What is the primary purpose of "Supply Planning" in IBP?

The primary purpose of "Supply Planning" in SAP Integrated Business Planning (IBP) is to balance demand with available supply. This critical function ensures that an organization can meet customer demand while utilizing resources efficiently. Supply Planning involves analyzing forecasts and actual demand, along with the existing inventory levels and production capabilities, to create a feasible supply plan that aligns with business objectives.

This process also entails making decisions about inventory levels, production schedules, and logistical requirements, thus allowing businesses to optimize their operations and minimize stockouts or excess inventory. The focus on matching supply to demand is what distinguishes Supply Planning from other functions, such as forecasting market trends or enhancing financial planning, which serve different strategic purposes within the organization. By ensuring that supply meets demand, companies can operate more smoothly and effectively in a competitive marketplace.