Integrating Production in ERP
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The document outlines the integrated production process in ERP systems, including defining routing steps, work centers, direct and indirect costs, and key document flows. It discusses how production orders are created from planned orders and materials are issued to production. Finally, it explains how a production order confirmation is created once the finished good is made and received in the warehouse.
Integrating Production in ERP
- 1. THE INTEGRATED PRODUCTION PROCESS IN ERP DPR105: MGMT INFO SYSTEMS Instructor: Tom Matys 4/09/14 1
- 2. The Goal Create a finished product using the most efficient amount of materials and resources, while maintaining accurate levels of inventory, managing time, people, and costs. 4/09/14 2
- 3. How Product is made • Make-To-Stock (SSB) • Make-To-Order (Dell) 4/09/14 3
- 4. Routing (define the steps) 1.Material Staging 2.Assembly 3.Initial inspection 4.Packing 5.Final Inspection 6.Move to storage 4/09/14 4
- 5. Work Centers • Staging Area • Assembly Area • Final Inspection Area What two types of work centers can there be? 4/09/14 5
- 6. Direct vs Indirect Costs Direct costs: Consultants, supplies, travel, labor, etc. Indirect Costs: Overhead, functions, rent, repairs, etc. 4/09/14 6
- 7. Document Flow 1) Planned Production Order 2) Production Order 3) Material issued to Production (Goods Movement) 4) Confirm Production Order (mfg process complete) 4/09/14 7
- 8. Planned Production order • A request to make a specified quantity of goods • Like a Purchase Requisition except: Instead of requesting goods from a vendor, the goods are requested from the company’s warehouse. • Planned orders are received by a production controller. *************************************** ***** 1. Planned Order Number 2. Request date 3. Material number (finished product) 4. Requested and approved by names (compare to manual input pg 108) MS4/09/14 8
- 9. Production Order • Created from a planned order by the production controller • Written authorization to make the goods • Can contain multiple planned production orders • Production Controller considers resources, capacity, labor, materials • A new number created o the production order, also has planned order no. • Is signed off, or checked off for approval. 4/09/14 9 1) Finished Material No. 2) Quantity 3) Date to Finish
- 10. Goods Issue Materials (Document) • Request made for materials • Staging process begins • Warehouse sends materials to production • Goods Issue is created 1) Material 2) Quantity 3) Storage Location to new location 4/09/14 10
- 12. Production Order Confirmation Once the finished good is created a confirmation is executed. 1) Material Number 2) Quantity created 3) Posting Date 4/09/14 12
- 13. Warehouse: Goods receipt 1) Production Order Number 2) Quantity received 3) New storage location Of course, based on any companies functionality, the process could be more complex 4/09/14 13
- 14. Next up….MRP)Materials Requirements Planning • BOM: Recipe of finished product • Sales History => Sales Forecast • Inventory Levels • Resource Capacity • Demand Planning • Stock Requirements List ….and more 4/09/14 14