inventory

Oracle Release 11i Training

ORACLE INVENTORY

http://oracleapps88.blogspot.com/ Raju Ch

http://oracleapps88.blogspot.com/


mailto:[email protected]

Course Objectives

• Review the new features of the R11i product

• Describe the business value of using the new

features

• Demonstrate the key features

• Discuss the implementation considerations

• Explain how the new features work within the

product family

• Supplement the R11i new features with hands-

on review quizzes, labs and exercises.





Course Overview

• Module Overview

• Inventory Structure

• Item Setup and Items

• Item Classification

• Inventory Controls

• Inventory Transactions

• Inventory Transactions – R11i New Features

• Inventory Planning and Replenishment

• …





Course Overview (Contd.)

• ABC Analysis

• Cycle Counting and Physical Inventory

• Workday Calendar

• Unit Of Measure

• Available To Promise (ATP)

• Forecasting

• Review Exercises

• Summary





INVENTORY STRUCTURE





Objectives

• Enterprise Structure

• Inventory Organization and Parameters

• Subinventories

• Locators





Enterprise Structure

• Human Resources View

– Business Group

– Legal Entity

– Operating Unit

– Work areas for:

• Inventory/warehousing

• Costing

• Manufacturing etc.






• Accounting View

– Set of Books

– Legal Entity

– Operating Unit

– Work areas for:

• Inventory/warehousing

• Costing

• Manufacturing etc.






• Business transactions affected by:

– Set of Books

– Costing Methods

– Item Costs

– Workday Calendars

– Movement Between Inventory Sites

– Planning Method

– Forecasting

– Accuracy Analysis





Inventory Organization

• Inventory Organization is the first level of

stratification of inventory items

• An Inventory Organization is an inventory

location defined by its set of books, item

and costing

• Following Oracle Modules are controlled at the

Inventory Organization level:

– Inventory, BOM/ENG, Costing, WIP, MS/MRP





Inventory Organization

• Following are controlled at Operating

Unit Level

– Purchasing, Order Entry, AR, AP

• Inventory Organization

– “Master” organization

– “Child” organizations





Defining Enterprise Structure

• Define Location

• Define Business Group

– Or use default

• Define Set of Books

• Define Legal Entities

• Define Operating Units

• Define Inventory Organizations

– Define organization parameters





Organization Parameters

• Organization Code

• Definition of a “Master” Organization

• Costing Parameters

• Locator Control

• Serial Control

• Lot Control

• Revision Control






• Source Information for Replenishments


• Exception Set

• Demand Class

• Perform Reverse Encumbrance






• Inventory Asset Account Parameters

• Inter-organization Transactions & Account

Parameters

• Receiving Accounts Parameters

• Profit and Loss Account Parameters





Key Flexfields

• Facilitate defining of “codes” using meaningful

segments to codify GL accounts, part

numbers, and other

business entities

– Called as key flexfields

– Flexible mechanism to define coding scheme without

programming

• Defined using the define key flexfields form





Sub-Inventory

• Logical or physical subdivision of an inventory

organization

– Raw inventory, finished goods, or defective material.

– All material held in sub-inventories

– At least one sub-inventory must be defined

• Defined using the define sub-inventory form





Sub-Inventory

• Sub-inventories can be:

– Asset sub -inventories

– Expense sub -inventories

– Quantity tracked

– Non quantity tracked

– Can allow/disallow reservations of Items

– Can allow/disallow netting of the quantity held in the

sub -inventory

– Used in calculation of ATP





Sub-Inventory

• Sub-inventories can be used to:

– Restrict certain items to specific sub--inventories by:

• associating items with specific sub-

inventories using item/ sub-inventory form

• setting item attributes for restricting

sub-inventories





Sub-Inventory





Locators

• Further optional subdivisions of a sub-

inventory

– Row, Rack, Bin

– Defined using the locator key flex field

– Ability to restrict certain items to specific locators





Locators





ITEM SETUP AND ITEMS





Objectives

• What is an Item?

• Item Types

• Item Attributes

• Status Attributes

• Attribute Controls

• Master Organization

• Creating Items

• Item Templates

• Item Relationship

• Cross Reference





Item

• An Item is:

“Any unique manufactured or purchased part,

service, material, intermediate, subassembly,

or product”

• Item Data

– Shared data in Oracle Manufacturing & Oracle

Financials

• Purchasing, Order Entry, Cost Management,

Bill of Material, Engineering, MRP / MPS,

Work in Process, Receivable , Payable,

Fixed Assets, Sales & Marketing,

Quality, Service etc.





Types of Items

• Seeded Item Types

– Standard Component Item

– Purchased Item

– Internally Ordered Item

– Service Items

– Finished Goods

– Planning Items

– Subassembly

– ATO Model

– ATO Item





Types of Items

• Seeded Item Types

– Kit

– PTO Item

– Outside Processing Item

– Consignment Items

– Phantom Item

– PTO Model

– Option Class

– Option Item

– Reference Item

– Supply Item





Item Type





Item Attributes

• An Attribute is a property of item controlling

the behavior of an Item in various functional

areas and business processes

– Set during item definition

– Oracle Inventory uses around 160 Mandatory and

optional attributes for defining items

– Attributes can be module dependent i.e. can be set

only if the concerned Oracle Product is installed

• For example :Item can be sold by setting attribute

‘Customer Order Enabled’ to yes only when OE is

installed





Item Attributes

• Item attributes grouped into groups

– Main

– Inventory

– Bill of Material

– Costing

– Purchasing

– Receiving





Item Attributes

• Item attributes grouped into groups (contd.)

– General Planning

– MS/MRP Planning

– Lead Times

– WIP

– Order Entry

– Service





Item Status Attributes

• Item Status Attributes

– Item Attributes that enable an item to be visible in

key

Oracle modules and enable key functionality for that

item

• Eight status attributes

• Mandatory if the item is to be used in the

module






• Stockable

– Allows to store the Item in an asset

sub-inventory

• Transactable

– Allows to transact the item in Oracle Inventory, Oracle

Order Entry, Oracle Purchasing and Oracle Work in

Process

• Purchasable

– Allows to place the item on a purchase order

• BOM Allowed

– Allows to create a bill of material for the item






• Build in WIP

– Allows to build the item on a discrete job,

and/or repetitive schedule

• Customer Orders Enabled

– Allows to place the item on a sales order

• Internal Orders Enabled

– Allows to place the item on an internal sales order

• Invoice Enabled

– Allows to create an invoice for the item





Attribute Dependencies

Certain attributes depend on each other. For example:

• Stockable must be no

if Inventory item attribute is no

• Transactable must be no

if Stockable attribute is no

• Purchasable must be no

if Purchased item is no

• Build in WIP must be no

if Inventory item is no





Attribute Dependencies

Certain attributes depend on each other. For example:

• Customer order enabled must be no

if Customer ordered item is no

• Internal orders enabled must be no

if Internal ordered Item attribute is no

• BOM allowed must be no

if Inventory item attribute is no

• Invoice enabled must be no

if Invoice item attribute is no





Attribute Controls

• Two types of Controls for Item attributes

– Status Control

• Only for control of item status attributes

– Attribute Control Level

• Can be used for almost all item attributes





Item Status Control Attribute

• Used to set the group of 8 status attributes by

defining status codes and using status codes

to update the status attributes






• For example, a status code of Active

could specify

– Stockable Yes

– Transactable Yes

– Purchasable Yes

– Build in WIP Yes

– Customer ordered Yes

– Internal orderable Yes

– BOM allowed Yes

– Invoice enabled Yes






• A Status of Obsolete could specify

– Stockable Yes

– Transactable No

– Purchasable No

– Build in WIP No

– Customer order No

– Internal order No

– BOM allowed No

– Invoice enabled Yes






• When a user changes the status of an

item from active to inactive, inventory will

immediately update the 8 attributes as per

their status control settings

• Status control settings

– Not used

– Defaults Value

– Sets Value





Define Item Status





Attribute Control Level

• Attributes define functionality of an item in

various organizations

• Different item functionality may be required in

different organizations

– Example:

An item may be a sales item in a distribution

center but it would be an assembly in the

manufacturing organization

– Its primary unit of measure could be same in all

organizations






• Attribute control allows user to standardize

the level at which each attribute is controlled

– Master level

• Used for attributes that typically have the same value for

an item in all inventory organizations

– Organization level

• Used for attributes having different values in different

organizations






• Attribute control form applies to all inventory

organizations in the Installation

– Attribute Control Level Applies to all Items using

the specific attribute





Item Master Organization

• Like any other inventory organization;

– Can be used for all purposes for which an inventory

organization can be used

– Desirable to use it only for defining Items

– Multiple Item master organizations can be defined

but each inventory organization can have only one

master or it is defined as its own master

– Used to specify Attribute Control Levels

• Each Item can have different attribute settings for

different organizations in which it is defined

– Copying of Items from an item master organization

to another master organization is not allowed directly





Defining Master Items

• Done using the “Define Master Item Form”

– Inventory automatically locates the correct master

organization of your current inventory organization





Defining Master Items





Defining Organization Items

• Used to specify item attributes in inventory

organization where the item is going to be

used

• Done using the organization assignment

feature in the special menu of the define

master item form

– Enable the item in the desired organizations by

checking the boxes

– The specific attributes for each organization are set

by selecting the organization and using organization

attributes

– Only those attributes that are controlled at

Organization level are updatable





Organization Assignment





Item Templates

• Used to define attribute settings for generic

item types

– Oracle provides pre-defined item templates

– Can be updated or modified

– Custom / new templates can be defined

• Items can be defined by:

– Providing the template reference while defining items

– Using previous item definitions as templates for new

items

– Multiple templates can be applied in succession to

the

same item





Item Templates

• Custom item templates defined using define

item template form

• Custom templates specific to an inventory

organization can be defined

– Template defined for an organization can only be

used in that organization





Item Template





Item Cross-Reference

• Item Cross-Reference

– Item Cross-Reference allows cross referencing of

Inventory item codes to other codification schemes

such as

• Old and new item codes

• User names and item code relationships

• Used mainly for reporting purposes

– Item Cross-References are defined in the Define

Cross-Referenced Type form





Item Relationships

• Used to improve purchasing management and

item searching capabilities

• Types of Item Relationships

– Item Cross-References

– Substitute Items

– Related Items

– Manufacturer Part Number

– Customer Items





Item Relationships

• Used to define whether items are substitutes

of each other or if there is some non-specific

relationship between them

– Allows usage of substitute relationships in

purchasing to order and receive Item substitutes

– Non-specific relationships used mainly for reporting

purposes

– Can be reciprocal

• Defined using the Item Relationships form





Manufacturer Part Number

• Manufacturer Part Number

– Used to link item definitions in inventory to the

corresponding Manufacturer’s Part Numbers for

use in reports and forms

• Defined using the define Manufacturer Part

Number form by Manufacturer or by Item





LAB – 1 Inventory Setup

• How do you set up multiple sites under one

Oracle Inventory Organization, when you want

to track inventory for shipments between

these sites?

• How many child organizations can be

associated with a master organization?

• What is an item attribute? Give an example.

• What is an item attribute group?

• Two inventory organizations have different

UOM. At what level would you set the Primary

UOM attribute?





LAB – 1 Inventory Setup (contd.)

• Create an item template XX_PUR_TEMPLATE for

purchased items.

• Create a Purchased item XX_PUR_ITEM1 in

using above template.

• Enable above item to 2 child organizations.

• Create one more item XX_PUR_ITEM2 using

item XX_PUR_ITEM1.

• Define substitute relationship for above items.





ITEM CLASSIFICATION





Objectives

• Item Classification & Cataloging

• Item Categories

• Category Sets

• Usage of Categories





Item Catalogs

• Catalog is a group of items that share common

characteristics.

• Catalog’s descriptive elements can be used as

search criteria for items.

• An item catalog group can have any number of

descriptive elements.

• When an item is assigned to catalog group,

descriptive element’s values can be set.





Assign Item to Item Catalog Group





Item Categories

• Used to group items for querying, reporting,

accounting, assigning responsibility purposes

• Accomplished by defining category sets

and categories

– A Category is a logical classification of items that

have similar characteristics

– A category set is a logical grouping of categories

• Category set is a flex field structure

– Can have multiple segments





Item Categories

• Each item should belong to at least one

category set

• Each item can belong to many categories

• Each category can have many items

• A category set can have many categories





Item Categories





Assign Item to Categories





Item Categories

• Used in various Oracle Modules to:

– Specify a group or groups of Items for submission of

various programs, reports, screens and queries

– Assign default overhead rates to specific category of

Items

– Summarize demand history and generate forecasts

for a group of Items

– Perform min-max planning and reorder point

planning for a range of Item categories





Item Categories

• Used in various Oracle Modules to:

– Calculate lead times for Items within a category

– Schedule orders and update price lists for Items in a

category

– Group purchase orders by Item category

– Receive Items that belong to a particular category

– Schedule sales order lines by Item category

– Prorate discounts across Item categories





Category Flex-field

• Implementation of Category and Category Sets

Key Flexfields is a mandatory step

• Different category set structures can be

designed to fulfill unique grouping requirement

– For Warehouse

– For Purchasing

– For Accountants

– For Order Entry

• Each Category Set can have a different Flexfield

Structure to satisfy unique needs





Default Category Set

• Used to specify the default category set for

each of following functional areas

– Inventory

– Purchasing

– Order Entry

– Engineering

– Cost Management

– Service

– Planning

• Used for automatically defaulting categories for

the item in these modules





Default Category Set





LAB – 2 Item Classification

• Define two categories.

• Define a category set and include above

categories. Make one of them default for the

set.

• How many categories can you assign to an

item?





INVENTORY CONTROLS





Objectives

• Understand and implement Inventory controls

– Describe Lot and Serial Number Control on item

– Understand stock locator control

– List different types of controls in Oracle Inventory





Item Controls in Oracle Inventory

LotControl

Serial Number

Control

LocatorControl

RevisionControl

Inventory Controls





Lot Control

• Used for tracking a specific batch of items

identified by a number

• Method referred to as Lot control

• Applies to a batch of items you might receive,

manufacture, or ship to a customer

• Lot number in inventory can be manually

entered or generated automatically

• Used in

– Inventory , OE, WIP





Lot Control

• Uniqueness

– Unique lot number for items across all inventory

organization

– No uniqueness requirement

• Numbering scheme

– Combination of prefix and a number

• Generated at item level or

• Inventory organization level or

• Can be user entered

• Cosmetic features available





Item Setups for Lot Control

• Used during transactions

– Lot Control for a specific item

• No Control

• Full control

– Define Shelf Life Control

• No shelf life control

• Shelf life days

• User defined shelf life

– Lot based picking rules





Serial Number Control

• Used for tracking each unit of an item and

its disposition

– Provides the tightest control on items

– Assigns a unique serial number to individual units

of an item

– Tracks its inventory movement very closely






• Uniqueness

– Unique serial number for items across all inventory

organizations

– Unique serial number for items within an inventory

organization

– Unique serial number for items within inventory items






• Numbering scheme

– Combination of prefix and a number

• Generated at item level or

• At inventory organization level





Item Setups for Serial Control

• Used during transactions

– No serial control for item

– Use pre defined serial numbers

– Dynamic entry at inventory receipt

– Dynamic entry at sales order issue

• Uses the prefix and starting number to

generate serial numbers





Locator Control

• Used for numbering physical locations /

addresses in a sub-inventory

– Often to restrict item transactions to or from specific

locations

• Implemented by:

– Defining stock locator flexfield structure

– Defining locators (Predefined / dynamically)

– Associating sub inventories and locators

– Associating items to sub-inventory / locator

combinations





Locator Control

• Uniqueness

– Locators (based on segment combination) are always

unique in an inventory organization and can be setup

for uniqueness across organizations

• Locator control level

– Entire Inventory organization can be under locator

control

– Only specific sub-inventories can be under locator

control

– Only specific items in a sub-inventory may be under

locator control

– No locator control





Locator Control

• Items can be restricted to specific sub-

inventory / locator combinations for

transactions by:

– Setting up locator control for items to be restricted in

item attributes

– Specifying restrict sub -inventories and restrict

locators in item attributes for those items concerned

inventory organization attributes

– Defining sub-inventory and locators in those sub-

inventories

– Associating items with sub-inventory / locator

combinations using the item/sub-inventory form





How To Implement Locator Control

Define Stock Locator Flexfield

Choose Locator Control Option AT:

1. Organization Level

2. Sub-inventory Level

3. Item Level

Define Sub-inventories

Define Locators

Enter Locator Information

when Performing Transactions





Inventory Controls





LAB – 3 Inventory Controls

• Define an item that is under locator control.

• Define two locators for any subinventory.

• Define an item that is under lot control.

• Define another item that is under lot and self

life control.

• Create a miscellaneous receipt for three units

of each of the two items that you just defined.

• Define an item that is under predefined serial

number control.

• Predefine 5 serial numbers for above item.

• Create miscellaneous receipt to receive 3 units

of the this item.





INVENTORY TRANSACTIONS





OBJECTIVES

• Definition – Inventory Transaction

• Transaction Setup

– Transaction Types and Source Types

– Transaction Actions

– Transaction Managers

– Inventory Accounting Periods

• Identify different transactions

– Receiving Transactions

– Sub-Inventory Transfers

– Inter-Org Transfers

– Miscellaneous transactions

– WIP Material Transactions

– Shipment Transactions

– RMA

• Transaction Inquiries





Inventory Transactions

• An inventory transaction is:

– Any business event/process that results in changes to

either quantity or value of items

– Used to control the flow of material in the

organization

• A transaction could be:

– The receipt of returned material from a vendor or

sub-inventory or organization

– The inspection and issue of material

– The movement of material from one physical/logical

source of inventory to another inventory or to and

from the shop floor

– Cost update






• A transaction could be:

– A transfer of material between warehouses, between

manufacturing facilities, or between stockrooms

– A shipment of finished goods to the customer

• The impact of transactions can be verified,

viewed, or tracked through different screens

and reports in Oracle Inventory such as:

– Material transactions, transaction distribution screen

– On hand quantity, storage location of item





When do

transactions

occur?

Change in Physical/Logical

location of material

Change in quantity

of item(s)

Change in accounted

value of item(s)

Generation of Accounting

Transaction to support

the Parent Transaction






Transaction Types

• Oracle inventory supports a large number of

standard (36) transaction types to satisfy

various business needs for inventory control

• Transaction types can be customized or new

transaction types created

• Transaction type defined using

– Transaction source type

– Transaction action

– Transaction types form





Transaction Source Types

• Indicates the entity originating the transaction

– Oracle provides system defined transaction sources

which can be customized

– User can create user defined transaction sources

• Using the transaction source type form






Pre-defined transaction sources:

• Purchase Order

• Sales Order

• Account

• Job or Schedule

• Account Alias

• Internal Requisition






Pre-defined transaction sources:

• Internal Order

• Cycle Count

• Physical Inventory

• Standard Cost Update

• RMA (Return Material Authorization)

• Inventory





Transaction Actions

• Specifies the result of the transaction action

• Oracle provides pre-defined transaction

actions

– Only names can be customized but not the effect of

the action

• Pre-defined actions

– Issue from stores

– Sub-inventory transfer

– Direct organization transfer

– Cycle count adjustment





Transaction Actions

• Pre-defined actions:

– Physical inventory adjustment

– Intransit receipt

– Intransit shipment

– Cost update

– Receipt into stores

– Delivery adjustments

– WIP scrap transaction





Transaction Actions

• Pre-defined actions:

– Assembly completion

– Assembly return

– Negative component issue

– Negative component return





Transaction Types Screen





Transaction Managers

• The transaction managers execute the

following processes:

– Material transaction

– Demand reservation

– Move transaction

– Resource cost transaction

– Material cost transaction





Transaction Managers





Inventory Accounting Periods






Inventory transactions fall in following broad

categories:

• Receiving Transactions

• Sub-inventory Transactions

• Move Orders

• Inter-organization Transfers

• Miscellaneous Transactions

• WIP Material Transactions

• Shipment Transactions

• Return Material Transactions





Receiving Transactions

• Used primarily for receiving against supplier

purchase orders

– Materials received into an inventory location

• Transaction type used is “Receive into Stores”

– Increases the on hand quantity in sub-inventory and

locator Oracle also increases the appropriate

inventory values

– Generates material distributions as specified in the

PO Distributions

– Reduces the open PO quantity





Receiving Transactions





Sub-Inventory Transfers

• Used primarily to transfer material between

– Two sub-inventories or

– Two locators of a sub-inventory of an inventory

organization

• Allowed transactions controlled by

– Settings of sub-inventory

• Asset / expense

– Item type settings

• Asset / expense






•





Inter-Organization Transfers

• Inter-Organization Transfers

– Used to move material between two inventory

organizations within an operating unit

– Requires defining shipping networks between them

– Types :

• Direct transfer

• In transit transfer






• Direct Transfer - issuing and receiving

transactions performed simultaneously

– Immediately reflected in the system quantities

• In-transit Transfer - a two-step process

– First, the material is issued out of the shipping

organization and into in-transit inventory

– On arrival at the destination,a normal receiving

transaction is performed to destination

– Shipment information can be kept up to date while in

transit






– Used widely for replenishment of Inventories

• Min-max or reorder point planning creates internal

requisitions

– Fulfilled by requesting an inter-organization transfer

– Requires Purchasing, Order Entry in addition to Inventory

for internal order processing





Miscellaneous Transfers

• Miscellaneous transfers are used to perform

any miscellaneous issues out or receipts into

inventory

– To perform receipts other than against a PO to a

vendor

– Creates distributions directly to the sub-inventory and

other specified account numbers or account aliases





Miscellaneous Transfers





WIP Material Transactions

• WIP Material Transactions

– Are used to perform shop floor related tasks like:

• Pushing components to jobs / schedules from inventory

• issue components for a complete job, individually or by

department or based on specific routing operation

– Forms for executing these transactions are found in

WIP





Shipment Transactions

• Shipment Transactions

– Used to fulfill customer orders

– Through the Ship Confirm





Return Material Authorizations

• Return Material Authorization

• Used for authorizing return of products sold to

customers

– Entered in Order Entry

– Customer return received in Inventory





Inventory

Transactions

WIP Material

Transaction

Miscellaneous

Transfers

Sub-inventory

Transfers

Return Material

Transaction

Inter-

Organization

Transfer

Shipment

Transaction

Receiving

Transaction





Transaction Inquiries

• View Material Transaction

• View Transaction Summaries

• View Pending Transactions

• View Material Transaction Distributions





Transaction Inquiries (Material

Transactions)





Common Features

• Control and Validation

– Revision control validation

– Sub-inventory restriction validation

– Stock locator control and locator restriction validation

– Lot control validation

– Serial number control validation

– Item status validation

– Transaction date open period validation





Common Features

• Screen Supports:

– Multi-line orientation

– Multiple units of measure with item primary UOM

default

– Item description display

– Descriptive flex fields

– Transaction reason codes

– Transaction reference

– Negative inventory parameter validation

– Quantities displayed in UOM

– Dynamic on-hand quantity and available quantity

display

– Available quantity = on-hand quantity - reservations





LAB - 4 Inventory Transactions

• Define a transaction type

XX_RECV_TRANS_TYPE to receive items. If

needed create a new source type also.

• Perform a transaction with above transaction

type.

• Transfer item XX_ITEM from a subinventory

XX_SUB1 to XX_SUB2 (within same

organization).

• Perform an inter-org transfer to an

organization that require intransit inventory.





INVENTORY TRANSACTIONS

R11i New Features





OBJECTIVES

• Move Orders

• Material Shortages

• Serial Genealogy





Move orders

• Move orders

– Used for moving stock within an inventory

organization as a better managed material flow

• Traditionally done using Miscellaneous transactions,

account transfers or sub inventory transfers

• Previously a one step activity providing no visibility,

planner intervention or documentation

– Defined as separate transaction types and there fore

can be transacted through the ‘Material transaction

open interface’

– Result in either an account issue or sub inventory

transfer





Move orders

• Move orders

– Faster and managed inventory movement

• User can request a move order which gets sent to a

picker for actual execution

• Replenishment mechanisms can auto trigger move

orders

– Integrated to Picking

• Move orders utilize the same mechanism of pick slips

and inventory visibility as a sales order

– API’s

• API’s allow move orders to be transacted through

mobile devices





Move orders Types

• Move order types made available in 11i

– Move order requisition

• Manually created

• The request can be for subinventory transfer or

account transfer

• The requisition can go through a workflow approval

process before it becomes a move order (optional)

• Two or three step process

– Create move order

– Detail move order

– Transact move order

• Print move order pick slip before or after transacting

– Sub inventories affected only after ‘Transacting’





Move orders Types

• Move order requisition (Contd.)

– Ability to transact through mobile devices

• Using the open transaction interface API

– Approval handled through workflow

• Indicated by setting the approval time out period in

organization parameters window along with time out

action

• Planner can be notified if one is associated with the

item

• Individuals in the notification list attached to source

and destination sub inventories can be notified of

planner approvals

– Notifications accessed through the viewer





Move orders Types


– Replenishment move order

• Can be automatically created by Kanban replenishment,

Min Max, or replenishment count process

• Pre approved with a transaction type of sub inventory

transfer

– A sub inventory type replenishment source needs to

be specified at the kanban pull sequence level for

kanban planned items





Move orders Types

• Replenishment move order (Contd.)

– A sub inventory type replenishment source needs to

be specified at any of the following levels for

replenishments using min max planning /

replenishment counts

• Master/Org item level

• Sub inventory level

• Item/Sub inventory level





Move orders Types


– Pick wave move order

• To be made available with release of order management

– Used for staging material to a staging location (set up as a

subinventory) from source location after Pick release

process

– Effectively a sub inventory transfer

– Is Pre approved





Move orders Process

• Move order creation

– Manually create a Requisition move order

– Other move orders generated automatically

• pick release

• kanban replenishment

• min max

• replenishment count report

– Header

• Stores the move order source type , default source and

destination , requested date

– Line

• Stores item , requested quantity , source , destination , any

specific serial or lot information

– Line Detail

• Auto Filled during detailing or entered manually





Move Order





Move orders Process

• Move Orders detailing

– Creation of line details suggesting inventory

transactions needed to fulfill the move order

– Occurs by clicking the Location details button

– Uses picking rules set up at organization or item

level to suggest source locators

– Destination details have to be specified at the time

of request entry, otherwise uses item subinventory

locator default

– Line details are considered as pending transactions

and the quantity taken away from the availability

picture

• Desist from detailing a move order line till ready to

transact





Move orders Process

• Move Orders Approval

– Uses Workflow

– Item Planner receives notification for approval





Move orders Setups

• Set up steps for move order

– Set up organization level time outs (length of time

the move orders are allowed to sit in pending

approval status) and default approval actions

• After one timeout reminder sent to approver

• After two timeouts , preset time out action performed

• If time out period is 0 , order is auto approved

– Define planners

– Associate planner with items.

• If no planner then move order auto approved





Move orders Setups

• Set up steps for move order

– Create notification lists

• email is sent to the ECO approval list attached to the

move order source and destination subinventory

– Attach notification lists to sub inventories

– Set up inventory picking rules

• Use standard Oracle Inventory picking rules

– Set up item-sub inventory locator defaults

• If the item is locator controlled then the location to be

specified at the time of move order request

– Set up min max planning

– Set item sourcing to sub inventory

– Set up kanban planning





Move Order Setup - Organization

Parameters





Move Order Setup - Create

Notification List





Material shortages

• Purpose

– To inform receiving personnel about potential cross

docking opportunities for incoming material to

alleviate shortages else where by

• Enabling shortage monitoring for items

• Receiving real time messages at receiving time of items

that may be in short supply using

– Alerts or

– Workflow notifications

• Viewing potential shortages

• Viewing actual shortages

– No automation of cross docking





Material shortages

• Enabling shortage monitoring for items

– Set up shortage parameters

– Enable item for shortage messages

– Enable the desired transaction types for shortage

notifications





Material shortages

• Set up shortage parameters

– Enable checking of shortages at organization level

– Set up separate controls for two major sources of

demand

• Work in process shortages

• Order entry shortages





Shortage Parameters





Material shortages

• For work in process shortages specify jobs /

schedules to consider

– Status and over due days

– Component due date basis

– Specify component exclusions

– Specify planner and/or buyer for receiving

notification

• For order entry shortages specify planner and

/ or order creator for receiving notifications





Material shortages

• Enable item for shortage messages

– Enable Item attribute for checking shortages

– Assign the planner and buyer to the items for which

shortage messages need to be received by them

• Required setup to send notification to item and

assembly / component planners and buyers





Item Attributes for Shortage

Messages





Material shortages

• Enable the transaction types for ‘alert’ or

shortage notifications

• Available transaction types are

– Purchase receipts or RMA receipts

– Miscellaneous transactions

– WIP material transactions

– WIP completion

– Work order less completion

• All the above transaction types result in an

action of receipt into subinventory





Setting up Transaction Type for

Shortage Notifications





Material shortages

• Schedule the Material shortage check

processor concurrent program

• Set up notification preferences of the user

– Use preferences window in oracle workflow

• As html or email etc





Material shortages

• Viewing shortage alerts

– Displayed automatically when receipt is performed

• Viewing shortage notifications

– Using the workflow ‘notifications summary’ window





Serial genealogy

• Facility to track serialized items / components

history from receipt through WIP to customer

sale

– Helps in problem isolation, resolution

– Enables improved supplier performance monitoring

– Aids quality tracking

– Generated using the material transactions records





Serial genealogy

• Features

– Provides a graphical interface for viewing

composition and transaction history of any serial

controlled item

– Provides features for forward and backward tracing

– Visibility to transactions that created / used the

item/component





Serial genealogy

• Capturing serial number information

– In WIP when

• Pushing components to a job

• Pulling components at an operation on the job

• Pulling components when completing the assembly

• Backflushing components when performing work order

less assembly completion

– In order entry when

• Ship confirming a serial controlled item to a customer





Serial genealogy

• Capturing serial number information

– In PO / Inventory when

• Receiving a serial controlled item against a vendor PO

• Building serial genealogy

– WIP provides facility to enter end item serial number

to which each component serial number is being

issued





Serial genealogy

• View serial genealogy using the ‘View

genealogy form’

– Parent genealogy

– Child genealogy

– Transaction history

• Setting up serial genealogy

– Item attribute for serial generation

• At receipt or Predefined





View Serial Genealogy





Lab – 5.1 Move Orders

• Verify that in organization parameters have a

value of ‘Null’ for ‘Move order time out period’

• Make sure that negative values are allowed in

the inventory organization to be used for the

exercise

• Create an item in the inventory organization

indicated by the instructor using the template

for a ‘Purchased item’

– Create the item name as XX_DRP_M

– Use your initials in place of the prefix ‘XX’





Lab – 5.1 Move Orders (Contd.)

• Create a move order for moving a quantity of

10 units from the stores sub inventory to the

floor stock sub inventory

• Select the move order and detail it for a

quantity of 1 unit from stores

• Transact and verify that the requested quantity

has been moved





LAB – 5.2 Material Shortage

• Create a component item in the inventory

organization using ‘Purchased item’ template.

– Create the item name as XX_DRP_C

– Enable the item for shortage monitoring

• Attach the item in the bill of material for

assembly AS18947 at the first operation.

• Set the shortage parameters for the

organization.

• Enable the following transactions for the

triggering shortage alerts

– Purchase receipts

– Miscellaneous receipts





LAB – 5.2 Material Shortage (Contd.)

• Create a discrete job for a quantity of 10 for

assembly item AS18947 and release it

• Check component requirement for component

‘XX_DRP_C

• View potential shortages

• Perform a miscellaneous receipt for the item

‘XX_DRP_C’ into the floor stock sub inventory

for a quantity of 10 units

– Oracle inventory should generate a shortage alert and

allow visibility to the shortage record





INVENTORY PLANNING AND REPLENISHMENT





Objectives

• Inventory Planning

– Concepts in Inventory Systems

– Order Point Inventory Control Systems

– Min-Max Planning

– Min-Max Planning Parameters

– Conditions under which Min-Max Planning is used

– Reorder Point Planning

– Economic Order Quantity (EOQ)





Objectives

• Inventory Planning


– Parameters

– Safety Stocks

– Conditions under which Reorder Point Planning is

used

– Replenishment Counting

– Non-Tracked Inventory Items Replenishment

– Order Modifiers

– Popular Sources of Replenishment





Inventory Planning

• The need for Inventory Planning

– Essential for managing appropriate levels of inventory

– Primarily to answer two key questions:

– How much to order ?

– When to order ?

• Two order point inventory control systems

– A fixed order quantity system

– A fixed order interval system





Inventory Planning

• Oracle provides three inventory planning

methods to be used:

– Min Max Planning


– Replenishment count processing





AT

Inventory Planning

Techniques

Min-Max

Planning

Reorder Point

Planning

Replenishment

Counting

Sub-Inventory

LevelSub-Inventory

Level

Organization

LevelOrganization

Level

AT AT





Min-Max Planning

• A technique where minimum and maximum

levels of inventory are specified

– Inventory is managed between the specified levels

– When the on hand level of the Inventory Item falls

below the specified minimum level reordering is

triggered

– Reorder quantity based on:

• Lot for lot

• Fixed order quantity

• Fixed lot multiples





Min-Max Planning

• Set ups

– Define item inventory planning attribute to

• Min-max planning for the concerned organization

– Specify

• Item minimum quantity

• Maximum quantity





Min-Max Planning

• Set ups

– Define any order modifier for reordering

• Minimum order quantity

• Maximum order quantity


• Fixed lot multiple





Organization Level Min-Max Planning

Info.





Min-Max Planning

• Min-Max Planning technique can be applied at

the following levels:


– Sub-inventory level

• To implement Min-Max planning at sub-

inventory levels

– Assign items to the sub-inventories

– Specify Min/Max planning Method for the sub-

inventory

– Define sub-inventory level minimum and maximum

quantities

– Specify order modifiers





Min-Max Planning at Subinventory

Level





Min-Max Planning

• Min-Max Planning is performed by

– Executing the Min-Max Planning Report

• To execute choose Min-Max planning report

and provide the parameters

– Choose items,categories, sources of supply, sources

of demand and other required parameters

– Choose whether to restock

• Choosing yes generates a requisition for reorder

quantity

– Submit the report

– Run requisition import in Oracle Purchasing





Min-Max Planning Report -

Parameters





Min-Max Planning Report





Reorder Point Planning

• Uses Demand Forecast as an input to decide

when to order new quantities of an Item

• Prevents consuming the Items safety stocks

• Calculated to minimize the total costs of

reordering and carrying inventory





EOQ =

2*Annual Demand * Avg. Cost of orders

Annual Inventory Carry Cost Percentage*Unit Cost

Economic Order Quantity

• EOQ is a fixed order quantity calculated to

minimize the combined costs of acquiring and

carrying Inventory.

• EOQ is calculated as:






• Set ups

– Define item inventory planning attribute to

• Reorder planning for the concerned organization

– Define any order modifier for reordering

• Minimum order quantity

• Maximum order quantity

– Set up safety stock calculation method

• Mean Absolute Deviation (MAD)

• User defined Quantity

• User defined Percentage






• Set ups

– Define any order modifiers for reordering


• Fixed lot multiple





Reorder Point Planning – Item Setup






• Reorder Point Planning technique can be

applied only at organization level






• Reorder Point Planning is performed by

– Executing the reorder point planning report

• To execute choose Reorder Point Planning

report and provide the parameters

– Choose items,categories, sources of supply, sources

of demand, forecast for safety stock computations

and other required parameters

– Choose whether to restock

• Choosing yes generates a requisition for reorder

quantity

– Submit the report

– Run requisition import in Oracle Purchasing





Reorder Point Planning Report -

Parameters





Reorder Point Planning Report





Replenishment Counting

• Used to order items for replenishment for non

quantity tracked sub-inventories

• Uses methods of visual inspections to enter

either item counts or the reorder quantities

directly

• In case of entering a visual count the expected

minimum and maximum levels of the

replenished items also need to be provided as

part of the item/sub-inventory set ups





Replenishment Counting

• For using this process, it is important to

– Implement manual processes of visual inspections

• To enter replenishment counts use the

replenishment counts form

– Provide either visual counts or order quantities for

items in the concerned non quantity tracked sub-

inventories

– Choose to process only the counts or only the report

or both

– Choosing process counts generates the requisitions

also





Replenishment Counts





Item Sourcing For

Replenishment

• Sources of Replenishment

– Internal / external set up in the item attributes

general planning region

– If internal , need to specify internal inventory source

organization and sub-inventory

– If sourced from external supplier organization

• Supplier name not specified in item attributes

• Automatic sourcing rules can be created in purchasing

to specify supplier(s) to whom requirements may be

sourced





• Sourcing information can be specified at:


– Sub-inventory level

– Item level

– Item / sub-inventory level

• When inventory does not find sourcing

information, it uses the above hierarchy for

default sourcing with item/sub-inventory

having highest precedence

Item Sourcing For Replenishment





• When running inventory planning reports

using any of the methods with a re-stock

option selected, Oracle Inventory generates

– Internal requisitions if source for item is determined

as internal

– Purchase requisitions if source for item is determined

as suppliers

• Requisitions created populate the open

requisitions interface in purchasing and can be

imported into Oracle Purchasing by running

requisition import

Item Sourcing For Replenishment





LAB – 6 Planning (Min-max

Planning)

• Enter organization level min-max planning

information for one of the items you have

defined.

• Enter subinventory level min-max planning

information for the same item.

• Receive some units of the item into the

organization.

• Run organization level min-max report for the

item.





LAB – 6 Planning (Reorder Point

Planning)

• What are the required attributes to perform

reorder point planning for an item?

• What are the methods for calculating safety

stocks for an item?

• Which safety stock methods require forecast

as parameter?





LAB – 6 Planning (Replenishment

Counting)

• Define a non-tracked subinventory

• Enter subinventory level min-max information

for any two items and the non-tracked

subinventory that you just defined.

• Enter replenishment counts for the non-

tracked subinventory by using “on-hand

quantity” method.





ABC ANALYSIS





Objectives

• ABC Analysis

– The relative importance of inventory items based on

certain criteria

– How to control these items

– How much to order at one time

– When to order





ABC Analysis

• With Oracle Inventory the user can:

– Perform ABC analysis by organization or sub-

inventory

– Choose a different ranking criterion for each ABC

analysis

– Define any number of ABC classes using

terminology provided by the user

– Assign items to multiple ABC classes

– Use ABC analyses to drive cycle counting





ABC Analysis

• Major Features

– Define ABC Classes

• Define users terminology for identifying classes

(ABC, XYZ, I II III IV, VED etc.)

– Define ABC Compile

• Choose the compilation criterion, the scope of

compilation

• The cost type to use to determine item values etc.





ABC Classes





ABC Compile





ABC Analysis

• ABC Compile Scope

– Determines the list of items for inclusion in ABC

analysis

– The user can compile ABC analyses for an entire

organization or an individual sub-inventory

• ABC Compile Valuation Scope

– Specifies whether the sub-inventory valuations or the

organization valuations are to be used for ranking if

the content scope is sub-inventory





ABC Analysis

• ABC Compile Criteria

– Current on-hand quantity

• Use the current system on-hand quantity of the item

– Current on-hand value

• Use the current on-hand value of the item

– Historical usage quantity

• Use the total historical transaction quantity of the item

• The sum of all transaction quantities for the item

– Historical usage value

• Use the total historical transaction value of the item

• The sum of all transaction values for the item





ABC Analysis

– Historical number of transactions

• Use the total number of transactions against each item

– Forecasted usage quantity

• Use the total forecast quantity of the item, as forecast

by the specified forecast name

– Forecasted usage value

• Use the total forecast value of the item, as forecast by

the forecast name specified by the user

– Previous cycle count adjustment quantity

• Use the sum of all previous cycle count adjustment

quantities for this item





ABC Analysis

– Previous cycle count adjustment value

• Use the total of all previous cycle count adjustment

values

– MRP demand usage quantity

• Use the sum of all gross requirements for the item, as

generated by the user-specified MRP plan

– MRP demand usage value

• Use the expected total demand usage value of the item,

as generated by the MRP plan specified by the user





ABC Analysis

• Compile

– To generate the ABC compile

• ABC Assignment Groups

– Allows the user to link an ABC compile with a valid

set of ABC classes

• Assign Items

– To assign items to valid ABC codes defined

• Update Classes

– To manually update ABC classes assigned to items





ABC Assignment Groups





Assigning ABC classes to Assignment

Groups





Assign ABC Items





LAB – 7 ABC Analysis

• Define three ABC classes.

• Rank the items in a subinventory based on

current on hand quantity criterion. Choose the

subinventory as validation scope.

• Create an ABC group using the ABC

compilation and three ABC classes you just

defined.

• Assign the items in your ABC compilation to

three classes

• Verify the ABC assignment report for the ABC

group just created





CYCLE COUNTING AND PHYSICAL

INVENTORY





Objectives

• Cycle Counting & Physical Inventory

– Inventory cycle counting techniques

– Physical inventory techniques

– How they compliment each other to ensure inventory

accuracy





• Cycle counting is:

– The technique of periodically counting items

throughout the year to ensure the accuracy of the

inventory quantities and values

– An essential prerequisite for:

• Managing supply and demand

• Maintaining high service levels

• Planning production

Cycle Counting & Physical Inventory





• APICS defines Cycle Counting as:

– “An inventory accuracy audit technique where

inventory is counted on a cyclic schedule rather than

once a year”


– The actual inventory itself

– The determination of inventory quantity by actual

count

– Physical Inventories can be taken on a continuous,

periodic, or annual basis

Cycle Counting & Physical Inventory





Cycle Counting

• Cycle counting - is the periodic counting of

individual items throughout the course of the

year to ensure the accuracy of inventory

quantities and values

• Cycle counting may be performed instead of

taking complete physical inventories

• Both techniques can be performed side-by-side

to verify inventory quantities and values





Reject

Approve

Define

Cycle

Count

Schedule the Cycle Count

Perform Cycle Count

Adjust Based

on Approval

Tolerances





• Define Cycle Count

– Choose a name, calendar, adjustment account

– Specify count controls, sub inventories to count

– Generate daily, weekly, or periodic count requests

and lists based on the user’s schedule

– Can use a calendar complementary to work calendar

• Choose approval method

– Approve, reject, or request recounts for cycle count

automatically

– Based on quantity / value based tolerances

Generating Cycle Count Requests





Define Cycle Counts





• Choose items manually for inclusion in the

cycle

– Items attribute Cycle Count Enabled should be

selected

• Specify items as control group items

– Always prompted for inclusion in every scheduled

count

– Indicated whether to include items in the control

group as a control measure

• Choose items using an ABC assignment group

– Items can be added or loaded into from an ABC

assignment group to a cycle count






Cycle Count Items





• Choose scheduling policies for cycle count

– Manual or automatic

– Specify count scheduling frequency

– Specify class count frequency

– Specify class / item level tolerances if desired






• Scheduling count requests -

automatically/manually

– Run the generate count request from special menu

• Oracle Inventory uses:

– The number of items in each cycle count class

– The count frequency of each class

– The workday calendar specified in the cycle count

definition

To determine which items to include on a specific

count






Manual Scheduling

• Schedule counts manually in addition to, or

instead of automatic scheduling

– Run the cycle count request manually

– Have no impact on automatically scheduled counts

– Can be used to count some items more frequently

than initially planned





Manual Scheduling





Enter Cycle Counts





Count and Adjustment Approval





Physical Inventory


– The actual inventory itself

– Determination of inventory quantity by actual count

– Can be taken on a periodic or annual basis

• Oracle Inventory support physical inventory

process

– Used to reconcile system on-hand balances with

actual counts of inventory





RejectApprove

Generate Tags

Enter & Void

Tag Counts

Define Physical

Inventory

Take a Snapshot

Physical Inventory





Physical Inventory

• Define Physical Inventory

– For the entire inventory organization or specific sub-

inventories within the warehouse

– Choose approval policies

• Required, not required or required when out of

tolerances

• Define approval tolerances also

• Run snapshot

– Creates a snapshot of system on-hand quantities

– Used to freeze on hand quantities at a given point in

time





Define Physical Inventory





Physical Inventory

• Define Tag Numbering Scheme

– To generate blank or pre-numbered, manually

entered tags

– Specify tag prefix and start number, increment for

automatic numbering of alphanumeric tags

• Generate Tags

– Inventory generates one tag for each unique

combination of item, revision, sub-inventory, locator,

lot number and serial number

– Oracle Inventory can generate default or blank tags

for the physical inventory





Generate Physical Inventory Tags





Enter Physical Inventory Tag Counts





Physical Inventory

• Generate Tags

– The tag numbers may be alphanumeric, but only the

numeric portion may be incremented

– The alphabetic characters in the tag number stay

constant

– Tags must be fully accounted for or voided

– Void unused or lost tags

• Approve or reject physical inventory

adjustments

– Based on approval tolerances

• Post Adjustments

– To inventory balances and general ledger accounts





Approve Physical Inventory Adjustments





LAB – 8 Cycle Counting & Physical

Inventory

• Define a cycle count header and initialize it with the

ABC group from the previous exercise.

• Enter count frequencies for each class after

initializing the cycle count.

• Change the cycle count class of one item within the

ABC group.

• Generate schedule requests with the automatic

scheduler.

• Generate count requests for your cycle count.

• Enter counts for your cycle count. Enter counts that

are different from system on hand quantities.

• Enter an unscheduled count for any one item. Enter

a count that is different from system on hand

quantity.

• Approve the cycle count entries.

• Verify that the Oracle inventory completes the

adjustments.





LAB – 8 Cycle Counting & Physical

Inventory

• Record on-hand quantities for a subinventory.

• Define a physical inventory for the

subinventory. Set the approval option to

Always and do not enter any tolerances. Enable

Dynamic Tags. Take a snapshot of on-hand

quantities.

• Generate default tags for the physical

inventory.

• Enter tag counts by using the default tags.

• Void one of the tags.

• Approve the adjustments.

• Adjust the physical inventory quantities.

• Verify that the oracle inventory completes the

adjustments.





WORKDAY CALENDAR





Objectives


– Understand Workday Calendar in Oracle Inventory

– Defining a Workday Calendar

– Shifts and Shift Exceptions





Workday Calendar


– Definition of available workdays for one or more

organizations

• Used by many modules of Oracle Applications

– Oracle Master Scheduling/MRP

– Oracle Inventory

– Oracle Work in Process

– Oracle Capacity

• To plan and schedule activities based on a calendar’s

available workdays





Workday Calendar

• Defining a Workday Calendar

– Define calendar start date, end date

– Specify on off pattern (for example, 5 days on before

an off occurs and 2 days off before an on occurs)

– Manually mark any specific days as exception to the

pattern or define and load an exceptions list

• Define Workday Exception Set

– To denote holidays, preventive maintenance

downtime

• Define Shifts

– Optional, provides flexible shift schedules and

timings

– Define shift exceptions





Workday Calendar





Workday Calendar - Shifts





LAB – 9 Workday Calendar

• What workday pattern would you define for

you organization if the first and only shift

worked Monday through Saturday?

• What departments would you notify before

changing your available workdays to add

overtime, maintenance, or a new holiday?

• If Plant # 1 shares a calendar with other

manufacturing plants, would you require a

new workday calendar if you added a shift to

the Plant # 1?





UNIT OF MEASURE





Objectives

• Unit of Measure UOM Classes

– Unit of Measures

– UOM and Conversions in Oracle Manufacturing

– Managing Units of Measure in Oracle Manufacturing





Unit of Measure

• Unit of Measure

– Unit in which the quantity of an item is measured,

recognized, stored, received , issued or transacted

• pounds

• each

• box of 12

• package of 10

• case of 14





Define Unit of Measure





Unit of Measure - Classes

• UOM classes -represent a physical property of

items that can be measured

– Weight, volume, force, current etc.

– Each class groups units of measures with similar

properties such as Volume or Length

– One of the various units of measures in each class is

used as the base unit of measure for that class

– All conversions to other units are w.r.t the base unit

– Need to define units of measure for tracking, moving,

storing and counting items

– Defined using the define UOM Classes





Unit of Measure - Classes





Unit of Measure - Conversions

• Conversions

– Standard conversion within UOMs of the same class

• e.g. Length in KMs and in Miles or in Meters

– Item specific conversion within UOMs of the same

class

• One meter roll of film on being converted into ft results

in only 3 ft because of wastage

– Item specific conversion within UOMs of a different

class

• One Gallon of paint on being converted to square feet

results in 300 sq.ft of applied area

– Accomplished using conversion factors in the UOM

conversions form





Unit of Measure - Conversions





LAB – 10 Unit of Measure

• Define a UOM class along with a new base

UOM.

• Define a non-base UOM belonging to the class

that you just defined.

• Define a standard conversion between your

base UOM and the other UOMs in the class.





AVAILABLE TO PROMISE (ATP)





Objectives

• Available to Promise

– ATP

– ATP Rules

– ATP Computation Options

– ATP Time Fence Options

– Supply and Demand Sources

– Used for ATP calculations

– ATP in Organization





Available to Promise

• Used to make valid achievable delivery

promises to customer

• Provides ability to match customer

requirements demands to available on hand and

expected supply

• ATP calculations determine the “uncommitted”

portion of company’s inventory and planned

supply.

• If inventory and planned supplies exist, they

can then be “promised” to meet customer

demand






• ATP calculations assist in committing items

requested Items in specified quantities, at a

“specified” date

• The ATP quantity is the uncommitted inventory

balance in the first period and is normally

calculated for each period in which a Master

Production Schedule (MPS) receipt is scheduled

• ATP includes on-hand inventory less customer

orders that are due and overdue





= + -

The ATP Algorithm






• Benefits of ATP

– Availability of an Item in required quantity on a

specific date is determined

– Availability of a group of Items in required quantities

on a specific date can also be determined

– Earliest availability dates for an Item or a group of

Items, can be determined

– For ATO & PTO items ATP takes into account the

availability of key components

– ATP results are supported by Supply and Demand

details for an Item over a period of time and can be

viewed for decision purposes






• Implementing ATP in Inventory

– Define ATP Rules

– Associate ATP rules to the specific items in the ATP

rule item attributes

– For items for whom ATP calculation is to be done

during Order Entry enable the check ATP item

attribute







– For models, if ATP of components is also to be

assessed , check ATP components Item attribute

– This attribute can be set to Yes only if any of the

below listed attributes are set to yes

• “Assemble To Order” is set to yes

• “Pick Components” is set to yes

• “WIP supply Type” is set to Phantom







– Specify components in the Bill Of Materials for which

ATP will be done/not done

• Over rides the item attribute level setting

• Use the ATP form to perform ATP calculations






• Define ATP Rule

– Use the define ATP rule form to create rules

– No limit on number of ATP Rules that can be created

• Specify consumption options

• Specify accumulation options

• Specify demand & supply past due information

• Specify infinite supply time fence information

• Select sources of supply to consider in ATP calculations

• Select sources of demand to consider in ATP

calculations





Define ATP Rule






• Backward Consumption

– Allows the user to check prior records for available

quantities of Items to meet demand

• Forward Consumption

– Allows the user to check future records for available

quantities of Items to meet demand

• Accumulate Available

– Allows use of excess quantities from a period to

accumulate in future periods

• An accumulation window can be specified






• Possible Choices

– No forward and no backward consumption

• Also know as period ATP

– Forward consumption only

– Backward consumption only

– Backward consumption and accumulate available

– Forward consumption and backward consumption

– Forward consumption and backward consumption

with accumulate available






• Demand and Supply Past Due Days

– Past due demand days

• ATP does not include any demand orders with a due

date prior to this time fence

– Past due supply days

• ATP does not include any supply orders with a due date

before this time fence





Define ATP Rule (contd.)






• Infinite Supply Time Fence

– Oracle Inventory does not consider supply sources

scheduled on or after this date in ATP calculations

– It assumes that after this date infinite supply is

available to cover any demand

– Choice in terms of:

• Cumulative manufacturing lead time

• Cumulative total lead time

• Total lead time

• User defined time fence






• Sources of supply to consider in ATP

calculations

– Choose to include current on-hand quantity,scheduled

intransit shipments, purchase orders, vendor

requisitions, internal requisitions, discrete WIP jobs,

repetitive schedules, and discrete and repetitive MPS

supply

• Sources of demand to consider in ATP

calculations

– Choose to include sales orders, internal

orders,Discrete WIP jobs and repetitive schedules as

sources of demand

• Option to choose sources of supply and

demand specific to a demand class






• Using ATP

– Use the ATP form in Inventory

• Specify item, quantity needed and the date by which it is

needed

• Specify the ATP rule to be used if not already defaulted

• Results displayed on selecting ATP results





Viewing ATP Information






• Using ATP

– In addition to running ATP for an individual item, the

user can run group ATP

• Available in order entry

– Group ATP allows the user to specify multiple items,

and executes an ATP for the group as a whole.

– Group ATP is useful if a multiline order must be

fulfilled completely or if the user has multiple items

that ship as a set





LAB – 11 Available to Promise

• Define an ATP rule XX_ATP_RULE, meeting

following criterion:

– The ATP quantity is the period ATP

– Infinite supply option = 15 days

– Demand source = sales order only

– Supply source = available on-hand quantity only

• Enable ATP checking for one of the items that

you have defined. Assign the ATP rule defined

above to your item.

• Use your ATP rule to perform an ATP inquiry

on an item.





Forecasting





Objectives

• Forecasting

– Forecasting methods

– Forecast Sets

– Various Types of Demand

– Time Buckets





Forecasting

• Forecasting Methods & the Techniques

Available for Forecasting

• Consuming Forecasts

• Various Levels of Consuming Forecasts

• Forecasting Operations & Forecasting Rules

• How to Compile Statistical Forecasts

• How to Import Forecasts from External Sources

• Exploding Forecasts by Demand Class





Forecasting

• APICS Definition

– Forecasting is the business function that attempts to

predict sales and use of products so they can be

purchased or manufactured in appropriate quantities

in advance





Forecasting

• Oracle Inventory provides two broad types of

methods:

– Focus Methods

– Statistical Methods





Forecasting

• Focus Forecasting Method:

– Short-term method

– Based on simulation of alternate forecasting methods

from prior periods in which the actual demand is

known

– Chooses the forecasting method that produces the

best fit forecast for the known period

– Intended to produce only one forecast period





Forecasting

• Statistical Forecasting Method:

– Addresses a longer term time frame

– Provides forecasts for numerous future periods

– Oracle Inventory provides algorithms for:

• Exponential Smoothing forecast (ESF)

• Trend-Enhanced forecast (TEF)

• Season-Enhanced forecast (SEF)

• Trend and Season-Enhanced forecast (TSEF)





Forecasting

• ESF technique

– Demand forecast by averaging actual demand from

previous periods

– The more recent data has greater influence than the

old data

• TSF technique

– Incorporates trend factor in the demand forecast

– Implemented by introducing a Tend Index in the

basic ESF model





Forecasting

• SEF Technique

– Incorporates seasonality into forecast calculations

– Incorporated by including a seasonality index in the

forecast model

• Represented as a factor indicating the deviation from

the average demand

• TSEF

– Reflects a combination of the TEF and SEF techniques

– Produces a forecast demand that is adjusted for the

trend as well as the seasonality of the demand





Forecasting

• Forecasts in Oracle Inventory

– Can be created using:

• Manual entry

• Using Oracle’s Focus / Statistical methods of forecasting

• Using third party tools and importing forecast using the

open forecast interface

– Can use any combination of historical, statistical, and

intuitive forecasting techniques

– Ability to create multiple forecasts

– Create aggregate forecasts by grouping

complimentary forecasts into forecast sets





Forecasting


– Has the capability to consume forecasts each time

customers place sales order demand for a forecast

product

– Ability to loads forecasts, together with sales orders,

into master demand and production schedules

– Provides capability to derive forecast for dependent

items

• Forecast explosion uses the BOM structure to derive the

dependent demand for MDS and MPS planned items

• Explodes Forecasts from aggregate for product families,

and models





Forecasting


– Ability to define demand classes for group of

customers or sales orders with similar characteristics

and consume forecasts by demand class

– Ability to use MPS to drive MRP

– Ability to loads forecasts from multiple organizations

– Forecasts defined in daily, weekly, or periodic

buckets





Forecasting

• Forecast contains information on:

– Original quantities

– Current quantities

– Confidence factor

– Specific customer related details





Forecasting

• Creating Forecasts in Oracle

– Define forecast rules

– Enable forecast control item attribute

– Enter and maintain manual forecast entries

– Enter aggregate forecasts

– Populate forecast interface if from external system

– Define forecast sets

– Load forecasts

– Consume forecast for booked sales orders





Define Forecast Rules





Define Forecast Entries





Forecasting

• Forecast Set

– Group of one or more complementing forecasts

– To define a forecast set specify:

• Forecast Level

• Consumption Level

• Outlier Percentage Update

• Backward & Forward Consumption Days

• Time Bucket Types





Define Forecast Set





Forecasting

• Item attributes used in planning and

forecasting

– Items that have independent demand have planning

attributes as MDS or MPS planned items

– Items which have dependent demand typically have

Planning attributes as MRP planned

– Forecasts are generally prepared for MDS / MPS

planned items





Master Items – Forecasting Attribute





Forecasting

• Forecast Consumption

– Total demand is sum of forecast demand and sales

order demand

– The process of replacing forecast demand with actual

sales order demand is called consuming forecast

– Done on booking of a sales order by using the sales

order schedule date





Forecast Consumption





Forecasting

• Forecast Consumption Affected by:

– Forecast Level

– Demand Class

– Sales Order Quantity

– Sales Order Date

– Forecast Bucket Type

– Backward & Forward Consumption Days





Forecasting

• Forecast Consumption

– Performed in two ways:

– Consumption by Demand Class - forecasts are

consumed at the Demand Class level for a Group of

Items which are similar in nature and the Sales Order

Demand addresses the same Demand Class.

– Consumption by Forecast Level

• Item level

• Customer level

• Bill-to Address level

• Ship-to Address level





Forecasting

• Backward Consumption Days

– Number of days back from current date the Inventory

searches for and consumes the forecast demand

against sales order demand if no forecast quantities

are available for the Sales Order Date

– The quantity consumed equals the Sales Order

Quantity





Forecasting

• Forward Consumption Days

– Number of days forward from the current date

Inventory search for and consumes forecast demand

if no forecast quantities are available for the Sales

Order Date

– The quantity consumed equals the Sales Order

Quantity





Forecasting

• Forecasts can be:

– Copied

– Modified while merging them into new ones





Forecasting

• Forecasts can be imported from external sources

• In the Oracle Inventory system, these imports are

facilitated through the Forecast Interfaces

• Forecasts may be imported from other systems to

load into the Master Schedules of the local system

• The various ways of importing forecasts follow:

– Copy Forecasts

– Modify Forecasts

– Explode Forecasts

– Review Forecasts

– Purge Forecasts





inventory

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