:

1. In the navigation pane, click the Items button. 2. Click Item Journal. 3. In the Posting Date column, enter a date prior to the work date, such

as 01/24/2010. 4. In the Entry Type column, select Positive Adjustment. 5. In the Item No. column, select 1000 (Bicycle). 6. In the Quantity column, enter 300. 7. Check that the location code is blank. 8. Click Post and click Yes to post the journal line. 9. Close the Item Journal window. 10. Proceed to set up the item card. 11. Open the item card for item 1000 (Bicycle) 12. Enter the following information on the Replenishment FastTab.

Replenishment System Prod. Order

Manufacturing Policy Make-to-Stock

Enter the following information on the Planning FastTab.

Reorder Cycle 1W

Reordering Policy Lot-for-Lot

Include Inventory Yes



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13. Click OK to close the item card.

Create a forecast based on item 1000 (Bicycle).

14. In the navigation pane click the Production Forecast button. 15. Double-click 2010 Forecast. 16. Verify 2010 is entered in the Production Forecast Name field. 17. Verify the Forecast Type is set to Sales Item. 18. In the View by field, select Month. 19. In the column Set field, change the period to be viewed to Jan

2010..Aug 20. This is done by clicking the Next Set or Previous Set button in the process action group.

20. Click Show Matrix. 21. On the line with Item 1000 (Bicycle), insert the quantities in the

periods as follows:

Item No Description Date Quantity

1000 Bicycle Oct 2010 0

1000 Bicycle Nov 2009 1,200

1000 Bicycle December 2009 1,200

1000 Bicycle Jan 2011 2,500

22. Click OK and close all open windows.

To demonstrate the concepts of master production scheduling, create sales orders to reflect actual customer demand. Create four sales orders based on the data in the following table.

23. In the navigation pane, click the Sales Orders button. 24. Click New. 25. Create four different sales orders for customer 20000 (Selangorian

Ltd.) with the following shipment dates and quantities. Ignore any credit limit check warnings.

Item No Description Shipment Date (DD -MM- YY) Quantity

1000 Bicycle 11/11/2010 90

1000 Bicycle 11/20/2010 170

1000 Bicycle 12/12/2010 510

1000 Bicycle 12/19/2010 710



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26. Ignore any stock-out warnings and click Yes to update any shipment dates.

27. Close all open windows.

Set up the planning system to run MPS only.



Calculation check box is not selected. 31. In the Current Production Forecast field, select 2010. 32. Verify that the Use Forecast on Location check box is not selected

and the Components at Location field is blank. 33. Click OK.

The preparation is complete; start generating the MPS.

34. In the navigation pane, click the Departments button. 35. Go to Manufacturing > Planning > Tasks > Planning Worksheet. 36. Delete the lines in the planning worksheet, if any are displayed. 37. Click Calculate Regenerative Plan. 38. On the Options FastTab, verify that a check mark is in the MPS

field and not in the MRP field. 39. On the Item FastTab, set two filters:

o No. filter for the item number, such as Item 1000 (Bicycle). o Location filter contains no data, to exclude from the plan all

demand existing on other locations.

40. Enter the starting date for the plan, for example 11/01/2010, in the Order Date field.

41. Enter the end of the planning horizon, such as 01/31/2011, in the Ending Date field.



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42. Verify the forecast, 2010, is entered in the Use Forecast field. If it is not, enter it now.

43. Leave the Exclude Forecast before field blank.

FIGURE 3.7 CALCULATE PLAN – PLANNING WORKSHEET

44. Click OK.

FIGURE 3.8 PLANNING WORKSHEET



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Analyze this output.

45. Select the first row in the planning worksheet. 46. Click Order Tracking.

A message displays indicating there are no tracking entries for this line. Forecast items are not tracked.

Order tracking information is not listed because this line represents the gross requirement for the forecast period and it is not tracked to any specific demand.

47. Close the Order Tracking window.

Demonstration 4

The following demonstration shows you how to use the order tracking information.

1. From the Planning Worksheet window, place the cursor on the line with a quantity of 1,220.

2. Click Order Tracking. The Order Tracking screen displays two lines, one for each sales order.

FIGURE 3.9 ORDER TRACKING

During December, there is an independent demand with a quantity of 1,220 (510+710). This demand is higher than the forecast quantity of 1,200. Therefore, the forecast for this period is totally neutralized by the actual demand.

3. Close the Order Tracking window.



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NOTE: Order Tracking does not track to the production forecast because of the forecast's design. The forecast quantity is the sum of several entries (correction history and forecast for different locations). The system needs to calculate the quantity when trying to track back to the forecast and this is not possible.

Reports

Two reports are useful in this process. These are Planning Availability and Production Forecast. Both are found by going to Departments > Manufacturing > Planning > Reports.

Planning Availability - This report displays an overview of all known existing requirements and receipts for the items selected on a specific date. Use the report to obtain a quick picture of the current demand-supply situation for an item. The report displays the item number and description plus the actual quantity in inventory. Changes to the projected available inventory are listed chronologically. The following table shows some of the fields in this report. Refer to the online Help for more information.

From the Planning Buffer FastTab, click the drop-down arrow under Show results to see the list.

Field Description

Gross Requirement

This is the total demand-independent and dependent-for the particular item. Independent demand comes from sales orders, service orders, transfer orders, and production forecasts. Dependent demand comes from production order components from planned, firm planned, and released production orders. Component demand for production order proposals in planning and requisition worksheets is also included.

Planned Receipts

These are the items from replenishment order proposals. This includes planned production orders, planning worksheets, and requisition worksheets.

Scheduled Receipts

These are the items from replenishment orders. This includes firm planned production orders, released production orders, purchase orders, and transfer orders.

Document Type

This shows the type of document that is the source of the availability.

Document Number

This shows the number of the relevant source document.

Production Forecast - This report shows an overview of the production forecast, plus any sales orders, for the selected items. Use the report to check the accuracy of a production forecast, for example. Define what is included in the report by setting filters.



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Forecasting Sales Items and Components When using a master production schedule, the planning responsibility for fulfilling customer demand moves to the Master Production Planner and the MPS. When users later calculate MRP, order proposals from MRP are exclusively based on dependent demand. Component needs for MPS items start the planning and the further explosion is then carried out as usual, with no consideration to demand from sales orders.

Demonstration 5

The following demonstration shows you how the different forecast types work. First, delete the sales orders and then remove the bicycle inventory.

1. In the navigation pane, click the Items button. 2. Double-click item 1000 (Bicycle). 3. From the General FastTab, go to the Qty. on Sales Order field and

click the number beside it. 4. Go to the first line and click Show Document, which goes to the

sales order. 5. Delete the sales order by going to Actions > Delete. 6. Click Yes to confirm. 7. Repeat steps 4-6 until all the sales orders for Item 1000 (Bicycle) are

gone.

The next step is to remove the inventory for item 1000 (Bicycle).

8. In the navigation pane, click the Items button. 9. Double-click item 1000 (Bicycle). 10. In the Inventory field, make a note of the total inventory available. 11. Click Item Journal. 12. From the Item Journal window, enter or select the following data in

the named fields:

Field Name Data to enter/select Posting Date 1/28/2010

Entry Type Negative Adjustment

Item No. 1000

Description Bicycle

Quantity Total quantity available

13. Click Post and click Yes to post the journal lines. 14. Close the Item Journal window.



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15. From the item card, go to Actions > Refresh to update the data. 16. In the Inventory field, note that the quantity is now zero. 17. Click OK to close the Item card.

Sales Forecast

The steps required to enter a sales forecast are now complete.

Demonstration 6

Create a new forecast, for example, using items A Bicycle, E Saddle, and a new item. The new item must be a component of the first item and have zero quantity on hand and no supply or demand. Make sure that the Reorder Cycle on the new item is 1M.

1. In the navigation pane, click the Production Forecast button. 2. Click New. 3. Enter a Name and Description. Enter a name of Example and a

description of Example. 4. Click OK. 5. Double-click Example to open it. 6. In the Forecast type field, select Sales Item. 7. In the View by field, select Month. 8. In the Column Set field, check that Jan 2010..Aug 2012 is shown. If

not, click the Next Set or Previous Set buttons. 9. Click Show Matrix. 10. Tab to the periods to be forecasted on the lines for items 1000

(Bicycle) and 1850 (Saddle), then enter the quantities according to the following table.

Item No Description Date (MM - YY) Qty.

1000 Bicycle 11 - 2010 200

1000 Bicycle 12 - 2010 150

1000 Bicycle 01 - 2011 300

1850 Saddle 11 - 2010 50

1850 Saddle 12 - 2010 50

1850 Saddle 01 - 2011 50

11. Click OK and close the Production Forecast window.



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The following steps show you how to start generating the MPS.

1. In the navigation pane, click the Departments button. 2. Go to Manufacturing > Planning > Tasks > Planning

Worksheets. 3. Delete the lines in the planning worksheet, if any are displayed. 4. Click Calculate Regenerative Plan. 5. On the Options FastTab, verify that a check mark is in the MPS field

and not in the MRP field. 6. Enter the starting date for the plan, for example 08/01/2010, in the

Order Date field. 7. Enter the end of the planning horizon, such as 01/31/2011, in the

Ending Date field. 8. In the Use Forecast field, select Example. 9. Leave the Exclude Forecast before field blank. 10. Change the Number filter to include the saddle. The filter appears as

1000|1850. Click OK. 11. Choose the new forecast Example, in the Use Forecast field, on the

Options FastTab.

The results of your forecast for the bicycle and saddle are shown.

Component Forecast

The component forecast can be seen as an option forecast in relation to a parent item. For example, this can be useful if the Production Planner can estimate the demand for the component.

The component forecast is designed to define options for a parent item; the component forecast must be equal or less than the sales item forecast quantity. If the component forecast is higher than the sales item forecast, the system treats the difference between these two types of forecast as independent demand.

MPS Output Provides Input to MRP In the following example, certain events, including heavy vacation and holiday schedules, are causing changes in the MPS. In addition, one of the primary vendors is closing the business down for a week during Christmas. Use the following procedure to change the quantities by date and by item in the generated planning worksheet.

1. In the navigation pane, click the Production Forecast button. 2. Double-click Example to open it. 3. In the Forecast type field, select Sales Item. 4. In the View by field, select Month. 5. In the Column Set field, check that Jan 2010..Aug 2012 is shown. If

not, click the Next Set or Previous Set buttons.



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6. Click Show Matrix. 7. Tab to the periods to be forecasted on the lines for item 1000

(Bicycle), then enter the quantities according to the following table.

Item No Description Date (MM - YY) Qty. 1000 Bicycle 11 - 2010 300

1000 Bicycle 12 - 2010 250

1000 Bicycle 01 - 2011 450


After completing the quantity changes, change the planning system to run MRP (using the modified MPS) as input.


Worksheets. 11. Delete the lines in the planning worksheet, if any are displayed. 12. Click Calculate Regenerative Plan. 13. On the Options FastTab, verify that a check mark is in the MRP

field 14. Enter the starting date for the plan, for example 10/01/2010, in the


Ending Date field. 16. In the Use Forecast field, select Example. 17. Leave the Exclude Forecast before field blank. 18. In the Item FastTab, ensure that there are no selected values and

click OK.

The results of your forecast are shown.

Summary In a complex production environment, it is crucial to plan ahead to ensure timely delivery to customers. This course examines the forecasting process in Microsoft Dynamics NAV 2009, which is one of the foundations for the MPS and MRP planning functionality. The planning approach in the planning worksheet is described in detail, and demonstrations show the calculation methods used in the system.



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Lab 3.1 - Forecast and MPS Scenario

There is a new item that has been produced by your company. You need to create a forecast for the new item.

Step by Step

Preparation

1. In the navigation pane, click the Items button. 2. Click New. 3. In the General FastTab, enter 8000 in the number and description

fields to create a new item card. 4. In the Base Unit of Measure field, select PCS. 5. In the Invoicing FastTab, go to the Gen Prod Posting Group field.

and select RETAIL 6. In the Inventory Posting Group field, select FINISHED. 7. In the Replenishment FastTab, go to the Replenishment System

field and select Prod. Order. 8. In the Manufacturing Policy field, select Make-to-Stock. 9. In the Planning FastTab, go to the Reordering Policy field and

select Lot-for-Lot. 10. Select the Include Inventory checkbox. 11. Enter a reorder cycle of 1W for one week. 12. Click OK.

Click a forecast based on the new item.

1. In the navigation pane, click the Production Forecast button. 2. Double-click 2010 Forecast to open it. 3. In the Forecast type field, select Sales Item. 4. In the View by field, select Month. 5. In the Column Set field, check that Jan 2010..Aug 2012 is shown. If

not, click the Next Set or Previous Set buttons. 6. Click Show Matrix. 7. In the No. field, type 8000 to filter the data.



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Tab to the periods to be forecasted on the lines for item 8000, then enter the quantities according to the following table.

Item No Description Date (MM - YY) Qty.

8000 8000 11 - 2010 200

8000 8000 12 - 2010 150

8000 8000 01 - 2011 300


Set up the planning system to run MPS only.



Calculation check box is not selected. 4. In the Current Production Forecast field, select 2010. 5. Verify that the Use Forecast on Location check box is not selected

and the Components at Location field is blank. 6. Click OK.

Start generating the MPS.


Worksheets. 9. Delete the lines in the planning worksheet, if any are displayed. 10. Click Calculate Regenerative Plan. 11. On the Options FastTab, verify that a check mark is in the MPS

field and not in the MRP field. 12. Enter the starting date for the plan, for example 08/01/2010, in the


Ending Date field. 14. In the Use Forecast field, select 2010. 15. Leave the Exclude Forecast before field blank. 16. In the No. field, select 8000. 17. Click OK.

The results of the forecast for item 8000 appear.



3-26

Quick Interaction: Lessons Learned Take a moment and write down three key points you have learned from this chapter

1.

2.

3.


Technology

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