Re: Inventory flow for production section

Unfortunately your choice of subject does not communicate much meaning to me.
I hope it does not set off any alarms with the cyber cops trying to translate
some hidden meaning.  ;-)

We're V405 CD MM on AS/400 & have no virtual stuff, but we have done routings
for many many years.  We do have some phantoms, primarily engineering
changes.  We put them in our BOM so that anyone doing inquiry can see the
history of changes.  In theory they should have no effect on anything other
than being this textual assistance.

So I cannot address Q1 ... we have no virtual stock in our production process.

Q2 is easy.
We have routings & BOM describing the parts to be made.
We release shop orders to make those parts.
The shop order files contain copies of info that came from the routings & BOM.
We post transactions to the shop orders reporting WIP so far.
These consume the raw materials that are needed to make the parts & record
labor & machine costs.
When we report the last operation of a shop order, it adds a reciept of the
Finished Goods to your inventory.
There is a delay in the costs getting from WIP shop orders to master files,
which can be a problem depending on your variances.
The history files show the actual & standard cost that is in your system AT
THE TIME of the transaction, which in our case does have a variance timing
problem.

We have 4 warehouses per facility.
Facility 40 is our Evansville facility.
Warehouse 41 is finished goods because type 1 is end items ready for shipping.
Warehouse 42 is work-in-process because type 2 is sub-assemblies.
Warehouse 47 is our stock room because type 7 is raw materials.
Warehouse 49 is for stuff waiting on QC decision what to do about it -
perhaps it can be repaired, perhaps it should be scrapped, perhaps a vendor
sent us something that we should return for credit.
We also have some special IN TRANSIT locations, that correspond to places
like DAVE PICKUP TRUCK & JOE VAN where our materials are in an employee
vehicle in transit to another facility.

All of our facilities use same # system.
1st character identifies the facility
2nd character identifies the type of material in that warehouse.

When production of something is to start, the neccessary raw materials are
transferred from stock room ... some location in warehouse x7 to some
location in x2 close to where the production will begin.

We have labor tickets in which one copy is used for the transaction recording
how many were made & various related information, and the yellow copy goes
with the bin of materials, identifying what it is that was made.  When the
labor ticket is entered to the system, THE SAME DAY as the production, that
consumes the materials, based on how much was made or scrapped, and so forth,
so that at the end of each day our inventory transactions should all be
caught up, in theory.

Each labor ticket that is on an operation that consumes the material does the
CI transactions to consume it.  Sometimes there is an RJ (reject).  Then the
last operation generates PR production receipt adding the inventory that was
made.

We treat the entire shop floor as one humongous location, so we do not have
to be transferring WIP inventory around in the computer.

So basically there are transactions at 4 stages.
The inventory is recieved into the stock room from purchases or DRP transfers
or whatever ... that is 1 stage ... straightforward.
The inventory is transferred from the stock room to the shop floor WIP
warehouse .. we use a T transfer transaction ... I think INV510
The inventory is consumed & manufactured on the shop floor ... we use JIT600.
Then it is shipped to the customer.
We have the extra step associated with WIP warehouse vs. shipping warehouse.
There is nothing to cancel out.

We don't do any single issue or multiple issue transactions by INV500.
JIT600 takes care of that pretty automatically.

There are 3 screens that we use primarily.
1. Identify shop order & quantities & type of labor.
2. The material consumption screen where you can do exceptions (we rarely).
3. The start-stop detail screen because we can have teams or crews & they
were not working non-stop.

If you are reporting labor via bar coding, it probably goes even more
smoothly than the way we doing it.

When we manufacture some WIP item (work in progress between raw materials &
finished goods), BPCS treats the cost of that item as MATERIALS even though
most of the cost might have been LABOR or MACHINE and OVERHEAD, when that
item is consumed into the next higher sub-assembly.  That is in general terms.

Actually it is at production order purge time that the actual costs get
updated in shop order sequence.  The cost of routings comes from information
stored in the shop orders which came from labor reporting through JIT600 or
SFC600.  The cost of the material comes from the latest information in the
cost master for the materials the shop orders recorded as being used, so
there is a timing issue depending on the sequence of shop orders released,
and how you average costs.

For example if you have a small order, that has higher than normal costs due
to setup, and if your numbering system is such that shop orders for end items
get released before those for components, then you can have the end item
purged first using costs from prior production run, followed by purge of
components getting the accurate cost based on current run, but then a few
weeks later when you making the part again, perhaps with larger quantities &
more efficiency of production, the end item purges first using costs from the
inefficient run, so BPCS can mix up costs & quantities & give you a distorted
picture.

This is one of the reasons we run our business primarily using standard costs.

brian_pang@sinaman.com writes:

> brian_pang@sinaman.com (=?big5?B?YnJpYW5fcGFuZw==?=)
>
>  V6.1.01 MM on AS/400
>
>  We are now want to apply routings and capacity planning.  Of course, we
also
> need to absorb the related cost into the WIP items.  According to the BPCS
> documentation (previous version), WIP warehouse(s) and locations are
needed.
> Then question comes out.  Though we know that such WIP warehouses and
> locations are virtual, system do not know.  Then, from the system point of
> view, they are the same as others, e.g. main store.
>  Q1. Are those WIP whs and locs really virtual and no stock
>      can exist under them?
>  Q2. How can we do from the production issue to FG receipt?
>      If we use single or multiple issue as usual, we just
>      take those stock out of store.  How about the WIP whs?
>      Do we need to use other transaction type to store in
>      those components in the WIP whs? If yes, do we use
>      trans type 'W' (WIP transfer) to trasnfer from one
>      loc (cost collect points) to another loc? How do we
>      cancel out those components in WIP whs and loc while
>      receipting that FG to FG store (use issue w/ receipt)?
>
>  Thanks a trillion for all your support and help.
>
>  Best regards,
>  Brian Pang


MacWheel99@aol.com (Alister Wm Macintyre) (Al Mac)
BPCS 405 CD Manager / Programmer @ Global Wire Technologies Incorporated
http://www.globalwiretechnologies.com = new name same quality wire
engineering company: fax # 812-424-6838