Status
Owner	NICASTRI-ext, Michele
Stakeholders	The persons consulted or otherwise involved in making this decision. Type @ to mention people by name

Issue

This Key Decision Document (KDD) describes the critical decisions, recommendations, and main pros and cons for the implementation of Manufacturing modules in the ERP Rebuild project.

The document aims to clarify the rationale behind exploring and evaluating SAP PP and SAP PP-PI modules. It highlights the benefits and drawbacks of each solution, including factors such as compliance with Best Practices, available functionalities, scalability, maintainability.

PP-PI is the SAP module for Process Production.

PP is the SAP module for Discrete Production.

It is clear that most of the Syensqo Manufacturing activity are best suited to SAP PP-PI. We must define whether use it also for Discrete Production, adapting the PP-PI module to suit them as much as possible, or introduce the implementation of SAP PP for those plants and production lines running Discrete Production.

Recommendation

The Option C - introduce PP only in the Pure Discrete plant(s), and use PP-PI across all other plants, also for Discrete Productions operations that a few of them are running, emerges as the preferred options by large:

Hybrid plants (Process and Discrete Manufacturing together) will run on PP-PI SAP module

Process plants will run on PP-PI

Only pure Discrete Plant(s) will run on PP. At the moment this affects only Newark plant.

Background & Context

Syensqo Manufacturing Plants using WP1 or PF1 systems are currently managed in 99% of the cases via SAP PP-PI module, with a variety of implementations and different subsets of functionalities activated. This module is the SAP intended best practice for Process Productions: Continuous Flows, Splitting Towers, Reactors, which are the vast majority of processes in Syensqo. PP-PI is also easily adaptable to manage packing activities. The only exception: plant 4048 is currently using Rate Routings and therefore PP Repetitive Manufacturing. It makes no sense for the processes managed in that plant, it must move to PP-PI.

However, Syensqo Manufacturing landscape includes relevant cases of Discrete Production.

The main example of Discrete Manufacturing is Plant Newark, Product Ajedium: extrusion of thermoplastic film. This plant is 100% Discrete Manufacturing. It is not on SAP systems at the moment.

Other Plants in Syensqo have Discrete Production together with Process Production:

Case 1: plants with Compounding units: Oudenaarde, Changsu, Kallo, Marietta

Case 2: Plant Oestringen, filming, pre-pegging and slitting.

For these productions, the SAP Best Practice is SAP PP. They are currently running SAP PP-PI module.

There are specific functionalities that exist only in SAP PP-PI and missing in SAP PP and vice versa, and there are different ways to manage the same activities in the two modules. Here we describe the main differences.

Master Data

the PP Routing is a sequence of operations, PP-PI Recipe is composed by Operations and Phases. Phases are the actual activities to be performed and confirmed in PP-PI, while operations are the actual activities in PP. The relationships are differently managed:

in PP-PI, Finish-Start, Finish-FInish and Start-Start relationships can be defined, offset can be defined only as a time
in PP the relationship is by default Finish-Start, Start-Start can be achieved via parallel sequences, and offset can be defined both in terms of time and in terms of quantities produced by an operation before the subsequent can start

Also the definition of Setup time is different:

in PP-PI a dedicated phase for Setup is required, to allow setup optimization in fine scheduling. Fixed Duration and Qty dependent Duration are two Standard Values used in Phases, however Setup optimization only takes into account the Fixed Duration of the first phase assigned to an operation
In PP, Setup, Machine and Labor time are the default standard value and Setup time is subject to Setup Matrix and FIne Scheduling optimization wherever it is used

PP-PI Recipes allow the usage of complex formulas, to calculate the quantities of produced materials based on the quantity of the components: bottom-up BOM/Recipe composition. In PP, the BOM logic is always top-down.

Production Versions are mandatory in both modules, however, they are automatically generated in PP-PI at Recipe Creation, when a BOM is assigned. In PP, Production Versions must be explicitly created with a dedicated App.

The default assignment of unassigned components to the first operation can be customized in PP, it is implicit and not flexible in PP-PI. Hence, in PP-PI is mandatory to explicitly assign the components to the operations in the Recipe to use the Fine Scheduling functions.

Order Management

Process Orders Campaigns exist only in PP-PI.

Detailed Scheduling contains more heuristics and allow more flexible alternatives in PP.

One of the main differences in the past was the Control Recipes and PI-Sheet functionality: it was the only way to define and collect data from process parameters like temperature, pressure, flux-meters data, etc. It was part of PP-PI only. It is defined as obsolete by SAP and maintained only to 2027, the new functionalities are in Digital Manufacturing and available both for PP and PP-PI

Integration with Warehouse Management

PP allows direct staging functionalities in EWM, which are not possible from PP-PI.

Production Confirmations and Goods Movements

There are not relevant differences here, just cosmetics.

Month End Closing and Order Settlement

The simultaneous adoption of PP-PI and PP in different plants or in different production lines of the same plant will require two different order settlement activities to run at Month End Closing, one for Process Orders and one for Production Orders.

Assumptions

The new ERP system will run on SAP S4/HANA 2023 FPS01 or higher version.

Impacts

The adoption of PP for the Discrete Productions currently on PP-PI would have the following impacts:

Data migration will become more complex, as Recipes must be converted in Routings and open Process Orders in open Production Orders
Project configuration, testing and training will increase as more objects must be configured and tested and more Fiori Apps must be included in training
Authorization Matrix will be more complex, as some users of some plants must be able to operate both on Process and Production Orders, both in Recipes and Routings, while users of the other plants will be authorized to Process orders and Recipes only
Once PP is introduced for Discrete activities in some plants, it can be used all across Syensqo production plants to manage Packing actvities, which are compatible with PP-PI, but PP is definitely a better fit for them. Setup optimization is the typical business case for this.

Forcing PP-PI to manage also Discrete Production would have the following impacts:

it will be more difficult to leverage the advantages of all available Apps in S4 system, as their design is tailored on the specific typical requirements of each module. Example: Manage Process Orders App does not allow to book directly confirmations, as in PP-PI they normally comes from Process Control, Manage Production Orders App allows to book directly and quickly confirmations and status updates
the solution will be less future-proof as the Digital Manufacturing, and the new Fiori Apps are and will be designed to work for each module in different specific ways for Discrete/Process environments
Some fine-scheduling functions will be unavailable. For instance, it won't be possible to schedule different capacities of the same Work Center on different orders simultaneously, it won't be possible to schedule the start of a subsequent operations based on quantity elaborated by the previous one.
If a product can be obtained via different sequences of operations, in PP-PI this can be achieved only creating completely different Recipes and Production Versions, while in PP it is also possible the creation of alternative sequences inside the same Routing.

Business Rules

No Specific Business Rule should change in the 2 optios.

Options considered

Option A: Adopt PP-PI for all Discrete Production Activities

The PP-PI module will be the only one used across the company. Discrete activities will be managed via Recipes and Process Orders.

This option simplifies and accelerates the implementation, but sacrifices the Best Practice concept for the sake of cost and time savings.

Pro’s	Con’s
Training: The same set of Apps and the same Master Data objects will be used across the company for Manufacturing activities	Far from Best Practice: using PP-PI for Discrete operations is a forcing and implies reduced functionalities
Change Management: little change management required, as all plants already in SAP are running production on PP-PI	Not Future-Proof: New Fiori Apps and new SAP Functionalities will likely be hard to adopt for the Discrete operations managed on PP-PI. Specific PP improvements that can be beneficial for those production lines and plants won't be available
Simplicity: the implementation is limited to the set of objects required by PP-PI module, we do not need to customize PP objects	Integration: most of third party MES systems and SAP Digital Manufacturing work on the assumption that the discrete processes are modeled by Discrete Production Orders and Continuous/Batch processes are modeled by Process Orders. Forcing PP-PI to adapt to Discrete operations will generate complexity and constraints integrating the ERP with Shop Floor control applications. It's very likely that most of the standard connectors cannot be used.
	Planning: usage of SAP PP-PI instead of PP affects mainly Planning related functionalities, like Setup Optimization, Order Dispatching and Fine Scheduling, Alternative Sequence Selections. All these PP functionalities become more complex, some of them even impossible, in PP-PI.

Option B: Adopt PP-PI for Process Activities and PP for Discrete Manufacturing

This is the option that better adopts the Best Practice concept. It requires the most complex implementation and the largest investment in training and Change Management.

Pro’s	Con’s
Best Practice: using PP for Discrete operations is 100% compliant with SAP Best Practice and allow to leverage all functionalities in S4 and, in case, in Digital Manugfacturing.	Training: Users must be trained to two different sets of Apps and Master Data to be used. For the hybrid plants, where both Process and Discrete production co-exist, some users must become familiar with twice the Apps and ways of working.
Future-Proof: New Fiori Apps and new SAP Functionalities can be quickly introduced for Discrete operations managed on PP. Specific PP improvements that can be beneficial for those production lines and plants will be available.	Change Management: huge change management is required, as the plants where PP will be introduced will need new ways of working for Master Data Management, Production Planning, Production Execution, Reporting.
Integration: most of third party MES systems and SAP Digital Manufacturing work on the assumption that the discrete processes are modeled by Discrete Production Orders and Continuous-Batch processes are modeled by Process Orders. The integration of Shop Floor applications will be easier and standard connectors can be largely used.	Complexity: the implementation effort to design, validate and implement both a PP model and a PP-PI model in the project is roughly estimated 1.5 times bigger than a single PP-PI model.
Planning: Setup Optimization, Order Dispatching, Fine Scheduling, Alternative Sequence Selections. All these PP functionalities will be available.

Option C: Adopt PP-PI for Process and Discrete Manufacturing activities in all mixed plants, adopt PP only in the pure Discrete Plant in Newark.

This option allows the plant(s) with pure discrete manufacturing to run on the Best Practices and leverage all functionalities, while the plants with mixed activities will have a simplified model and reduced efforts and training as they keep the current PP-PI module and will deal with familiar concepts. The opportunity of this option comes from the fact that the only pure Discrete plant in the company, Newark, is not on SAP yet. The option to introduce SAP in the plant here at the same time of the project Go-Live is considered.

Pro’s	Con’s
Best Practice PP Plants: using PP for Discrete operations is 100% compliant with SAP Best Practice and allow to leverage all functionalities in S4 and, in case, in Digital Manufacturing for the Plant characterized by pure Discrete Production	Complexity: the implementation effort to design, validate and implement both a PP model for a single plant and a PP-PI model in the project is roughly estimated 1.3 times bigger than a single PP-PI model.
Future-Proof: New Fiori Apps and new SAP Functionalities can be quickly introduced for Discrete operations managed on PP for the pure Discrete Production Plants. Specific PP improvements that can be beneficial for those production plants will be available. Having a PP model in the system, will allow the company to roll-out it to new Plants completely or predominantly running Discrete production and to the Discrete productions of existing Plants after the completion of the project.
Integration PP plants: most of third party MES systems and SAP Digital Manufacturing work on the assumption that the discrete processes are modeled by Discrete Production Orders and Continuous-Batch processes are modeled by Process Orders. The integration of Shop Floor applications will be easier and standard connectors can be largely used, but only in the fully Discrete Production plants adopting PP.	Integration PP-PI Plants : most of third party MES systems and SAP Digital Manufacturing work on the assumption that the discrete processes are modeled by Discrete Production Orders and Continuous-Batch processes are modeled by Process Orders. Forcing PP-PI to adapt to Discrete operations will generate complexity and constraints integrating the ERP with Shop Floor control applications. It's very likely that most of the standard connectors cannot be used.
Planning PP Plants: Setup Optimization, Order Dispatching, Fine Scheduling, Alternative Sequence Selections. All these PP functionalities will be available.	Planning PP-PI Plants: usage of SAP PP-PI instead of PP affects mainly Planning related functionalities, like Setup Optimization, Order Dispatching and Fine Scheduling, Alternative Sequence Selections. All these PP functionalities become more complex, some of them even impossible, in PP-PI.
Training: Users of each Plant will be trained on a single production model: PP-PI for most of the plants, PP for the purely Discrete Production Plants.
Change Management: little extra change management is required, as the plants already running in PP-PI will remain on it and we introduce PP on a PLant currently not on SAP.

Note, in all cases, we consider to move plant 4048 Zhenjiang to PP-PI, Repetitive Manufacturing is not a good solution there.

Evaluation

The simple decision matrix lists all considered criteria and the estimated weights and scores for each of the 3 options. The total is the sum of each score multiplied by the weight of the criteria and gives a global evaluation of the options across the different points of view.

Criteria	Weight (1-10)	Option 1 Full PP-PI for all plants	Option 2 PP for all Discrete Productions, PP-PI for all Process Prod.	Option 3 PP for pure Discrete Plant(Newark), PP-PI elsewhere
Future Proof and Scalability	9	4	9	8
Best Practice	8	3	9	8
Planning Functionalities	6	7	9	8
Shop Floor integration: DMC &3P MES	10	5	9	8
Complexity	7	9	2	6
Training	6	9	2	6
Change Management	7	9	3	7
Total		332	344	391

The Option 3 - introduce PP only in the Pure Discrete plant(s), and use PP-PI across all other plants, also for Discrete Productions operations that a few of them are running, emerges as the preferred options by large. Hybrid plants (Process and Discrete Manufacturing together) will run on PP-PI SAP module.

Although all options have their advantages and disadvantages, the Option 3 has the indisputable merit of introducing a PP model in the new ERP system, opening the door for leveraging it for future Discrete Production Plants that may be acquired, rolling it out to progressively to the Discrete operations running in the current plant and keeping the company up to date with all SAP innovations and new functionalities that will be introduced in that area by SAP. It is also the best balance between the aim for Best Practice and the containment of complexity and costs.