ERP 101: Work Orders - The Starting Points of Manufacturing
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The document provides an overview of work orders as a fundamental aspect of manufacturing ERP systems, detailing their origin, processes, and significance in material planning and execution. It explains how MRPs generate suggested work orders, which facilitate accurate tracking of labor and material while ensuring historical data maintenance. Upcoming topics in the ERP 101 webinar series are also mentioned, highlighting the continued education in various manufacturing and accounting practices.
ERP 101: Work Orders - The Starting Points of Manufacturing
- 1. ERP 101 Session 8 Work Orders – Manufacturing’s Starting Point David Bush Senior Manufacturing Consultant, Rootstock
- 3. The ERP 101 Webinar Series Date Topic Aug 2, 2016 An Introduction to ERP for Manufacturing Aug 16, 2016 Engineering – Learn how to create Part Master Records and Bills of Material Aug 30, 2016 Engineering – Learn how Change Orders and/or Revisions ensures that ERP system data is accurate and up-to-date Oct 11, 2016 Shop Floor – Explore how ERP is used to create and maintain Work Centers, Routings and Procedures Nov 1, 2016 Shop Floor – See how scheduling the Shop Floor through ERP controls Labor and Machines Nov 29, 2016 Procurement – Link your Vendors and Purchased Parts via ERP Dec 13, 2016 MRP – Step through an overview of this vital ERP subset Jan 24, 2017 Work Orders – Manufacturing’s Starting Point Feb 14, 2017 Inventory - Maintaining Accurate and Reliable Data TBA Sales – See how you can link your Customers and Products via ERP TBA Manufacturing Accounting – An overview using standard cost TBA Manufacturing Accounting – An overview using weighted cost
- 4. Meet Our Speaker David Bush Senior Manufacturing Consultant, Rootstock • 30+ years of manufacturing and MRP/ERP systems experience • Previously at General Microcircuits, Consona Corporation, Relevant Business Systems, Inc
- 5. A Quick Recap • What we have covered in our first 7 episodes: – The history of MRP/ERP systems – Engineering Item Master and Bills of Material – Shop Floor Routings – Purchasing’s role in modern ERP systems – MRP – How it fits into the ERP system Today we look at another facet of MRP planning, work orders.
- 6. Material Planning WITHOUT MRP • Spreadsheets are used to track material supplies and demands for raw material and subassemblies. Data includes: – Current Inventory Levels – Current Demands – Future Demands – Re-order points • Planner calculates actual demand over time • Open supply orders considered (work orders/po’s) • Open demands then deducted from inventory and supply orders to determine necessary actions: – We’re ok – Uh oh… about to run out – Uh oh… we have way too much! Done for every active part on the system.. .PFEW! Thank goodness for MRP!
- 7. Where do Work Orders Originate? MRP Engine Material Demands from Sales Orders and Work Orders Engineering and Inventory Item Masters used by Planning MRP creates suggested Work Orders Manual Work Orders Work Order Receipts bring material to stores Planner reviews and firms suggested Work Orders
- 8. Work Orders Create Supplies AND Demands Bicycle handlebar assembly • The Work Order to build this assembly creates a SUPPLY for the number of assemblies being built. • MRP also sees a DEMAND for the components required to build the assembly: – Handlebar grips (2) – Stem (1) – Reflector Assembly (1) These demands are defined on the bill of material, and may be adjusted on the work order without affecting the original bom. So, what do Work Orders accomplish?
- 9. Work Order Accomplishments Supplies Satisfy ‘needs’ seen by MRP Provide the ability to manually build items apart from MRP Capture Data and Maintain History Material Issues Labor Reporting Work Center Demands Scrap Costs: material, labor, machine, overhead, subcontract Identify Demands Material demands for raw material and sub-assemblies Labor and Machine time, used for scheduling and financial planning Is that all there is to consider?
- 10. Following a Work Order’s Progress • MRP generates planned Work Orders • Planned Work Orders are firmed to identify material requirements via the pick list. • Routing is attached to identify labor/machine requirements. • Material is allocated and issued. • Work Order is ‘released’ to Manufacturing. • Component and Parent scrap is identified • Labor is reported, along with completions at each operation. • Finished parts are received to stores. • Work Order formally ‘closed’ when all costs are accounted for. – No further labor or material issues can occur when ‘closed’. Let’s see how this comes together is Rootstock.
- 11. Work Order Firm/Unfirm Object What if the work order needs to be adjusted before I firm it?
- 12. Adjusting MRP-created Work Orders Once we have made our changes and ‘firmed’ up the order, what’s next?
- 13. Creating Pick List and attaching the Routing • Click ‘Extract Operations’ to create the routing for this order. • Click ‘Extract Components’ to create the pick list used to issue material to the work order. Let’s examine additional information held on the record.
- 14. Work Order Adjustments • Changing the Due Date has adjusted the other related dates. • Scheduled Completion Date will be visible once the order is included in the shop floor scheduling function. • Cost details including labor, material, overhead and subcontract operations are all visible from the work order object, adjusting as the work order progresses thru the scheduled operations. How are operation quantity completions and labor entered?
- 15. Work Order Labor and Quantities Complete • One method is using the Time & Quantity Bookings object. • Transaction date, total hours and total parts completed are entered. • Parts completed can reduce time still needed at the work center when running the scheduling program. • Hours adds both labor and overhead costs to the work order. How are the completed parts received into stock?
- 16. Quantity accepted may be equal to or less than quantity available. • Inventory location (id and number) are entered, then ‘Perform Work Order Receipt’ button is clicked. • Quantity Remaining indicates number of parent yet to be received. If scrapped at any operation, this number will reflect the total ‘good’ available for stock. Once all of the work order quantity is accounted for (received or scrapped) the work order may be closed, ending all further activity. Work Order Receipts to Stock
- 17. Where Do We Go From Here? Today we covered the Work Order segment of manufacturing… building parts and assemblies in-house. This satisfies the MRP demands for manufactured items. What’s still to come? • Inventory – Maintains current balances of direct material – Provides means to issue material as needed to work orders and subcontract purchase orders. – Includes ability to monitor inventory records for accuracy. • Order Entry – Feeds the ‘demand’ side of ERP from the customer base. – Maintains customers, products, orders, etc • Standard Costs – Setting and maintaining standard costs for parts/assemblies/finished goods. – Using simulated costs for future planning. And much more…..
- 19. The ERP 101 Webinar Series Date Topic Aug 2, 2016 An Introduction to ERP for Manufacturing Aug 16, 2016 Engineering – Learn how to create Part Master Records and Bills of Material Aug 30, 2016 Engineering – Learn how Change Orders and/or Revisions ensures that ERP system data is accurate and up-to-date Oct 11, 2016 Shop Floor – Explore how ERP is used to create and maintain Work Centers, Routings and Procedures Nov 1, 2016 Shop Floor – See how scheduling the Shop Floor through ERP controls Labor and Machines Nov 29, 2016 Procurement – Link your Vendors and Purchased Parts via ERP Dec 13, 2016 MRP – Step through an overview of this vital ERP subset Jan 24, 2017 Work Orders – The starting point of manufacturing Feb 14, 2017 Inventory - Maintaining Accurate and Reliable Data TBA Sales – See how you can link your Customers and Products via ERP TBA Manufacturing Accounting – An overview using standard cost TBA Manufacturing Accounting – An overview using weighted cost
Editor's Notes
- #3: INTRO SCRIPT: Good Morning everyone, and welcome to today's webinar sponsored by Rootstock Software Our last topic was “MRP – Step through an overview of this vital ERP subset.” This is the eighth webinar in our ERP101 webinar series. Our topic today is “Work Orders – Manufacturing’s Starting Point.” Moving on to some housekeeping. Before we get started, I’d like to go over a few items so you know how to participate in today’s event. We've taken a screen shot of an example of the Attendee interface. You should see something that looks like this on your own computer desktop in the upper-right corner. You’re listening-in using your computer's speaker system by default. If you prefer to join over the phone, just select “Telephone” in the Audio pane and the dial-in information will be displayed. All attendees will be on mute throughout the presentation. You’ll have the opportunity to submit text questions to today’s presenter by typing your questions into the Questions pane of the control panel. You may send in your questions at any time during the presentation; we will collect these and address them during the Q&A session at the end of today’s presentation.
- #4: Now we’ll take a look at our upcoming schedule. Today we will be covering “Work Orders – Manufacturing’s Starting Point.” The next webinar in the ERP 101 Webinar Series by Rootstock Software is scheduled for February 14th and will cover the topic “Inventory - Maintaining Accurate and Reliable Data.” Future webinar dates are to be announced. I encourage you to follow Rootstock Software on LinkedIn, Twitter, Facebook, Google Plus and more for the latest and most important information about Cloud ERP. Follow Rootstock Software on social media!
- #5: ABOUT PRESENTER : I would now like to introduce our Presenter, David Bush, Senior Manufacturing Consultant at Rootstock Software. David Bush has 30+ years of manufacturing and MRP/ERP systems experience. David was previously at General Microcircuits, Consona Corporation, and Relevant Business Systems. David will now introduce us to our ERP 101 webinar “Work Orders – Manufacturing’s Starting Point.” Hi David…
- #10: Clean up the 3rd box…
- #14: Click once for each of the bullet points.
- #15: Add click to see each bullet point.
- #16: Add builds for each bullet point.
- #19: Q&A SCRIPT: Thank you David, that was impressive! Before we go to your questions, just a quick reminder this webinar will be posted on our website at www.rootstock.com. And of course after the webinar if you have any further inquiries, please email us at marketing@rootstock.com. We’ll now answer questions submitted during today’s presentation as well as take any new questions – And just a reminder, you can still submit questions through the Questions pane in your attendee control panel. Our first question today is….. 1. If there is a need to build a normally purchased part, how is that accomplished? 2. If the routing needs to be changed after it is attached to the work order, how can you keep the changes so that any future work orders will use the latest version? 3. How is MRP affected when parent items are scrapped?
- #20: Before we end today’s webinar, I’d like to present a brief look ahead at the upcoming topics in our ERP 101 Webinar series. Today we covered “Work Orders – The starting point of manufacturing.” The next webinar in the ERP 101 Webinar Series by Rootstock Software is scheduled for February 14th, 2017 and will cover the topic “Inventory - Maintaining Accurate and Reliable Data.” Future webinar dates are to be announced. I encourage you to follow Rootstock Software on LinkedIn, Twitter, Facebook, Google Plus and more for the latest and most important information about Cloud ERP. Follow Rootstock Software on social media! Thank you for joining us today. We look forward to seeing you at our next webinar. Today’s webinar is now over.