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11i Inventory Management Fundamentals

Volume 2 - Student Guide

D16356GC20 Edition 2.0 D40250 January 2005

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Copyright Oracle Corporation, 2005. All rights reserved. This documentation contains proprietary information of Oracle Corporation. It is provided under a license agreement containing restrictions on use and disclosure and is also protected by copyright law. Reverse engineering of the software is prohibited. If this documentation is delivered to a U.S. Government Agency of the Department of Defense, then it is delivered with Restricted Rights and the following legend is applicable: Restricted Rights Legend Use, duplication or disclosure by the Government is subject to restrictions for commercial computer software and shall be deemed to be Restricted Rights software under Federal law, as set forth in subparagraph (c)(1)(ii) of DFARS 252.227-7013, Rights in Technical Data and Computer Software (October 1988). This material or any portion of it may not be copied in any form or by any means without the express prior written permission of the Education Products group of Oracle Corporation. Any other copying is a violation of copyright law and may result in civil and/or criminal penalties. If this documentation is delivered to a U.S. Government Agency not within the Department of Defense, then it is delivered with Restricted Rights, as defined in FAR 52.227-14, Rights in Data-General, including Alternate III (June 1987). The information in this document is subject to change without notice. If you find any problems in the documentation, please report them in writing to Worldwide Education Services, Oracle Corporation, 500 Oracle Parkway, Box SB-6, Redwood Shores, CA 94065. Oracle Corporation does not warrant that this document is error-free. Oracle and all references to Oracle Products are trademarks or registered trademarks of Oracle Corporation. All other products or company names are used for identification purposes only, and may be trademarks of their respective owners.

Author Tyra Crockett, Yuvaraj Kandhaswamy Technical Contributors and Reviewers Jennifer Sherman, Alain Roth, Mary Hartman, Lata Sundar, Vanessa Graziano, April Nelson, Neeta Gera This book was published using:

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Table of Contents
11i Receipt to Issue ..........................................................................................................................................1-1 11i Receipt to Issue........................................................................................................................................1-2 Objectives ......................................................................................................................................................1-3 Agenda...........................................................................................................................................................1-4 Overview .......................................................................................................................................................1-5 Agenda...........................................................................................................................................................1-7 Receipt to Issue Life Cycle............................................................................................................................1-8 Agenda...........................................................................................................................................................1-10 Receiving Inventory ......................................................................................................................................1-11 Agenda...........................................................................................................................................................1-14 Transferring Inventory...................................................................................................................................1-15 Agenda...........................................................................................................................................................1-16 Issuing Inventory ...........................................................................................................................................1-17 Agenda...........................................................................................................................................................1-19 Oracle Inventory Application Integration.....................................................................................................1-20 Integration of Oracle Inventory to Financial Applications ...........................................................................1-22 Agenda...........................................................................................................................................................1-23 Summary........................................................................................................................................................1-24 11i Defining Inventory Organizations............................................................................................................2-1 11i Defining Inventory Organizations ...........................................................................................................2-2 Objective........................................................................................................................................................2-3 Agenda...........................................................................................................................................................2-4 Multi-Org Structure .......................................................................................................................................2-5 Organization Model.......................................................................................................................................2-6 Sample Organization Structure......................................................................................................................2-8 Enterprise Structure Considerations ..............................................................................................................2-10 Inventory Organizations ................................................................................................................................2-12 Inventory Organization Structure ..................................................................................................................2-13 Sample Inventory Organization.....................................................................................................................2-14 Agenda...........................................................................................................................................................2-15 Setting up Locations ......................................................................................................................................2-16 Defining Organizations..................................................................................................................................2-17 Organization Setup ........................................................................................................................................2-18 Additional Set Up Steps ................................................................................................................................2-20 Additional Organizational Setups..................................................................................................................2-21 Guided Demonstration: Creating an Inventory Organization ........................................................................2-22 Guided Demonstration - Setting Up Locations..........................................................................................2-23 Guided Demonstration - Setting Up Organizations ...................................................................................2-24 Agenda...........................................................................................................................................................2-27 Summary........................................................................................................................................................2-28 11i Overview of Defining and Maintaining Items .........................................................................................3-1 11i Overview of Defining and Maintaining Items .........................................................................................3-2 Objective........................................................................................................................................................3-3 Agenda...........................................................................................................................................................3-4 Items ..............................................................................................................................................................3-5 Agenda...........................................................................................................................................................3-6 Oracle Organization.......................................................................................................................................3-7 Inventory Organizations ................................................................................................................................3-8 Defining Organizations..................................................................................................................................3-9 Agenda...........................................................................................................................................................3-10 Defining Items in Item Master.......................................................................................................................3-11
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Steps to Setup, Define, and Maintain Items..................................................................................................3-12 Defining Items ...............................................................................................................................................3-13 Agenda...........................................................................................................................................................3-14 Item Attributes...............................................................................................................................................3-15 Item Statuses and Attributes ..........................................................................................................................3-16 Item Attribute Groups....................................................................................................................................3-17 Agenda...........................................................................................................................................................3-18 Creating Item Templates ...............................................................................................................................3-19 Enabling Attributes in a Template .................................................................................................................3-20 Agenda...........................................................................................................................................................3-21 Organization Assignment and Organization Item..........................................................................................3-22 Agenda...........................................................................................................................................................3-23 Deletion Constraints and Deletion Groups ....................................................................................................3-24 Agenda...........................................................................................................................................................3-25 Summary........................................................................................................................................................3-26 11i Defining and Maintaining Items Fundamentals .....................................................................................4-1 11i Defining and Maintaining Items Fundamentals.......................................................................................4-2 Objectives ......................................................................................................................................................4-3 Agenda...........................................................................................................................................................4-4 Unit of Measure .............................................................................................................................................4-5 Units of Measure ...........................................................................................................................................4-7 Use of Units of Measure ................................................................................................................................4-8 Defining UOM Classes..................................................................................................................................4-9 Units of Measure Conversions.......................................................................................................................4-10 Units of Measure Setup .................................................................................................................................4-11 Guided Demonstration Overview: Units of Measure ....................................................................................4-12 Guided Demonstration - Units of Measure................................................................................................4-13 Practice Overview: Units of Measure............................................................................................................4-15 Practice - Defining Units of Measure ........................................................................................................4-16 Solution Defining Units of Measure .......................................................................................................4-18 Agenda...........................................................................................................................................................4-21 Item Statuses and Attributes ..........................................................................................................................4-22 Item Status .....................................................................................................................................................4-23 Status Attributes ............................................................................................................................................4-24 Item Attribute Relationships..........................................................................................................................4-25 Status Attribute Interdependencies ................................................................................................................4-26 Status Attributes and Functionality ...............................................................................................................4-29 Guided Demonstration Overview: Viewing Item Attributes .........................................................................4-31 Guided Demonstration - Viewing Item Attributes.....................................................................................4-32 Practice Overview: Viewing Item Attributes.................................................................................................4-33 Practice - Viewing Item Attributes ............................................................................................................4-34 Solution Viewing Item Attributes...........................................................................................................4-35 Agenda...........................................................................................................................................................4-41 Defining the Item Master Organization .........................................................................................................4-42 Agenda...........................................................................................................................................................4-44 Defining Items ...............................................................................................................................................4-45 Steps to Setup, Define, and Maintain Items..................................................................................................4-46 Defining Items ...............................................................................................................................................4-47 Item Templates ..............................................................................................................................................4-48 Organization Assignment and Organization Item..........................................................................................4-49 Item Control Level.........................................................................................................................................4-50 Guided Demonstration: Defining Items.........................................................................................................4-52 Guided Demonstration - Define Item ........................................................................................................4-53 Practice Overview: Defining Items................................................................................................................4-54 Defining Items ...........................................................................................................................................4-55 Solution - Defining Items ..........................................................................................................................4-57

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Agenda...........................................................................................................................................................4-61 Deletion Constraints ......................................................................................................................................4-62 Agenda...........................................................................................................................................................4-64 Profile Values ................................................................................................................................................4-65 Item Profile Options ......................................................................................................................................4-67 Agenda...........................................................................................................................................................4-69 Implementation Considerations .....................................................................................................................4-70 Agenda...........................................................................................................................................................4-71 Summary........................................................................................................................................................4-72 11i Inventory Controls Concepts....................................................................................................................5-1 11i Inventory Controls Concepts ...................................................................................................................5-2 Objectives ......................................................................................................................................................5-3 Agenda...........................................................................................................................................................5-4 Inventory Control Overview..........................................................................................................................5-5 Agenda...........................................................................................................................................................5-6 Subinventories Overview ..............................................................................................................................5-7 Agenda...........................................................................................................................................................5-8 Locator Control Overview.............................................................................................................................5-9 Agenda...........................................................................................................................................................5-10 Revision Control Overview ...........................................................................................................................5-11 Agenda...........................................................................................................................................................5-12 Lot Control Overview....................................................................................................................................5-13 Agenda...........................................................................................................................................................5-14 Serial Number Overview ...............................................................................................................................5-15 Agenda...........................................................................................................................................................5-16 Summary........................................................................................................................................................5-17 11i Inventory Controls Fundamentals ...........................................................................................................6-1 11i Inventory Controls Fundamentals............................................................................................................6-2 Objectives ......................................................................................................................................................6-3 Agenda...........................................................................................................................................................6-4 Inventory Control Overview..........................................................................................................................6-5 Agenda...........................................................................................................................................................6-6 Defining Subinventories ................................................................................................................................6-7 Subinventory-Locator Relationship...............................................................................................................6-8 Locator Structuring........................................................................................................................................6-10 Locator Control Reports ................................................................................................................................6-11 Guided Demonstration Overview: Defining Subinventories .........................................................................6-12 Guided Demonstration - Creating Subinventories .....................................................................................6-13 Practice Overview: Defining Subinventories.................................................................................................6-14 Practice - Creating Subinventories ............................................................................................................6-15 Solution - Creating Subinventories............................................................................................................6-16 Guided Demonstration Overview Setting Up Locator Control......................................................................6-20 Guided Demonstration - Locator Control ..................................................................................................6-21 Practice Overview Setting Up Locator Control .............................................................................................6-23 Practice - Setting Up Locator Control .......................................................................................................6-24 Solution Setting Up Locator Control ......................................................................................................6-26 Agenda...........................................................................................................................................................6-33 Revision Control............................................................................................................................................6-34 Agenda...........................................................................................................................................................6-36 Lot Control ....................................................................................................................................................6-37 Lot Number Purging......................................................................................................................................6-38 Maintaining Lot Information .........................................................................................................................6-39 Cycle Counts Under Lot Control...................................................................................................................6-40 Physical Inventory Under Lot Control...........................................................................................................6-41 Disabled Lots.................................................................................................................................................6-42 Lot Control Reports .......................................................................................................................................6-43

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Agenda...........................................................................................................................................................6-44 Generating Serial Numbers............................................................................................................................6-45 Maintaining Serial Numbers..........................................................................................................................6-46 Serial Genealogy ...........................................................................................................................................6-47 Serial Number Control Reports .....................................................................................................................6-48 Guided Demonstration Overview: Revision, Lot, and Serial Controls..........................................................6-49 Guided Demonstration - Revision, Lot, and Serial Controls .....................................................................6-50 Practice Overview: Revision, Lot, and Serial Controls .................................................................................6-53 Practice - Revision, Lot, and Serial Controls.............................................................................................6-54 Solution Revision, Lot and Serial Controls ............................................................................................6-56 Agenda...........................................................................................................................................................6-67 Locator Flexfield Structure............................................................................................................................6-68 Changing Locator Control .............................................................................................................................6-69 Transacting Controlled Items ........................................................................................................................6-70 Agenda...........................................................................................................................................................6-72 Summary........................................................................................................................................................6-73 11i Transacting Inventory Concepts ..............................................................................................................7-1 11i Transacting Inventory Concepts ..............................................................................................................7-2 Module Objectives.........................................................................................................................................7-3 Agenda...........................................................................................................................................................7-4 Inventory Structure ........................................................................................................................................7-5 Overview .......................................................................................................................................................7-6 Agenda...........................................................................................................................................................7-7 Inventory Transactions ..................................................................................................................................7-8 Agenda...........................................................................................................................................................7-9 Transaction Types..........................................................................................................................................7-10 Transaction Source Types..............................................................................................................................7-11 Transaction Action ........................................................................................................................................7-13 Transaction Reasons ......................................................................................................................................7-15 Transaction Managers....................................................................................................................................7-16 Agenda...........................................................................................................................................................7-17 Move Orders..................................................................................................................................................7-18 Agenda...........................................................................................................................................................7-19 Shortage Alerts and Notifications..................................................................................................................7-20 Agenda...........................................................................................................................................................7-21 Mobile Transactions ......................................................................................................................................7-22 Agenda...........................................................................................................................................................7-23 Summary........................................................................................................................................................7-24 11i Transaction Setup......................................................................................................................................8-1 11i Transaction Setup ....................................................................................................................................8-2 Objectives ......................................................................................................................................................8-3 Agenda...........................................................................................................................................................8-4 Running Transaction Managers.....................................................................................................................8-5 Predefined Transaction Types .......................................................................................................................8-7 Guided Demonstration Overview: Defining a Customized Transaction .......................................................8-8 Guided Demonstration - Customized Transactions ...................................................................................8-9 Practice Overview: Defining a Customized Transaction...............................................................................8-11 Practice - Defining a Customized Transaction ..........................................................................................8-12 Solution Defining a Customized Transaction .........................................................................................8-13 Agenda...........................................................................................................................................................8-18 Interorganization Shipping Network ...........................................................................................................8-19 Shipping Method ...........................................................................................................................................8-21 Agenda...........................................................................................................................................................8-22 Movement Statistics ......................................................................................................................................8-23 Movement Statistics Parameters....................................................................................................................8-25 Collecting and Reporting Movement Statistics .............................................................................................8-26

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Agenda...........................................................................................................................................................8-28 Account Aliases.............................................................................................................................................8-29 Agenda...........................................................................................................................................................8-30 Setting Up for Move Orders ..........................................................................................................................8-31 Setup Steps for Move Orders.........................................................................................................................8-33 Agenda...........................................................................................................................................................8-35 Material Shortage Alerts and Notifications ...................................................................................................8-36 Setting Up Shortage Alerts and Notifications................................................................................................8-38 Movement Statistics Reports .........................................................................................................................8-39 Transaction Reports and Inquiries .................................................................................................................8-41 Agenda...........................................................................................................................................................8-42 Transaction Profile Options...........................................................................................................................8-43 Agenda...........................................................................................................................................................8-49 Implementation Considerations .....................................................................................................................8-50 Implementation Considerations for Shortage Messages................................................................................8-51 Agenda...........................................................................................................................................................8-52 Summary........................................................................................................................................................8-53 11i Issue and Transfer Material .....................................................................................................................9-1 11i Issue and Transfer Material .....................................................................................................................9-2 Module Objectives.........................................................................................................................................9-3 Agenda...........................................................................................................................................................9-4 Transaction Flows..........................................................................................................................................9-5 Inventory Transactions ..................................................................................................................................9-6 Inventory Transactions Without Documents and Requisitions......................................................................9-7 Inventory Transactions With Documents and Requisitions...........................................................................9-8 Agenda...........................................................................................................................................................9-9 Control Options and Restrictions...................................................................................................................9-10 Agenda...........................................................................................................................................................9-11 Subinventory Transfer ...................................................................................................................................9-12 Guided Demonstration: Subinventory Transfer.............................................................................................9-13 Guided Demonstration - Subinventory Transfers ......................................................................................9-14 Miscellaneous Transaction (Account Receipt) ..............................................................................................9-15 Application of Miscellaneous Transactions...................................................................................................9-17 Inter-organization Direct Shipment ...............................................................................................................9-18 Interorganization Intransit Shipment .............................................................................................................9-20 Guided Demonstration Overview: Interorganization Transfer ......................................................................9-22 Guided Demonstration - Interorganization Transfer..................................................................................9-23 Practice Overview: Interorganization Transfer..............................................................................................9-24 Practice - InterOrganization Transfer ........................................................................................................9-25 Solution InterOrganization Transfer .......................................................................................................9-26 Agenda...........................................................................................................................................................9-29 Managing Receipts ........................................................................................................................................9-30 Using Locations in Receiving........................................................................................................................9-31 Entering Receipt Lines ..................................................................................................................................9-32 Express Receipts and Receiving Transactions...............................................................................................9-34 Receiving Unordered Items ...........................................................................................................................9-35 Direct Receipts ..............................................................................................................................................9-37 Inspecting Received Items.............................................................................................................................9-39 Guided Demonstration Overview: Receiving Items into Inventory ..............................................................9-41 Guided Demonstration - Receiving Stock into Inventory..........................................................................9-42 Practice Overview: Receiving Items into Inventory ......................................................................................9-44 Practice - Receiving Material into Inventory.............................................................................................9-45 Solution Receiving Material into Stock..................................................................................................9-46 Returns to Receiving .....................................................................................................................................9-51 Returns to Inventory ......................................................................................................................................9-52 Entering Returns ............................................................................................................................................9-53

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Guided Demonstration Overview: Receiving Returns to Inventory ..............................................................9-55 Guided Demonstration - Receiving Returns ..............................................................................................9-56 Agenda...........................................................................................................................................................9-57 Receiving Reports..........................................................................................................................................9-58 Agenda...........................................................................................................................................................9-59 Move Orders Process Flow............................................................................................................................9-60 Move Order Requisition Approval Process ...................................................................................................9-61 Benefits of Managed Material Flow in a Facility ..........................................................................................9-63 Move Order Source Types.............................................................................................................................9-65 Move Order Components ..............................................................................................................................9-67 Move Order Allocating..................................................................................................................................9-69 Generate Move Orders...................................................................................................................................9-71 Item Allocation ..............................................................................................................................................9-73 Transact Move Orders ...................................................................................................................................9-74 Guided Demonstration Overview: Transacting Move orders ........................................................................9-75 Guided Demonstration - Transacting Move Orders...................................................................................9-76 Practice Overview: Transacting Move orders................................................................................................9-78 Practice - Transacting Move Orders ..........................................................................................................9-79 Solution Transacting Move Orders.........................................................................................................9-81 Agenda...........................................................................................................................................................9-91 Transactions Using a Mobile Device.............................................................................................................9-92 Guided Demonstration Overview: Mobile Transactions ...............................................................................9-94 Guided Demonstration - Mobile Application Inter-organization Transfer ................................................9-95 Practice Overview: Mobile Transactions.......................................................................................................9-96 Practice - Mobile Transactions ..................................................................................................................9-97 Solution Mobile Transactions.................................................................................................................9-98 Agenda...........................................................................................................................................................9-103 Managing Shipments .....................................................................................................................................9-104 Agenda...........................................................................................................................................................9-105 Summary........................................................................................................................................................9-106 11i Replenishment Concepts...........................................................................................................................10-1 11i Replenishment Concepts .........................................................................................................................10-2 Objectives ......................................................................................................................................................10-3 Agenda...........................................................................................................................................................10-4 Overview .......................................................................................................................................................10-5 Overview of Inventory Planning ...................................................................................................................10-6 Order Planning...............................................................................................................................................10-7 How Much to Order.......................................................................................................................................10-8 Replenishment Process for Intra-Org Supply Sources...................................................................................10-9 Replenishment Process for Supplier Supply Sources ....................................................................................10-10 Replenishment Process for Inter-Org Supply Sources...................................................................................10-11 Replenishment Process for Product Supply Sources .....................................................................................10-12 Agenda...........................................................................................................................................................10-13 Overview of Oracle Inventory Forecasting....................................................................................................10-14 Forecast Types...............................................................................................................................................10-15 Agenda...........................................................................................................................................................10-16 Oracle Inventory Replenishment Methods ....................................................................................................10-17 Replenishment Methods Levels.....................................................................................................................10-18 Safety Stock...................................................................................................................................................10-19 Economic Order Quantity..............................................................................................................................10-20 Overview of Reorder-Point Planning ............................................................................................................10-21 Overview of Min-max Planning ....................................................................................................................10-22 Overview of Kanban Replenishment.............................................................................................................10-23 Overview of Replenishment Counting ..........................................................................................................10-25 Overview of PAR Counting...........................................................................................................................10-26 Agenda...........................................................................................................................................................10-27

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Mobile Replenishment Count Overview .......................................................................................................10-28 Agenda...........................................................................................................................................................10-29 Summary........................................................................................................................................................10-30 11i Replenishment Fundamentals ..................................................................................................................11-1 11i Replenishment Fundamentals.................................................................................................................11-2 Objectives ......................................................................................................................................................11-3 Agenda...........................................................................................................................................................11-4 Overview .......................................................................................................................................................11-5 Agenda...........................................................................................................................................................11-6 Focus Forecasting ..........................................................................................................................................11-7 Focus-Forecasting (continued) ......................................................................................................................11-8 Using Focus Forecasting ...............................................................................................................................11-10 Focus Forecasting Example...........................................................................................................................11-11 Statistical Forecasting....................................................................................................................................11-13 Exponential Smoothing Forecast (ESF) ........................................................................................................11-14 Trend-Enhanced Forecast (TEF) ...................................................................................................................11-16 Season-Enhanced Forecast (SEF)..................................................................................................................11-18 Trend- and Season-Enhanced Forecast (TSEF).............................................................................................11-20 Forecast Setup and Maintenance ...................................................................................................................11-22 Guided Demonstration Overview: Creating a Manual Forecast ....................................................................11-23 Guided Demonstration - Creating a Manual Forecast ...............................................................................11-24 Practice Overview: Creating a Manual Forecast ...........................................................................................11-26 Practice - Creating a Manual Forecast .......................................................................................................11-27 Solution Creating a Manual Forecast......................................................................................................11-28 Agenda...........................................................................................................................................................11-31 Uses of Reorder-point Planning.....................................................................................................................11-32 Reorder-point Planning: Safety Stock ...........................................................................................................11-33 Reorder-Point Planning: Lead Time ..............................................................................................................11-34 Reorder-Point Planning: Reorder Quantity....................................................................................................11-35 Reorder-Point Planning Steps........................................................................................................................11-37 Entering Item Planning Attributes .................................................................................................................11-38 Entering General Planning Attributes for Reorder-point Planning................................................................11-39 Entering Lead Times .....................................................................................................................................11-41 Entering Safety Stocks...................................................................................................................................11-42 Performing Reorder-point Planning...............................................................................................................11-44 Guided Demonstration: Reorder Point Planning ...........................................................................................11-46 Guided Demonstration - Reorder Point Planning ......................................................................................11-47 Agenda...........................................................................................................................................................11-48 Uses of Min-max Planning ............................................................................................................................11-49 Min-max Planning .........................................................................................................................................11-50 Min-max Planning: When to Order? ............................................................................................................11-51 Min-max Planning: How Much to Order? ....................................................................................................11-52 Min-max Planning Steps ...............................................................................................................................11-53 Item Planning Attributes................................................................................................................................11-54 Min-max Planning Setup Procedure ..............................................................................................................11-55 Selecting a Planning Level ............................................................................................................................11-56 Entering Planning Attributes .........................................................................................................................11-57 Submitting the Min-max Planning Requests .................................................................................................11-58 Guided Demonstration Overview: Min-max Planning ..................................................................................11-60 Guided Demonstration - Min-max Planning..............................................................................................11-61 Practice Overview: Min-max Planning..........................................................................................................11-63 Practice - Performing Min-max Planning ..................................................................................................11-64 Solution Performing Min-max Planning.................................................................................................11-65 Agenda...........................................................................................................................................................11-71 Uses of Replenishment Counting ..................................................................................................................11-72 Replenishment Planning Steps ......................................................................................................................11-73

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Subinventories Window ................................................................................................................................11-75 Item Subinventories Window ........................................................................................................................11-76 Item Subinventories: Order Modifier Tab ....................................................................................................11-77 Replenishment Count Headers ......................................................................................................................11-78 Replenishment Count Lines...........................................................................................................................11-79 Processing Replenishment Counts................................................................................................................11-81 Practice Overview: Performing a Replenishment Count Using Forms..........................................................11-83 Practice - Performing a Replenishment Count Using Forms .....................................................................11-84 Solution - Performing a Replenishment Count Using Forms ....................................................................11-86 Practice Overview: Performing a Replenishment Count Using the Mobile Application...............................11-91 Practice - Performing a Replenishment Count Using the Mobile Application ..........................................11-92 Solution - Performing a Replenishment Count Using the Mobile Application .........................................11-94 Processing PAR Counts.................................................................................................................................11-102 Reorder Quantity For PAR Count .................................................................................................................11-103 Agenda...........................................................................................................................................................11-105 Kanban Cards ................................................................................................................................................11-106 Kanban Planned Items ...................................................................................................................................11-107 Kanban Cards ................................................................................................................................................11-109 Kanban Supply Status....................................................................................................................................11-111 Kanban Replenishment Sources ....................................................................................................................11-112 Kanban Card Printing ....................................................................................................................................11-113 Guided Demonstration Overview: Generating Kanban Cards.......................................................................11-114 Guided Demonstration - Kanban ...............................................................................................................11-115 Practice Overview: Generating Kanban Cards ..............................................................................................11-116 Practice - Generating Kanban Cards..........................................................................................................11-117 Solution Generating Kanban Cards ........................................................................................................11-118 Agenda...........................................................................................................................................................11-122 Available to Promise .....................................................................................................................................11-123 ATP Rules and ATP Checks..........................................................................................................................11-124 Uses of ATP in Oracle Inventory ..................................................................................................................11-125 Steps for Checking ATP ................................................................................................................................11-126 ATP Rules Setup Steps..................................................................................................................................11-127 Defining Computation Options......................................................................................................................11-128 Specifying Supply and Demand Time Fences ...............................................................................................11-130 Specifying Demand Sources..........................................................................................................................11-134 Specifying Supply Sources ............................................................................................................................11-136 Setting Up Item and Bills for ATP Checking ................................................................................................11-137 ATP Checking ...............................................................................................................................................11-138 Viewing ATP Criteria....................................................................................................................................11-141 Agenda...........................................................................................................................................................11-142 Planning and Forecasting Profile Options .....................................................................................................11-143 Setting Up the Min-Max System Profile Value.............................................................................................11-145 Subinventory Setup Windows .......................................................................................................................11-146 Agenda...........................................................................................................................................................11-147 Min-Max Order Type and Order Source .......................................................................................................11-148 Replenishment Method Selection ..................................................................................................................11-151 Agenda...........................................................................................................................................................11-152 Summary........................................................................................................................................................11-153 11i Inventory Accuracy Concepts ..................................................................................................................12-1 11i Inventory Accuracy Concepts..................................................................................................................12-2 Objectives ......................................................................................................................................................12-3 Agenda...........................................................................................................................................................12-4 Overview of Inventory Accuracy ..................................................................................................................12-5 Agenda...........................................................................................................................................................12-6 ABC Analysis Overview ...............................................................................................................................12-7 Agenda...........................................................................................................................................................12-8
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Cycle Counting Overview .............................................................................................................................12-9 Agenda...........................................................................................................................................................12-10 Physical Inventory Overview ........................................................................................................................12-11 Why Perform Physical Inventories? ..............................................................................................................12-12 Agenda...........................................................................................................................................................12-13 Mobile Inventory Accuracy Overview ..........................................................................................................12-14 Agenda...........................................................................................................................................................12-15 Summary........................................................................................................................................................12-16 11i Inventory Accuracy Fundamentals..........................................................................................................13-1 11i Inventory Accuracy Fundamentals ..........................................................................................................13-2 Objectives ......................................................................................................................................................13-3 Agenda...........................................................................................................................................................13-4 Defining an ABC Analysis ............................................................................................................................13-5 Define and Run an ABC Compilation ...........................................................................................................13-6 ABC Compilation Criteria.............................................................................................................................13-7 Agenda...........................................................................................................................................................13-9 ABC Valuation Scope ...................................................................................................................................13-10 Agenda...........................................................................................................................................................13-11 Defining ABC Groups ...................................................................................................................................13-12 Defining ABC Classes...................................................................................................................................13-13 ABC Item Assignments .................................................................................................................................13-14 Guided Demonstration Overview: Compiling an ABC Analysis ..................................................................13-16 Guided Demonstration - ABC Analysis ....................................................................................................13-17 Practice Overview: Compiling an ABC Analysis..........................................................................................13-19 Practice - Compiling an ABC Analysis .....................................................................................................13-20 Solution Compiling an ABC Analysis....................................................................................................13-22 Agenda...........................................................................................................................................................13-28 Defining and Maintaining a Cycle Count ......................................................................................................13-29 Agenda...........................................................................................................................................................13-30 Cycle Count Approval Tolerance ..................................................................................................................13-31 Approval Tolerances......................................................................................................................................13-32 Hit/Miss Tolerance ........................................................................................................................................13-34 Measurement Errors ......................................................................................................................................13-35 Cycle Count Items .........................................................................................................................................13-36 Agenda...........................................................................................................................................................13-38 Automatic Scheduling ...................................................................................................................................13-39 Manual Scheduling ........................................................................................................................................13-40 Count Requests ..............................................................................................................................................13-41 Entering Cycle Counts...................................................................................................................................13-43 Cycle Count Open Interface ..........................................................................................................................13-44 Agenda...........................................................................................................................................................13-45 Count Adjustments and Approvals ................................................................................................................13-46 Automatic Recounts ......................................................................................................................................13-47 Approving Cycle Counts and Adjustments ...................................................................................................13-48 Guided Demonstration Overview: Performing Cycle Counts .......................................................................13-50 Guided Demonstration - Cycle Counting ..................................................................................................13-51 Practice Overview: Performing Cycle Counts...............................................................................................13-54 Practice - Performing a Cycle Count .........................................................................................................13-55 Solution Performing a Cycle Count........................................................................................................13-57 Practice Overview: Mobile Counting ............................................................................................................13-66 Practice - Mobile Counting........................................................................................................................13-67 Solution Mobile Counting ......................................................................................................................13-68 Agenda...........................................................................................................................................................13-73 Summary........................................................................................................................................................13-74

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Preface
Profile
Before You Begin This Course Before you begin this course, you should have the following qualifications: Working experience with Oracle Applications.

Prerequisites There are no prerequisites for this course.

How This Course Is Organized 11i Inventory Management Fundamentals is an instructor-led course featuring lecture and handson exercises. Online demonstrations and written practice sessions reinforce the concepts and skills introduced.

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Copyright Oracle, 2005. All rights reserved.

Related Publications
Oracle Publications
Title Oracle Inventory Users Guide Part Number A8350708

Additional Publications None

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Typographic Conventions
Typographic Conventions in Text
Convention Bold italic Caps and lowercase Courier new, case sensitive (default is lowercase) Element Glossary term (if there is a glossary) Buttons, check boxes, triggers, windows Code output, directory names, filenames, passwords, pathnames, URLs, user input, usernames Graphics labels (unless the term is a proper noun) Emphasized words and phrases, titles of books and courses, variables Interface elements with long names that have only initial caps; lesson and chapter titles in crossreferences SQL column names, commands, functions, schemas, table names Menu paths Key names Key sequences Example The algorithm inserts the new key. Click the Executable button. Select the Cant Delete Card check box. Assign a When-Validate-Item trigger to the ORD block. Open the Master Schedule window. Code output: debug.set (I, 300); Directory: bin (DOS), $FMHOME (UNIX) Filename: Locate the init.ora file. Password: User tiger as your password. Pathname: Open c:\my_docs\projects URL: Go to http://www.oracle.com User input: Enter 300 Username: Log on as scott Customer address (but Oracle Payables) Do not save changes to the database. For further information, see Oracle7 Server SQL Language Reference Manual. Enter user_id@us.oracle.com, where user_id is the name of the user. Select Include a reusable module component and click Finish. This subject is covered in Unit II, Lesson 3, Working with Objects.

Initial cap Italic

Quotation marks

Uppercase

Arrow Brackets Commas

Plus signs

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Key combinations

Use the SELECT command to view information stored in the LAST_NAME column of the EMP table.

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Select File > Save. Press [Enter]. Press and release keys one at a time: [Alternate], [F], [D] Press and hold these keys simultaneously: [Ctrl]+[Alt]+[Del]

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11i Inventory Management Fundamentals Table of Contents xiii

Typographic Conventions in Code


Convention Caps and lowercase Lowercase Element Oracle Forms triggers Column names, table names Passwords PL/SQL objects Example When-Validate-Item SELECT last_name FROM s_emp; DROP USER scott IDENTIFIED BY tiger; OG_ACTIVATE_LAYER (OG_GET_LAYER (prod_pie_layer))

Lowercase italic Uppercase

Syntax variables

CREATE ROLE role

SQL commands and SELECT userid FROM emp; functions

Typographic Conventions in Oracle Application Navigation Paths


This course uses simplified navigation paths, such as the following example, to direct you through Oracle Applications. (N) Invoice > Entry > Invoice Batches Summary (M) Query > Find (B) Approve
This simplified path translates to the following:

1. 2. 3.

(N) From the Navigator window, select Invoice then Entry then Invoice Batches Summary. (M) From the menu, select Query then Find. (B) Click the Approve button.

Notations: (N) = Navigator (M) = Menu (T) = Tab

(B) = Button (I) = Icon

(H) = Hyperlink (ST) = Sub Tab

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11i Inventory Management Fundamentals Table of Contents xiv

Typographical Conventions in Oracle Application Help System Paths


This course uses a navigation path convention to represent actions you perform to find pertinent information in the Oracle Applications Help System. The following help navigation path, for example (Help) General Ledger > Journals > Enter Journals represents the following sequence of actions: 1. 2. 3. 4. In the navigation frame of the help system window, expand the General Ledger entry. Under the General Ledger entry, expand Journals. Under Journals, select Enter Journals. Review the Enter Journals topic that appears in the document frame of the help system window.

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11i Issue and Transfer Material


Chapter 9

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Chapter 9 - Page 1

11i Issue and Transfer Material

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Chapter 9 - Page 2

Module Objectives

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Chapter 9 - Page 3

Agenda

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Chapter 9 - Page 4

Transaction Flows

Transaction Flows A transaction is an item movement into, within, or out of inventory. A transaction can change the quantity, location, and inventory value of an item. Oracle Inventory supports a number of predefined and user-defined transaction types. Every material movement has a corresponding set of accounting transactions that Oracle Inventory automatically generates. All transactions validate the various controls (revision, locator, lot number, and serial number) that you enable for your items. You can choose your own transaction processing methods to use available computing resources most effectively.

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11i Issue and Transfer Material Chapter 9 - Page 5

Inventory Transactions

You Can Perform the Following Oracle Inventory Transactions Receive items into your organization from a general ledger account number. Issue items from your organization to a general ledger account number. Transfer items from a subinventory in your organization to another subinventory in the same organization. Transfer items directly between organizations. Transfer items between organizations by way of intransit. Reserve items for a specific account or temporarily prevent the release of items onto the shop floor.

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11i Issue and Transfer Material Chapter 9 - Page 6

Inventory Transactions Without Documents and Requisitions

Inventory Transactions Without Documents and Requisitions Inventory organization transfers can be accomplished without using an internal requisition or internal sales order. You can use miscellaneous receipts to receive material without a purchase order number. Use miscellaneous issues to issue material without approvals or a document number. Use subinventory transfers to transfer the location of material without a document number.

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11i Issue and Transfer Material Chapter 9 - Page 7

Inventory Transactions With Documents and Requisitions

Inventory Transactions with Documents and Requisitions You can use internal requisitions and internal sales orders as an approval mechanism and to provide a document to track when you transport material between warehouses or transfer material across inventory organizations. Within a single warehouse or inventory organization: Use move orders with a Move Order Issue transaction type to approve a transaction and to provide a document to track the issue of the material. Previously, sales orders with approvals in the order cycle were used to issue the material and track the movement. Use move orders with a Subinventory Transfer transaction type to approve a transfer and to provide a document to track the transfer of the material.

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11i Issue and Transfer Material Chapter 9 - Page 8

Agenda

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Chapter 9 - Page 9

Control Options and Restrictions

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Chapter 9 - Page 10

Agenda

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Subinventory Transfer

Subinventory Transfer (N) Transactions > Subinventory Transfer (B) Transaction Lines Choosing a Transaction Type You can use one of your user-defined transaction types or one of the system predefined transaction type, Subinventory Transfer. Entering a Transaction Source You can enter source information for the source type associated with the transaction type you chose. The source type corresponding to the transaction type determines whether Oracle Inventory validates the source information. Application of Subinventory Transfers You can move items from one bin to another. You can replenish floor stock inventories or move items from one stockroom to another. (Help) Oracle Manufacturing Applications > Oracle Inventory > Transactions > Transferring Between Subinventories

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11i Issue and Transfer Material Chapter 9 - Page 12

Guided Demonstration: Subinventory Transfer

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Guided Demonstration - Subinventory Transfers


Responsibility: Inventory, Vision Operations USA 1. 2. 3. 4. (N) > Transactions > Subinventory Transfer Enter Subinventory Transfer as the Type. Choose Transaction Lines. Enter the following transfer information. Item: AS18947 Subinventory: FGI Quantity: 45 To Subinventory: Stores (M) File > Save. (M) File > Close Form.

5. 6.

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Chapter 9 - Page 14

Miscellaneous Transaction (Account Receipt)

Miscellaneous Transaction (N) Transactions > Miscellaneous Transaction Choosing a Transaction Type You can use one of your user-defined transaction types or one of the system-defined transaction types: Account alias issue Account alias receipt Account issue Account receipt Miscellaneous issue Miscellaneous receipt Entering a Transaction Source Enter source information for the source type associated with the transaction type you chose. The source type corresponding to the transaction type determines whether Oracle Inventory validates the source information.

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11i Issue and Transfer Material Chapter 9 - Page 15

If you enter an account or an account alias, the account is credited or debited depending on whether you are conducting an issue or a receipt. When your transaction type has a userdefined source type, enter a source for your miscellaneous transaction. For example if your transaction type is Issue to Charity, you might enter Goodwill as your source and the expense account corresponding to Goodwill or Charities in the Account field. Entering an Account Number Charge each miscellaneous transaction to an account number or an account alias. If your source type is Account alias, your account number is not displayed but Oracle Inventory uses the account identified by your account alias. (Help) Oracle Manufacturing Applications > Oracle Inventory > Transactions > Performing Miscellaneous Transactions

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Chapter 9 - Page 16

Application of Miscellaneous Transactions

When do You Perform Miscellaneous Transactions Initial loading of item on-hand quantities when you start implementing Oracle Inventory Scrapping items by issuing them to expense accounts denoting scrap Issuing items to individuals, departments, or projects Receiving items that were acquired by assorted means (without purchase orders) Entering adjustments and corrections to system quantities due to theft, vandalism, loss, shelf-life expiration, or inaccurate record keeping

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11i Issue and Transfer Material Chapter 9 - Page 17

Inter-organization Direct Shipment

Inventory Direct Shipment (N) Transactions > Inter-organization Transfer (B) Transaction Lines Transaction Type You must use a transaction type that corresponds to the type of transfer (direct or intransit). Use either a user-defined or a system-defined transaction type. Entering a Transaction Source You can enter source information for each interorganization transfer transaction. Enter source information for the source type associated with the transaction type you chose.The source type corresponding to the transaction type determines whether Oracle Inventory validates the source information. Entering Freight Information You can choose the freight carrier to use for your shipment. Update the default interorganization transfer accounts, freight charge, and transfer credit information. You can specify the expected receipt date for your shipment. Oracle Inventory and MRP/MPS use intransit shipments as supply sources for ATP checking and the planning processes.

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11i Issue and Transfer Material Chapter 9 - Page 18

(Help) Oracle Manufacturing Applications > Oracle Inventory > Transactions > InterOrganization Transfers

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Chapter 9 - Page 19

Interorganization Intransit Shipment

Intransit Shipment (N) Transactions > Inter-organization Transfer > (B) Transaction Lines When you use the Intransit Shipment window to perform the transfer transaction: You do not need to specify the delivery location. You only need to enter the subinventory you are shipping from, a shipment number, the freight information, and a percentage of the transaction value or a discrete amount that Oracle Inventory uses to compute transfer charges. Transaction Type You must use a transaction type that corresponds to the type of transfer (direct or intransit). Use either a user-defined or a system-defined transaction type. Entering a Transaction Source You can enter source information for each interorganization transfer transaction. Enter source information for the source type associated with the transaction type you chose. The source type corresponding to the transaction type determines whether Oracle Inventory validates the source information. Entering Freight Information

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11i Issue and Transfer Material Chapter 9 - Page 20

You can choose the freight carrier to use for your shipment. Update the default interorganization transfer accounts, freight charge, and transfer credit information. You can specify the expected receipt date for your shipment. Oracle Inventory and MRP/MPS use intransit shipments as supply sources for ATP checking and the planning processes. (Help) Oracle Manufacturing Applications > Oracle Inventory > Transactions > InterOrganization Transfers

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Chapter 9 - Page 21

Guided Demonstration Overview: Interorganization Transfer

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Chapter 9 - Page 22

Guided Demonstration - Interorganization Transfer


Responsibility: Inventory, Vision Operations USA 1. (N) Transactions > Inter-organization Transfer Note: Verify a shipping network exists between the shipping organization and the receiving organization. 2. Enter the following transaction information: To Org: M2 Type: Intransit Shipment Freight: DHL Shipment Number: 001 Containers: 2 Choose Transaction Lines Enter the following transaction information: Item: AS18947 From Subinventory: FGI To Subinventory: Stores Quantity: 10 (M) File > Save. (M) File > Close Form.

3. 4.

5. 6.

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Practice Overview: Interorganization Transfer

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Chapter 9 - Page 24

Practice - InterOrganization Transfer


Overview
Your instructor has validated the shipment of product from the Seattle, WA organization (M1) to the Boston, MA Organization (M2). Now we will ship a part between M1 and M2. Note: Make sure the part you decide to ship has been assigned to both M1 and M2.

Assumptions
You are skilled in Oracle navigation. You must have access to an Oracle Application Vision database or comparable training or test instance at your site on which to complete this practice.

Transacting Items Transfer an item from M1 Seattle Manufacturing to M2 Boston Manufacturing using the following information: Transact Type: Shipment Number: Freight: Waybill: Containers: Expected Receipt date: Inventory Intransit shipment T## DHL T## 1

1 week from today.

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Chapter 9 - Page 25

Solution InterOrganization Transfer


Transacting Items Responsibility = Inventory, Vision Operations USA 1. Navigate to the Inter Organization Transfer Window. (N) Transactions > Inter-organization Transfer To Org: M2 Boston Manufacturing Transact Type: Intransit shipment Shipment Number: T## Freight: DHL Waybill: T## Containers: 1 Expected Receipt date: 1 week from today.

2.

Select Transaction Lines. Item: From subinventory: To subinventory: Quantity:

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1

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Your Choice ##-FGI FGI (this is Bostons subinventory)

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11i Issue and Transfer Material Chapter 9 - Page 26

NOTE: If you choose an item that has inventory controls, the system requires you to enter that information for both the shipping organization and the receiving organization. 3. 4. (M) File > Save. (M) File > Close Form.

Viewing Transactions 5.

Navigate to the Material Transactions window. (N) Transactions > Material Transactions.

6.

Enter your part number and select the Find button.

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11i Issue and Transfer Material Chapter 9 - Page 27

7.

Select the Intransit tab.

8.

(M) File > Close Form.

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11i Issue and Transfer Material Chapter 9 - Page 28

Agenda

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Chapter 9 - Page 29

Managing Receipts

Managing Receipts Receive both internally and externally sourced shipments. You can deliver to inventory, shop floor, and expense destinations. You can satisfy the following receiving business needs: Increased receiving process control Streamlined receiving throughput Increased transaction visibility and traceability A common process for all receipt types

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11i Issue and Transfer Material Chapter 9 - Page 30

Using Locations in Receiving

Using Locations in Receiving This slide shows the use of several receiving locations and the delivery of ten items each to multiple destinations.

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Chapter 9 - Page 31

Entering Receipt Lines

Specifying Receipt Line Information (Oracle Purchasing) You typically process receipts by selecting the items you want to receive and noting actual quantities. There are minor differences between the different Receiving transactions you will process. See the next few slides for information on these different types and when each should be used. Purchasing displays the Quantity due for the shipment. If you change the unit of measure, the receipt quantity is adjusted to reflect the new unit of measure. You can override this value if you are recording a partial receipt or an over-receipt. The quantity received on the corresponding purchase order or return material authorization (RMA) is updated to reflect the received quantity. Substitutions You can receive predefined substitute items when you allow suppliers to ship alternatives to the items that you order. Scenario You sell bicycles and assign unique internal item numbers to mountain bikes of the same model but different colors.

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11i Issue and Transfer Material Chapter 9 - Page 32

You also have an agreement with your mountain bike supplier that allows him to ship white bikes in place of the blue bikes you order if that is all he has in stock. Specifying Substitute Receipt Details You can select a substitute item in the Lines region based on the following restrictions: You must allow substitute receipts for the shipments you want to receive. You have defined substitutes for the items you want to receive. When you query in the list of values for the item, Oracle Purchasing displays all valid substitutes for the item you want to receive. All subsequent receipt processing is identical to other standard and direct receipts. Supplying Handling of Substitute Items When you receive a substitute item, Oracle Purchasing removes the purchase order supply for the original item. If you perform a standard receipt, Purchasing creates receiving supply for the new item. If you perform a direct receipt, Oracle increments on-hand balances for the new item. (Help) Oracle Manufacturing Applications > Oracle Purchasing > Receiving > Entering Receipt Lines

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Chapter 9 - Page 33

Express Receipts and Receiving Transactions

Specifying Express Receipt Details Options Create a new receipt or add to an existing receipt for the supplier who shipped the items you want to transact. Specify the supplier for new receipts. Click Express to select either the final destination or the default receiving location. Omit individual shipments that you do not want to process by selecting the Omit action in the Receipt Lines region. Any receipts that cannot be transacted with an express receipt will remain in the Receipt Line region after you save your work. In order to enable the Express button, the Find Expected Receipts window must be able to derive the supplier either by specifying the supplier or a PO number. (Help) Oracle Manufacturing Applications > Oracle Purchasing > Receiving > Express Receipts and Receiving Transactions

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11i Issue and Transfer Material Chapter 9 - Page 34

Receiving Unordered Items

Unordered Items You can receive items for which there is no corresponding purchase order. The first step is to create a record of the receipts, citing Supplier, Item, and Quantity details. Match these received items to an existing purchase order in a second step, and then continue transacting them as you would any other supplier receipt. Scenario You receive items that you actually did order, but the shipping documentation is illegible or missing. You have an agreement with the supplier that allows overruns against existing orders; however, you do not allow over-receipts for this item. In both cases you want to receive the items so you can track them on the system while you wait for a buyer to decide which purchase order to use for the match transaction. Receipt Header window (Oracle Purchasing) Navigate to the Find Expected Receipts window. Choose the Supplier and Internal tabbed region to create an unordered receipt that will later be matched to a purchase order or release.

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11i Issue and Transfer Material Chapter 9 - Page 35

Choose the Customer tabbed region to create an unordered receipt that will later be matched to a Return Material Authorization (RMA). An RMA is created in Order Management to authorize a customer's returning an item to your company. Initiating an Unordered Receipt Click Unordered in the Find Expected Receipts window. Enter receipt header information such as Freight Carrier, Packing Slip, Number of Containers in the Receipt Header window. You cannot add to an unordered receipt header but you can attach detail lines to that header. Specifying Unordered Receipt Lines Enter specific line information such as quantity, unit of measure, item, or item description for all unordered items received. This information is critical to the subsequent process of matching this receipt to its actual order. Create a new receipt for the supplier who shipped the unordered items. Perform a standard receipt for the unordered item shipment quantity. Note that the Destination Type defaults to Receiving. Location is a required field and must be a receiving location. Optionally, you can provide receipt details or attachments for this transaction. Specifying Unordered Receipt Details (Oracle Purchasing) You can enter specific line information such as quantity, unit of measure, item, or item description. Supplying Handling of Unordered Items When you receive unordered items, the supply is invisible to Oracles planning and inventory products until you match this receipt to a purchase order. When you perform the match, Oracle Purchasing reduces the purchase order supply by the received quantity and replaces it with a receiving supply for that same quantity (Help) Oracle Manufacturing Applications > Oracle Purchasing > Receiving > Unordered Receipts

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Chapter 9 - Page 36

Direct Receipts

Performing a Direct Receipt If the associated receipt Routing is Standard Receipt or Inspection Required, you cannot perform a direct receipt unless your Allow Routing Override profile is set to Yes. You can specify the quantity you want to receive in your selected unit of measure. Optionally you can enter receipt line details and attachments for this shipment. Delivery Requirements for Direct Receipts Oracle Purchasing requires that all destination details be complete for direct receipts. When you save your work, Oracle Purchasing prompts you for any missing destination details, including: Destination Type Destination Details Inventory Lot and serial numbers if required by Inventory setup Inventory Subinventory Inventory Locator if required by Inventory setup Inventory Item revision if required by Inventory setup Expense Deliver to location Direct Receipts with Multiple Distributions

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11i Issue and Transfer Material Chapter 9 - Page 37

If you record a direct receipt for a shipment with multiple distributions, Oracle Purchasing also prompts you to allocate your receipt quantity manually across these distributions. You can double-click the plus sign to expand, or the minus sign to collapse, the multiple distributions.

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Chapter 9 - Page 38

Inspecting Received Items

Specifying Inspection Details (Oracle Purchasing) Select Accept or Reject for each transaction you want to inspect. Enter the quantity associated with this inspection result. You can add additional information, including a user-defined Quality Code. Multiple Inspection Results by Transaction You can record multiple inspection results for each transaction. For example, if a lot of 15 items fails inspection due to four discrete quality problems, you can record four Reject actions for the inspected quantity. Oracle Purchasing constructs this transaction history as follows: Receive 15 Reject 15 Reject 15 Reject 15 (Help) Oracle Manufacturing Applications > Oracle Purchasing > Receiving > Inspections and
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(Help) Oracle Manufacturing Applications > Oracle Purchasing > Receiving > Inspecting Received Items

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Chapter 9 - Page 40

Guided Demonstration Overview: Receiving Items into Inventory

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Chapter 9 - Page 41

Guided Demonstration - Receiving Stock into Inventory


Responsibility: Inventory, Vision Operations USA Receipts 1. 2. 3. (N) Change Organization. M2 Boston Manufacturing (N) Transactions > Receiving > Receipts. Enter the following transaction information: Source Type: Internal Item: AS18947 Choose Find. Select the Item to receive. Enter the receiving Location. (M) File > Save. (M) File > Close Form.

4. 5. 6. 7. 8.

Receiving Stock 9. (N) Transactions > Receiving > Receiving Transactions.

10. Enter the following transaction information: Type: Internal Item: AS18947 11. Choose Find. 12. Select the transaction to deliver.

13. Enter the following receiving information: Location: M2 Boston Subinventory: Stores 14. (M) File > Save.

15. (M) File > Close Form.

Verifying Receipts and Receiving Transacitons 16. (N) Transactions > Receiving > View Receiving Transactions
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17. Enter the following transaction information: Type: Internal Item: AS18947 18. Choose Find. 19. Select the appropriate receipt number. 20. Choose Transactions. 21. (M) File > Close Form.

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Chapter 9 - Page 43

Practice Overview: Receiving Items into Inventory

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Chapter 9 - Page 44

Practice - Receiving Material into Inventory


Overview
In this practice you learn how to receive items into inventory.

Assumptions
You are skilled in Oracle Navigation You completed the defining items practice You completed the interorganization transfer practice You must have access to an Oracle Application Vision database or comparable training or test instance at your site on which to complete this practice.

Tasks
Receiving Inventory Receive the item into stock that you transferred in the interorganization transfer practice. Moving Items from Receiving into Inventory After you take delivery of the item in receiving, move it into inventory. Verifying the Items are in Inventory

Verify that the transaction is processed and the resulting on-hand quantity.

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Chapter 9 - Page 45

Solution Receiving Material into Stock


Receiving Inventory Responsibility = Inventory, Vision Operations USA 1. Change Organization to M2 Boston. 2. (N) Change Organization M2 Boston Manufacturing

Navigate to the Receiving Receipts window. (N) Transactions > Receiving > Receipts Source Type: Internal Item: The item you transferred in the Interorganization practice.

3. 4.

Select Find.

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Close the Header when it opens


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5. 6. 7. 8. 9.

Select the item you want to receive Verify the item quantity Verify the UOM. Enter the appropriate inventory control information if necessary. Enter M2 Boston in the Location column

10. Save and Close window

Moving Items from Receiving into Inventory 11. Navigate to the Receiving Transactions window. (N) Transactions > Receiving > Receiving Transaction.

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12. Find your item in the Find Receiving Transactions window.

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13. Select the Item to receive. 14. Enter M2 Boston as the Location. 15. Verify FGI is the subinventory.

16. Save and Close window (M) File > Save

Verifying the Items are in Inventory 17. Verify the transaction processed.

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Find your item View the Receipt Headers Summary

(M) File > Close Form

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(N) Transaction > Receiving > View Receiving Transaction

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Select Transactions Verify the transaction receipt and delivery.

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18. Close the window. (M) File > Close Form.

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Returns to Receiving

Returns Oracle Purchasing allows you to perform returns to suppliers and returns to customers in the Receiving Returns window. Use the Receiving Returns window to return delivered items to Receiving and to return received or delivered externally sourced items to the Supplier if the purchase order has neither been cancelled nor final closed. For controlled items, you must specify lot numbers, serial numbers or locators as appropriate. If the Quality module is installed, you can enter quality information. You can use the Receiving Returns window to return items back to a customer. For example, a customer returns to your company a part that does not work properly. You receive and fix the part, then return the part to the customer. Note: You cannot enter returns for internal shipments. For more information on returns, refer to the Online Help: (Help) Oracle Manufacturing Applications > Oracle Purchasing > Receiving > Returns

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Returns to Inventory

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Entering Returns

Receiving Returns (Oracle Purchasing) You can return both received and delivered items to the source supplier when you experience quality problems, purchased the wrong item, or have excess inventory. Specifying Return to Supplier Details You can choose the Return To Supplier action and enter the quantity you want to return. Oracle Purchasing populates the Return To field with the source supplier for your items. You can update the Return From subinventory for Inventory deliveries. You cannot update the Return From information for Expense and Shop Floor deliveries. You can specify additional return information such as Reason Code and RMA Number and a lot and serial information, if required. Purchase Order Effects When you perform a Return To Supplier transaction, Oracle Purchasing reopens the associated purchase order for the return quantity by reducing the original receipt quantity. You cannot perform a Return To Supplier transaction against a Finally Closed or Cancelled purchase order. Return to Supplier Transaction History

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When you perform a Return To Supplier transaction, Oracle Purchasing automatically creates both a Return To Receiving and a Return To Supplier transaction. For example, if you receive, deliver, and return ten items to their supplier, Oracle Purchasing constructs your transaction history as follows: Receive 10 Deliver10 Step 1 Return to receiving 10 Step 2 Return to supplier 10 (Help) Oracle Manufacturing Applications > Oracle Purchasing > Receiving > Entering Returns

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Guided Demonstration Overview: Receiving Returns to Inventory

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Guided Demonstration - Receiving Returns


Responsibility: Inventory, Vision Operations USA Receiving Returns 1. 2. 3. 4. 5. 6. 7. 8. 9. (N) Change Organization. M1 Seattle Manufacturing (N) Transactions > Receiving > Receipts. (T) Customer. Enter the RMA number. Choose Find. Close the Receipt Header Verify the receipt information. Select M1 Seattle as the receiving location. Select the subinventory from the list of values.

10. (M) File> Save. 11. (M) File > Close Form. Viewing Returns

(N) Transactions > Receiving > View Receiving Transactions 12. (T) Customer. 13. Enter the Item number. 14. Choose Find.

15. Choose Transactions.

16. (M) File > Close Form.

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Agenda

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Receiving Reports

Further Help For more information on expected receipts or overdue supplier shipments, refer to the Online Help: (Help) Oracle Manufacturing Applications > Oracle Purchasing > Reports and Processes ../ Expected Receipts Report ../ Overdue Supplier Shipments Report

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Agenda

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Move Orders Process Flow

Move Order Requisition Process Flow Move orders can be created manually or automatically. Oracle Order Management automatically creates them to support the staging of Picking Waves. Move Orders can be one of the following three types: Requisition Move Order - to relocate material or adjust perpetual inventory records Inventory Replenishment Move Orders - to refill depleted inventory locations Pick Release Move Orders - to replenish forward pick locations Move orders will be manually or automatically generated, depending on the source of the transaction. Move orders must be assigned detailed source and destination locations, or used to identify shortages for further action. This process is called Allocating, and must occur for all move orders. If the material could not be fully sourced because of a lack of available quantity, the Move Order is in backorder and the unsourced balance can be re-released at a later time. Move instructions can now be issued for available quantities either through printing of a paper pick slip or transmission to a mobile device through Move Order APIs.

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Move Order Requisition Approval Process

Move Order Approvals If approvals are required on Move Order requisitions, Oracle Inventory manages the approval process through Oracle Workflow. When the requisition is created, the workflow approval process sends a notification to the item planner that a move order requisition line is awaiting approval. Timeout Period is an organization-level attribute that determines the number of days the order can wait for an approval action. After one timeout period, if the order is still not approved or rejected, a reminder notice is sent to the item planner. After another timeout period the order is automatically approved or rejected depending on the move order timeout action you determine at the organization level. The Move Order Timeout Period and Timeout Action are both inventory organization parameters. These inventory parameters do not override any periods set up by Oracle Workflow. The Item Planner is an item attribute. If no planner is specified for the item, the requisition line is automatically approved. If no approvals are required in your organization, set the Timeout Period to 0 and the timeout action to Approve Automatically.

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Once the order line is approved, notices are sent to a notification list that is attached to the source and destination subinventories to let the subinventory planners know that material will be moved to or from their areas. Note: Replenishment and pick wave move orders are pre-approved.

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Benefits of Managed Material Flow in a Facility

Benefits of Managed Material Flow Oracle Inventory uses move orders to distinguish the user roles that should manage inventory levels from those who carry out actual transactions. The following are the benefits of managed material flow through move orders: Quick Response - You can now request a transaction and forward the request on to a picker for actual transaction execution. The request is tracked in Oracle Inventory to minimize inaccurate information transfer. When required, replenishment mechanisms automatically generate move orders without the intervention of an item planner for simple cases where the material is drawn from within the facility. This results in faster inventory replenishment with minimal human intervention. Warehouse Visibility - Move orders use inventory picking rules to determine where to source material for a subinventory or Move Order Issue. This ensures that the same mechanisms created to rotate material properly for deliveries is used to rotate material within the facility. It also uses the material visibility in Oracle Inventory to automatically suggest source locations, lots, and so on. Tracking - Move orders can be transacted through Application Program Interfaces (APIs). APIs enable you to use mobile devices to transact, giving you better material

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visibility and accuracy. Move orders can also be created to cross-dock material to staging locations.

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Move Order Source Types

Move Order Source Types Oracle Inventory provides three types of move orders: Move Order Requisitions Replenishment Move Orders Pick Wave Move Orders The move order type refers to the entity that created the move order. For all move orders, the final result is one of the two supported transactions: subinventory or move order issue. Move Order Requisition The requisition is a manually generated request for a move order. You can generate requests for subinventory transfers or move order issues. The requisition can optionally go through an Oracle Workflow approval process before it becomes a move order. If no approval process is used, the requisition becomes a move order immediately. Replenishment Move Order These move orders are generated automatically. For example, kanban cards can create a replenishment move order where the pull sequence calls for a subinventory transfer (intraorganization kanbans), or by min-max planned items where the items replenishment source

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(set at the item-subinventory level) is another subinventory. In this case, the min-max or replenishment count report automatically generates a move order. Replenishment move orders are pre-approved and ready to be transacted. The type of move order generated depends on the replenishment source: If the replenishment source is a supplier, then a move order requisition is created. If the replenishment source is another inventory organization, then an internal requisition is created. If the replenishment source is a subinventory then a replenishment move order is created. Note that the source subinventory must be set up at the item subinventory level. For the min-max report to generate a move order, the report must be generated at the subinventory level. For kanban to generate a move order, the pull sequence source type must be set to Intra-org. Pick Wave Move Order The pick release process generates move orders to bring the material from its source location in stores to a staging location, which you define as a subinventory in Oracle Inventory. This transaction is a subinventory transfer. These move orders are generated automatically by the Oracle Shipping Execution pick release process. These orders are pre-approved and ready to transact. Pick slips and other shipping and inventory reports will also be available with Oracle. WIP Issue Move Orders An optional process in Oracle WIP allows you to run pick release for the components of a range of jobs or schedules. This process creates move orders to either directly issue the material to WIP, or to move the material to the backflush locator. These orders are automatically approved, the picking rules are sued to allocated material for the job, and pick slips can be printed for warehouse users.

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Move Order Components

Move Order Components Move Order Header The move order header contains the move order source type. This refers to the entity that created the move order. An order could be a pick wave for sales order picks, a replenishment type move order, a requisition for subinventory transfer, and so on. The move order header also contains the default source and destination if available, the order number, and the requested date. Move Order Lines Move order lines are the requests on a move order. They contain the item, requested quantity, the completed quantity (if the move order has been partially fulfilled), and a source and destination, if known. The move order lines also include any project and task references, if the organization is project-manufacturing enabled. You can also enter specific serial or lot numbers on the move order lines. Move Order Line Details The line details are the inventory transactions that will occur to fulfill a particular request line (move order line). If the material is locator-, lot-, or serial-controlled, this information is filled in at the line detail level. These details are automatically filled in by Oracle Inventory using the

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inventory picking rules and the item-transaction defaults for destination locators or you can manually fill in the details. You can edit these details prior to transaction.

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Move Order Allocating

Allocating Move Orders Allocating is the process in Oracle Inventory that uses picking rules and item transaction defaults to suggest move order line details to fulfill a move order line. The line details are the inventory transactions that must be fulfilled to complete the move order allocation. You can consider the allocating process as a sourcing process. Allocating occurs when you click the Allocate button in the Transact Move Orders window. Suggesting Sources Oracle Inventory uses the picking rules you set up at the organization or organization-item level to suggest source locators, revisions, and lots to source the material in order to fulfill a move order allocation. Suggesting a Destination The picking rules only suggest source locations. If the destination subinventory is locatorcontrolled and no locator is specified on the move order line, Oracle Inventory generates a suggestion based on the item subinventory locator default you set up for move orders. You can set up a default locator for each item that you want to move around the warehouse on a move order. This is not the same default type that you would use for receiving or shipping.

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You have two choices in transacting the move orders to transfer the material to the destination location: Automatic Pick Confirmation: The move order is transacted instantly after the order is allocated without any further human intervention. On-hand inquiries will show the material in staging. You can then perform ship confirmation. Manual Pick Confirmation: You can confirm the pick of the move order allocation. You can also update any picking details such as the source locations, lots or serials and to report shortages or inventory inaccuracies and allow the system to generate more pick suggestions. Reporting inventory inaccuracies enables you to request a cycle count in the inventory area where the material was not found if so desired. Oracle Shipping Oracle Shipping provides two choices for when and how you can fill in the line details. These choices are made by setting up an organization parameter but can be overridden at pick release. Auto allocate - the allocating process is done at pick release instantly after the move order is created. No more human intervention is needed and the pick slip can be printed automatically. Pick release only creates move orders but does not fill in the line details. You must navigate to the move order form after pick release and click on the Allocate button. This option allows warehouse managers to determine when to release the pick to the floor and might be a better solution for implementations running a global order entry with distributed warehouse management and/or shipping. In these cases, orders can be released to regional warehouses from the central order management location in advance and individual warehouses can schedule picks closer to actual ship time.

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Generate Move Orders

Generating Move Order Requisitions You use the Move Orders window to create move order requisitions by specifying item, quantity, source, destination, locations, and other order information. For each move order, an order number is required. A number is defaulted for you if you leave the field without entering a value. In the Default region, you can set up values that default to the lines. Default fields are not required. You can set up a default transaction type of either Subinventory Transfer or Move Order Issue. A Move Order Issue is the same as an account issue. You can specify the Move Order Issue for accounts and account aliases. You can define a default source subinventory, destination subinventory or account, for Move Order Issues, as well as the requested delivery date (date required) for the material. The lines are the actual material requests for the move order. In the Item tabbed region, you can specify the item, revision, and quantity, and you can update the delivery date for that item. A move order requisition manually requests subinventory transfers or Move Order Issues. These requests can optionally go through an approval process before they become move orders that are ready to be sourced and transacted. The approval process does not include dollar amount constraints.

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Defining Project and Task Information If the organization is a project manufacturing-enabled organization, you specify the project and task in the Project and Task tabbed region. Defining Source Information You use the Source tabbed region to specify the subinventory from which to draw the material. This field defaults from the header-level default block but can be overridden if necessary. You can also specify the locator, lot, and serial numbers if known to use for the transactions. Only the subinventory field is required. If you do not know from where the items should come, the On Hand button takes you to an on-hand inquiry window for that item to locate the material within your organization. Defining Destination Information You use the Destination tabbed region to specify the subinventory or account for Move Order Issues that the material should be delivered. This field defaults from the header-level default block but can be overridden if necessary. You can also specify the destination locator for subinventory transfer move orders if known. Defining Control Information You use the Control tabbed region to request a subinventory transfer or Move Order Issue at the line level by selecting a transaction type. This field defaults from the header-level default block but can be overridden if necessary. You can optionally specify a reason and reference code on the inventory transactions. (Help) Oracle Manufacturing Applications > Oracle Inventory > Transactions > Overview of Move Orders .. / Generating Move Order Requisitions ../ Generating Replenishment Move Orders

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Item Allocation

Allocating Items Reservation A reservation is a line in the inventory reservations table. In the reservation table, supply, such as on-hand inventory, is matched with a demand source such as a sales order. A reservation is used to earmark your inventory for a particular use. Pending Transaction A pending transaction is a transaction that Oracle Inventory expects to occur shortly, but confirmation of the transaction has not yet been recorded. This is a material pick that has not yet been completed. Move order line details are an example of the pending transaction. A pick slip may have already been printed, but the picker has not yet indicated that they have deposited the material in the destination location. Neither reserved material nor a pending transaction quantity is included in any availability calculation for the source location. You should not allocate a move order line too soon in the business process, because the allocating process for a move order creates pending transactions and removes that quantity from an availability picture. Allocating should not be done until you are ready to print the pick slip and move the material.

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Transact Move Orders

Transacting Move Order Lines Use the Transact Move Order Line Allocations window to view, allocate, transact move order allocations, view the move order line details, and transact move order allocations. Transacting move orders will post all movement activity immediately for the selected move order line and its related details. Transact Once the lines have been allocated, you can commit all of the transactions for a single move order line by selecting the lines you want to transact and clicking the Transact button. You can save and exit the move order line details without transacting if you need to print a pick slip report. This enables you to transact each detail line before or after picking the material. (Help) Oracle Manufacturing Applications > Oracle Inventory >Transactions > Overview of Move Orders > Transacting Move Orders

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Guided Demonstration Overview: Transacting Move orders

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Guided Demonstration - Transacting Move Orders


Responsibility: Inventory, Vision Operations USA Create an Item 1. 2. (N) Items >Master Items. Create an Item using the following information: Item: CM11445 Description: Mother Board (M) Tools > Copy from. Enter Finished Good in the template field. Choose Apply. Choose Done. (T) Inventory. Use the following information to enable the Locator Control attribute: Locator Control: Dynamic Entry (M) File > Save.

3. 4. 5. 6. 7. 8. 9.

10. (M) Tools > Organization Assignment.

11. Enable item CM11445 in the following organizations: M1 Seattle M2 Boston 12. (M) File > Save. 13. (M) File > Close Form. Receive the Item

14. (N) Transactions > Miscellaneous Transaction 15. Enter the following transaction information: Type: Miscellaneous Receipt Account: Miscellaneous 16. Choose Transaction Lines

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17. Use the following information to complete a miscellaneous receipt:


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Item: Subinventory: Locator: Quantity:

CM11445 FGI 1.2.1 500

18. (M) File > Save. 19. (M) File > Close Form. Generate Move Order 20. (N) Move Orders > Move Orders 21. Use the following information to generate a move order: Number: 001 Description: Mother Board Move Order Transaction Type: Move Order Transfer Source Subinventory: FGI Destination Subinventory: Stores Item: CM11445 Quantity: 200 22. Choose Approve. 23. (M) File > Close Form. Transact Move Orders 24. (N) Move Orders > Transact Move Orders. 25. Find move order 001. 26. Choose View / Update Allocations.

27. Use the following information to update the move order: Source Subinventory Locator: 1.2.1 Destination Subinventory Locator: 1.1.2 28. Choose Transact.

29. (M) File > Close Form.

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Practice Overview: Transacting Move orders

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Practice - Transacting Move Orders


Overview
In this practice you will generate and transact move orders.

Assumptions
You are skilled in Oracle navigation You completed the Define Items practice You completed the Locator controls practice You completed the define subinventory practice You must have access to an Oracle Application Vision database or comparable training or test instance at your site on which to complete this practice.

Tasks
Create an Item Create an item using the following information. Name: ##-1234 Template: Purchased Item Locator Control: Dynamic Entry Organizations: M1, M2 Receive your item

Create a miscellaneous receipt for 500 pieces of your item and receive them into at least two locators of your ##FGI subinventory. Create a Move Order

Create a move order for your item and move 10 pieces from the ##FGI subinventory to the FGI subinventory using the following information: Number: ##-1 Description: Team ## Move order Transaction Type: Move Order Transfer Item: ##-1234 Transact Move Order

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Verify your move order, and make changes such as locator control. When complete transact your move order.
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Verify the Results Verify your transaction was processed.

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Solution Transacting Move Orders


Create an Item Responsibility = Inventory, Vision Operations USA 1. Navigate to the Master Item window. 2. (N) Item > Master Items

Define an item using the following information: Name: ##-1234 Description: Move Order Item Apply the Purchased Item template (M) Tools > Copy From. Select the Purchased Item Template from the LOV. Select Apply. Select Done.

3.

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4.

Enable Inventory Control. (T) Inventory Locator Control: Dynamic Entry

5.

Save your work. (M) File > Save.

6.

Assign your item to organizations M1 and M2. (M) Tools > Organization Assignment.

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Enable item in M1 Seattle and M2 Boston.

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7.

Save and Close window. (M) File > Save. (M) File > Close Form.

Receive Your Item 8. Receive 500 pieces of your item into stock.

(N) Transactions > Miscellaneous Transaction Type: Miscellaneous Receipt Account: Miscellaneous (From LOV)

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Select Transaction Lines. Item: Subinventory: Locator: ##-1234 ##FGI ##.1.2

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Enter the following information in the subsequent fields: Item: ##-1234 Subinventory: ##FGI Locator: ##.1.1 Quantity 250

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Quantity

250

9.

Save and Close window. (M) File > Save. (M) File > Close Form.

Create a Move Order 10. Navigate to the Move Order window.

11. Define a Move Order Using the following Information: Number: ##-1 Description: Team ## move order Transaction Type: Move Order Transfer Source Subinventory: ##FGI Item: ##-1234 Quantity: 10

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12. (T) Destination. Subinventory:

FGI

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13. Save and Close window. Choose Approve. (M) File > Close Form.

Transact Move Order

14. Navigate to the Transact Move Orders window. (N) Move Orders > Transact Move Orders

15. Find your move order.

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Numbers: ##-1 Choose Find.

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16. Update your Move Order. Select View/Update Allocations Verify/Update the following: Subinventory: ##FGI Locator: ##.1.1 To Subinventory: FGI To Locator: 1.2.1 Quantity: 10

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17. Choose Transact. 18. (M) File > Close Form Verify the Results

19. View the results to verify the transaction processed. (N) On-hand, Availability > On-hand Quantity Subinventory: FGI Locator: 1.2.1 Item: ##-1234

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Select Find.

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20. (M) File > Close Form.

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Agenda

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Transactions Using a Mobile Device

Transactions Using a Mobile Device You can perform inventory transactions using a mobile device. You can perform the following transactions: Miscellaneous Receipt Alias Receipt Inventory Issues Subinventory Transfers Move Orders Organization Transfers PO RMA Intransit Shipment Internal Requisition Receipts Sales Orders

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Internal Order Shipments Cycle Count Physical Inventory Entries

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Guided Demonstration Overview: Mobile Transactions

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Guided Demonstration - Mobile Application Inter-organization Transfer


1. 2. 3. 4. 5. 6. 7. 8. 9. Enter telnet esxxxx.oracle.com 7070 in the Windows Run dialog box, where xxxx is the instance number. Select Default from the Device List. Enter your user name and password. Note that the responsibility, Materials & Mfg must be assigned to your user name. If there is more than one responsibility assigned to your user name, select Materials & Mfg from the Responsibilities list. Select Inventory from the Materials & Mfg menu. Select Transfers. Select Org Transfer. Enter M1 as the Org code. Enter M2 as the To Org.

10. Enter Intransit Shipment as the transaction type. 11. Enter 001 as the shipment number. 12. Enter AS18947 as the item to ship. 13. Enter FGI as the from subinventory 14. Enter 5 as the quantity to transfer. 15. Select Done.

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Practice Overview: Mobile Transactions

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Practice - Mobile Transactions


Overview
In this lab you will transfer items from one organization to another.

Assumptions
You must have access to an Oracle Application Vision database or comparable training or test instance at your site on which to complete this practice.

Tasks
Interorganization Transfers Using the Mobile Interface Use the Mobile interface to conduct an interorganization transfer using the following information: From Organization: M1 Seattle To Organization: M2 Boston Item: your choice Quantity: 5

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Solution Mobile Transactions


Interorganization Transfers Using the Mobile Interface Responsibility = Materials & Mfg 1. Start the Telnet session. Windows Start menu > Run Enter telnet esxxxx.oracle.com 7070 in the Run dialog box, where xxxx is the instance number.

2.

Select Default from the Device List.

3.

Enter your user name and password. Note that Materials & Mfg responsibility must be assigned to your user name.

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4.

If more than one responsibility had been assigned to your user name, then select Materials & Mfg from the list.

5.

Select Inventory from the Materials & Mfg Menu.

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6.

Select Transfers from the Inventory Menu.

7.

Select Org Transfer from the Transfers Menu.

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8.

Enter your item to transfer using the following information: Org Code: M1 To Org: M2 Trx Type: Intransit Shipment Shipment Number: ## Item: Your Choice From Sub: ##FGI Quantity: 1 To Sub: Stores

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9.

Select Done Note: Use the down arrow to advance to Done.

10. Select Logout

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Agenda

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Managing Shipments

Managing Shipments (Oracle Purchasing) You can review and update intransit shipments between inventory organizations. Shipment Visibility: You can access all incoming and outgoing shipments associated with the current organization. Shipment Header: You can update information pertaining to the shipment header such as Ship-to Location and Number of Containers. If you change the Expected Receipt Date, Oracle Purchasing updates Shipment Supply to reflect the new due date. Shipment Lines: You can update information pertaining to the shipment lines such as Expected Receipt Date, Receipt Routing, Packing Slip, and Note to Receiver. The receipt routing that you specify in Maintain Shipments overrides routings specified at the item, organization, or system levels. (Help) Oracle Manufacturing Applications > Oracle Purchasing > Receiving > Managing Shipments

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Agenda

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Chapter 9 - Page 105

Summary

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Chapter 9 - Page 106

11i Replenishment Concepts


Chapter 10

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Chapter 10 - Page 1

11i Replenishment Concepts

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Chapter 10 - Page 2

Objectives

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Chapter 10 - Page 3

Agenda

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Chapter 10 - Page 4

Overview

Course Overview This module provides an overview of Oracle Inventory forecasting and replenishment methods.
(Help) Oracle Inventory > Inventory Planning and Replenishment > Overview of Inventory Planning and Replenishment > Forecasting.

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Overview of Inventory Planning

Overview of Oracle Inventory Inventory planning involves answering two questions: When should you place a new order? How much should you order? Using the Oracle Inventory application, you can set up the following types of inventory replenishment plans: Min-max planning Reorder-point planning Kanban replenishment planning Replenishment counting (for non-quantity tracked subinventories) After you select the replenishment method that you want to use, Oracle Inventory concurrent programs populate the requisition interface. Oracle Inventory planning interfaces with Oracle Purchasing, and indirectly with Oracle Order Management.

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Order Planning

Replenishment Considerations Before you replenish your inventory, you should consider the following: Order time Order size Planning method When to Order Typically, you should order when the on-hand quantity plus incoming supply minus demand is less than the specified minimum inventory level. On-hand quantity refers to what you currently have in stock. Supply represents on-hand stock plus inventory coming into the organization. Demand represents the need for a particular item.

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How Much to Order

How Much to Order Ideally, you should order a quantity that balances the cost of placing an order with the cost of managing inventory while covering expected demand. After you determine the amount to order, you can create a requisition to replenish inventory from another organization or a supplier. Note: Suppliers may have minimum order quantities.

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Chapter 10 - Page 8

Replenishment Process for Intra-Org Supply Sources

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Chapter 10 - Page 9

Replenishment Process for Supplier Supply Sources

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Chapter 10 - Page 10

Replenishment Process for Inter-Org Supply Sources

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Chapter 10 - Page 11

Replenishment Process for Product Supply Sources

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Chapter 10 - Page 12

Agenda

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Chapter 10 - Page 13

Overview of Oracle Inventory Forecasting

Inventory Planning and Forecasting Forecasts generated by Oracle Inventory are based on historical transaction activity only. When creating a forecast, you can select the type of transactions that you want to use. You can also specify how far into the future that you want to forecast demand. After you complete a forecast, you can use it to determine reorder-point planning. You can also load forecasts into the master schedule, which is a component of the Oracle Material Requirements Planning (MRP) application. Note: You can manually create forecasts using Oracle Inventory or Oracle MRP. There are no constraints for manually created forecasts. So, manually created forecasts can be based on transaction activity other than historical data.

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Forecast Types

Forecast Types Forecast generation uses mathematical algorithms to calculate a prediction of future demand. You can calculate estimated future demand for items using historical data and focus or statistical forecasting techniques. You can create multiple forecasts and group complementing forecasts into forecast sets. Oracle Inventory supports the following forecast types: Focus Statistical Focus forecasting enables you to simulate various methods of calculating demand so that you can select the best forecasting model. Statistical forecasting enables you to use detailed history and applies weighted factors to exponentially smooth the data. Statistical forecasting also enables you to apply exponentially weighted trend and seasonality factors to predict demand. You typically use Focus forecasting to produce single period forecasts, whereas you can use Statistical forecasting to forecast any number of periods into the future.

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Agenda

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Chapter 10 - Page 16

Oracle Inventory Replenishment Methods

Oracle Inventory Replenishment Methods With Oracle Inventory, you can set up specific replenishment methods to help you decide the size, timing, and amount to order. Oracle Inventory supports the following replenishment methods: Reorder-Point-planning Min-Max planning Kanban replenishment Replenishment counting For more information see: (Help) Inventory Planning and Replenishment > Overview of Planning and Replenishment.

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11i Replenishment Concepts Chapter 10 - Page 17

Replenishment Methods Levels

Oracle Inventory Replenishment Methods (continued) Based on the replenishment method that you select, you can perform replenishment planning at the organization or subinventory level. The table in the slide summarizes the levels at which you can perform a specific replenishment method. Note that Kanban is done at the locator level. Also Periodic Automatic Replenishment which is a type of Replenishment Counting is also done at the locator level.

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11i Replenishment Concepts Chapter 10 - Page 18

Safety Stock

Safety Stock Safety Stock is a base level of inventory from which Oracle inventory performs planning. In other words, the item is planned as if the safety stock quantity for the period is the zero inventory balance of the item. This ensures that the safety stock quantity remains in inventory to cover any fluctuations in demand.

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Chapter 10 - Page 19

Economic Order Quantity

Economic Order Quantity The economic order quantity (EOQ) is a type of fixed order quantity that determines the amount of an item to be purchased or manufactured at one time. The intent is to minimize the combined costs of acquiring and managing inventory.

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Chapter 10 - Page 20

Overview of Reorder-Point Planning

Reorder-Point Planning Overview As shown in the graphic, with reorder-point planning, you order a quantity when the quantity falls to a predetermined reorder-point. Ideally it is best to reorder at some point before inventory levels fall into the safety zone. Safety stock typically provides a buffer from which to fill orders between reorder-points. At the end of the lead time, the onhand quantity should equal the safety stock. The essential feature of reorder-point planning is that it projects what the stock level will be based on forecast demand and no visibility of sales ordersat the end of the item's lead time. This projection is then used to decide whether or not the reorder-point has been reached. The reorder-point is calculated by adding expected demand during lead time to safety stock. You perform reorder-point planning for the entire organization. You can use reorder-point planning for items under independent demand. That is, demand for items (or materials) that are independent of the demand for other items (or materials). When you define an item, you can specify reorder-point planning as the inventory planning method. For more information see: (Help) Oracle Inventory > Inventory Planning and Replenishment > Overview of Reorder Point Planning.

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11i Replenishment Concepts Chapter 10 - Page 21

Overview of Min-max Planning

Min-max Planning Overview Min-max planning is a method of inventory planning that determines how much to order based on user-defined minimum and maximum inventory levels. In contrast to reorder-point planning, min-max planning is not based on demand projections and does not consider lead time. With Oracle Inventory, you can perform min-max planning at the both the organization and the subinventory levels. To perform organization-level min-max planning for an item, you must specify organization-level minimum and maximum quantities. Min-max planning is typically used to control low value inventory items that do not need great control. To perform subinventory-level min-max planning for an item, you must specify subinventory-level minimum and maximum quantities. For more information see: (Help) Oracle Inventory > Inventory Planning and Replenishment > Overview of Min-Max Planning.

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11i Replenishment Concepts Chapter 10 - Page 22

Overview of Kanban Replenishment

Kanban Replenishment Kanban is a means of supporting pull-based replenishment in manufacturing systems. A kanban system is a self-regulating pull system that leads to shorter lead times and reduced inventory. Kanban systems are typically applied to items with relatively constant demand and medium-to-high production volume. Kanbans represent replenishment signals that are manual and highly visible, such as a colorcode card that moves with the material, a light that goes on when replenishment is required, or an empty bin that is moved to the supply location to trigger replenishment. Kanban systems typically provide support for external devices, such as bar code readers to read kanban cards and trigger a replenishment signal. Kanban System Features Kanban systems include the following characteristics: Close cooperation between the users and the supply channel Short re-supply lead times Relatively small quantities reordered at a time Relative frequent ordering

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For more information see: (Help) Oracle Inventory > Inventory Planning and Replenishment > Overview of Kanban Replenishment.

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Chapter 10 - Page 24

Overview of Replenishment Counting

Replenishment Counting Replenishment counting enables you to perform counts for non-tracked subinventories and then direct Oracle Inventory to check these counts against the minimum quantities that you specified. A non-tracked subinventory is an expense subinventory for which Oracle Inventory does not maintain on-hand quantity information. When you move valued material to a non-tracked subinventory, Oracle Inventory automatically charges the appropriate expense account and discards that quantity. Non-tracked subinventories typically store items of low value, such as office stationery. You can also use replenishment counting if you do your own planning. In this case you may order either a specific quantity or the maximum quantity specified in the MinMax values. Non-tracked subinventories might include hospital storerooms, where there is no opportunity to record accurate and timely issue-transaction information. For more information see: (Help) Oracle Inventory > Inventory Planning and Replenishment > Overview of Replenishment Counting.

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11i Replenishment Concepts Chapter 10 - Page 25

Overview of PAR Counting

Periodic Automatic Replenishment (PAR) Counting PAR counting is replenishment counting done at the locator level in a subinventory.

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Chapter 10 - Page 26

Agenda

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Chapter 10 - Page 27

Mobile Replenishment Count Overview

Mobile Device Replenishment Count Oracle Mobile Materials Management provides windows to perform mobile replenishments.

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Chapter 10 - Page 28

Agenda

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Chapter 10 - Page 29

Summary

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Chapter 10 - Page 30

11i Replenishment Fundamentals


Chapter 11

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Chapter 11 - Page 1

11i Replenishment Fundamentals

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Chapter 11 - Page 2

Objectives

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Chapter 11 - Page 3

Agenda

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Chapter 11 - Page 4

Overview

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Chapter 11 - Page 5

Agenda

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Chapter 11 - Page 6

Focus Forecasting

Describing Focus Forecasting Methods Focus forecasting simulates five forecast methods to determine the best forecasting model to use. An example of each focus forecast method is shown in this slide and on the following pages. Each method generates a forecast for the current period based on demand from previous periods. Note: If not using daily time buckets, focus forecast methods 1 and 4 require at least one year of historical data. When you use daily time buckets, a week is used instead of a year in calculating Models 1 and 4. Fifty-two week years are presumed in yearly calculations with weekly time buckets. This means that the same week last year is taken to be the week fifty-two weeks before the current week.

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11i Replenishment Fundamentals Chapter 11 - Page 7

Focus-Forecasting (continued)

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Chapter 11 - Page 8

Focus-Forecasting (continued)

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Using Focus Forecasting

Determining the Best Forecast Method The system uses the absolute percentage error (APE) to determine the best forecasting method to use. The APE is the difference between the actual demand and the forecast associated with the actual demand. You calculate the APE using actual and forecast demand. Oracle Inventory selects the model with the smallest APE to calculate the current period forecast. The following formula determines the APE: APE = ( |actual demand - forecast demand| ) / actual demand Note: Focus forecasting provides a one-period forecast. If you request a focus forecast for multiple periods, then Oracle Inventory uses the forecast of the first period for all of the forecast periods in the request. If actual demand is available for the current period, then you can recompile the focus forecast to update the forecast.

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11i Replenishment Fundamentals Chapter 11 - Page 10

Focus Forecasting Example

Example of Focus Forecasting To evaluate which forecasting model produced the best forecast, last period, the absolute percentage error (APE) is calculated for the five forecasts. The forecast model with the smallest APE is then chosen to calculate the forecast for the next period. In this example, to determine the best forecast model to use, you would first calculate the forecast and APE for March 2001 for each of the five focus forecasting methods. Then, to forecast demand for April 2001, select the the focus forecast method that yielded the smallest APE. Forecast Model 4 represents the best model for March of 2001, because the APE associated with this forecast is only 5 percent compared to the higher APEs for Models 1, 2, 3 and 5. Note: This example shows the calculation for Method 4 only. Forecast = actual demand in the same period last year (actual demand in the previous period this year / actual demand in the previous period before the same period last year) Calculating the Forecast and APE for Model 4: March 2001 = March 2000 (February 2001 / February 2000) = 250 (255 / 210)

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11i Replenishment Fundamentals Chapter 11 - Page 11

= 303.57142, rounded to 304 APE for model 4: APE = (| actual demand - forecast demand |) / actual demand = (|290 - 304|) / 290 = 0.05 or 5% Calculating the Demand Forecast for April 2001: Because 5% is the smallest error of the five models, you would select Model 4 to calculate the April 2001 forecast. April 2001 = April 2000 (March 2001 / March 2000) = 260 (290 / 250) = 301.6000 or 302 Note: Results have been rounded to the nearest whole number.

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Chapter 11 - Page 12

Statistical Forecasting

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Exponential Smoothing Forecast (ESF)

Describing the Exponential Smoothing Forecast (ESF) Exponential smoothing uses the forecast from the prior period and adds an adjustment to obtain the forecast for the next period. With ESF, demand is forecast by averaging all of the past periods of actual demand. This forecasting method weighs more recent data to give it greater influence over the forecast results than older data. You can calculate the current period forecast by using a weighted average of the most recent and forecasted demand. The alpha factor, also called the smoothing constant, is multiplied by the forecast error to determine the adjustment. You can specify an alpha factor between zero and one. The larger the alpha factor, the less impact the older data has on the new forecast. The current forecast is equal to the old forecast, plus a portion of the forecast error from the previous period. You can use this method when trend or seasonality patterns do not exist. Example of Exponential Smoothing Forecasting This example shows the ESF calculations for a 9-step ahead forecast assuming an alpha () value of 0.2, At-1 of 270, and ESFt-1 of 288. So the forecast for period 9 for the assumed values of , At-1, and ESFt-1 is: ESFt = At-1 + (1 - ) ESFt-1

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ESF9 = 0.2 A8 + (1 0.2) ESF8 = 0.2 270 + 0.8 288 = 284.4 Note: ESF always lags behind the trend by at least one period.

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Trend-Enhanced Forecast (TEF)

Describing the Trend-Enhanced Forecast (TEF) For longer-range forecasts, you can use the trend-enhanced forecast to estimate the amount of persistent change in basic demand from period to period. TEF is based on the exponential smoothing factor (), but also considers the trend (). Both the exponential smoothing and trend values closer to zero are weighted towards the past trend and values closer to one are weighted more heavily towards the current trend. Example of Trend-Enhanced Forecasting This example shows the effect of adding the trend enhancement to the ESF calculation. With the trend-enhanced forecast, you can reflect the current trend in a forecast. The trend-enhanced forecast for period 9 is derived by performing the following calculations: Determining base value Updating the trend index Adding the two for the current period trend-enhanced forecast This example shows the TEF calculations for a 9-step ahead forecast for the following assumed values: = 0.2

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11i Replenishment Fundamentals Chapter 11 - Page 16

= 0.1 A8 = 270 TEF8 = 306 B8 = 287 R8 = 19 Determining the Base Value Bt = At-1 + (1 ) TEFt-1 B9 = 0.2 A8 + (1 0.2) TEF8 = 0.2 270 + 0.8 306 = 298.8 Updating the Trend Index Rt = (Bt - Bt-1) + (1 - ) Rt-1 R9 = 0.1 (B9 - B8) + (1 - 0.1) R8 = 0.1 (298.8 287) + 0.9 19 = 18.28 Adding the Base and Trend Index to determine the Period 9 Trend Forecast Recall that the calculated base value was 298.8 and the trend index was 18.28. TEFt = Bt + Rt TEF9 = B9 + R9 = 298.8 + 18.28 = 317.08 = Period 9 Forecast

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Chapter 11 - Page 17

Season-Enhanced Forecast (SEF)

Describing the Season-Enhanced Forecast (SEF) You can use seasonality indexes to indicate the degree of seasonal variation for a product. You can specify a seasonality factor to estimate how much demand during the season will be above or below the average demand for the product. Values closer to zero give more weight to past seasonal indexes, and values closer to one one give more weight to current seasonal indexes. This method produces a more consistent pattern of seasonal demand from period to period over the course of the forecast. You can use SEF to track changes in demand that result from annual promotions and expected peaks in demand. For example, you might use SEF to track the demand of childrens clothing purchases at the beginning of the school year versus the demand for childrens clothing at other times of the year. Example of Season-Enhanced Forecasting With highly seasonal goods such as winter clothing and holiday cards you should take seasonal demand variations into consideration. To do this, you must first enter seasonality indices for each period indicating how much demand during the period is above or below average. A seasonality index of 2 indicates that demand during this period is twice the average demand. An index of 0.5 indicates that demand during this period is half the average demand. An index

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11i Replenishment Fundamentals Chapter 11 - Page 18

of 1 means that the demand is average during this period. If the average seasonality index entered is not equal to 1, then Oracle Inventory normalizes the indices so that the average seasonality indices do equal 1. The same kind of logic that is used for adjusting for trend in the TEF is used to adjust for the seasonal variations. Demand is first deseasonalized by dividing by the seasonality index for that period and then exponential smoothing is used to produce a new base value. The base value is then multiplied by the seasonal index for the period being forecasted to produce the season-enhanced forecast (SEF). To determine seasonality index, you perform the following calculations: Adjust the last periods seasonality index Calculate the forecast base value Multiply the forecast base value by the period seasonality index This example assumes the following: = 0.2 = 0.3 A8 = 270 B8 = 238 S7 = 1.15 Adjust The Last Periods Seasonality Index St = (At / Bt) + (1 ) St-1 S8 = 0.3 (A8 / B8) + (1 0.3 ) S7 = 0.3 (270 / 238) + 0.7 1.15 = 1.145 Calculate the Forecast Base Value Bt = (At-1 / St-1) + (1 ) Bt-1 B9 = 0.2 (A8 / S8) + (1 0.2) B8 = 0.2 (270 / 1.145) + 0.8 238 = 237.56157 Multiply the Forecast Base Value by the Period 8 Seasonality Index SEFt = Bt St-1 SEF9 = B9 S8 = 237.56157 1.145 = 272.00799 Note: After determining period 9 results, you can calculate period 9s seasonality index and then forecast for period 10.

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Trend- and Season-Enhanced Forecast (TSEF)

Describing the Trend- and Season-Enhanced Forecast (TSEF) The Trend- and Season-Enhanced forecast combines the trend and seasonal methods to incorporate both types of demand. With TSEF you specify a trend factor as well as a seasonality index. Example of Trend- and Season-Enhanced Forecasting Despite the seasonal adjustments made in the SEF, a trend element may remain in the forecast base, B. The TEF and the SEF can be combined to derive a trend- and season-enhanced forecast (TSEF). The TSEF uses all three smoothing factors: alpha (), beta ( ), and gamma ( ). As with the season-enhanced forecast, you calculate the new period 8 seasonality index as soon as period 8 actual demand is determined. To calculate the trend- and season-enhanced forecast for period 9, you perform the following calculations: Calculate the period 8 seasonality index Calculate the period 9 base value Calculate the new trend factor

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Add the base and trend factors together and multiply by the seasonality factor to get the period 9 trend- and season-enhanced forecast For this example, assume the following values: Smoothing constant, = 0.2 Trend smoothing constant, = 0.1 Seasonality smoothing constant, = 0.3 A8 = 270 B8 = 255 R8 = 10 S7 = 1.15 Calculating the Period 8 Seasonality Index St = [At / (Bt + Rt)] + [(1 ) St-1] S8 = 0.3 [A8 / (B8 + R8)] + [(1 0.3 ) S7] = 0.3 [270 / (255 + 10)] + (0.7 1.15) = 1.11066 Calculating the Period 9 Base Value Bt = (At-1 / St-1) + (1 ) (Bt-1 + Rt-1) B9 = 0.2 (A8 / S8) + (1 0.2) (B8 + R8) = 0.2 (270 / 1.11066) + 0.8 (255 + 10) = 260.6197 Calculating the New Trend Factor Rt = (Bt Bt-1) + (1 ) Rt-1 R9 = 0.1 (B9 B8) + (1 0.1) R8 = 0.1 (260.6197 255) + 0.9 10 = 9.56197 Calculating the Period 9 Trend- and Season-Enhanced Forecast TSEFt = (Bt + Rt) St-1 TSEF9 = (B9 + R9) S8 = (260.6197 + 9.56197) 1.11066 = 300.07997

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Forecast Setup and Maintenance

Accessing Forecast Help For an overview about the forecast setup components, access the online help topic: Overview of Forecasting. (Help) Oracle Inventory > Inventory Planning and Replenishment > Forecasting. The Overview of Forecasting topic appears. Accessing Forecast Setup Help You can find information on forecast rules in the Overview of Forecasting topic. To access instructions on how to set up a forecast, scroll to the bottom of the Overview of Forecasting topic and click the Defining a Forecast link. The Defining a Forecast topic appears. Follow the instructions provided to set up a forecast.

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Guided Demonstration Overview: Creating a Manual Forecast

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Guided Demonstration - Creating a Manual Forecast


Responsibility: Inventory, Vision Operations USA Creating a Forecast Set 1. 2. (N) Planning > Forecasts > Sets Enter the following the information to create a forecast set: Forecast Set: FG Set Description: Finished Goods forecast set Bucket Type: Weeks Forecast: FGI Description: Finished Goods forecast (M) File > Save. (M) File > Close Form.

3. 4.

Setting Up Forecast Entries 5. 6. 7. 8. (N) Planning > Forecasts > Entries (M) View > Find Select the FG Set forecast set. Enter the following forecast entry information Item: AS18947 Date: Todays Date End Date: 1 week in advance. Current: 1000 Item: AS18947 Date: 1 week in advance End Date: 2 weeks in advance Current: 2000 Item: AS18947 Date: 2 weeks in advance End Date: 3 weeks in advance. Current: 3000 (M) File > Save.

9.

10. (M) File > Close Form.

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Viewing Forecast Quantities 11. (N) Planning > Forecasts > View Entries 12. (M) View > Find. 13. Select the FG Set Forecast set. 14. Choose Bucketed 15. (M) File > Save. 16. (M) File > Close Form.

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Chapter 11 - Page 25

Practice Overview: Creating a Manual Forecast

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Chapter 11 - Page 26

Practice - Creating a Manual Forecast


Overview
In this lab you will create a manual forecast for one of your items.

Assumptions
You are skilled in Oracle Navigation You completed the define items lab. You must have access to an Oracle Application Vision database or comparable training or test instance at your site on which to complete this practice.

Tasks
Define a Forecast Set Define a forecast set using the following information: Forecast Set Name: ##-FSET Description: Forecast Set for Team ## Bucket type: Weeks Forecast Name: ##-FNAME Forecast Description: Forecast Name for Team ## Enter Forecast Entries

Define forecast entries using the following information: Forecast Item: ##-Item02 Quantities: 3000, 4000, 2000, 2500, 2000, 4500 View Forecast Quantities View the forecast quantities for your forecast.

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Solution Creating a Manual Forecast


Define a Forecast Set Responsibility = Inventory, Vision Operations USA 1. Navigate to the Forecast Sets Window. 2. (N) Planning > Forecasts > Sets

Define a forecast set using the following information: Name: ##-FSET Description: Forecast Set for Team ## Bucket type: Weeks Enter the following information in the forecast field: Name: ##-FNAME Description: Forecast Name for Team ##

3.

4.

Save and Close window. (M) File > Save

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11i Replenishment Fundamentals Chapter 11 - Page 28

Enter Forecast Entries 5. Navigate to the Forecast Entries window. 6. (N) Planning > Forecasts > Entries

Open your forecast set (M) View > Find Select the ##-FSET forecast set Enter your ##-Item02 in the item field.

7.

Enter the following quantities in progressive weeks for the next 6 weeks. Start with the first date field, and use the LOV for each available date. 3000 4000 2000 2500 2000 4500

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Chapter 11 - Page 29

(M) File > Save (M) File > Close Form

View Forecast Quantities 9. Navigate to the Item Forecast Entries window. (N) Planning > Forecasts > View Entries

10. Open your forecast set (M) View > Find Select the ##-FSET forecast set that you created from the LOV.

11. Select Bucketed to view your forecast quantities.

12. Close window.

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Agenda

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Chapter 11 - Page 31

Uses of Reorder-point Planning

Uses of Reorder-point Planning You can perform reorder-point planning for the entire organization. You can use reorder-point planning for items under independent demand. You can specify reorder-point planning as the inventory planning method when you define an item. You can use reorder-point planning for items that you do not need to control very tightly and that are not very expensive to carry in inventory. You can use reorder-point planning to decide when to order new quantity before using safety stock.

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Reorder-point Planning: Safety Stock

Reorder-Point Planning Recall from Replenishment Concepts that with reorder-point planning, you order a quantity when the quantity falls to a predetermined reorder point as shown in the above graphic. Reorder-point planning uses the following pieces of information: Safety stock Replenishment lead time Item demand Order cost Carrying cost Safety Stock: Safety stock is the quantity of an item that you plan to have in inventory to protect against fluctuations in supply and demand. You can manually enter safety stock quantities or Oracle Inventory can calculate a safety stock level based on an existing forecast for an item.

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Reorder-Point Planning: Lead Time

Reorder-Point Planning (continued) Replenishment Lead Time Replenishment lead time is the total time between recognizing the need to reorder and the receipt of items. Order processing lead times include the following components: Preprocessing lead time Processing lead time Postproccessing lead time Oracle Inventory calculates reorder point planning lead time by adding all the three components. Item Demand The reorder point planning routine uses the average demand during the replenishment lead time. Oracle Inventory uses forecast information to calculate average demand. Timing of Reorders You should reorder when the following is true: (quantity on hand + quantity on order) < reorder point where the reorder point = safety stock + [(lead time) (average demand during lead time)]

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Reorder-Point Planning: Reorder Quantity

Reorder-Point Planning (continued) Quantity of Reorders The reorder quantity is equal to the Economic Order Quantity (EOQ). The EOQ is the quantity that minimizes the total cost of ordering and storing inventory. Use the following formula to determine the EOQ: EOQ = SQRT {[2 (annual demand) (order cost)] / (annual carrying costs)} Oracle Inventory calculates the EOQ by using annual demand from the forecast that you provide when you perform reorder-point planning. The system also uses the order and annual carrying costs that you specify when you define items. You can constrain the reorder quantity by specifying the following information for each item: Fixed-lot multiplier Minimum order quantity Maximum order quantity Quantity on Order

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Quantity on order represents supply that you have not yet received. The quantity on order is the sum of the purchase order, requisition (internal and supplier), and in-transit quantities owned by the organization.

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Chapter 11 - Page 36

Reorder-Point Planning Steps

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Chapter 11 - Page 37

Entering Item Planning Attributes

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Chapter 11 - Page 38

Entering General Planning Attributes for Reorder-point Planning

Organization Items: General Planning Tabbed Region Navigation Path Inventory Responsibility (N) Items > Organization Items > (T) General Planning Carrying Cost Percent Oracle Inventory uses the carrying cost percent information to calculate the EOQ for the item. The annual carrying cost represents your internal cost to stock one of that item per year. Carrying cost = (carrying cost percent) (standard unit cost) Order Cost Oracle Inventory uses the order cost to calculate the EOQ for the item. The order cost represents the fixed cost of placing an order for any quantity of the item. Fixed-lot Size Multiplier Oracle Inventory orders a quantity that is a multiple of the fixed-lot size multiplier. Minimum-Order Quantity Oracle Inventory orders a quantity that is at least as large as the minimum-order quantity.

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Maximum-Order Quantity Oracle Inventory orders a quantity that is less than or equal to the maximum-order quantity.

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Entering Lead Times

Organization Items: Lead Times Tabbed Region Navigation Path (N) Items > Organization Items > (T) Lead Times Lead Times You can specify the following lead times: Preprocessing lead time: Represents the number of days required to place a purchase or manufacturing order. Processing lead time: Represents the number of days required to procure or manufacture the item. Postprocessing lead time: Represents the number of days required to deliver a purchased item from the initial supplier receipt of the purchase order.

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Entering Safety Stocks

Entering Safety Stock You can enter a user-defined quantity as the safety stock or have the system calculate the safety stock. To enter user-defined quantities, use the Enter Item Safety Stocks window. If you want Oracle Inventory to calculate safety stock, using the Mean Absolute Deviation method, you must submit a concurrent request through the Reload Safety Stock window. Navigation Path for Enter Item Safety Stocks Window Inventory Responsibility (N) Planning > Safety Stocks Navigation Path for Reload Safety Stock Window Inventory Responsibility (N) Planning > Safety Stock Update Stock Calculation Methods User-defined quantity method: You can enter safety stock quantities and the date for which each quantity is effective. You can update safety stock quantities that you previously entered or that Oracle Inventory calculated for you.

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11i Replenishment Fundamentals Chapter 11 - Page 42

User-defined percentage method: To use the user-defined percentage method, you must use the Reload Safety Stock window and specify the following information for the item: A forecast A safety stock percent - Oracle Inventory uses the following equation to calculate safety stock quantities: Safety stock = (safety stock percent) (forecast demand). Mean Absolute Deviation Method: To calculate safety stock using this method, you submit a concurrent request using the Reload Safety Stock window. In this window, you must specify the following information: A forecast A service level percent - The service level percent represents the probability that you can fill an order from available inventory. If you enter a high service level, then Oracle Inventory calculates relatively larger safety stock quantities. Oracle Inventory calculates safety stock quantity by using the following equation: safety stock = Z 1.25 (mean absolute deviation) where Z is the appropriate value from a table of standard normal distribution corresponding to the service level. The mean absolute deviation is a measure of how the forecast demand deviates form the actual demand.

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Chapter 11 - Page 43

Performing Reorder-point Planning

Providing a Forecast The reorder-point planning program uses information from the forecast to calculate the Economic Order Quantity (EOQ) and the reorder-point quantity. The following equations show each of these calculations: EOQ = SQRT {[2 (annual demand) (order cost)] / (annual carrying costs)} Reorder point = safety stock + [(lead time) (average demand)] Providing On-Order Quantity Information Oracle uses on-order quantity information to determine when to reorder an item. You should reorder when the following is true: (quantity on hand + quantity on-order) < reorder point Oracle uses the following sources to calculate on-order quantities: Purchase orders Requisitions (internal and supplier) In-transit shipments owned by the organization Oracle Inventory uses purchase orders, requisitions, and in-transit shipments that are scheduled to be delivered before the supply cutoff date.

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11i Replenishment Fundamentals Chapter 11 - Page 44

Viewing Planning Information You can view planning information before creating replenishment orders. If you want to create replenishment orders automatically, then you must request requisitions. Creating Requisitions Oracle creates requisitions for all items that meet the following condition: (quantity on hand + quantity on order) < reorder point Oracle creates either purchase requisitions (if the source is a supplier) or internal requisitions (if the source is an Inventory Organization). The reorder quantity is the EOQ constrained by the following attributes: Fixed-lot size multiplier Minimum order quantity Maximum order quantity Reorder Submission You can submit the planning process for all items under reorder-point planning or submit the planning process for just those items that are below their reorder-point quantities.

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Chapter 11 - Page 45

Guided Demonstration: Reorder Point Planning

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Guided Demonstration - Reorder Point Planning


Responsibility: Inventory, Vision Operations USA 1. 2. 3. 4. 5. 6. 7. 8. 9. (N) Items > Organization Items. Find Item AS18947. (T) General Planning. Change the Inventory Planning Method to Reorder Point. Change the Minimum Order Quantity to 35. Change the Order Cost to 45. Change the Carrying Cost % to 12. (T) Lead Times. Change the Processing lead time to 5.

10. Save and Close Window. 11. (N) > Planning > Reorder Point Planning. 12. Select Items Under Reorder Point as the Item Selection. 13. Enter Demand and Supply cut off dates. 14. Select a Forecast from the list of values. 15. Submit your request.

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Agenda

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Chapter 11 - Page 48

Uses of Min-max Planning

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Chapter 11 - Page 49

Min-max Planning

Min-Max Planning Recall that Min-max planning is a method of determining when and how much to order based on user-defined minimum and maximum inventory levels. Note: To perform organization-level Min-max planning for an item, you must specify organization-level minimum and maximum quantities. Deciding When to Order with Min-max Planning You should order when the following is true: (on-hand quantity demand) + (quantity on order) < minimum quantity Quantity on order is the sum of purchase order quantities, requisition quantities, and in- transit shipments. It also includes WIP jobs as supply at the organization level. Quantity on order represents supplies that you have not yet received in your organization.

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Min-max Planning: When to Order?

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Min-max Planning: How Much to Order?

Note: You can constrain the order quantity by specifying the following order modifiers for an item: Fixed-lot multiplier Minimum order quantity Maximum order quantity

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Min-max Planning Steps

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Chapter 11 - Page 53

Item Planning Attributes

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Chapter 11 - Page 54

Min-max Planning Setup Procedure

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Chapter 11 - Page 55

Selecting a Planning Level

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Entering Planning Attributes

Entering Item Planning Attributes After you select a planning level, either Organization or Subinventory, you enter the appropriate planning attributes.

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Submitting the Min-max Planning Requests

Submitting the Min-max Planning Requests In addition to setting up planning attributes, min-max planning involves submitting a concurrent process that generates the Min-max planning report. You can also perform exception reporting with the Min-max planning reporting feature. When you submit the Minmax planning request, you must specify a number of parameters including parameters that address the following: Nettable subinventories Demand quantities On-order quantity information Requisitions and WIP unrealized jobs Exception reporting You can submit the planning process for all items under min-max planning. You can also submit the planning process for just those items under their minimum quantities and submit the planning process for just those items over the maximum quantities. Using Nettable Subinventories

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Oracle Inventory enables you to use on-hand quantities that exist in either nettable or nonnettable subinventories, or both. Displaying Demand Quantity Oracle Inventory displays the sum of all unfulfilled demand created before the cutoff date. The system calculates demand quantity by using information from the following sources: Sales orders Internal orders You can include WIP job component requirements as a source of demand as well. You can net unfulfilled demand against on-hand quantity and also include inventory reservations in netting on-hand quantity against demand. Viewing Planning Information You can view planning information before creating replenishment orders. To automatically create replenishment orders, you must request requisitions. Creating Requisitions and WIP Unrealized Jobs If you request a restock, Oracle Inventory creates requisitions and WIP unreleased jobs for all items that meet the following condition: (on-hand quantity) + (quantity on order) < minimum quantity Oracle Inventory creates purchase requisitions (if the source is a supplier) and internal requisitions (if the source is an Inventory Organization) for all Buy items, and WIP unreleased jobs for all Make items. The order quantity is constrained by the following attributes: Fixed-lot size multiplier Minimum order quantity Maximum order quantity Navigation Path Inventory Responsibility (N) Reports > Planning

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Chapter 11 - Page 59

Guided Demonstration Overview: Min-max Planning

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Guided Demonstration - Min-max Planning


Responsibility: Inventory, Vision Operations USA Setting Up Min-max Planning for an Item. 1. 2. 3. 4. 5. 6. 7. 8. 9. (N) Items > Organization Items. Find Item AS54888 (T) General Planning Change the Inventory Planning Method to Min-Max. (M) File > Save. (M) Tools > Item Subinventories. (M) File > New Enter FGI as the subinventory. Select the Min-Max Planning Check box.

10. Enter 300 as the Minimum Qty. 11. Enter 900 as the Maximum Qty. 12. (M) File > Save. 13. (M) File > Close Form. Running the Min-max Planning Report. 14. (N) Planning > Min-Max Planning

15. Enter the following planning information. Planning Level: Subinventory Subinventory: FGI 16. Choose OK.

17. Choose Submit.

Viewing the Min-Max Planning Report 18. (N) Requests.

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19. Find your request.


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11i Replenishment Fundamentals Chapter 11 - Page 61

20. Choose View Output. 21. (M) File > Close. 22. (M) File > Close Form.

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Chapter 11 - Page 62

Practice Overview: Min-max Planning

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Chapter 11 - Page 63

Practice - Performing Min-max Planning


Overview
In this lab you will perform min-max planning for an item.

Assumptions
You completed the define items lab. You must have access to an Oracle Application Vision database or comparable training or test instance at your site on which to complete this practice.

Tasks
Enable Min-max Planning for Item Enter Min-max planning for ##-Item03 and restrict to your ##FGI subinventory. Use the following minimum and maximum quantities: Minimum quantity: 300 Maximum quantity: 900 Request a Min-max Planning Report Request a min-max planning report for your item and subinventory using the following information: Planning level: Subinventory Subinventory: ##FGI View Min-max Planning Report View your min-max planning report.

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Solution Performing Min-max Planning


Enable Min-max Planning for Item Responsibility = Inventory, Vision Operations USA 1. Navigate to the Organization Items window and find your ##-Item03 item. 2. 3. (N) Items > Organization Items

Find your ##-Item03 item. (T) General Planning Inventory planning Method: Min-Max

4. 5. 6.

(M) File > Save

(M) Tools > Item Subinventories

Enter the minimum and maximum quantities for the item/subinventory combination as follows: Name: ##FGI Minimum Quantity: 300 Maximum Quantity: 900
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7.

Save and Close window. (M) File > Save (M) File > Close Form

Request a Min-max Planning Report 8. Navigate to the Min-Max Planning window. 9. (N) Planning > Min-Max Planning

Enter the following information in the Parameters window: Planning Level: Subinventory Subinventory: ##-FGI

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10. Choose OK. 11. Choose Submit.

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View Min-max Planning Report 12. (N) Requests 13. Select My Completed Requests

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14. Select Find. 15. Select your request.

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16. Select View Output. 17. (M) File > Close. 18. (M) File >Close Form.

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Agenda

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Uses of Replenishment Counting

Uses of Replenishment Counting Recall that replenishment counting is a method of ordering items for subinventories. You can perform counts for the non-tracked subinventories and then have Oracle Inventory check these counts against the minimum quantities that you have specified. Oracle Inventory creates requisitions that are based on the sourcing options that you specify for each item.

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Replenishment Planning Steps

The following are the steps involved in performing a replenishment count: 1. Specify the requisition approval status using the profile options. 2. Use the Subinventories window to create the subinventories for which you want to perform replenishment counts. 3. Assign items to the subinventories using the Item Subinventories window. 4. Define sourcing information for the subinventories. You can define sourcing information at various levels, for example you can define sourcing information at the itemsubinventory level or at the subinventory level. 5. Enter the replenishment count header information using the Replenishment Count Headers window. 6. Enter the replenishment counts using the Replenishment Count Lines window. 7. Process and report the count information for the system to generate requisitions based on the sourcing information. For example, if sourcing is from another subinventory then the system automatically generates a move order. Note Use the INV: Replenishment Count Requisition Approval profile option to specify the

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requisition approval status. Use the INV: Replenishment Count Line Failure profile option to specify whether the system should stop or continue processing in case a replenishment count fails.

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Subinventories Window

Subinventories Window Inventory Responsibility (N) Setup > Organizations > Subinventories (B) New.

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Item Subinventories Window

Specifying Min-max Planning To enter replenishment counts for an item, you must specify subinventory-level min-max planning for the item. Entering Subinventory-Level Min-Max Minimum and Maximum Quantities You can use the Min-max method to replenish subinventories. In one replenishment count entry method, you can order the min-max maximum quantity. In another replenishment count entry method designed only for non-tracked subinventories, you can enter an on-hand quantity, after which Oracle Inventory performs min-max calculations. Navigation Path Inventory Responsibility (N) Setup > Organizations > Subinventories (B) Item/Subinventory.

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Item Subinventories: Order Modifier Tab

Entering Order Modifiers Fixed-Lot-Size Multiplier When you perform replenishment counting, Oracle Inventory calculates order quantities that are multiples of the fixed-lot-size multiplier. Minimum Order Quantity When you perform replenishment counting, Oracle Inventory calculates order quantities that are greater than the minimum order quantity. Maximum Order Quantity When you perform subinventory replenishment, Oracle Inventory calculates order quantities that are less than the maximum order quantity. Navigation Path Inventory Responsibility (N) Setup > Organizations > Subinventories > (T) Order Modifiers.

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Replenishment Count Headers

Entering Replenishment Count Header Information In the Replenishment Count Headers window, you enter a name and subinventory for which you want to perform replenishment counting. Navigation Path Use the following navigation path to access the Replenishment Count Headers window: Inventory Responsibility (N) Counting > Replenishments Counts > Counts (B) New.

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Replenishment Count Lines

Entering Replenishment Count Lines You must enter replenishment count header information to enter replenishment count lines for items that are associated with the subinventory that you specify. For any count type, the reorder quantities are constrained by fixed-lot-size multiple quantities, maximum order quantities, and minimum order quantities. Oracle Inventory uses the sourcing options defined for that item and subinventory combination. On-Hand Quantity This method is only for non-tracked subinventories. The item for which you select this method must be a min-max planned item. You can count the contents of the subinventory and then enter the on-hand quantity. Oracle Inventory uses the quantity that you enter to perform minmax comparisons and to generate requisitions. Order Maximum The item for which you select this method must be a min-max planned item. Oracle Inventory generates a requisition for the min-max maximum quantity specific to that item and subinventory combination. You cannot enter a quantity if you select this option. Order Quantity

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The item for which you select this method can be planned using any replenishment planning method. With the Order Quantity count type, Oracle Inventory generates a requisition for the quantity that you enter. Navigation Path Use the following navigation path to access the Replenishment Count Lines window: Inventory Responsibility(N) Counting > Replenishment Counts > Counts (B) Lines.

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Chapter 11 - Page 80

Processing Replenishment Counts

Entering Counts Using External Devices You can use external data collection devices, such as bar code readers to enter replenishment counts. You can run the replenishment validator and processor after entering counts directly into the replenishment open interface. Replenishment Validator and Processor The replenishment validator reads the count records that exist in the interface table. The interface table stores the counts that you enter with an external device. Oracle Inventory validates the items, subinventories, and counts, and then writes the records to the count tables. The replenishment count processor performs the calculations that are necessary to determine whether Oracle Inventory should create requisitions. Oracle Inventory creates internal or purchase requisitions according to each items default sourcing options. Run the replenishment validator program before submitting the replenishment processor. Purging Replenishment Counts If you want to purge replenishment counts, use the Purge Replenishment Counts window. Navigation Paths Inventory Responsibility(N) Counting > Replenishment Counts > Process Interface.

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Inventory Responsibility (N) Counting > Replenishment Counts > Purge.

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Chapter 11 - Page 82

Practice Overview: Performing a Replenishment Count Using Forms

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Practice - Performing a Replenishment Count Using Forms


Overview
In this practice you will perform a replenishment count using forms. The following are the steps in this practice: Defining item-subinventory relationship and sourcing information Entering the replenishment count header information Entering the replenishment count using forms Processing the count information using forms

Assumptions
You are skilled in Oracle Navigation. You completed the practice on creating subinventories. You completed the practice on defining items. The quantity of ##-Item02 in your ##RM subinventory is at least 100. You must have access to an Oracle Application Vision database or comparable training or test instance at your site on which to complete this practice.

Responsibility = Inventory, Vision Operations USA

Tasks

Define Item-Subinventory Relationship and Sourcing Information

Define item-subinventory relationship and sourcing information for the following: Subinventory: ##LV Item: ##-Item02 Min-Max Planning: Yes Minimum Quantity: 10 Maximum Quantity: 50

Also define sourcing information in such a way that ##-Item02 for ##LV is replenished from the subinventory ##RM. Enter Replenishment Count Header Information Create a replenishment count header for forms using the following information:
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Name: Subinventory:

##RC1 ##LV

Enter Replenishment Count Using Forms Enter the replenishment count for ##RC1 using the following information: Item: ##-Item02 Count Type: Onhand Quantity Count: 5 Process the Count Information Using Forms Process the count entered for ##RC1 using the forms. Answer the following question after you complete the lab. What is the reorder quantity for ##RC1?

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Solution - Performing a Replenishment Count Using Forms


Define Item-Subinventory Relationship and Sourcing Information Responsibility = Inventory, Vision Operations USA 1. Change Organization to M1 Seattle. 2. (N) Change Organization Choose Seattle Manufacturing Select OK

Verify the on-hand quantity of ##-Item02 in ##RM Subinventory. (N) On-hand, Availability > On-hand Quantity Subinventory: ##RM Item / Revision: ##-Item02

3.

(B) Find.

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4.

Navigate to the Subinventories window (N) Setup > Organizations > Subinventories

5. 6. 7.

Select the ##LV subinventory from the list. Select Item/Subinventory

Define the item-subinventory relationship using the following information: (T) Planning Item: ##-Item02 Min-Max Planning: Yes Min Qty: 10 Max Qty: 50 (T) Sourcing Type: Subinventory:

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Subinventory ##RM

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8.

(M) File > Save.

Enter Replenishment Count Header Information 9. Navigate to the Replenishment Count Headers window. (N) Counting > Replenishment Counts > Counts

10. Select New.

11. Create a new replenishment count header using the following information: Name: ##RC1 Subinventory: ##LV Count Using Mobile: No

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12.

Enter Replenishment Count Using Forms 13. Select Default Items. 14. Enter the following information: Count Type: Onhand Quantity Quantity: 5

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15.

16. (M) File > Save. Process the Count Information Using Forms

17. Return to the Replenishment Count Headers window.

18. Select Process and Report. The replenishment request number is displayed.

19. View the details of the Replenishment Count Report by querying for the request number in the Requests window. Note: As the item ##-Item02 for the subinventory ##LV is sourced from another subinventory ##RM, the application automatically creates a move order after you process the count. However, to complete this transaction you must transact this move order using the Transact Move Orders window. 20. What is the reorder quantity for ##RC1? The reorder quantity is 45 (maximum quantity onhand quantity).

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Practice Overview: Performing a Replenishment Count Using the Mobile Application

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Practice - Performing a Replenishment Count Using the Mobile Application


Overview
In this practice you will perform a replenishment count using the mobile application. The following are the steps in this practice: Entering the replenishment count header information using forms Entering the replenishment count using the mobile application Processing the count information using the mobile application

Assumptions
You are skilled in Oracle Navigation. You completed the practice on performing a replenishment count using forms. You must have access to an Oracle Application Vision database or comparable training or test instance at your site on which to complete this practice.

Responsibility = Materials & Mfg

Tasks
Enter Replenishment Count Header Information

Create a replenishment count header using the following information: Name: ##RC2 Subinventory: ##-LV Count Using Mobile: Yes Enter Replenishment Count Lines

Enter the replenishment count line information for ##RC2 using the forms: Item: ##-Item02 Count Type: Order Quantity Enter Replenishment Count Using the Mobile Application

Enter the replenishment count for ##RC2 in the mobile application using the following information: Organization: M1 Subinventory: ##-LV
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Replenishment Count: Item: Order Quantity:

##RC2 ##-Item02 30

Process the Count Information Using the Mobile Application Process the count entered for ##RC2 using the mobile application. Answer the following question after you complete the lab. Can you enter the count in the Replenishment Count Lines window for ##RC2? Why?

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Solution - Performing a Replenishment Count Using the Mobile Application


Enter Replenishment Count Header Information Responsibility = Inventory, Vision Operations USA 1. Navigate to the Replenishment Count Headers window. 2. 3. (N) Counting > Replenishment Counts > Counts

Select New. Create a new replenishment count header using the following information: Name: ##RC2 Subinventory: ##-LV Count Using Mobile: Yes

Enter Replenishment Count Lines 4. 5. Select Default Items.

Enter the following information: Count Type: Order Quantity

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6.

(M) File > Save.

Enter Replenishment Count Using the Mobile Application Responsibility = Materials & Mfg 7.

Start the Telnet session. Windows Start menu > Run Enter telnet esxxxx.oracle.com 7070 in the Run dialog box, where xxxx is the instance number.

8.

Select Default from the Device List.

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9.

Enter your user name and password. Note that Materials & Mfg responsibility must be assigned to your user name.

10. If more than one responsibility had been assigned to your user name, select Materials & Mfg from the list.

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11. Select Inventory from the Materials & Mfg Menu.

12. Select Counting from the Inventory menu.

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13. Select Repl Count from the Counting menu.

14. Enter the following information when prompted. Note: The mobile application screen is case sensitive. Organization Code: M1 Subinventory: ##-LV Replenishment Count Name: ##RC2 15. Select Count to enter the order quantity.
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16. Enter 30 as the order quantity and select Save/Next. Note: As ##-Item02 is the only item associated with 00-LV subinventory, the item name is automatically displayed and you are prompted to enter just the count quantity. If there are more than one item associated with the subinventory, then you also need to enter the item. You can enter the count quantity for all items that have been associated with the subinventory. You can enter the count quantity for these items even if you have not included them in the Replenishment Count Header.

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17. Press Ctrl+B to view the Message Page.
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Process the Count Information Using the Mobile Application 18. Select Process and Report to process the count information that you entered.

19. Press Ctrl+B to view the Message Page. The request number is displayed. You can view the details of the Replenishment Count Report by querying for the request number in the Requests window.

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11i Replenishment Fundamentals Chapter 11 - Page 100

20. Select Logout to exit the mobile application. 21. Can you enter the count in the Replenishment Count Lines window for ##RC2? Why? No, you cannot enter the count in the Replenishment Count Lines for ##RC2. This is because you would have selected the Count Using Mobile check box in the Replenishment Count Headers window, you can enter the count only using the mobile application.

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Processing PAR Counts

PAR Counts Periodic Automated Replenishment (PAR) counting is a replenishment method that enables you to perform replenishment count at a locator level. For example, in Oracle Inventory you can model a hospital storeroom as a subinventory and the shelves and trolleys in the storeroom as locators. You can define PAR levels for each item stored in these locators. You can replenish these items every time they go below the PAR level. In general, the steps for PAR are the same as that of replenishment counting. For a list of these steps, see Replenishment Planning Steps earlier in this lesson. The following steps are specific to PAR: Enable PAR level planning for the subinventories. Define locators for the subinventories. Enter the PAR level when you define the item subinventory relationship. Note: If you have enabled PAR level planning for a subinventory, you cannot perform min-max planning for that subinventory. The PAR level acts as both the minimum and maximum quantity levels for subinventories that have PAR level planning enabled.

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Reorder Quantity For PAR Count

PAR Count Reorder Quantity The reorder quantity when you process a PAR count depends on the following factors: PAR Level Quantity Count Type The table in the slide explains how the reorder quantity differs based on these factors. The system generates the appropriate replenishment document based on the item sourcing for the subinventory. For example, if sourcing is from another organization, the system automatically generates an internal order. If you choose on-hand quantity as the count type, then the quantity denotes the on-hand quantity available in the locator. The system compares this quantity that you enter with the PAR level to calculate the reorder quantity. This option is only for non-tracked subinventories. If you choose order PAR then the reorder quantity is same as the PAR level. This is similar to the order maximum option available when you perform a replenishment count. You cannot enter the quantity if you choose order par.

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11i Replenishment Fundamentals Chapter 11 - Page 103

Choose order quantity to generate a replenishment requisition for the quantity that you want to order. In this case, the quantity denotes the order quantity. Note: If you have not specified the PAR level, then you can only choose order quantity as the count type.

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Chapter 11 - Page 104

Agenda

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Chapter 11 - Page 105

Kanban Cards

Kanban Replenishment Recall that a kanban system is a self-regulating pull system that leads to shorter lead times and reduced inventory. Kanban systems are typically applied to items with relatively constant demand and medium-to-high production volume.

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Kanban Planned Items

Kanban Planned Items To define a kanban planned item, you must set the Release Time Fence attribute in the MPS/MRP Planning attribute group to the Kanban Item (Do Not Release) option in the Master Items window. Use the following navigation path to access the MPS/MRP Planning attribute. You can define pull sequences only for kanban planned items. Navigation Path Inventory Responsibility (N) Items > Master Items > (T) MPS/MRP Planning. Defining Pull Sequence Sources For every kanban planned item, you must define a pull sequence, which is a series of kanban locations that model the replenishment network on the shop floor. For example, a kanban location can be a subinventory locator. The replenishment source for a kanban location can be another kanban location, a production line, or an external source. You can use locators even if locator control is turned off at the organization and item levels. Kanbans can be sourced from an external supplier or an internal organization. A suppliersource-type kanban triggers a purchase request to the supplier, while an inter-org- source-type kanban results in an inter-organization transfer. Navigation Path

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Inventory Responsibility(N) Kanban > Pull Sequences > (T) Source.

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Kanban Cards

Kanban Cards Kanban cards are created for an item, subinventory, and locator (optional). They are uniquely identified by a kanban number. For cards generated from a kanban pull sequence, the number is automatically generated. For manually defined cards, both replenishable and nonreplenishable, you can enter an unused kanban number or let the system create the number. You cannot override the quantity for generated cards, but you can add additional cards or delete existing cards from the pull sequence to control the inventory in the replenishment chain. A supply source defaults from the sourcing rules if a sourcing rule is available for the item and kanban location. Only the primary supplier, based on the split percentage and ranking, is used. You can manually override the quantity and supply source on a pull sequence only before the cards are printed. Changes to the pull sequence are not reflected until the old cards are deleted and new ones are created. Updates to the sourcing rules apply only to cards created after the update. Kanban Card Status Kanban cards are generated with a default card status of Active. When you define a card manually,you can initially give it either Active or Hold status.You can terminate use of a card

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11i Replenishment Fundamentals Chapter 11 - Page 109

by changing the card status to Canceled, but you cannot reverse this change. Only canceled cards can be deleted. Navigation Path Inventory Responsibility(N) Kanban > Pull Sequences (T) Kanban.

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Chapter 11 - Page 110

Kanban Supply Status

Kanban Supply Status You can set all of the supply status codes manually. You can also set all of the supply statuses automatically except for In-Transit. All cards are generated with a status of New. You can switch this status to Empty to trigger a kanban replenishment signal. During initial setup, you can switch the status to Full if you are starting out with a full bin. When you are defining a card manually, you create a card with at status of Empty, Full or New.

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Kanban Replenishment Sources

Kanban Sources of Replenishment You can create kanban cards with the following source types: Inter-Org- Replenished by another organization. Intra-Org- Replenished from another subinventory in the same organization. Production- Replenished by a production line. Supplier- Replenished by an external supplier. Flow Schedules- Replenished by flow. User Defined- You can define a replenishment source.

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Kanban Card Printing

Kanban Card Printing You can print kanban cards for a replenishment plan or a replenishment chain when you generate the cards. You can also print cards individually if the card information is complete. You can print duplicate cards only if the original is lost or voided. You are given a warning message when you print duplicate cards.

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Chapter 11 - Page 113

Guided Demonstration Overview: Generating Kanban Cards

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Guided Demonstration - Kanban


Responsibility: Inventory, Vision Operations USA Create Kanban Pull Sequence 1. 2. 3. (N) Kanban > Pull Sequences. Choose New. Enter the following information to create the pull sequence. Item: AS18947 Subinventory: FGI Source Type: Supplier Supplier: Advanced Network Devices Supplier Site: Santa Clara (T) Kanban Calculate: Size: Number of Cards: Minimum Order Qty: (M) File > Save Choose Generate Cards Choose Cards Select the first card. Choose Replenish Number of Cards 10 10 20

4.

5. 6. 7. 8. 9.

10. Select the second card. 11. Choose Replenish 12. (N) File > Save

13. (N) File > Close Form.

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Practice Overview: Generating Kanban Cards

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Practice - Generating Kanban Cards


Overview
In this lab you will learn how to generate Kanban Cards.

Assumptions
You have completed the defining Subinventories Lab You have completed the Defining Items Lab. You are skilled in Oracle navigation. You must have access to an Oracle Application Vision database or comparable training or test instance at your site on which to complete this practice.

Tasks
Setting up a Kanban Pull Sequence Set up a Kanban pull sequence using the following information: Item ##-Item03 Subinventory: ##FGI Locator: Source Type: Supplier Supplier: Advanced Network Devices Supplier Site: Santa Clara Calculate: Number of Cards Size: 10 Cards: 10 Minimum Order Quantity: 20 Generate Kanban Cards

Generate Kanban cards for the pull sequence you created. Replenish Kanban Cards

Replenish your Kanban cards.

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Solution Generating Kanban Cards


Setting up a Kanban Pull Sequence Responsibility = Inventory, Vision Operations USA 1. Navigate to the Pull Sequences window. 2. (N) Kanban > Pull Sequences > (B) New.

Use the following information to define a new pull sequence: Item: ##-Item03 Subinventory: ##FGI Locator: Row ##, Rack 1, Bin 1 Source Type: Supplier Supplier: Advanced Network Devices Supplier Site: Santa Clara

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(T) Kanban Calculate: Size: Number of Cards:

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Minimum Order Quantity:

20

3.

(M) File > Save

Generate Kanban Cards 4. 5. 6. Choose Generate Cards Choose Yes to print Kanban cards. Verify your Kanban cards printed.

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(M) View > Requests Select All My Requests Choose Find

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(M) File > Close Form

Replenish Kanban Cards 7. Navigate to the Kanban Cards Summary window. 8.

Choose Cards or (N) Kanban > Kanban Cards.

Replenish Kanban cards.

Select the first Kanban card in the list, and choose Replenish. Verify the supply status changed to Wait.

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Verify the supply status is Empty.

Select the second Kanban card in the list and choose replenish.

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9.

(N) File > Save.

10. (N) File > Close Form.

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Agenda

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Chapter 11 - Page 122

Available to Promise

Available to Promise Available to Promise (ATP) represents the quantity available for sale at any given period. The basic formula for ATP is ATP quantity = on-hand quantity + supply - demand shortage. Oracle Inventory enables you to define different rules that govern what is considered supply and demand.

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Chapter 11 - Page 123

ATP Rules and ATP Checks

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Uses of ATP in Oracle Inventory

Uses of ATP in Inventory You can view the earliest available data for a specific quantity of an item or a group of items and the available quantity of an item for a specific date. You can view the supply, demand, and ATP item quantities for the periods that fall between the current date and the end of the ATP horizon.

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Steps for Checking ATP

Checking ATP Note: Oracle Inventory displays the organization-level default ATP rule whenever you perform ATP queries in your organization.

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ATP Rules Setup Steps

Defining an ATP Rule Navigation Path Inventory Responsibility (N) Setup > Rules > Available to Promise You can use the following equation to calculate the ATP quantity for each supply period. Period ATP = (period supply) (period demand)

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Defining Computation Options

ATP Computation Options When you define ATP rules, you must specify computation options. Computation options govern how to calculate the ATP quantity in each period. You can use computation options individually or in combination. Backward Consumption of Shortage You can calculate ATP information by using the surplus quantity of an item from prior ATP periods to cover a period shortage. If the period ATP is negative, you can go backward through the supply periods, one at a time, and subtract the shortage from the available quantity. You can keep going backward until the shortage disappears or you run out of periods. Forward Consumption of Shortage You can calculate ATP information by using a surplus quantity of an item from future ATP periods to cover an earlier period shortage. If the period ATP is negative, then you can go forward through the supply periods, one at a time, and subtract the shortage from the available quantity. You can keep going forward until the shortage disappears or you run out of periods.

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Defining Computation Options

Determining ATP using Accumulation Options You can use the Accumulate Available option to calculate ATP by carrying over the available quantity of an item from one ATP period to the next. Note: This option assumes backward consumption of shortage. Entering an Accumulation Window Accumulation window is the number of days by which to limit the accumulation of available supply. The accumulation window is measured in workdays based on the organization calendar and exception set. The accumulation window option prevents the commitment of near-term supply to orders that have requirement dates far into the future. The accumulation window applies to only the following two computation options: Accumulate Available Backward Consumption

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Specifying Supply and Demand Time Fences

Specifying Supply and Demand Time Fences A time fence is the total lead time required to purchase or manufacture an item. You can define item time fence options to provide timing information for the ATP calculation. The ATP calculation algorithm uses the following time fences: Past-due-supply time fence Past-due-demand time fence Infinite-supply time fence Entering Past Due Supply and Demand Days Past-Due-Supply Days The ATP process does not consider any supply scheduled before the past-due-supply time fence date. The ATP process considers all supply from the beginning of the past-due-supply time fence date to the current date as supply for the current date. Past-due-supply time fence date = (current date) (past-due-supply days) Past-Due-Demand Days

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The ATP process does not consider any demand scheduled before the past-due-demand time fence date. The ATP process considers all demand from the beginning of the past-due-demand time fence date to the current date as demand for the current date. Past-due-demand time fence = (current date) (past-due-demand days)

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Specifying Supply and Demand Time Fences

Selecting an Infinite-Supply Option The infinite-supply time fence date is the end of the ATP horizon. Oracle Inventory does not consider supply sources scheduled on or after this date in ATP calculations. The infinitesupply option represents the total time beyond which the ATP process assumes that infinite supply is available to cover any scheduled demand. You can select one of the following infinite-supply options: Cumulative manufacturing lead time: The manufacturing lead time of an assembly plus the largest adjusted cumulative manufacturing lead time of its components. Cumulative total lead time: The total lead time of an assembly plus the largest adjusted cumulative total lead time of its components. Total lead time: The sum of the preprocessing, processing, and postprocessing lead times of an item. User-defined time fence: A lead time that you specify for the item.

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Specifying Supply and Demand Time Fences

Specifying a Supply Period Oracle Inventory designates a period as beginning on a scheduled supply date and ending on the day before the next scheduled supply date. A supply period can cover several days or be a minimum of one day. If supply occurs on a nonworkday, the ATP calculation considers that supply as belonging to the next workday. If multiple supply events occur on the same day, the ATP process considers the total supply.

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Specifying Demand Sources

ATP Demand ATP demand is the sum of all demand quantities in the supply period. If demand occurs on a nonworkday, the ATP calculation considers that demand as belonging to the previous workday. ATP by Demand Class Check Box If you select the ATP by Demand Class check box, the ATP calculation considers only supply and demand for a particular demand class. The demand class feature enables you to forecast, plan, and promise based on subdivisions of your demand. For example, a demand class might represent a large customer or a group of related customers. If you select ATP by Demand Class, Oracle Inventory considers only the following sources of supply: Discrete MPS Repetitive MPS Discrete WIP Repetitive WIP Nonstandard WIP Including User-defined Demand Sources

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In addition to Oracles predefined sources, you can use your own demand sources. To use your own demand sources, you must populate the user-defined demand interface table with your external demand information.

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Chapter 11 - Page 135

Specifying Supply Sources

Using the Available On-Hand Quantity as the Supply Source You can choose to include available on-hand quantity as a source of supply. However, you should not typically use available on-hand quantity as supply in make-to-order and assembleto-order environments. Including User-Defined Supply as a Supply Source In addition to Oracles predefined supply sources, you can use your own supply source. However, you must populate the user-defined supply interface table with your external supply information.

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11i Replenishment Fundamentals Chapter 11 - Page 136

Setting Up Item and Bills for ATP Checking

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Chapter 11 - Page 137

ATP Checking

Enabling ATP Checking When Placing a Demand If you enable the Check ATP attribute, the item must pass an ATP test before you can place a demand for it in Oracle Order Management. When you place a demand for the item in Oracle Order Management, the ATP process checks to see if there is sufficient quantity. If you decide not to enable the Check ATP attribute, then you can place a demand for the item even if there is not sufficient stock to satisfy the demand. You should not enable the Check ATP attribute for items that are noncritical, rarely out of stock, on a short manufacturing cycle, or replenishable on short notice. Specifying an Item ATP Rule Oracle Inventory uses the ATP rule that you assigned to check ATP when you place a demand for the item in Oracle Order Management. If you do not specify an ATP rule for the item, the ATP process uses the organization-level default ATP rule that you enter in the Organization Parameters window.

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ATP Checking

Selecting the ATP Components Attribute If you enable the ATP Components attribute for an assembly, you can place a demand for the assembly only if all of the components with the enabled Check ATP attribute at the billcomponent level pass the ATP check. If you enable the Check ATP attribute for the assembly, then the assembly must also pass the ATP check before you can place a demand for it.

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ATP Checking

Setting the Check ATP attribute at the Bill Level Use the following navigation path to access the Bills of Material window: Navigate to the Oracle Bills of Material application, (N) Bills > Bills. If an item is a component in a bill of material, you can change the value of the Check ATP attribute, at the bill-component level, to something other than what you set at the master-item level. If you had enabled the Check ATP attribute when you defined the item, you can decide whether to enable or disable the component Check ATP attribute. If you had not enabled the Check ATP attribute when you defined the item, Oracle Inventory does not enable the bill component Check ATP attribute. This enables you to set up items that require passing ATP checks when ordered directly, but that do not require passing ATP checks when they are components of an assembly. Use the following navigation path to access the Check ATP attribute in Oracle Inventory: (N) Items > Organization Items > (T) Order Management.

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Viewing ATP Criteria

Viewing ATP Information for Individual Items When you set up ATP criteria, you must specify the following information: Required quantity Required date Oracle Inventory then displays the following ATP results: Earliest date on which the required quantity will be available ATP quantity for the required date Viewing ATP Information for a Group of Items Oracle Inventory returns the date when all of the items in the group will be available. You can view the ATP result and supply and demand detail for each item by navigating to the ATP by Period and Supply/Demand Detail windows respectively. Viewing ATP Information for a Demand Class You can view ATP information for individual items and groups of items that belong to a particular demand class.

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Agenda

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Chapter 11 - Page 142

Planning and Forecasting Profile Options

Planning and Forecasting Profile Options Minmax Reorder Approval Indicates the status of requisitions created by the Minmax Planning Report. Inventory predefines a value of Pre-approved for this profile for all levels upon installation. If you choose Incomplete, you can optionally load requisitions as unapproved and use the document approval functionality in Oracle Purchasing. Enter Replenishment Count Form Indicates processing control in the Enter Replenishment count window. The available values are as follows: Background processing: Upon commit, control returns immediately to you, allowing you to continue working. The replenishment count transactions are executed on a periodic basis. Concurrent processing: Upon commit, Oracle Inventory spawns the concurrent process and returns control immediately to you, allowing you continue working. Displays the concurrent request number representing the concurrent process executing the replenishment. Replenishment Count Line Failure

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Indicates the action taken when a failure is detected while processing a replenishment count line. Inventory predefines a value of Continue processing for this profile for all levels upon installation. Continue processing- Other (successful) lines for the replenishment header are processed to requisition lines. Halt processing- Do not process other (successful) lines for the replenishment header. Replenishment Count Requisition Approval Indicates the status of subinventory replenishment requisitions created by the replenishment processor. Available values are: Pre-approved- Requisitions created by the replenishment processor are approved. Incomplete Requisitions created by the replenishment processor have not been submitted for approval. Approval Required- Requisitions created by the replenishment processor are currently not approved. Inventory predefines a value of Incomplete for this profile. If you choose Approval Required, you can optionally load subinventory replenishment requisitions as unapproved and use the document approval functionality in Purchasing.

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Chapter 11 - Page 144

Setting Up the Min-Max System Profile Value

Entering Min-Max Approval Status When you run the Min-max report, the INV: Minmax Reorder Approval profile option enables you to create requisitions as either approved or unapproved. How to Enter a Min-Max Approval Status To enter a min-max requisition approval status, navigate to the System Profiles window to enter a personal or system profile value to specify a min-max reorder approval status. Navigation Path Inventory Responsibility (N) Setup > Profiles > Personal. The Personal Profile Values window appears. (M) View > Find. A Find window appears. Enter %Minmax% in the find window to locate the Minmax Reorder Approval profile option. Note: If you do not have access to system-level profile values, ask your system administrator for assistance in setting up the system-level Minmax Reorder Approval profile option.

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Subinventory Setup Windows

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Agenda

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Chapter 11 - Page 147

Min-Max Order Type and Order Source

Min-Max Order Type and Order Source An item can be a make item or a buy item. This characteristic of an item and the source type that you specify for the item determine the type of replenishment order created for that item. For organization level min-max planning, you can specify the source type in the General Planning tab of the Organization Item window. For subinventory level min-max planning, you can specify the source type in the Sourcing tab of the Item Subinventories window. If this is left blank, the report checks to see if a source type is specified either at the Subinventory level, the Organization Item level, or in the Organization Parameters window. If the item is a Buy item and the source type is set to Inventory, min-max creates requisitions. If the source type is Supplier, it creates purchase orders, and if the source type is Subinventory, it creates move orders. Note that source type Subinventory is not valid for organization level planning (it is not a valid option on the Organization Parameters window; if used on the Organization Item window for an item that is planned at the organization level, it will not restock the item). Items must also be transactable in order for min-max to create purchase orders, requisitions or move orders (Transactable check box on Inventory tab of Organization Item window checked).

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Purchasable Item Considerations The following conditions must be satisfied before min-max can insert records into the PO interface table: For requisitions (source type Inventory), internal orders must be enabled for the item. That is, the Internal Orders Enabled check box in the Order Management tab of the Organization Item window must be selected. For purchase orders (source type Supplier), the item is purchasable. That is, the Purchasable check box in Purchasing tab must be selected. An Inventory AP Accrual account is defined for the organization. An Invoice Price Variance account is defined for the organization. For Min-Max Report to create Purchase / Internal requisitions successfully, Encumbrance Account SHOULD BE specified at Item or Org level, if the 'Use Requisition Encumbrance' check box is selected in the Financial Options window under Encumbrance tab. For subinventory level planning, Encumbrance Account SHOULD BE specified at the item-subinventory, subinventory, organization-item or organization level. For organization level planning, min-max will only look at the organization-item or organization level to find the encumbrance account. If the 'Use Requisition Encumbrance' check box is not selected, it is optional to specify Encumbrance Account in the Organization Items window or Organization Parameters window. A charge account is defined. If the Inventory Asset Value check box in the Costing tab of Organization Item window is checked, then the material account is used. For organization level planning, the material account is specified in the Valuation Accounts section of the Costing Information tab of the Organization Parameters window. For subinventory level planning, the material account is specified in the Subinventories window. If the Inventory Asset Value check box is not selected, the expense account is used for organization level planning. The expense account is defined on the Purchasing tab of the Organization Item window, or in the Valuation Accounts section of the Costing Information tab of the Organization Parameters window; for subinventory level planning, Oracle Inventory checks the expense account defined at the subinventory level before looking at the org-item or org level expense account. Additional considerations for Creation of WIP Jobs For make items, min-max inserts a record into the WIP interface table wip_job_schedule_interface for creating a WIP Job or Schedule for manufacturing this item. WIP work orders cannot be generated for subinventory level min-max planning if a Make item is min-max planned at the subinventory level, the report flips the flag and treats it as a Buy item instead. Also, the item must have the Build in WIP and Pick components enabled. Make Item Considerations The following considerations should be considered when using min-max on make type items. Discrete MPS Set the item type to Make. Make certain that under the general planning tab the sourcing is set to null and cleared out. Make certain to run the min-max planning with restock = yes. Whether or not WIP demand and supply are included in the calculations is specified in the report parameters.

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It is possible to verify that an entry has been made into the table WIP_JOB_SCHEDULES_INTERFACE. Run the associated Mass load Concurrent Program (WIP > Discrete > Import Jobs and Schedules) to ensure that the WIP interface tables have been picked up and processed.

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Chapter 11 - Page 150

Replenishment Method Selection

Replenishment Method Selection Consider the following information when determining the replenishment method to use: Supply sources Document created during replenishment Demand Sources Although not listed in the table, demand sources might include the following: - Sales orders - Forecasts

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Agenda

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Chapter 11 - Page 152

Summary

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Chapter 11 - Page 153

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Chapter 11 - Page 154

11i Inventory Accuracy Concepts


Chapter 12

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Chapter 12 - Page 1

11i Inventory Accuracy Concepts

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Chapter 12 - Page 2

Objectives

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Chapter 12 - Page 3

Agenda

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Chapter 12 - Page 4

Overview of Inventory Accuracy

Overview Oracle Inventory has features that enable you to control and improve the accuracy of your inventory records: ABC Analysis Cycle Counting Physical Inventory

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Agenda

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Chapter 12 - Page 6

ABC Analysis Overview

ABC Analysis ABC Analysis is the classification of a group of items in decreasing order of annual dollar volume or other criteria. This array is then usually split into three classes A, B, and C. A Group- The A group usually represents 10% to 20% by number of items and 50%-70% by projected dollar volume. B Group- The B group usually represents about 20% of the number of items and about 20% of the dollar volume. C Group- The C group contains 60%-70% of the number of items and represents about 10%-30% of the dollar volume.

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Agenda

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Chapter 12 - Page 8

Cycle Counting Overview

Cycle Counting With cycle counting, inventory is counted on a cyclic schedule rather than once a year. A cycle inventory count is usually taken on regular defined basis. Most effective cycle counting systems require the counting of a certain number of items every workday with each item counted at a prescribed frequency. You can use cycle counting along with ABC analysis to count items of greater importance more frequently than those of less importance. Cycle counting supports scheduled counting based on value or counting by location, and can be set up at the organization level or the subinventory level. Benefits of Cycle Counting Cycle counting enables you to keep inventory records accurate by correcting errors between the system on-hand (perpetual) and actual on-hand (physical) quantities. Cycle counting can also be a valuable tool to help identify patterns in the errors found. Analysis of these patterns can suggest and help to prioritize improvements in training, tools, and processes. Over a period of time these improvements may increase the average level of inventory record accuracy.

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11i Inventory Accuracy Concepts Chapter 12 - Page 9

Agenda

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Chapter 12 - Page 10

Physical Inventory Overview

Physical Inventory A physical inventory is a periodic reconciliation of system on-hand balances with physical counts in inventory. You can perform physical inventories whenever you choose to verify the accuracy of your system on-hand quantities. You can perform a physical inventory for an entire organization or for particular subinventories within an organization. Physical inventories are usually performed once every six months or once a year depending on the organization requirements.

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11i Inventory Accuracy Concepts Chapter 12 - Page 11

Why Perform Physical Inventories?

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Agenda

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Chapter 12 - Page 13

Mobile Inventory Accuracy Overview

Mobile Device Inventory Accuracy Oracle Mobile Materials Management provides windows to perform cycle counting and complete physical inventory functions.

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Chapter 12 - Page 14

Agenda

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Chapter 12 - Page 15

Summary

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Chapter 12 - Page 16

11i Inventory Accuracy Fundamentals


Chapter 13

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Chapter 13 - Page 1

11i Inventory Accuracy Fundamentals

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Chapter 13 - Page 2

Objectives

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Chapter 13 - Page 3

Agenda

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Chapter 13 - Page 4

Defining an ABC Analysis

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Define and Run an ABC Compilation

Explaining ABC Compilation An ABC Compile is a ranking of your items based upon selected criteria. You can define and compile an ABC analysis for your entire organization or for a specific subinventory within your organization. You choose the compilation criterion, the scope of your analysis, the cost type to use in determining item values and any additional information that may be conditionally necessary based on your compilation criterion.

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11i Inventory Accuracy Fundamentals Chapter 13 - Page 6

ABC Compilation Criteria

Explaining ABC Compilation Criteria For each distinct compile, you can choose one criterion (such as current on-hand value or MRP demand usage value) to value and rank each item included in the ABC compile. The criterion that you choose defines what the rank of a particular item will be in the ABC Compile. For example, if you use current on-hand quantity as your compile criterion, then item X with an on-hand quantity of 10 units is of higher rank than item Y with a quantity of 5 units. If you use current on-hand value as the criterion and if item X has a cost of $10 per unit and item Y has a cost of $25 per unit, then item Y has a higher value than item X since Oracle Inventory compares $100 ($10x10 units) to $125 ($25x5 units). Explaining ABC Compilation Criteria Options Current On-Hand Quantity Use the current on-hand quantity of inventory. Assign the sequence number by descending quantity. Current-On-Hand Value Use the current on-hand quantity of inventory multiplied by the cost for the cost type. Assign the sequence number by descending value.

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Historical Usage Value Use the historical usage value (transaction history). This is the transaction quantities times the unit cost of the transactions for the time period you specify. Assign the sequence number by descending value. Historical Usage Quantity Use the historical usage quantity (transaction history) for the time period you specify. Assign the sequence number by descending quantity. Historical Number of Transactions Use the historical number of transactions (transaction history) for the time period you specify. Assign the sequence number by descending number of transactions. Forecasted Usage Value Use the forecasted usage value based on the forecast quantity calculated and the cost type you specify. Assign the sequence number by descending value. Forecasted Usage Quantity Use the forecasted usage quantity. Assign the sequence number by descending quantity. Previous Cycle Count Adjustment Quantity Oracle Inventory sums the quantity of all cycle count adjustments that have occurred since the last ABC compile date. Assign the sequence number by descending quantity. Previous Cycle Count Adjustment Value Oracle Inventory sums the value of all cycle count adjustments that have occurred since the last ABC compile date. Assign the sequence number by descending value. MRP Demand Usage Quantity Oracle Inventory sums the MRP gross requirements for the MRP plan you specify. Assign the sequence number by descending quantity. MRP Demand Usage Value Oracle Inventory sums the MRP gross requirements for the MRP plan you specify, then multiplies each by the item cost type you choose in the ABC compile form. Assign the sequence number by descending value. MPS Demand Usage Quantity Oracle Inventory sums the MPS gross requirements for the MPS schedule you specify. Assign the sequence number by descending quantity. MPS Demand Usage Value Oracle Inventory sums the MPS gross requirements for the MPS schedule you specify, then multiplies each by the item cost type you choose in the ABC compile form. Assign the sequence number by descending value. DRP Demand Usage Quantity Oracle Inventory sums the DRP gross requirements for the DRP plan you specify. Assign the sequence number by descending quantity. DRP Demand Usage Value Oracle Inventory sums the DRP gross requirements for the DRP plan you specify, then multiplies each by the item cost type you choose in the ABC compile form. Assign the sequence number by descending value.

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Agenda

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ABC Valuation Scope

ABC Valuation Scope You can select a valuation scope for determining the ranking of items. You can do an ABC compile across individual subinventories or across an organization. If you choose to restrict ABC compile to items within a particular subinventory, you have the option of valuing your items across all subinventories in the organization or by the individual subinventory.

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Chapter 13 - Page 10

Agenda

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Defining ABC Groups

Defining ABC Groups ABC assignment groups link a particular ABC compile with a valid set of ABC classes. This allows you to selectively reduce or increase the number of ABC classes you want to use in your item assignments for a particular ABC compile. Oracle Inventory uses these groups when you automatically assign your items to ABC classes. It ensures that you divide your items into the exact number of groupings you specified in the ABC group. You must also assign a sequence number to each class associated with the ABC group. The class with the lowest sequence number is assumed to have the highest rank and will have higher rank items assigned to that class than the next higher sequence number. You may update an assignment group to add new classes, however you cannot delete a class. If you need to delete a class, you must create a new assignment group with only the desired classes.

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Defining ABC Classes

Defining ABC Classes You use ABC Classes to identify the value groupings to which your items belong. You can define these classes using your own terminology. For example you might define classes High, Medium, Low, and later assign your items of highest rank to high, those of lower rank to Medium, and those of the lowest rank to low. You must assign an ABC class to at least one ABC group. You can use ABC classes to group items for a cycle count where you count A items more frequently than B items. When you use ABC classes in this way, you perform an ABC analysis and assign items to classes based on analysis results.

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ABC Item Assignments

When you define ABC assignments you specify the cutoff point for each ABC class. Each ABC class must have at least one item assigned to it and all items in the ABC compile must be assigned to an ABC class. You can use any of the following fields to determine the cutoff points: Seq: You can enter the sequence number from the ABC Descending Value Report for the last item to be included in each ABC class. Oracle Inventory automatically calculates this value if you choose to assign classes by another method. Oracle Inventory displays the last sequence number as the default of the last class. Inventory Value: You can enter the cumulative value from the ABC Descending Value Report for the last item to include in each ABC class. Oracle Inventory automatically calculates the maximum value. This maximum value is restricted to the total inventory value compiled and is displayed in the Total Compile Value field. Oracle Inventory displays the total inventory value as the default for the last class. ABC Item Assignments Note % Items: You can enter the percent of number of items compiled from the ABC Descending Value Report to include in each class. Oracle Inventory automatically calculates this value if you choose to assign classes by another method.

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% Value: You can enter the percent of total compile value from the ABC Descending Value Report to include in each class. Oracle Inventory automatically calculates this value if you choose to assign classes by another method. It is possible to have several items in the ABC compile with zero value. If any item with zero value is in a class other than the last class, you may only assign items using the sequence number or item percent. For the Inventory Value, % Item, and % Value fields, if the value entered does not exactly match any item, Oracle Inventory chooses the first item with a value greater than the value entered. For example, if you choose 20% to be A items, inventory calculates which items comprise 20% and will include the next item if a partial is in the calculation. If 20% = the first 10 items in your compile, plus part of the 11th item, then items 1-11 are A items. If you are not satisfied with the class into which an item falls as a result of the automatic ABC assignment process, you can change it. For example, you compile your ABC analysis based on historical usage value. A new item in your inventory is ranked low because it has little transaction history. However, you know that for the future this item should really be ranked higher. Use the Update ABC Assignments form to reclassify this item. Whenever you recompile an ABC analysis or change the method by which you assign your ABC classifications, you lose any changes you might have made to your item assignments. All items are reclassified based on their new ranks in the ABC Descending Value Report and the method you choose to determine cutoff points.

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Guided Demonstration Overview: Compiling an ABC Analysis

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Guided Demonstration - ABC Analysis


Responsibility: Inventory, Vision Operations USA Creating an ABC Compile 1. 2. 3. 4. 5. 6. 7. 8. 9. (N) ABC Codes > ABC Compiles. Choose New. Enter Finished Goods as the compile name. Enter Finished Goods Analysis as the description. Choose subinventory as the content scope. Choose subinventory as the valuation scope. Select the FGI subinventory. Select Current on hand quantity as the compile criterion. Choose Compile. Note: Note the concurrent request number. 10. Choose Yes to print the compile results. Note: Note the concurrent request number. 11. Choose Close Form Creating ABC Classes 12. (N) ABC Codes > ABC Classes. 13. (M) File > New.

14. Create three ABC Classes using the following information. Class Name: Finished Goods A Description: Finished Goods Class A Class Name: Description: Class Name: Description: Finished Goods B Finished Goods Class B Finished Goods C Finished Goods Class C

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15. (M) File > Save. 16. (M) File > Close Form. ABC Assignment Groups 17. (N) ABC Codes > ABC Assignment Groups. 18. (M) File > New. 19. Enter Finished Goods ABC as the Group Name. 20. Enter Finished Goods as the compile name. 21. Choose Group Classes. 22. Choose the following ABC Classes. Finished Goods A Finished Goods B Finished Goods C 23. (M) File > Save. 24. Choose Assign Items. 25. Enter the following percentage values. A items: 50% B items 80% C items populates automatically 26. (M) File > Save and Proceed. Note: Note the Concurrent request number. 27. (M) File > Close Form.

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Chapter 13 - Page 18

Practice Overview: Compiling an ABC Analysis

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Practice - Compiling an ABC Analysis


Overview
In this practice you will compile an ABC analysis.

Assumptions
You are skilled in Oracle Navigation. You must have access to an Oracle Application Vision database or comparable training or test instance at your site on which to complete this practice.

Tasks
Receive Items Receive 20 items of your choice in to your ##FGI subinventory. You can use part numbers from other teams as well as system items that begin with AS, CM, or SB. Be sure to receive different quantities of each item ranging from 5-100. Note: Receive at least one system item. These items are associated with standard costs. Compile an ABC analysis 1. Compile an ABC Analysis using the following information: Name: ##FGI ABC Description: ABC Complie for Team ##FGI Content and Valuation Scope: Subinventory Subinventory: ##FGI Criterion: Current on hand quantity Cost Type: Frozen

Define ABC Classes 2.

Define three ABC Classes using the following naming convention: Name: ##Class A Description: A items Name: Description: Name: Description: ##Class B B items ##Class C C items

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Define an ABC Group 3. Define an ABC group using the following information Group Name: ##ABC Group Compile Name: ##FGI-ABC

Define an ABC Sequence 4. Define an ABC Sequence using the following information: Class Name ##Class A ##Class B ##Class C

Assign Item Valuation 5. Assign item valuation as follows: ##Class A: 50 ##Class B: 80 ##Class C: (system calculates)

Update ABC Codes 6. Change one item from a C item to an A item, and change one item from a C item to a B item.

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Solution Compiling an ABC Analysis


Compile an ABC Analysis Responsibility = Inventory, Vision Operations USA 1. Navigate to the ABC Compile window. 2. (N) ABC Codes > ABC Compiles (M) File > New

Compile an ABC Analysis using the following information: Name: ##FGI-ABC Description: ABC Complie for Team ##FGI Content and Valuation Scope: Subinventory Subinventory: ##FGI Criterion: Current on hand quantity Cost Type: Frozen

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Select Compile, and note your report request number. ___________________ Select Yes to print results, and note your request number. _________________
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Define ABC Classes 3. Navigate to the ABC Classes window. 4. (N) ABC Codes > ABC Classes (M) File > New

Define three ABC Classes using the following naming conventions: Name: ##Class A Description: A items Name: Description: Name: Description: ##Class B B items ##Class C C items

5.

Save and Close window. (M) File > Save.

Define an ABC Group 6.

Navigate to the ABC Assignment Groups window. (N) ABC Codes > ABC Assignment Groups.
Copyright Oracle Corporation, 2005. All rights reserved.

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(M) File > Close Form.

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7.

(M) File > New.

Define an ABC group using the following information: Group Name: ##ABC Group Compile Name: ##FGI-ABC Note: Make sure that ##ABC Group (the group that you created) is selected.

Select Group Classes

Define an ABC Sequence 8.

Define an ABC Sequence using the classes you created earlier. Class Name ##Class A ##Class B ##Class C

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9.

Save your work. (M) File > Save

Assign Item Valuation 10. Select Assign Items. 11. Enter the following percentages in the % Items field: ##Class A: 50 ##Class B: 80 ##Class C: (system calculates)

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12. Select Assign. Update ABC Codes 13. Review and update the ABC codes assigned to items in the ##FGI subinventory. Select ##ABC Group in the ABC Assignment Groups window. Select Update Items.

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Change one item from ##Class C to ##Class A. Change one item from ##Class B to ##Class C. (M) File > Save. (M) File > Close Form.

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Chapter 13 - Page 27

Agenda

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Defining and Maintaining a Cycle Count

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Agenda

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Cycle Count Approval Tolerance

Cycle Count Approval Tolerance A cycle count is a count of a subset of items, counted during the working day rather than after freezing stock levels. When the actual count and the systems on-hand quantity do not exactly agree, the cycle count will be compared to an approval tolerance.

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Approval Tolerances

Approval Tolerances Oracle Inventory supports two types of cycle count approval tolerances, Quantity Variance Tolerance and Adjustment Value Tolerance. For each type, you can specify a positive and a negative limit which can differ from each other. When a particular cycle count entry results in an adjustment that exceeds any one of these limits, you have a cycle count adjustment that exceeds approval tolerances. Based on the approval option you choose when you define your cycle count, this adjustment is either posted automatically or held for approval. Quantity Variance Tolerance: The Quantity Variance Tolerance is a user-defined limit for the difference between the actual cycle count quantity and the system tracked on-hand quantity. You express positive and negative quantity variance tolerances as percentages of the system on-hand quantity. You enter these percentages when you define your: Cycle Count Header Cycle Count Classes Cycle Count Items

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Oracle Inventory uses any percentages you define at the cycle count item level first. If you do not have any defined for an item, it uses the tolerances defined for that items cycle count class. If you do not have any defined for the class, it uses the tolerances at the cycle count header level. If you have no tolerances defined for the header, Oracle Inventory assumes that there is no limit to the approval tolerance. Adjustment Value Tolerance: The Adjustment Value Tolerance is a user-defined limit for the total value of a cycle count adjustment. The adjustment value is calculated as: adjusted value = (system on-hand qty actual count qty) * current item cost The Adjustment Value Tolerance is expressed as positive and negative amounts in your functional currency. An adjustment value is out of tolerance if it falls outside of these amounts. You enter these tolerances when you define your cycle count header and cycle count classes. Oracle Inventory uses the values you define at the cycle count class level first. If you do not have any defined for an items class, it uses the values at the cycle count header level. If you have no tolerances defined for the header, Oracle Inventory assumes that there is no limit to the approval tolerance.

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Hit/Miss Tolerance

Hit/Miss Tolerance The Hit/Miss Tolerance is a user-defined limit for the difference between the system tracked on-hand quantity and the actual cycle count quantity. You express positive and negative hit/miss tolerances as percentages of the system on-hand quantity. A count is considered a hit if it is within these tolerances, and a miss if it is outside them. The Hit/Miss Tolerance allows you to evaluate the actual accuracy of your inventory. You enter Hit/Miss tolerance percentages when you define your cycle count header and when you define your cycle count classes. Oracle Inventory uses the percentages you define at the cycle count class level first. If you do not have any defined for an items class, it uses the tolerances at the cycle count header level. If you have no tolerances defined for the header, Oracle Inventory assumes that there is no limit to the Hit/Miss tolerance, and all variances are therefore hits regardless of the size. Inventory uses these tolerances to generate the Cycle Count Hit/Miss Analysis report which will be covered later in this course.

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Measurement Errors

Measurement Errors: Negative and positive measurement errors are user-defined limits for the difference between the cycle count quantity and the system tracked on-hand quantity. Measurement Error limits are assigned by Item. Inventory does not make any adjustments to an item whose cycle count quantity differs from the system tracked on-hand quantity by less than the measurement error. Because of this, measurement errors may implicitly override any approval tolerances you specify. You specify measurement errors when you define or update an item at the Master Item or Organizational Item level. Use measurement errors with extreme caution since they actually prevent cycle count adjustments from taking place. You would typically use this feature on an exception basis for items you cannot accurately count. For example, if you visually check the level of bolts in a bin to estimate the quantity, or you use their weight to approximate the quantity, you might want to allow for measurement errors. Therefore, if your system tracked on-hand quantity for the bolts in that bin is within an acceptable range, you do not perform a cycle count adjustment.

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Cycle Count Items

Cycle Count Items You must load items into your cycle count before you can schedule or count them. There are two methods you can use to do this: Specify an existing ABC group from which to automatically load your items Manually enter, delete, or update the items you want included/excluded When you specify an existing ABC group, Oracle Inventory automatically includes all items in the ABC group you choose in your cycle count. Inventory also copies the ABC classes for that ABC group into the current cycle count classes and maintains the same classifications for the included items. You can change the classifications of your items for your cycle count independent of the ABC classes. Once you have generated your list of items to count from an ABC group, you can periodically refresh the item list with new or reclassified items from a regenerated ABC group. Using the Cycle Counts window, you can choose whether to automatically update class information for existing items in the cycle count based on the new ABC assignments. You can also choose to have any items that are no longer in the ABC group automatically deleted from the cycle count list.

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You manually enter, delete, or update the items you want included/excluded using the Cycle Count Items window. You may want to use this window to load all your items for a cycle count or to simply add items as they are defined in the system rather than recompiling your ABC group and doing a complete reinitialization.

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Agenda

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Automatic Scheduling

Automatic Scheduling In order for Oracle Inventory to perform automatic scheduling you must do the following: Set the Cycle Count Enabled item attribute to Yes for the items you want to include in the cycle count. Enable automatic scheduling when you define your cycle count. Request the schedule using the Generate Automatic Schedule Requests window. - Each time the auto scheduler runs, it schedules counts only for the schedule interval you defined for the cycle count header. So if your schedule interval is weeks, Oracle Inventory schedules all items that you need to be counted on all of the workdays in the current week. If your schedule interval is days, then Oracle Inventory only schedules those items that are due for counting on the current date.

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Manual Scheduling

Manual Scheduling You can request counts for specific subinventories, locators, and items, and set the count for any inventory date. For example, you could enter a request to count item A wherever it can be found in subinventory X. Or you could request to count all item quantities in subinventory Y, locator B-100. Since manually scheduled counts have no impact on automatically scheduled counts, you can potentially count some items more frequently than you had initially planned. Physical Location Scheduling You can use this feature to execute location-based cycle counting. You first need to generate a schedule for counting each subinventory and locator. You then need to enter the schedule requests for each locator, specifying the schedule date.

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Count Requests

Count Requests This process takes the output of the automatic scheduler and your manual schedule entries and generates a count request for each item number, revision, lot number, subinventory and locator combination for which on-hand quantities exist. These count requests are ordered first by subinventory and locator, then by item, revision, and lot. Oracle Inventory assigns a unique sequence number to each count request that can be used for reporting, querying and rapid count entry. As the count requests are derived from the state of on-hand balances at the time the Generate Cycle count Requests process is run, you should wait to run it until you are ready to count. Note: When you schedule an item to be counted using manual scheduling, some schedule requests may have overlapping count requirements. The count request generator does not create duplicate count requests, but instead cross-references one count request back to each associated schedule request. Count Requests for Items with Zero Count By default Oracle Inventory does not automatically generate requests to count items with an on-hand quantity of zero. To include such items:

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Define all sourcing details and inventory controls for the item. For example, if an item is under predefined locator control be sure it is assigned to a subinventory and locator. Select the Generate Zero Counts option when you define your cycle count. The count request generation process automatically creates a count request. If a quantity is found and counted, an adjustment is made. At count entry, you may receive a warning message stating Zero count, no adjustment performed. Oracle Inventory generates this warning if it cannot find all levels of inventory control defined for the item. In this situation, enter the count but no adjustment is performed. To make an adjustment and update the missing information, enter an unscheduled count using either the Cycle Count Entries or Approve Adjustments window.

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Entering Cycle Counts

Entering Cycle Counts You can use the same window to enter counts of items requested through automatic or manual cycle count scheduling.You can also enter unscheduled count entries, if they are allowed for your cycle counts. You can use unscheduled counts to perform location based cycle counts. You can also use a mobile device to enter cycle count quantities. Oracle Inventory automatically queries all count requests for which you have not yet entered a count. You can use flexible search criteria to specify the group of count requests for which you want counts entered to speed up the count entry process. For example, you can specify a range of count request sequences assigned to one person so they can be entered in the same order they were printed on the count sheet.

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Cycle Count Open Interface

Cycle Count Open Interface You can import/export cycle count entries from external systems into Oracle Inventory using the Cycle Count Entries Open Interface. Export Cycle Count Request This process enables you to export cycle count requests into external systems. Update Cycle Count Open Interface This process enables you to update cycle count entries. Import Cycle Count Entries from Open Interface This process enables you to import cycle count entries open interface records into the database. Purge Cycle Count Entries Open Interface Data This process enables you to purge all cycle count entries from the open interface. Print Cycle Count Entries Open Interface Data This process enables you to print cycle count entries open interface data.

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Agenda

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Count Adjustments and Approvals

Count Adjustments and Approvals Once you enter and save your cycle counts, Oracle Inventory determines whether any adjustments need to be made depending on the approval options and tolerances you set when you define the cycle count.

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Automatic Recounts

Automatic Recounts If you turn on the Automatic Recount option when you define your cycle count, Oracle Inventory automatically submits recount requests for items that are outside the limits of the approval tolerances you specify. Oracle Inventory submits recounts as many times as necessary, limited by the maximum automatic recounts you specify for the cycle count. After you reach the maximum number of recounts, Oracle Inventory holds the count for approval. Any count request with the Recount status automatically appears on the next cycle count listing. You can manually request recounts when you are approving adjustments. This recount request will be included in the next cycle count listing.

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Approving Cycle Counts and Adjustments

Approving Cycle Counts Held for Approval Employees with access to the Count Adjustment Approvals Summary window can query, request the recount of, or approve cycle counts pending approval. You can query all counts or only those pending approval. You can approve adjustments, recount an item in question, reject the count or take no action until further investigation takes place. Approving Cycle Count Adjustments You use the Count Adjustment Approvals Summary window to approve cycle count adjustments, to request/approve recounts, or to reject the adjustment. Oracle Inventory determines which counts need approval by using the approval tolerances you entered while defining your cycle count. You can use flexible search criteria to specify the cycle count adjustments you want to review or approve. Using the Count Adjustment Approvals Summary window, you can view a variety of current item information to help determine whether to approve an adjustment. Select the information from the following tabbed regions: Adjustment: View information for the count adjustment UOM, variance quantity, variance value, variance percentage, and system quantity.

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Item Location: View information for subinventory and locator. You can also view the unit of measure and adjustment quantity. Item Details: View information for a revision, lot number, and serial number. You can also view the unit of measure and adjustment quantity. Reason, Reference: View or update the transaction reason and reference information. You can also view the unit of measure and adjustment quantity. Count: View information for UOM, count quantity, counter, and count date. Count Status, Class: View information for the sequence number, count status, and cycle count class. Approval: View information for date approved and approver. Approval Actions and Adjustments Options For items appearing in the Approval Actions, Adjustments region, you can approve, request a recount, or reject cycle count entries that are pending approval. You can also approve or reject any count for which a recount has already been requested. You can reject any cycle count request that has not yet been counted. You can display count history information or open the Count Adjustment Approvals window. Select Approved to approve the selected count entry and post the adjustment to the transaction manager for processing. Select Rejected to reject the selected count record. An adjustment is not posted. No further processing of this count entry takes place. Select Recount to process a recount request for the selected count request. An adjustment is not posted. Select the Count History button to open the Count History window for the current item. For the current item, this window displays count and variance information for the current, prior and first counts. Select the Open button to open the Count Adjustment Approvals window for the current line. This window is a combination block which you can use to view and enter approval and adjustment information for the current line instead of using the Count Adjustment Approvals Summary window.

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Chapter 13 - Page 49

Guided Demonstration Overview: Performing Cycle Counts

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Guided Demonstration - Cycle Counting


Responsibility: Inventory, Vision Operations USA 1. 2. 3. (N) Counting > Cycle Counting > Cycle Counts. Choose New. Enter the following cycle count information. Name: FGI Cycle Count Description: Finished Goods Cycle Count Adjustment Account: Miscellaneous Late Days: 1 Starting Sequence: 0 Unscheduled Entries: Yes Display System Qty: Yes Select Specific in the Count Subinventories alternative region. Select the FGI subinventory from the drop down list. (T) Serial and Schedule Enter the following Serial and Schedule information: Auto Schedule: Yes Frequency: By period (T) Adjustments and ABC Enter the following approval tolerances: Qty Variance: 3 Adjustment Value: 50 Hit / Miss Analysis: 10

4. 5. 6. 7.

8. 9.

10. Enter the following ABC Information: Group: Group created during ABC analysis (Finished Goods ABC) Option: (Re)initialize 11. Choose Classes.

12. Enter the following ABC Class information: Class: Class A class created during ABC analysis (Finished Goods A) Count: 150 Class: Class B class created during ABC analysis (Finished Goods B) Count: 100 Class: Class C class created during ABC analysis (Finished Goods C)
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Count: 13. (M) File Save.

50

14. (M) Tools > Perform Full Cycle Count 15. Enter the cycle count name for the following parameters Generate automatic schedule recount Generate cycle count request Cycle count listing. 16. Choose Submit. 17. (M) File > Close Form. Entering Cycle Count Entries Using a Mobile Device 18. Select Inventory. 19. Select Counting 20. Select Cycle Count 21. Select Normal 22. Enter the following cycle count information: Org Code: M1 Cycle count name: FGI Cycle Count Subinventory: FGI Item: AS18947 Quantity: Enter a number plus or minus the system quantity. 23. Select Done. Cycle Count Entries and Approvals

24. (N) Counting > Cycle Counting > Cycle Count Entries 25. Enter FGI Cycle Count in the Cycle Count field. 26. Choose find.

27. At the question: Find all open count requests? choose Yes to view all open cycle count items. Note: Notice the item amount entered during the mobile counting demonstration does not appear. 28. Choose Adjustments.
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29. Enter the count quantities. 30. (M) File > Save. 31. (M) File > Close Form. 32. (N) Counting > Cycle Counting > Approve Counts 33. Enter FGI Cycle Count in the Cycle Count field. 34. Choose Find. 35. At the question: Query count pending approval only? choose No to view all cycle count items. Note: Notice the item quantity entered in the mobile counting demonstration appears in the Count tabbed region. 36. Choose Approved to approve an item adjustment. 37. Select the Approver from the drop down list in the Approval tabbed region. 38. (M) File Save. 39. Choose OK. 40. Close the Approvals window. 41. Approve or reject the remaining items. 42. (M) File > Save. 43. (M) File > Close Form.

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Chapter 13 - Page 53

Practice Overview: Performing Cycle Counts

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Practice - Performing a Cycle Count


Overview
In this practice you will perform a cycle count using the ABC compile group you created in a previous lab.

Assumptions
You are skilled in Oracle Navigation. You completed the Compile an ABC Analysis practice. You completed the Define Items practice. You have at least 20 items in your ##FGI subinventory You must have access to an Oracle Application Vision database or comparable training or test instance at your site on which to complete this practice.

Responsibility = Inventory, Vision Operations USA

Tasks
Define a Cycle Count Header Define a cycle count header using the following information: Name: ##Cycle Count Description Team ##Cycle Count Adjustment Account: Miscellaneous Late Days: 1 Starting Sequence: ## Unscheduled entries Yes Display System qty: Yes Count Subinventories: Specific Subinventory: ##FGI Auto Schedule: Yes Frequency: By Period Approval Required: If out of Tolerance QTY 3% Adjust Value: 50 Hit/Miss: 10% Group: ##ABC Group Option: (Re)initialize Class A: 150 counts per year

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11i Inventory Accuracy Fundamentals Chapter 13 - Page 55

Class B: Class C: Perform a Cycle Count

100 counts per year 50 counts per year

Use the following parameters to perform a cycle count: Name: Generate Automatic Schedule Cycle Name: ##Cycle Count Name: Cycle Name: Name: Cycle Name: Generate CycleCount Requests ##Cycle Count Cycle Count Listing ##Cycle Count

Enter Cycle Count Entries View the system quantities and enter quantities for the cycle count. Have some of the items out of tolerance, and have at least one item match the system quantity. Approve, Reject or Recount Cycle Count Why are some of the items already approved? ________________________________________ Approve, Reject or recount all entries for your cycle count.

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Chapter 13 - Page 56

Solution Performing a Cycle Count


Define a Cycle Count Header Responsibility = Inventory, Vision Operations USA 1. Navigate to the Cycle Counts Window. 2. 3. (N) Counting > Cycle Counting > Cycle Counts

Select New. Enter a new cycle count header using the following information: (T) Scope and Control Name: Description Adjustment Account: Late Days: Starting Sequence: Unscheduled entries Display System qty: Count Subinventories: Subinventory: ##Cycle Count Team ##Cycle Count Miscellaneous 1 ## Yes Yes Specific ##FGI

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Chapter 13 - Page 57

(T) Serial and Schedule Count: Auto Schedule: Frequency: (T) Adjustments and ABC Approval Required: QTY Adjust Value: Hit/Miss: Group: Option:

Not Allowed Yes By Period

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If out of Tolerance 3% 50 10% ##ABC Group (Re)initialize

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Chapter 13 - Page 58

Select Classes ##Class A: ##Class B: ##Class C:

150 counts per year 100 counts per year 50 counts per year

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4.

(M) File > Save

Perform A Cycle Count 5. (M) Tools > Perform Full Cycle Count

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6.

Enter the following parameters Generate automatic schedule (Parameters field):

##Cycle Count

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##Cycle Count

Generate cycle count requests (Parameters field):

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Chapter 13 - Page 61

Cycle Count Listing (Parameters field):

##Cycle Count

7.

Select Submit Note: Do not proceed until after your concurrent request completes.

Enter Cycle Count Entries 8. Navigate to the Cycle Count Entries window. 9. (N) Counting > Cycle Counting > Cycle Count Entries

Enter ##Cycle Count in the Cycle Count name field, or select your cycle count from the list of values.

10. Select Find to populate your items.

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11. Choose Yes to see all open count requests. 12. (T) Adjustments 13. Enter Count quantities for your items. Enter a few quantities that are out of tolerance, a few quantities within tolerance, and at least one that matches the system quantity.

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Chapter 13 - Page 63

14. Save and Close window. (M) File > Save (M) File > Close Form

Approve, Reject or Recount Cycle Count

15. Navigate to the cycle count approvals window.

(N) Counting > Cycle Counting > Approve Counts

16. Select your cycle count from the LOVs in the Cycle Count field. 17. Select Find to open your cycle count items. 18. Select No to view all items.

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11i Inventory Accuracy Fundamentals Chapter 13 - Page 64

19. Why are some of the items already approved? They fall within set approval limits. 20. Approve, reject or recount your items. 21. Save and Close window. (M) File > Save (M) File > Close Form

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Chapter 13 - Page 65

Practice Overview: Mobile Counting

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Chapter 13 - Page 66

Practice - Mobile Counting


Overview
Use the mobile device to perform a cycle count for your ##FGI subinventory.

Assumptions
You have completed the ABC Analysis Lab. You have completed part one of the Cycle Counting lab. You must have access to an Oracle Application Vision database or comparable training or test instance at your site on which to complete this practice.

Tasks
Entering Item Quantities Using the Mobile. Enter cycle count quantities for an item.

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Solution Mobile Counting


Entering Item Quantities Using the Mobile Responsibility = Materials & Mfg 1. Start the Telnet session. Windows Start menu > Run Enter telnet esxxxx.oracle.com 7070 in the Run dialog box, where xxxx is the instance number.

2.

Select Default from the Device List.

3.

Enter your user name and password. Note that Materials & Mfg responsibility must be assigned to your user name.

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11i Inventory Accuracy Fundamentals Chapter 13 - Page 68

4.

If more than one responsibility had been assigned to your user name, select Materials & Mfg from the list.

5.

Select Inventory from the Materials & Mfg Menu.

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11i Inventory Accuracy Fundamentals Chapter 13 - Page 69

6.

Select Counting from the Inventory Menu.

7.

Select Cycle Count from the Counting Menu.

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11i Inventory Accuracy Fundamentals Chapter 13 - Page 70

8.

Select Normal from the Cycle Count menu.

9.

Enter the following information when prompted. Note: The mobile application screen is case sensitive. Org Code: M1 Cycle Count Name: ##Cycle Count Sub: ##FGI Item: Enter an item in your ##FGI subinventory Qty: Enter a quantity
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11i Inventory Accuracy Fundamentals Chapter 13 - Page 71

10. Select Done to apply your cycle count. 11. Select Logout to exit the Mobile.

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Agenda

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Chapter 13 - Page 73

Summary

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Chapter 13 - Page 74