What is planning horizon in SAP PP-MRP - Material Requirements Planning?

SAP Term: planning horizon

• Component: PP-MRP

• Component Name: Material Requirements Planning

• Description: Period that is defined for net change planning in the planning horizon. In this type of net change planning, only materials that undergo an MRP-relevant change in the planning horizon are planned in the planning run. The planning horizon needs to be long enough to include the following at least: The period in which sales orders are received Delivery times The total lead time of the materials

Smart SAP Assistant

• Key Concepts: 
  Planning horizon is a term used in SAP's Material Requirements Planning (MRP) component. It is the time period for which the MRP system will generate planned orders or purchase requisitions. The planning horizon can be set to a specific number of days, weeks, or months. 
  
  How to use it: 
  The planning horizon can be set in the MRP parameters of the material master record. The planning horizon should be set to a time period that is long enough to cover the lead time of the material, but not so long that it creates unnecessary planned orders or purchase requisitions. 
  
  Tips & Tricks: 
  It is important to review the planning horizon periodically to ensure that it is still appropriate for the material. If the lead time of the material changes, then the planning horizon should be adjusted accordingly. 
  
  Related Information: 
  The planning horizon is closely related to the safety stock and reorder point settings in MRP. The safety stock and reorder point settings determine when a planned order or purchase requisition will be generated, while the planning horizon determines how far into the future these orders will be generated.