In addition to the above objectives, which you can select/weight or deselect, Oracle ASCP maintains a set of implicit (hidden) objectives that it takes into consideration no matter what you select. These objectives are defined to be the negative of various penalty costs, as follows:

Implicit objectives =

• -(Penalty cost for late demand)

  -(Penalty cost for resource capacity violation)

  -(Penalty cost for transport capacity violation)

  -(Penalty cost for material capacity violation)

  -(Penalty cost for safety stock violation)

  -(Penalty cost for using alternate sources)

  -(Penalty cost for using alternate routings)

  -(Penalty cost for using alternate resources)

  -(Penalty cost for using substitute items)

  -(Percentage of carrying cost)

Maximizing implicit objectives results in minimization of the penalty costs.

Penalty costs are the product of the penalty factor and some other parameter such as list price, item cost, resource cost, or transportation cost. For example:

Penalty cost for late demand [$/unit/day] = (Penalty factor) * (List price)

You can set penalty factors at different levels using flexfields, plan options, or profile options. Flexfields let you set penalty factors at the most discrete level. For example, you can set the Penalty Factor for Late Demand at the Demand, Item, or Org level using flexfields. Plan options and profile options let you set the same penalty factor at the plan level and site level, respectively.