CYCLE COUNTING USING MATERIALS MANAGEMENT

INTRODUCTIONS

• Attendees

• Materials

• Accounting

• IT

• Other

• Presenter

• Bruce Beattie

• Guide Technologies Application Consultant

• 435-590-1706

• bbeattie@guidetechnologies.com

PHYSICAL INVENTORY

• Lost production

• Required by Auditors

• Introduces errors

• Counters not invested

• No Root Cause

CYCLE COUNTING

• Invested Counter(s)

• No lost production

• Root Cause

• Two Years to prove out

MAPICS/XA

• Written in 1989

• Third Party Packages

• Limited Variances supported

• Cumbersome to start Cycle Counting program

STRATIFICATION

• ABC Analysis Report

• Rewritten in 2016

• Annual Usage from ITEMBL

• Optionally will update Value Class

• Only 3 Classes supported

• Requirements

• Requires Forecast

• Use 10 Months of Requirements (dependent on production Lead Time)

• Use number of As, Bs, and Cs to count each day

• Performed annually

ABC ANALYSIS REPORT

VARIANCE REPORTING

• XA Supports

• Variance Quantity

• Variance Percent

• Distorted accuracy possible

• A zero Count Quantity always results in a Variance of 1.000

• A change from 5 to 1 results in a negative .800

• A change from 1 to 5 results in a 4.000

• Variance by Count Class reduces distortions

VARIANCE REPORTING ALTERNATIVES

• Variance Value

• Variance Absolute Value

• Variance Absolute Quantity

• Variance Absolute Percent

• Transactional Variance Percent

• Use Integrator and extension file to Inventory Count Items object

VARIANCE REPORTING EXAMPLE

Item Compare Qty Count Qty Variance Qty Variance Percent Variance Value Abs Var Value Abs Var Qty Abs Var Percent Transaction Percent

Item A 100 90 -10 -10 -25 25 10 10 0.77

Item B 300 320 20 6.667 30 30 20 6.667 2

Total 400 410 10 -3.333 5 55 30 16.667 2.77

GETTING STARTED

• Count Frequency

• XA only supports Monthly, Quarterly and Semi-Annually

• Current thinking/practice

• A’s Quarterly, B’s Semi-Annually and C’s Annually or Bi-Annually

• Spreadsheet

• Last Count Date

• Next Count Date

• Cycle Count Activity

POWERLINK CYCLE COUNTING

• Item Warehouses or Item Locations Object

• View with pertinent fields based selection criteria used

• Subset based on selection criteria

• Sort using Class, Item, Last Count Date, and Cycle Count Activity

• Manual activity to select Items or Item Locations to count

ITEM LOCATIONS VIEW

ITEM LOCATIONS VIEW

• Fields included

• Warehouse (if applicable) and Item

• Value Class or Cycle Count Class

• Location and Location Quantity

• Batch/Lot and FIFO Date (if applicable)

• Last Count Date and Cycle Count Activity

• Item Warehouse On Hand

• Forced Cycle Count

• QC Status and QC Due Date (if applicable)

ITEM LOCATIONS SUBSET

ITEM LOCATIONS SUBSET

• Selection criteria

• Count Class = ‘A’ and Last Count Date <= -3 Months

• Or Count Class = ‘B’ and Last Count Date <= -6 Months

• Or Count Class = ‘C’ and Last Count Date <= -2 Years

ITEM LOCATIONS SORT

ITEM LOCATIONS SORT

• Sort criteria

• Count Class or Value Class

• Last Count Date

• Cycle Count Activity (descending)

• Item

CYCLE COUNT GROUP

• Count Group for each Day

• Count Groups for each Count Class

• Reuse in the future

• Negative On Hand

• Handled separately or as part of Cycle Count

• Tailoring Question for Negative On Hand

• Forced Cycle Count

• Flag is set whenever there is a negative On Hand

• Not reset until all Locations for an Item are counted

CYCLE COUNT GROUP

• Compare Quantity

• Entry On Hand

• Captured when Count is entered

• Cutoff On Hand

• Captured when Count Group is activated

• Physical Inventory is usually Cutoff On Hand

• Activate Count Group

• Once activated Items cannot be added to Count Group

CYCLE COUNT GROUP CREATION

CYCLE COUNT GROUP CREATION

CYCLE COUNT GROUP CREATION

COUNT ENTRY

• Sequential or Random

• Sequential is based on the View

• Random is based on Template

• Use Defaults to reduce entry time

• SQL to populate fields that will be the same—Count Date, etc.

• Counts entered in Inventory Count Items object

• Can access via Inventory Count Groups object

• Post the Inventory Count Group when counting complete and Variances

resolved

COUNT ENTRY

COUNT ENTRY

OUT OF TOLERANCE

• Tolerance Percent in ITEMBL file

• Suggested values

• A Items 0 to 2 percent

• B Items 2 to 5 percent

• C Items 4 to 10 percent

• XA will set flag in Inventory Count Items if out of tolerance

• XA supports up to 3 Counts for each Inventory Count Item

• Suggest using just Count 1

ROOT CAUSE

• XA does not support

• XA does not support Variance signoff

• Use Integrator and an extension file to the Inventory Items Count object

• Subscriptions to support Variance signoffs

PHYSICAL INVENTORY

• Mechanics of conducting Physical Inventory

• Tags

• Tag control

• Count Sheets

• Offline Load via PHVENT

• Variance review

• Posting of Physical Inventory

PHYSICAL INVENTORY USING PICC

GENERATE PHYSICAL INVENTORY TAGS

PRINT PHYSICAL INVENTORY TAGS

PHYSICAL INVENTORY USING PICC

• Generate Physical Inventory Tags

• Several formats (will add new formats to match client’s existing Tag format)

• Generate Miscellaneous Tags for Items “found” during the Physical Inventory

• Generate Physical Inventory Count Sheets

• Supports Inventory Tag Batch processing

• Inventory Counted/Uncounted reports

• Variance reports

RECAP

• Enhancements to supplement XA

• Stratification program

• Inventory Count Items extension with program(s) to populate

• Variances

• Root Cause

• Variance signoffs

QUESTIONS

THANK YOU FOR ATTENDING