Using the PPDS setup matrix

Hello All -
I have 3 products A,B and C which  are run on a single line during a particular week(day). We have certain set-up times when we move from one product to another. Here are the set-up times:
The sequence in which these products run on the line is decided by the plant scheduler during production planning. The production planners run heuristics and peform manual changes to the planned orders. They know which product runs in which shift but they do not necessarily adjust the planned orders to the hourly level.
What we would like the system to do is somehow incorporate the set-up times when we move from one product to another.  We would like to see the the resource being consumed during the set-up time.
Also, we are not in a position to use the optimizer. So any solutions involving the Optimizer are out of scope. Just want to achieve this using heuristics.
To achieve this, I have created the following master data:
1) Created 3 setup groups SG1(A), SG2(B), SG3(C).
2) Created a setup matrix SM1 and set up the transitions for   all the above combinations.
3) Assign the setup group to operations in a ppm
4) Assign the setup matrix to the resource
I then created 3 planned orders in production planning for the SAME day. All 3 have the same availability time 23:59:59 and based on run-rates we have different start times.
I have the following questions:
1) Which DS heuristic should I use to adjust the start times and the end times of these orders by considering the set-up times in the setup matrix?
The resource should basically be consumed during these setup times. I have looked at "Reschedule" function in the DS planning board but I get an error when I run this. Please see end of this post for the error. The message says I may not have free capacity, but I do. I am using backward scheduling and infinite.
2) Is there anyway the set-up times/matrix can be considered during production planning itself and not during detailed scheduling?
3) Can the option of "Schedule Sequence" work for my scenario.
Appreciate all your help.
Varun
Error during scheduling
Message no. /SAPAPO/OM043
Diagnosis
The system could not schedule an order, operation or activity.
This could have the following causes:
The resource does not have any free working time or capacity.
If you have set planning direction backwards in the strategy profile:
There is not enough working time or capacity available for scheduling between now and the scheduling date.
If you have set planning direction forwards in the strategy profile:
There is not enough working time or capacity available for scheduling between the scheduling date and the end of the planning area.
If you plan characteristics-dependently:
You have assigned characteristics to operations of the order that do not agree with characteristics of the resources on which the operations are to be processed.
The system cannot find any suitable characteristics on the resources and so it cannot schedule.
Procedure
Depending on which of the above reasons is the cause, change the following settings:
Change the working times and capacities of the resources.
Set the planning mode "infinite planning" in the strategy profile.
Activate the planning direction forwards or backwards and reverse in the strategy profile.
Change the characteristics that you have assigned to the resource.

Thank you all -
It was a mistake on my part. I was supposed to create a new "set up" activity before processing activity and make that relevant to set-up. I had the processing step checked for setp all this while. Now its working.
Thanks
Varun

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