erp 101: work orders - the starting points of manufacturing
TRANSCRIPT
ERP 101 Session 8Work Orders – Manufacturing’s Starting PointDavid BushSenior Manufacturing Consultant,Rootstock
The ERP 101 Webinar SeriesDate Topic
Aug 2, 2016 An Introduction to ERP for Manufacturing
Aug 16, 2016 Engineering – Learn how to create Part Master Records and Bills of Material
Aug 30, 2016 Engineering – Learn how Change Orders and/or Revisions ensures that ERP system data is accurate and up-to-date
Oct 11, 2016 Shop Floor – Explore how ERP is used to create and maintain Work Centers, Routings and Procedures
Nov 1, 2016 Shop Floor – See how scheduling the Shop Floor through ERP controls Labor and Machines
Nov 29, 2016 Procurement – Link your Vendors and Purchased Parts via ERP
Dec 13, 2016 MRP – Step through an overview of this vital ERP subset
Jan 24, 2017 Work Orders – Manufacturing’s Starting Point
Feb 14, 2017 Inventory - Maintaining Accurate and Reliable Data
TBA Sales – See how you can link your Customers and Products via ERP
TBA Manufacturing Accounting – An overview using standard cost
TBA Manufacturing Accounting – An overview using weighted cost
Meet Our SpeakerDavid BushSenior Manufacturing Consultant, Rootstock• 30+ years of manufacturing and MRP/ERP
systems experience• Previously at General Microcircuits,
Consona Corporation, Relevant Business Systems, Inc
A Quick Recap• What we have covered in our first 7
episodes:– The history of MRP/ERP systems– Engineering Item Master and Bills of Material– Shop Floor Routings– Purchasing’s role in modern ERP systems– MRP – How it fits into the ERP system
Today we look at another facet of MRP planning, work orders.
Material Planning WITHOUT MRP• Spreadsheets are used to track material supplies and demands
for raw material and subassemblies. Data includes:– Current Inventory Levels– Current Demands – Future Demands– Re-order points
• Planner calculates actual demand over time• Open supply orders considered (work orders/po’s)• Open demands then deducted from inventory and supply
orders to determine necessary actions:– We’re ok– Uh oh… about to run out– Uh oh… we have way too much!
Done for every active part on the system.. .PFEW! Thank goodness for MRP!
Where do Work Orders Originate?
MRP Engine
Material Demands from Sales Orders and Work Orders
Engineering and Inventory Item Masters used by Planning
MRP creates suggested Work Orders
Manual Work Orders
Work Order Receipts bring material to stores
Planner reviews and firms
suggested Work Orders
Work Orders Create Supplies AND Demands
Bicycle handlebar assembly• The Work Order to build this assembly creates a SUPPLY
for the number of assemblies being built.• MRP also sees a DEMAND for the components required
to build the assembly:– Handlebar grips (2)– Stem (1)– Reflector Assembly (1)
These demands are defined on the bill of material, and may be adjusted on the work order without affecting the original bom.
So, what do Work Orders accomplish?
Work Order AccomplishmentsSupplies
Satisfy ‘needs’ seen by MRP
Provide the ability to manually build items apart from MRP
Capture Data and Maintain History
Material IssuesLabor Reporting
Work Center DemandsScrap
Costs: material, labor, machine, overhead, subcontract
Identify Demands
Material demands for raw material and sub-assemblies
Labor and Machine time, used for scheduling and financial
planning
Is that all there is to consider?
Following a Work Order’s Progress• MRP generates planned Work Orders• Planned Work Orders are firmed to identify material requirements via
the pick list.• Routing is attached to identify labor/machine requirements.• Material is allocated and issued.• Work Order is ‘released’ to Manufacturing.• Component and Parent scrap is identified• Labor is reported, along with completions at each operation.• Finished parts are received to stores.• Work Order formally ‘closed’ when all costs are accounted for.
– No further labor or material issues can occur when ‘closed’.
Let’s see how this comes together is Rootstock.
Work Order Firm/Unfirm Object
What if the work order needs to be adjusted before I firm it?
Adjusting MRP-created Work Orders
Once we have made our changes and ‘firmed’ up the order, what’s next?
Creating Pick List and attaching the Routing
• Click ‘Extract Operations’ to create the routing for this order.• Click ‘Extract Components’ to create the pick list used to issue material to the work order.
Let’s examine additional information held on the record.
Work Order Adjustments
• Changing the Due Date has adjusted the other related dates.• Scheduled Completion Date will be visible once the order is included in the shop floor scheduling function.• Cost details including labor, material, overhead and subcontract operations are all visible from the work order
object, adjusting as the work order progresses thru the scheduled operations.
How are operation quantity completions and labor entered?
Work Order Labor and Quantities Complete
• One method is using the Time & Quantity Bookings object.• Transaction date, total hours and total parts completed are entered.• Parts completed can reduce time still needed at the work center when running
the scheduling program.• Hours adds both labor and overhead costs to the work order.
How are the completed parts received into stock?
Quantity accepted may be equal to or less than quantity available. • Inventory location (id and number) are entered, then ‘Perform Work Order Receipt’ button is clicked.• Quantity Remaining indicates number of parent yet to be received. If scrapped at any operation, this
number will reflect the total ‘good’ available for stock.
Once all of the work order quantity is accounted for (received or scrapped) the work order may be closed, ending all further activity.
Work Order Receipts to Stock
Where Do We Go From Here?Today we covered the Work Order segment of manufacturing… building parts and assemblies in-house. This satisfies the MRP demands for manufactured items. What’s still to come?
• Inventory– Maintains current balances of direct material– Provides means to issue material as needed to work orders and subcontract purchase
orders.– Includes ability to monitor inventory records for accuracy.
• Order Entry – Feeds the ‘demand’ side of ERP from the customer base.– Maintains customers, products, orders, etc
• Standard Costs– Setting and maintaining standard costs for parts/assemblies/finished goods.– Using simulated costs for future planning.
And much more…..
The ERP 101 Webinar SeriesDate Topic
Aug 2, 2016 An Introduction to ERP for Manufacturing
Aug 16, 2016 Engineering – Learn how to create Part Master Records and Bills of Material
Aug 30, 2016 Engineering – Learn how Change Orders and/or Revisions ensures that ERP system data is accurate and up-to-date
Oct 11, 2016 Shop Floor – Explore how ERP is used to create and maintain Work Centers, Routings and Procedures
Nov 1, 2016 Shop Floor – See how scheduling the Shop Floor through ERP controls Labor and Machines
Nov 29, 2016 Procurement – Link your Vendors and Purchased Parts via ERP
Dec 13, 2016 MRP – Step through an overview of this vital ERP subset
Jan 24, 2017 Work Orders – The starting point of manufacturing
Feb 14, 2017 Inventory - Maintaining Accurate and Reliable Data
TBA Sales – See how you can link your Customers and Products via ERP
TBA Manufacturing Accounting – An overview using standard cost
TBA Manufacturing Accounting – An overview using weighted cost