Oracle Outside ProcessingOracle Outside Processing

Rob Pierson

DARC Corporation

11-7-2005

AgendaAgenda

• Introductions

• Overview

• Setup

• Execution

• Costing

• Q&A

OverviewOverview

What is Outside Processing?

A means of providing supplier-sourced components and processes as an integral

part of the manufacturing process

OverviewOverview

• Outside processing (OSP)

– Consists of the use of inventory items and resources to model supplier-sourced services

– OSP resources are used to schedule and cost supplier-sourced services within manufacturing routings

– OSP allows for routing operation steps to be converted into purchase requisitions wherein the req line item is the OSP item

– WIP automatically requisitions material and purchase orders are charged directly to work orders

– Close loop, fully integrated solution

OverviewOverview

• OSP Features

– Multiple OSP operations on a work order and multiple OSP resources per operation

– Supplier provided components are included in BOM and referenced as supply type = supplier

– Automatic requisition generation

– Full tracability of work orders on purchase orders, receipts, & receiving transactions

– Automatic resource charging and move transactions

– Automatic work order completions

Overview: OSP Integration Overview: OSP Integration

Oracle Oracle PurchasingPurchasing

Oracle Work Oracle Work in Processin Process

OracleOracleInventoryInventory

OracleOracleBills of Bills of MaterialMaterial

Oracle Oracle Outside Outside

Processing Processing

Oracle Oracle Mobile Mobile Supply Supply ChainChain

Oracle Oracle Cost MgmtCost Mgmt

Setup: InventorySetup: Inventory

• Item Master

– Create OSP item using item template = @Outside Processing

Setup: InventorySetup: Inventory

• Item Attributes

– Item AttributesInventory Item Unchecked

Stockable Unchecked

Transactable Unchecked

Costing Enabled Unchecked

Inventory Asset Value Unchecked

Include in Rollup Unchecked

Purchased Checked

Purchasable Checked

Outside Processing Item Checked

Setup: InventorySetup: Inventory

• Outside Processing Unit Type

– Assembly – OSP resource charges are based on the work order quantity

– Resource – OSP resource charges are based on the work order quantity x the resource run rate

• List Price

– Enter a list price

Setup: ResourcesSetup: Resources

• Outside Processing Resource

Setup: ResourcesSetup: Resources

• Standard Costing Considerations

– Type = Currency

– UOM = Dollars

• Average Costing Considerations

– Type = Amount

– UOM = Each

• Department Locations need to be setup

Setup: RoutingsSetup: Routings

• Operation Resources

Setup: BOMSetup: BOM

• Supply Type Supplier

Setup: WIPSetup: WIP

• Shop Floor Status

– Allow Moves = Unchecked

Setup: WIPSetup: WIP

• WIP Parameters

Setup: WIPSetup: WIP

• WIP Parameters

Setup: Cost Setup: Cost

• Cost Rollup

Execution: WIP Execution: WIP

• Create and Release WIP Job

Execution: WIP Execution: WIP

• Perform Move Operation

– Move material from operation 10, Queue, to operation 10, To Move

– Perform transaction save

– Remember, WIP Parameter

• Requisition Creation Time = @ Operation

Execution: WIP Execution: WIP

• Perform Move Operation

Execution: WIP Execution: WIP

• WIP Components

Execution: WIP Execution: WIP

• WIP Components:Supplier

Execution: PurchasingExecution: Purchasing

• Perform Requisition Import

Execution: PurchasingExecution: Purchasing

• Perform Requisition Import

Execution: PurchasingExecution: Purchasing

• WIP: Enable Outside Processing

– Yes Enable OSP workflows

– No Disable OSP workflows

Execution: PurchasingExecution: Purchasing

• Requisition Summary

Execution: PurchasingExecution: Purchasing

• Requisition Summary

– OSP item list price x work order assembly quantity

Execution: PurchasingExecution: Purchasing

• Requisition Summary

– Approved Status

Execution: PurchasingExecution: Purchasing

• AutoCreate Purchase Order & Approve

Execution: PurchasingExecution: Purchasing

• AutoCreate Purchase Order & Approve

Execution: ReceivingExecution: Receiving

• Receipts

Execution: ReceivingExecution: Receiving

• Receipts: Outside Services Tab

Execution: ReceivingExecution: Receiving

• Receiving Transaction Summary

Costing: WIPCosting: WIP

• Resource Distribution at Standard

– Resource Type: Currency (USD)

– Outside Processing Unit Type: Assembly

– Operation Resource Usage: $ 5 (based on resource UOM)

– Assembly Quantity: 10

Resource Distribution = 10 units x $ 5/unit = $ 50

Costing: WIPCosting: WIP

• Purchase Order Pricing

– List Price: $.60

– Outside Processing Unit Type: Assembly

– Assembly Quantity: 10

PO Extended Price = 10 units x $ .6/unit = $ 6

Costing: WIPCosting: WIP

• Outside Processing Charging & Variances

– Differences between the standard resource charge and the actual OSP purchase price are are charged to the OSP variance account

01-000-1450-0000-000 $50 Debit to OSP inventory valuation01-540-1430-0000-000 $25 Debit to Overhead inventory valuation01-540-1450-0000-000 <$44> Credit to OSP variance account01-540-7405-0000-000 <$25> Credit to Overhead Absorption account01-540-1410-0000-000 <$6> Credit to OSP Absorption account

Costing: WIPCosting: WIP

• WIP Value Summary

Costing: WIPCosting: WIP

• WIP Value Summary: Distributions

Costing: WIPCosting: WIP

• View Resource Transactions

Costing: WIPCosting: WIP

• View Resource Transactions

Costing: WIPCosting: WIP

• View Resource Transactions

Costing: WIPCosting: WIP

• View Resource Transactions: Distributions

Costing: WIPCosting: WIP

• View Resource Transactions: Distributions

Questions & AnswersQuestions & Answers

Oracle Outside ProcessingOracle Outside Processing