R12 Oracle Inventory Management Fundamentals

R12 Oracle Inventory
Management Fundamentals
Student Guide
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Edition 1.0
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Table of Contents
Overview of Oracle Inventory..........................................................................................................................1-1

R12 Overview of Oracle Inventory .................................................................................................................1-3
Objectives ......................................................................................................................................................1-4
Overview ........................................................................................................................................................1-5
Inventory Capabilities.....................................................................................................................................1-6
Inventory Capabilities (Cont) ..........................................................................................................................1-7
Receipt to Issue Life Cycle.............................................................................................................................1-8
Receiving Inventory........................................................................................................................................1-9
Transferring Inventory ....................................................................................................................................1-12
Issuing Inventory ............................................................................................................................................1-13
Oracle Inventory Application Integration ........................................................................................................1-15
Integration of Oracle Inventory to Financial Applications ...............................................................................1-17
Summary........................................................................................................................................................1-18
Inventory Structure ..........................................................................................................................................2-1

R12 Defining Inventory Organizations............................................................................................................2-3
Objective ........................................................................................................................................................2-4
Inventory Organizations .................................................................................................................................2-5
Inventory Organization Structure....................................................................................................................2-6
Sample Inventory Organization ......................................................................................................................2-7
Multi-Organization Structure ..........................................................................................................................2-8
Setting Up Locations ......................................................................................................................................2-9
Guided Demonstration - Setting up Locations............................................................................................2-10
Defining Organizations...................................................................................................................................2-11
Inventory Parameters.....................................................................................................................................2-12
Costing Parameters .......................................................................................................................................2-13
Revision, Lot, Serial, and License Plate Number (LPN) Parameters .............................................................2-14
ATP, Pick, Item-Sourcing Parameters............................................................................................................2-15
Interorganization Parameters .........................................................................................................................2-16
Other Account Parameters.............................................................................................................................2-17
Warehouse Management Parameters ...........................................................................................................2-18
Guided Demonstration - Setting Up Organizations ....................................................................................2-19
What is a Subinventory? ................................................................................................................................2-23
What is a Subinventory (Cont) .......................................................................................................................2-24
Defining Subinventories .................................................................................................................................2-25
Guided Demonstration - Defining Subinventories ......................................................................................2-26
Practice - Creating Subinventories .............................................................................................................2-27
Solution - Creating Subinventories .............................................................................................................2-28
Locator Control...............................................................................................................................................2-33
Dynamic and Static Locators .........................................................................................................................2-34
Subinventory-Locator Relationship ................................................................................................................2-35
Locator Flexfield Structure .............................................................................................................................2-36
Guided Demonstration - Defining Locators ................................................................................................2-37
Practice - Defining Locators .......................................................................................................................2-38
Solution – Setting Up Locator Control ........................................................................................................2-39
Interorganization Shipping Networks..............................................................................................................2-41
Shipping Method ............................................................................................................................................2-42
Copyright © Oracle 2009. All rights reserved.
R12 Oracle Inventory Management Fundamentals Table of Contents

i
Additional Set Up Steps .................................................................................................................................2-43
Additional Organizational Setups ...................................................................................................................2-44
Copying Inventory Organizations ...................................................................................................................2-45
Organization Hierarchy ..................................................................................................................................2-47
Organization Reports .....................................................................................................................................2-49
Organization Reports (Cont) ..........................................................................................................................2-50
Profile Options................................................................................................................................................2-51
Implementation Considerations......................................................................................................................2-52
Implementation Considerations (Cont)...........................................................................................................2-53
Summary........................................................................................................................................................2-58
Units of Measure ..............................................................................................................................................3-1

R12 Units of Measure ....................................................................................................................................3-3
Objectives ......................................................................................................................................................3-4
Units of Measure ............................................................................................................................................3-5
Uses of Units of Measure...............................................................................................................................3-6
Unit of Measure Class....................................................................................................................................3-7
Guided Demonstration - Creating Units of Measure...................................................................................3-8
Guided Demonstration - Creating Unit of Measure Classes.......................................................................3-9
Unit of Measure Conversions .........................................................................................................................3-10
Guided Demonstration - Defining Unit of Measure Conversions ................................................................3-11
Lot-Level Unit of Measure Conversions .........................................................................................................3-12
Units of Measure Setup..................................................................................................................................3-13
Practice - Defining Units of Measure..........................................................................................................3-14
Solution – Defining Units of Measure .........................................................................................................3-15
Unit of Measure Reports ................................................................................................................................3-19
Profile Options................................................................................................................................................3-20
Organization Parameter Setup.......................................................................................................................3-21
Summary........................................................................................................................................................3-23
Defining and Maintaining Items ......................................................................................................................4-1

R12 Defining and Maintaining Items Fundamentals.......................................................................................4-3
Objective ........................................................................................................................................................4-4
What is an Item? ............................................................................................................................................4-5
Steps to Setup, Define, and Maintain Items ...................................................................................................4-6
Defining Items ................................................................................................................................................4-7
Guided Demonstration - Define Item..........................................................................................................4-9
Item Master Organization...............................................................................................................................4-10
Item Master ....................................................................................................................................................4-12
Item Attributes ................................................................................................................................................4-13
Item Attribute Groups .....................................................................................................................................4-14
Guided Demonstration - Viewing Item Attributes........................................................................................4-15
Item Status .....................................................................................................................................................4-16
Unit of Measure Attributes..............................................................................................................................4-17
Item Statuses and Attributes ..........................................................................................................................4-19
Status Attributes and Functionality.................................................................................................................4-20
Status Attribute Interdependencies ................................................................................................................4-23
Item Attribute Relationships ...........................................................................................................................4-26
Practice - Viewing Item Attributes ..............................................................................................................4-27

ii
Solution – Viewing Item Attributes..............................................................................................................4-28
Item Templates ..............................................................................................................................................4-36
Creating Item Templates................................................................................................................................4-37
Enabling Attributes in a Template ..................................................................................................................4-38
Guided Demonstration - Creating Item Templates .....................................................................................4-39
Organization Assignment and Organization Items .........................................................................................4-40
Control Levels ................................................................................................................................................4-41
Revision Control.............................................................................................................................................4-43
Defining Items ............................................................................................................................................4-44
Solution - Defining Items ............................................................................................................................4-45
Restricting Items to Subinventories................................................................................................................4-58
Guided Demonstration - Restricting Items to Subinventories .....................................................................4-59
Item Relationships..........................................................................................................................................4-60
Guided Demonstration -Establishing Item Relationships ...........................................................................4-61
Categories and Category Sets .......................................................................................................................4-62
Assigning Items to Categories .......................................................................................................................4-63
Practice - Defining Categories....................................................................................................................4-64
Solution – Defining Categories...................................................................................................................4-65
Item Catalogs .................................................................................................................................................4-68
Guided Demonstration - Setting up Catalog Groups ..................................................................................4-69
Deletion Constraints and Deletion Groups .....................................................................................................4-71
Deletion Constraints.......................................................................................................................................4-72
Deletion Constraints (Cont) ............................................................................................................................4-73
Item Reports ..................................................................................................................................................4-74
Item Reports (Cont)........................................................................................................................................4-75
Profile Options................................................................................................................................................4-77
Profile Options (Cont).....................................................................................................................................4-78
Summary........................................................................................................................................................4-85
Lot and Serial Control......................................................................................................................................5-1

R12 Lot and Serial Control .............................................................................................................................5-3
Objective ........................................................................................................................................................5-4
Lot Control Overview......................................................................................................................................5-5
Child Lots .......................................................................................................................................................5-6
Setting up Lot Control (Organization Parameters) ........................................................................................5-7
Guided Demonstration - Setting Up Organizations ....................................................................................5-8
Lot Number Uniqueness ................................................................................................................................5-12
Setting up Lot Control (Item Attributes) .........................................................................................................5-13
Managing Lots................................................................................................................................................5-15
Expired Lots ...................................................................................................................................................5-16
Disabled Lots .................................................................................................................................................5-17
Guided Demonstration - Generating Lots...................................................................................................5-18
Guided Demonstration - Maintaining Grades .............................................................................................5-20
Guided Demonstration - Maintaining Lot Actions .......................................................................................5-22
Practice - Using the Lot Master ..................................................................................................................5-23
Solution – Using the Lot Master .................................................................................................................5-24
Lot Number Purging .......................................................................................................................................5-31
Cycle Counts Under Lot Control.....................................................................................................................5-32

iii
Physical Inventory Under Lot Control.............................................................................................................5-33
Guided Demonstration - Revision, Lot, and Serial Controls .......................................................................5-34
Serial Number Overview ................................................................................................................................5-36
Generating Serial Numbers............................................................................................................................5-37
Serial Uniqueness ..........................................................................................................................................5-38
Maintaining Serial Numbers ...........................................................................................................................5-40
Practice - Generating and Maintaining Serial Numbers .............................................................................5-41
Solution –Generating and Maintaining Serial Numbers..............................................................................5-42
Lot Genealogy................................................................................................................................................5-47
Guided Demonstration - Viewing Lot Genealogy .......................................................................................5-48
Serial Genealogy............................................................................................................................................5-49
Lot and Serial Reports ...................................................................................................................................5-50
Lot and Serial Reports (Cont).........................................................................................................................5-51
Profile Options................................................................................................................................................5-53
Summary........................................................................................................................................................5-57
Transaction Setup............................................................................................................................................6-1
R12 Transaction Setup ..................................................................................................................................6-3
Objectives ......................................................................................................................................................6-4
Overview ........................................................................................................................................................6-5
Inventory Transactions...................................................................................................................................6-6
Move Orders ..................................................................................................................................................6-7
Transaction Source Types .............................................................................................................................6-8
Transaction Action .........................................................................................................................................6-10
Transaction Reasons .....................................................................................................................................6-12
Transaction Types..........................................................................................................................................6-13
Guided Demonstration - Creating Customized Transactions .....................................................................6-14
Predefined Transaction Types .......................................................................................................................6-15
Transaction Managers ...................................................................................................................................6-16
Running Transaction Managers .....................................................................................................................6-17
Creating Picking Rules...................................................................................................................................6-19
Guided Demonstration - Creating Picking Rules ........................................................................................6-21
Account Aliases..............................................................................................................................................6-22
Accounting Periods ........................................................................................................................................6-23
Guided Demonstration - Opening Accounting Periods ...............................................................................6-24
Material Shortage Alerts and Notifications .....................................................................................................6-25
Setting Up Shortage Alerts and Notifications .................................................................................................6-27
Setting Up for Move Orders ...........................................................................................................................6-28
Setup Steps for Move Orders.........................................................................................................................6-30
Profile Options................................................................................................................................................6-32
Implementation Considerations for Shortage Checks ....................................................................................6-38
Implementation Considerations for Move Orders ..........................................................................................6-39
Summary........................................................................................................................................................6-40
Issuing and Transferring Material...................................................................................................................7-1

R12 Issue and Transfer Material ....................................................................................................................7-3

iv
Module Objectives..........................................................................................................................................7-4
Overview of Inventory Transactions ...............................................................................................................7-5
Inventory Transactions...................................................................................................................................7-6
Inventory Transactions Without Documents and Requisitions .......................................................................7-7
Inventory Transactions with Documents and Requisitions .............................................................................7-8
Control Options and Restrictions....................................................................................................................7-9
Miscellaneous Transactions ...........................................................................................................................7-10
Practice - Processing Miscellaneous Receipts...........................................................................................7-11
Solution – Processing Miscellaneous Receipts ..........................................................................................7-12
Subinventory Transfer....................................................................................................................................7-22
Guided Demonstration - Performing Subinventory Transfers.....................................................................7-23
Practice - Processing Subinventory Transfers ...........................................................................................7-24
Solution – Processing Subinventory Transfers...........................................................................................7-25
Inter-Organization Direct Shipment ................................................................................................................7-29
Inter-organization Intransit Shipment .............................................................................................................7-30
Guided Demonstration - Performing Interorganization Transfers ...............................................................7-32
Practice - Performing Interorganization Transfers......................................................................................7-33
Solution – Performing Interorganization Transfers .....................................................................................7-34
Managing Receipts ........................................................................................................................................7-38
Express Receipts and Receiving Transactions ..............................................................................................7-40
Direct Receipts...............................................................................................................................................7-41
Standard Receipt ...........................................................................................................................................7-42
Inspection Receipt..........................................................................................................................................7-43
Guided Demonstration - Receiving Stock into Inventory ............................................................................7-44
Practice - Receiving Material into Inventory ...............................................................................................7-45
Solution – Receiving Material into Stock ....................................................................................................7-46
Move Orders ..................................................................................................................................................7-52
Move Orders Process Flow............................................................................................................................7-53
Move Order Requisition Approval Process ....................................................................................................7-54
Benefits of Managed Material Flow in a Facility .............................................................................................7-56
Move Order Source Types .............................................................................................................................7-57
Move Order Components ...............................................................................................................................7-59
Generate Move Orders ..................................................................................................................................7-60
Move Order Allocating....................................................................................................................................7-62
Item Allocation................................................................................................................................................7-64
Transact Move Orders ...................................................................................................................................7-65
Practice - Transacting Move Orders...........................................................................................................7-66
Solution – Transacting Move Orders ..........................................................................................................7-67
Guided Demonstration - Defining Subinventories ......................................................................................7-72
Mobile Transactions .......................................................................................................................................7-73
Guided Demonstration - Mobile Application Interorganization Transfers ...................................................7-74
Practice - Performing Mobile Transactions.................................................................................................7-75
Solution – Mobile Transactions ..................................................................................................................7-76
Managing Shipments .....................................................................................................................................7-81
Transactions Reports .....................................................................................................................................7-82
Transactions Reports (Cont) ..........................................................................................................................7-83
Summary........................................................................................................................................................7-87
On-hand and Availability .................................................................................................................................8-1

R12 On-hand and Availability.........................................................................................................................8-3

v
Objectives ......................................................................................................................................................8-4
Overview of On-hand Quantity .......................................................................................................................8-5
Overview of Reservations ..............................................................................................................................8-6
Overview of Availability ..................................................................................................................................8-7
Reservation Versus Allocation .......................................................................................................................8-8
Material Workbench .......................................................................................................................................8-9
Display Options ..............................................................................................................................................8-10
Viewing Available Items .................................................................................................................................8-12
Material Workbench Transactions..................................................................................................................8-13
Guided Demonstration - Using the Material Workbench ............................................................................8-14
Practice - Using the Material Workbench ...................................................................................................8-15
Solution – Using the Material Workbench ..................................................................................................8-16
Available to Promise ......................................................................................................................................8-19
What are Supply and Demand? .....................................................................................................................8-20
Uses of ATP in Oracle Inventory ....................................................................................................................8-21
ATP Rules Setup Steps .................................................................................................................................8-22
Defining Computation Options .......................................................................................................................8-23
Specifying Supply and Demand Time Fences ...............................................................................................8-25
Specifying Demand Sources ..........................................................................................................................8-29
Specifying Supply Sources ............................................................................................................................8-31
Setting Up Item and Bills for ATP Checking...................................................................................................8-32
ATP Checking ................................................................................................................................................8-33
Guided Demonstration - Creating an ATP Rule .........................................................................................8-34
Reservation Types .........................................................................................................................................8-35
Supply Types .................................................................................................................................................8-36
Demand Types...............................................................................................................................................8-37
Reserving Material .........................................................................................................................................8-38
Reservation Management- Transfer Supply...................................................................................................8-40
Reservation Management- Transfer Demand ................................................................................................8-41
Guided Demonstration - Creating Reservations.........................................................................................8-42
Practice - Creating Reservations................................................................................................................8-43
Solution – Creating Reservations...............................................................................................................8-44
On-hand and Availability Reports...................................................................................................................8-46
Profile Options................................................................................................................................................8-47
Summary........................................................................................................................................................8-50
Material Status Control....................................................................................................................................9-1

R12 Material Status........................................................................................................................................9-3
Objectives ......................................................................................................................................................9-4
Material Status ...............................................................................................................................................9-5
Material Status Control Levels .......................................................................................................................9-6
Material Status Transactions..........................................................................................................................9-7
Cumulative Effective Status ...........................................................................................................................9-8
Material Status Examples ..............................................................................................................................9-9
Setting Up ......................................................................................................................................................9-10
Defining Item Material Status Control.............................................................................................................9-11
Assigning Material Status Control to Subinventories and Locators ................................................................9-12
Assigning Planning Statuses..........................................................................................................................9-13

vi
Disabling Material Statuses............................................................................................................................9-14
Practice - Setting up Material Status Control..............................................................................................9-15
Solution – Setting up Material Status Control.............................................................................................9-16
Material Status Reports..................................................................................................................................9-23
Profile Option .................................................................................................................................................9-24
Summary........................................................................................................................................................9-26
Inventory Replenishment ................................................................................................................................10-1

R12 Replenishment Fundamentals ...............................................................................................................10-3
Objectives ......................................................................................................................................................10-4
Overview of Inventory Planning......................................................................................................................10-5
Order Planning ...............................................................................................................................................10-6
How Much to Order ........................................................................................................................................10-7
Replenishment Process for Intra-Org Supply Sources...................................................................................10-8
Replenishment Process for Supplier Supply Sources ....................................................................................10-9
Replenishment Process for Inter-Org Supply Sources...................................................................................10-10
Replenishment Process for Product Supply Sources.....................................................................................10-11
Replenishment Methods ................................................................................................................................10-12
Overview of Inventory Forecasting.................................................................................................................10-13
Forecast Types ..............................................................................................................................................10-15
Forecast Setup and Maintenance ..................................................................................................................10-16
Guided Demonstration - Creating a Manual Forecast ................................................................................10-17
Oracle Inventory Replenishment Methods .....................................................................................................10-19
Replenishment Methods Levels .....................................................................................................................10-20
Safety Stock ...................................................................................................................................................10-21
Economic Order Quantity...............................................................................................................................10-22
Overview of Reorder-Point Planning ..............................................................................................................10-23
Uses of Reorder-Point Planning.....................................................................................................................10-24
Reorder-Point Planning Steps........................................................................................................................10-25
Performing Reorder-Point Planning ...............................................................................................................10-26
Guided Demonstration - Setting up Reorder Point Planning ......................................................................10-28
Overview of Min-Max Planning.......................................................................................................................10-29
Uses of Min-Max Planning .............................................................................................................................10-30
Min-Max Planning ..........................................................................................................................................10-31
Min-Max Planning: How Much to Order? .......................................................................................................10-32
Min-Max Planning Steps ................................................................................................................................10-33
Item Planning Attributes .................................................................................................................................10-34
Min-Max Planning Setup Procedure...............................................................................................................10-35
Selecting a Planning Level .............................................................................................................................10-36
Entering Planning Attributes...........................................................................................................................10-37
Submitting the Min-Max Planning Requests ..................................................................................................10-38
Guided Demonstration - Setting up Min-Max Planning ..............................................................................10-40
Practice - Performing Min-Max Planning ....................................................................................................10-41
Solution – Performing Min-max Planning ...................................................................................................10-42
Overview of Replenishment Counting ............................................................................................................10-48
Uses of Replenishment Counting...................................................................................................................10-49
Replenishment Planning Steps ......................................................................................................................10-50
Subinventories Window..................................................................................................................................10-52
Item Subinventories Window..........................................................................................................................10-53

vii
Item Subinventories: Order Modifier Tab .......................................................................................................10-54
Replenishment Count Headers ......................................................................................................................10-55
Replenishment Count Lines ...........................................................................................................................10-56
Processing Replenishment Counts ................................................................................................................10-58
Mobile Replenishment Count Overview .........................................................................................................10-59
Practice - Performing a Replenishment Count Using Forms ......................................................................10-60
Solution - Performing a Replenishment Count Using Forms ......................................................................10-62
Practice - Performing a Replenishment Count Using the Mobile Application .............................................10-68
Solution - Performing a Replenishment Count Using the Mobile Application .............................................10-69
Overview of PAR Counting ............................................................................................................................10-77
Processing PAR Counts.................................................................................................................................10-78
Reorder Quantity for PAR Count....................................................................................................................10-79
Overview of Kanban Replenishment ..............................................................................................................10-81
Kanban Cards ................................................................................................................................................10-82
Kanban Planned Items...................................................................................................................................10-83
Kanban Cards ................................................................................................................................................10-84
Kanban Supply Status....................................................................................................................................10-86
Kanban Replenishment Sources....................................................................................................................10-87
Kanban Card Printing.....................................................................................................................................10-88
Guided Demonstration - Performing Kanban Replenishment.....................................................................10-89
Practice - Performing Kanban Replenishment ...........................................................................................10-90
Solution – Performing Kanban Replenishment...........................................................................................10-91
Planning and Replenishment Reports............................................................................................................10-94
Planning and Replenishment Reports (Cont) .................................................................................................10-95
Profile Options................................................................................................................................................10-96
Summary........................................................................................................................................................10-102
Inventory Accuracy..........................................................................................................................................11-1
R12 Inventory Accuracy Fundamentals .........................................................................................................11-3
Objectives ......................................................................................................................................................11-4
Overview of Inventory Accuracy.....................................................................................................................11-5
ABC Analysis Overview .................................................................................................................................11-6
Defining an ABC Analysis ..............................................................................................................................11-7
Define and Run an ABC Compilation .............................................................................................................11-8
ABC Compilation Criteria ...............................................................................................................................11-9
ABC Valuation Scope.....................................................................................................................................11-11
Defining ABC Groups.....................................................................................................................................11-12
Defining ABC Classes....................................................................................................................................11-13
ABC Item Assignments ..................................................................................................................................11-14
Guided Demonstration - Compiling an ABC Analysis.................................................................................11-16
Practice - Compiling an ABC Analysis .......................................................................................................11-18
Solution – Compiling an ABC Analysis.......................................................................................................11-20
Cycle Counting Overview...............................................................................................................................11-25
Defining and Maintaining a Cycle Count ........................................................................................................11-26
Cycle Count Approval Tolerance....................................................................................................................11-27
Approval Tolerances ......................................................................................................................................11-28
Hit/Miss Tolerance .........................................................................................................................................11-30

viii
Measurement Errors ......................................................................................................................................11-31
Cycle Count Items..........................................................................................................................................11-32
Automatic Scheduling ....................................................................................................................................11-34
Manual Scheduling.........................................................................................................................................11-35
Count Requests .............................................................................................................................................11-36
Entering Cycle Counts ...................................................................................................................................11-38
Cycle Count Open Interface ...........................................................................................................................11-39
Count Adjustments and Approvals .................................................................................................................11-40
Automatic Recounts .......................................................................................................................................11-41
Approving Cycle Counts and Adjustments .....................................................................................................11-42
Guided Demonstration - Performing a Cycle Count ...................................................................................11-44
Practice - Performing a Cycle Count ..........................................................................................................11-47
Solution – Performing a Cycle Count .........................................................................................................11-49
Mobile Inventory Accuracy Overview .............................................................................................................11-58
Practice - Mobile Counting .........................................................................................................................11-59
Solution – Mobile Counting ........................................................................................................................11-60
Physical Inventory Overview ..........................................................................................................................11-65
Why Perform Physical Inventories? ...............................................................................................................11-66
Defining Physical Inventories .........................................................................................................................11-67
Physical Inventory Tags .................................................................................................................................11-68
Inventory Snapshots ......................................................................................................................................11-70
Entering Physical Inventory Counts ...............................................................................................................11-72
Voiding Tags ..................................................................................................................................................11-74
Approval Tolerances ......................................................................................................................................11-75
Physical Inventory Adjustments .....................................................................................................................11-76
Accuracy Reports...........................................................................................................................................11-77
Accuracy Reports (Cont)................................................................................................................................11-78
Profile Options................................................................................................................................................11-83
Summary........................................................................................................................................................11-87
Table Information .............................................................................................................................................12-1

R12 Table Information....................................................................................................................................12-3
Objective ........................................................................................................................................................12-4
Organization Tables .......................................................................................................................................12-5
Subinventories and Locator Tables................................................................................................................12-6
Item Master Tables ........................................................................................................................................12-8
Item Status Tables .........................................................................................................................................12-10
Item Categories Tables ..................................................................................................................................12-12
Item Reservation Tables ................................................................................................................................12-14
Inventory Transaction Tables .........................................................................................................................12-16
Guided Demonstration - Accessing eTRM .................................................................................................12-18
Summary........................................................................................................................................................12-19

ix
Preface
Profile
Before You Begin This Course

• Thorough knowledge of <insert information specific to this course>
• Working experience with <insert information specific to this course>
Prerequisites
• <insert prerequisites from the course description, including any suggested preparation
courses>
• <if there are no prerequisites, insert the following sentence:> There are no
prerequisites for this course.
How This Course Is Organized

This is an instructor-led course featuring lecture and hands-on exercises. Online demonstrations
and written practice sessions reinforce the concepts and skills introduced.

xi
Related Publications
Oracle Publications
Title Part Number
Additional Publications
• System release bulletins
• Installation and user’s guides
• Read-me files
• International Oracle User’s Group (IOUG) articles
• Oracle Magazine

xii
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Bold italic Glossary term (if The algorithm inserts the new key.
there is a glossary)
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triggers, Assign a When-Validate-Item trigger to the ORD block.
windows Open the Master Schedule window.
Courier new, Code output, Code output: debug.set (‘I”, 300);
case sensitive directory names, Directory: bin (DOS), $FMHOME (UNIX)
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lowercase) passwords, Password: User tiger as your password.
pathnames, Pathname: Open c:\my_docs\projects
URLs, URL: Go to http://www.oracle.com
user input,
User input: Enter 300
usernames
Username: Log on as scott
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Italic Emphasized words Do not save changes to the database.
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marks with long names
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lesson and chapter
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xiii
Caps and Oracle Forms When-Validate-Item
lowercase triggers
Lowercase Column names, SELECT last_name
table names FROM s_emp;
Passwords DROP USER scott

IDENTIFIED BY tiger;
PL/SQL objects OG_ACTIVATE_LAYER
(OG_GET_LAYER (‘prod_pie_layer’))
Lowercase Syntax variables CREATE ROLE role

italic
Uppercase SQL commands and SELECT userid
functions FROM emp;
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. (N) From the Navigator window, select Invoice then Entry then Invoice Batches
Summary.
2. (M) From the menu, select Query then Find.
3. (B) Click the Approve button.
Notations:
(N) = Navigator
(M) = Menu
(T) = Tab
(B) = Button
(I) = Icon
(H) = Hyperlink
(ST) = Sub Tab
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. In the navigation frame of the help system window, expand the General Ledger entry.
2. Under the General Ledger entry, expand Journals.

xiv
3. Under Journals, select Enter Journals.
4. Review the Enter Journals topic that appears in the document frame of the help system
window.

xv

xvi
Overview of Oracle Inventory
Chapter 1
Copyright © Oracle, 2009. All rights reserved.

Chapter 1 - Page 1

Chapter 1 - Page 2
R12 Overview of Oracle Inventory

Chapter 1 - Page 3
Objectives

Chapter 1 - Page 4
Overview
Overview
Oracle Inventory treats many different types of things as inventory. Inventory can be:
• Finished goods that you sell to customers
• Services that you sell to customers
• Spare parts for maintenance
• Raw materials for manufacturing processes
• Inventory you purchase from a supplier on consignment

Chapter 1 - Page 5
Inventory Capabilities

Chapter 1 - Page 6
Inventory Capabilities (Cont)

Chapter 1 - Page 7
Receipt to Issue Life Cycle
Receipt to Issue
Oracle Inventory uses the receipt to issue process to manage your inventory. When inventory
arrives in your warehouse you receive it. After you receive inventory, you can transfer it
within your organization or to another organization. Finally, you can issue material out of
Oracle Inventory.

Chapter 1 - Page 8
Receiving Inventory
Receiving Inventory
There are different ways you can receive material into your organization.
Purchasing
You can use Oracle Purchasing to receive material from outside of your organization. You can
receive:
• Purchase order receipts
• Internal requisitions
• In-transit receipts
• Return material authorizations
• Unexpected receipts
Work in Process
You can use Oracle Work in Process to receive material from the manufacturing floor. You can
receive:
• Component returns
• Negative component issues
• Assembly returns
Inventory

Chapter 1 - Page 9
You can use Oracle Inventory to receive material in to your warehouse. You can receive:
• Miscellaneous account receipts
• Receipt from projects
• User-defined receipts
• Interorganization transfers

Chapter 1 - Page 10
Receiving Inventory

Chapter 1 - Page 11
Transferring Inventory
Transferring Inventory
Different applications can generate requests to transfer inventory.
Shipping
You can use Oracle Shipping Execution to generate a transfer to move material from a storage
area to a staging to for shipping.
Order Management
You can use Oracle Order Management to generate a transfer to move material from a storage
area to a staging area for shipping.
Work in Process
You can use Oracle Work in Process to generate a transfer to acquire components for a project.
Inventory
You can use Oracle Inventory to:
• Transfer material between organizations
• Transfer material within an organization
• Replenish materials
• Request transfers

Chapter 1 - Page 12
Issuing Inventory
Issuing Inventory
You can use the following applications to issue material:
Order Management
Oracle Order Management can generate an inventory issue through:
• Sales orders
• Internal orders
Purchasing
Oracle Purchasing can generate an inventory issue for:
• Return to vendor materials
Work in Process
Oracle Work in Process can generate an inventory issue through:
• Component issues
• Assembly returns
Inventory
Oracle Inventory can issue stock through:
• User-defined material issues

Chapter 1 - Page 13
• Interorganization transfers
• Cycle count negative issue
• Issue requests

Chapter 1 - Page 14
Oracle Inventory Application Integration
Integration of Oracle Inventory to Manufacturing Applications

Oracle Inventory interacts with the following applications:
• Oracle Cost Management receives cost information and transaction rates from Oracle
Inventory. Oracle Inventory integrates to Oracle General ledger via Oracle Cost
Management
• Oracle Work in Process provides work in process (WIP) activity and available to promise
(ATP) supply information to Oracle Inventory and receives item and on-hand quantity
information from Oracle Inventory.
• Oracle Advanced Supply Chain Planning and Oracle Global Order Promising provide
ATP supply information and receive on-hand quantity and forecast information from
Oracle Inventory.
• Oracle Bill of Materials receives item information from Oracle Inventory.
• Oracle Engineering provides engineering item information and receives item information
from Oracle Inventory.
• Oracle Order Management provides shipping, reservations, and demand information and
receives item, ATP, and on-hand quantity information from Oracle Inventory.

Chapter 1 - Page 15
• Oracle Purchasing provides receipt, delivery, ATP supply, and planning supply
information and receives item requisition, and interorganization shipment information
from Oracle Inventory.

Chapter 1 - Page 16
Integration of Oracle Inventory to Financial Applications
Integration of Oracle Inventory to Financial Applications

• Oracle General Ledger provides ledger and currency exchange rates and receives
transaction accounting summary detail via Oracle Cost Management.
• Oracle Payables receives Item information from Oracle Inventory.
• Oracle Receivables provides intercompany invoice information and receives item
information from Oracle Inventory.
• Oracle Assets receives item information from Oracle Inventory.

Chapter 1 - Page 17
Summary

Chapter 1 - Page 18
Inventory Structure
Chapter 2
Inventory Structure
Chapter 2 - Page 1
Inventory Structure
Chapter 2 - Page 2
R12 Defining Inventory Organizations
Inventory Structure
Chapter 2 - Page 3
Objective
Inventory Structure
Chapter 2 - Page 4
Inventory Organizations
Inventory Organizations
An inventory organization is a facility where you store and transact items. Before you can use
Oracle Inventory, you must define one or more inventory organizations. Inventory
organizations represent distinct entities in your enterprise and can be one of the following:
• A physical entity such as a manufacturing facility, warehouse, or distribution center.
• A logical entity such as an item master organization, which you use to define items.
An inventory organization may have the following attributes:
• An inventory organization can have its own location, ledger, costing method, workday
calendar, and items.
• An inventory organization can share one or more of these characteristics with other
organizations.
Inventory Structure
Chapter 2 - Page 5
Inventory Organization Structure
Inventory Organization Structure

An inventory organization, where you store and transact items can have one or more
subinventories. Subinventories are unique physical or logical separations of material inventory,
such as raw material inventory, finished goods inventory, or defective goods inventory. In
Oracle Inventory, all material within an organization is held in a subinventory. You must
define at least one subinventory for every organization. You can track item quantities by
subinventory as well as restrict items to specific subinventories.
The subinventories in an inventory organization may be made up of one or more locators. You
use locators to identify physical areas where you store inventory items. You can track items by
locator and restrict items to a specific locator. Locator control is optional in Oracle Inventory.
Inventory Structure
Chapter 2 - Page 6
Sample Inventory Organization
Inventory Structure
Chapter 2 - Page 7
Multi-Organization Structure
Multi-Organization Structure
Multi-Organization structure enables you to model multiple business units in an enterprise
using a single installation of Oracle applications. In a multi-organization architecture you can
keep data secure and separate from each business unit.
The following are the benefits of multi-organization structure:
• You can use a single installation of any Oracle Applications product to support any
number of business units, even if those business units use a different ledger.
• Secure access to data so users can access only relevant information.
• You can define a organizational model that best suits your business requirements.
• In Inventory, you can fulfill any Sales Order or Purchase Order regardless of them being
booked from any Inventory organization. You can also determine if any inter-company
invoicing needs to occur based on if the Sales Order or Purchase Order was booked in a
different Operating Unit other than the one to which the Inventory organization is
assigned.
Inventory Structure
Chapter 2 - Page 8
Setting Up Locations
Setting Up Locations
• Define information describing the physical locations of employees and organizations.
• Locations are shared between Oracle Inventory, Oracle Purchasing, and Oracle Human
Resource Management Systems. Locations flagged as global locations are available to all
business groups. You can associate each organization with only one location; however,
you can associate more than one organization with the same location.
Inventory Structure
Chapter 2 - Page 9
Guided Demonstration - Setting up Locations
Responsibility = Inventory, Vision Operations USA
1. Navigate to the Locations window.
(N) > Setup > Organizations > Locations.
2. Define a Location using the following information:
− Name: M12 Orlando
− Description: Orlando Manufacturing
3. (T) Address Details
− Address Style: United States
4. Enter the following address information:
− Address Line 1: 100 Buena Vista Drive
− City: Orlando
− State: FL
− Zip Code: 32803
− County: Orange
− Country: United States
− Telephone: (407) 828-5000
5. Select the following Timezone from the list of values:
− Eastern
6. (T) Shipping Details
− Ship-To Location:M12 Orlando
7. Verify the following boxes are checked
− Ship-To Site
− Receiving Site
− Office Site
− Bill-To Site
− Internal Site
8. Save and Close form.
Inventory Structure
Chapter 2 - Page 10
Defining Organizations
Defining Organizations
Classify the Organization
• Choose an organization classification to describe the general purpose of your organization.
• Examples of organization classifications are inventory organization, legal company, and
HR organization.
• Choose inventory organization as your organization classification to use your organization
for inventory management.
Ledger
• Tie each inventory organization to an operating unit. Each operating unit is associated to a
legal entity and a primary ledger.
Inventory Structure
Chapter 2 - Page 11
Inventory Parameters
Inventory Parameters
Organization Features
You must enter organization information such as the organization code, and the item master
organization. The system defaults this field to the current organization. You must change this
for any organization that is not an item master organization. The item master organization
should be the first inventory organization you create.
Note- The Manufacturing Partner Organization functionality is only available in Japan, Taiwan
and Korea.
Products and Features

You can enable specific products on the Inventory Parameters tab. These include Oracle
Warehouse Management, Oracle Process Execution, and Oracle Enterprise Asset Management.
If you have Oracle Warehouse Management installed, then you can enable the Warehouse
Control System.
Inventory Structure
Chapter 2 - Page 12
Costing Parameters
LIFO costing-Costing method where it is assumed that items that were received most recently
are
transacted first.
FIFO Costing-Costing method where it is assumed that items that were received earliest are
transacted first.
Inventory Structure
Chapter 2 - Page 13
Revision, Lot, Serial, and License Plate Number (LPN) Parameters
Revision, Lot, Serial, and LPN Parameters

You determine the starting revision for all items in the organization when you define your
inventory organization. You can also choose to set lot control and serial control parameters at
the organization level. Revision control is discussed in the Defining and Maintaining Items
module. Lot control and serial control is discussed in the Lot and Serial Control module.
LPN Generation Options
If you have Oracle Warehouse Management installed, and you are working with a Warehouse
Management enabled organization, you can define License Plate Number (LPN) Generating
Options. LPNs must be unique across organizations. Setting the parameters on the Revision,
Lot, Serial, And LPN tab enables the system to generate LPNs on demand, or through a
concurrent request. As long as the number is unique, Oracle Warehouse Management also
enables you to generate your own LPNs.
Inventory Structure
Chapter 2 - Page 14
ATP, Pick, Item-Sourcing Parameters
Inventory Structure
Chapter 2 - Page 15
Interorganization Parameters
Inventory Structure
Chapter 2 - Page 16
Other Account Parameters
Inventory Structure
Chapter 2 - Page 17
Warehouse Management Parameters
Warehouse Management Parameters

For more information about Oracle Warehouse Management Organization Parameters see the
Oracle Warehouse Management Implementation Guide.
Inventory Structure
Chapter 2 - Page 18
Guided Demonstration - Setting Up Organizations
Responsibility: Inventory, Vision Operations USA
1. Navigate to the Organizations window.
(N) > Setup > Organizations > Organizations.
2. (B) New in Find window
3. Set up a new organization using the following information:
− Name: M12 Orlando MFG
− Type: Plant
− Location: M12 Orlando MFG
4. Save your work.
5. In the Organization Classification alternative region, select the following information:
− Name: Inventory Organization
− Enabled: Selected
6. Save your work.
Define Accounting Information

7. (B) Others > Accounting Information.
8. Enter the following accounting information:
− Primary Ledger: Vision Operations
− Legal Entity: Vision Operations
− Operating Unit: Vision Operations
9. Save your work.
Define Inventory Parameters

10. (B) Others > Inventory Information > (T) Inventory Parameters
11. Enter the following inventory parameters:
− Organization Code: M12
− Item Master Organization: Vision Operations
− Calendar: Vision01
− Demand Class: Blank
− Move Order Timeout Period: 60 Days
− Mover Order Timeout Action: Approve automatically
− Locator Control: Determined at Subinventory Level
− Allow Negative Balances: Selected
− Auto Delete Allocations at Move Order Cancel: Selected
Discuss the different types of organizations, Manufacturing Partner Organization, EAM Enabled, Process
Manufacturing Enabled, WMS Enabled, and WCS Enabled.
12. (T) Costing Information
13. Enter the following costing parameters:
− Costing Method: Standard
Inventory Structure
Chapter 2 - Page 19
− Transfer to GL: Yes
− Reverse Encumbrance: No
− Project Cost Collect Enabled: No
− Defer Logical Transactions: No
− Cost Cutoff Date: Blank
− Default Material Sub-Element: Blank
− Material Overhead Sub-Element: Blank
14. Enter the following valuation accounts:
Account Type Account

Material 01-000-1410-0000-000
Outside Processing 01-000-1450-0000-000
Material Overhead 01-000-1420-0000-000
Overhead 01-000-1430-0000-000
Resource 01-000-1440-0000-000
Expense 01-520-7530-0000-000
15. (T) Other Accounts

16. Enter the following other account information:
Purchase Price Variance 01-520-5210-0000-000
Invoice Price Variance 01-520-5220-0000-000
Inventory AP Accrual 01-000-2220-0000-000
Sales 01-520-4110-0000-000
Cost of Goods Sold Account 01-450-5110-0000-000
Deferred COGS Account 01-450-5110-0000-000
17. (T) Revision, Lot, Serial And LPN

18. Enter A in the Starting Revision field.
19. Enter the following Lot Control parameters:
− Uniqueness: Across Items
− Generation: At Item Level
− Total Length: 30
− Generation: At item level
− Auto Create Lot UOM Conversion: Blank
− Allow Different Lot Status: With exception
20. Enter the following Serial Control parameters:
− Uniqueness: Within organization
Inventory Structure
Chapter 2 - Page 20
− Generation: At Item level
− Prefix SER
− Starting Serial Number: 0000000001
21. (T) ATP, Pick, Item-Sourcing
22. Enter the following information:
− ATP Defaults Rule: Total ATP, No DC (select second)
− Picking Defaults: Rule: Default Picking Rule PR1
− Subinventory Order: Blank
− Locator Order: Blank
− Pick Confirmation Required: Blank
− Over Picking for Manufacturing: Blank
− Over Picking for Transfer Orders: Selected
− Enable Rules Override for Lot-Level Res.: Selected
− Item Sourcing Detail: Type: Supplier
− Item Sourcing Detail: Organization: Blank
− Item Sourcing Detail: Subinventory: Blank
23. (T) Inter-org Information
− Inter-organization Transfer Charge: Predefined percent
− Predefined Percent: 10%
− Transfer Credit: 01-520-5290-0000-000
− Purchase Price Variance: 01-520-5210-0000-000
− Receivable: 01-000-1810-0000-000
− Payable: 01-000-2370-0000-000
− Intransit Inventory 01-000-1460-0000-000
25. (M) File > Close Form
Define Receiving Information

26. (B) Others > Receiving Information
27. Enter the following Receiving Information:
− Enforce Ship-To: None
− ASN Control Action: None
− Receipt Days Early and Late: 5
− Receipt Days Exceed-Action Warning
− Over Receipt Tolerance (%) 5%
− Over Receipt Action Warning
− RMA Receipt Routing: Standard
− Receipt Routing: Standard
− Allow Substitute Receipts: Selected
− Allow Unordered Receipts: Selected
− Allow Express Transactions: Selected
Inventory Structure
Chapter 2 - Page 21
− Allow Cascade Transactions: Selected
− Validate Serial Numbers on RMA Receipts: Selected
− Receipt Number Generation: Automatic
− Receipt Number Type: Alphanumeric
− Next Receipt Number: 1
− Validate Lots on RMA Receipts: Restricted
− Receiving Inventory Account: 01-000-1410-0000-000
− Clearing Account: 01-000-1410-0000-000
28. (B) Save
29. Click Close Window.
30. Save your work.
31. Close the Organizations window.
Link the Location to the Inventory Organization

32. Navigate to the Location window.
(N) Setup > Organizations > Location
33. Find M12 Orlando.
(M) > View > Query By Example > Enter
34. Enter %M12% in the Name field.
(M) > View > Query By Example > Run
35. (T) Other Details
− Inventory Organization: M12 Orlando MFG
37. Save your work and close the window.
Inventory Structure
Chapter 2 - Page 22
What is a Subinventory?
What Is a Subinventory?
A subinventory is a physical or logical grouping of inventory such as raw material, finished
goods, defective material, or a freezer compartment. A subinventory can be the primary place
where items are physically stocked. You must specify a subinventory for every inventory
transaction.
Inventory Structure
Chapter 2 - Page 23
What is a Subinventory (Cont)
What is a Subinventory (Cont)

For more information about subinventories, Defining Subinventories, Oracle Inventory User’s
Guide.
Inventory Structure
Chapter 2 - Page 24
Defining Subinventories
Defining Subinventories
You define subinventories by organization. Each subinventory must contain the following
information:
• Unique alphanumeric name
• Status
• Cost Group (if you have Oracle Warehouse Management installed)
• Parameters
• Lead times
• Sourcing information
• Account information
For more information about subinventories see Defining Subinventories, Oracle Inventory
User’s Guide
Inventory Structure
Chapter 2 - Page 25
Guided Demonstration - Defining Subinventories
1. (N) Setup > Organizations > Subinventories
2. (M) File > New
3. Enter the following subinventory information:
− Name: Raw
− Description: Raw Materials
− Locator Control: Item Level
4. (B) Open.
5. Select Receiving as the subinventory Type.
6. (M) File > Save.
7. (M) File > Close Form.
Verifying Subinventories
9. (N) Change Organization.
10. Select M2 Boston Manufacturing.
12. (M) View > Find.
13. Enter Raw in the Find Field.
14. Click OK.
15. Note that subinventory Raw is not available in M2.
Inventory Structure
Chapter 2 - Page 26
Practice - Creating Subinventories
Overview
In this practice you will learn how to create two subinventories.
Assumptions
• You are skilled in Oracle navigation.
• Responsibility > Inventory, Vision Operations USA
• 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
If necessary, change your Organization to Seattle (M1).
Create four subinventories for your team. Create one subinventory for your finished goods
(FGI) stock, a Main Stores (MAIN) subinventory, a Raw Materials (RM) subinventory, and Low
Value (LV) items subinventory. Your Low Value subinventory must be a non-tracked
subinventory. Use the following naming convention to differentiate your team from other teams
(##FGI) where the pound sign represents your team number.
After completing the lab, answer the following questions.
1. In which organization are your new subinventories?
2. Determine if ##FGI exists in M2- Boston Manufacturing and why.
Inventory Structure
Chapter 2 - Page 27
Solution - Creating Subinventories
1. Change Organization to M1 Seattle.
(N) Change Organization
Choose Seattle Manufacturing
Select OK
2. Navigate to the Sub-inventories window.
(N) Setup > Organizations > Subinventories
3. (B) New
− Name: ##FGI
− Description: Finished Goods Inventory
− Status: Active
− Type: Storage
4. (M) File > Save

5. (M) File > New.
− Name: ##Main
Inventory Structure
Chapter 2 - Page 28
− Description: Main Stores
− Type: Storage
− Status: Active
− Locator Control: Dynamic Entry
6. (M) File > Save

7. (M) File > New
− Name: ##RM
− Status: Active
− Type: Storage
− Locator Control: None
Inventory Structure
Chapter 2 - Page 29
8. (M) File > Save
9. (M) File > New
− Name: ##LV
− Description: Low Value Inventory
− Status: Unserviceable: Not Available for Netting, ATP and Reservations
− Type: Storage
− Locator Control: None
− Quantity Tracked: Deselected
Inventory Structure
Chapter 2 - Page 30
10. Save and Close window.
(M) File > Save
(M) File > Close Form
11. In which organization are your new subinventories? M1 Seattle Manufacturing
12. Does a subinventory called ##FGI exist in M2 Boston Manufacturing? No, you created your
subinventories in M1 Seattle Manufacturing.
Select M2 Boston Manufacturing.
14. (N) Setup > Organizations > Subinventories.
Inventory Structure
Chapter 2 - Page 31
Inventory Structure
Chapter 2 - Page 32
Locator Control
Locator Control
Locators are structures within subinventories. Locators are the third level in the enterprise
structuring scheme of Oracle Inventory. Locators may represent rows, aisles, or bins in
warehouses. You can transact items into and out of locators. You can restrict the life of
locators as well as define locator dimensions.
Inventory Structure
Chapter 2 - Page 33
Dynamic and Static Locators
Inventory Structure
Chapter 2 - Page 34
Subinventory-Locator Relationship
Subinventory-Locator Relationship
You can structure Oracle Inventory in such a way that some of the subinventories and items
have locator control while others do not. If locator control is turned on at the item level, you
must specify a locator when transacting the item into or out of a subinventory. If locator
control is turned on at the subinventory level, you must specify a locator when transacting any
item into or out of that subinventory. Each stock locator you define must belong to a
subinventory, and each subinventory can have multiple stock locators. The possible locator
control types are:
• None
• Prespecified
• Dynamic entry
• Item Level
You cannot use the same locator names within any two subinventories within the same
organization.
For more information about setting up locator control see Defining Stock Locators, Oracle
Inventory User’s Guide.
Inventory Structure
Chapter 2 - Page 35
Locator Flexfield Structure
Locator Flexfield Structure

Locator flexfield structure is common across all organizations. For Example if you set up Row
1A Rack 1A and Bin 1A in M1 Seattle, you cannot use Aisle 1A Rack 1A and Bay1A structure
in M2 Boston.
For more information see the Oracle Applications Flexfields Guide.
Inventory Structure
Chapter 2 - Page 36
Guided Demonstration - Defining Locators
Setting Up Stock Locators

1. (N) Setup > Organizations > Stock Locators.
2. Click New.
3. Enter a new Row Rack and Bin.
Note: Locators must be unique across an organization.
4. Enter a Description.
5. Enter the Subinventory.
6. (M) File > Save.
Inventory Structure
Chapter 2 - Page 37
Practice - Defining Locators
Overview
In this lab you will learn how to set up locator control for subinventories and items.
Assumptions
• You are skilled in Oracle Navigation
Tasks
Defining Stock Locators

1. Define some storage locators for your ##FGI subinventory and your ##Main subinventory.
For this exercise use the following convention:
− Row: (your team #) ## ##
− Rack: 01 01
− Bin: 01 02
− Subinventory: ##FGI
− Row: ## ##
− Rack: 02 02
− Bin: 01 02
− Subinventory: ##Main
Inventory Structure
Chapter 2 - Page 38
Solution – Setting Up Locator Control
Defining Stock Locators
1. Navigate to the Stock Locators window.
(N) Setup > Organizations > Stock Locators
(B) New
2. Enter the following new locators using the following information:
− Row: (your team #) ##
− Rack: 1
− Bin: 01
− Description: Anything you want
− Type: Storage Locator
− Locator Status: Active
− Row: ##
− Rack: 1
− Bin: 02
− Type: Storage Locator
− Locator Status: Active : Not Available for Netting, ATP and Reservations
− Row: ##
− Rack: 2
− Bin: 01
− Subinventory ##Main
− Locator Status: Active
− Row: ##
− Rack: 2
− Bin: 02
− Subinventory ##Main
− Locator Status: Active : Available for ATP and Reservations
Inventory Structure
Chapter 2 - Page 39
3. Select (M) File > Save
4. Select (M) File > Close
Inventory Structure
Chapter 2 - Page 40
Interorganization Shipping Networks
Interorganization Shipping Networks

An interorganization shipping network describes the relationships and accounting information
between a shipping organization and a destination organization. You must define a shipping
network between two organizations before you can transfer material between organizations.
When you setup a shipping network you must select a transfer type. The choices are intransit
or direct. If you choose intransit, Oracle Inventory moves material to an intermediary state
before it reaches the destination organization, and a receipt transaction is required in the
destination organization once the material arrives in order to retrieve it. If you choose direct,
Oracle Inventory moves the material directly to the destination organization. However, for
both, you can determine default receipt routing and whether internal orders are required to
transfer material.
If you choose intransit as the transfer type you can determine:
• Shipping methods
• GL accounts to use in transit
• Material ownership during transfers
• Planning lead-times
• Transfer charges
For more information see Interorganization Shipping Network, Oracle Inventory User’s Guide.
Inventory Structure
Chapter 2 - Page 41
Shipping Method
Shipping Method
Shipping methods are the way you ship material. When you create a shipping method, you
must enable it before you can use it in a shipping network. If you disable a shipping method
you cannot use it in a shipping network.
Inventory Structure
Chapter 2 - Page 42
Additional Set Up Steps
Additional Set Up Steps

Entering Employees
Employees who perform cycle and physical inventory counts.
Defining Planners
Identify persons responsible for planning items or groups of items.
Defining Freight Carriers
Enables assignment of a general ledger account to one or more carriers to collect costs
associated with their use. You can assign a carrier to each interorganization transfer.
Inventory Structure
Chapter 2 - Page 43
Additional Organizational Setups
Material Shortage Parameters

Define the parameters for the system to determine when unsatisfied demand exceeds available
quantity of incoming supply. This condition can be used by the system to trigger shortage
alerts and notifications.
Organization Access
This controls access to organizations based on the user responsibility assigned to a user by the
system administrator.
When implemented for one user responsibility, it is then required for all other user
responsibilities accessing the same organization.
Inventory Structure
Chapter 2 - Page 44
Copying Inventory Organizations
Copying Inventory Organizations

You can create new inventory organizations or copy an existing organization. You must
establish a model organization to use as a baseline for new organizations. This model
organization must be a transactional organization and not an item master organization. You can
copy only organizations within the same operating unit. The system creates the new
organizations under the same business group to which the model organization belongs, and
assigns the new organizations to the same operating unit, legal entity, and ledger as the model
organization.
When you copy organizations you specify which information to copy from the model
organization. You can choose to copy the following information from the model organization:
• Organization definition
• Shipping networks
• Hierarchy assignments
• Bills of material and bills of material parameters
• Departments, resources, and routings
• Item information
When you copy a model organization the system automatically copies the following
information:
Inventory Structure
Chapter 2 - Page 45
• Subinventories
• Locators
• Work in Process parameters
• Work in Process accounting classes
• Planning parameters
• Shipping parameters
Note: The system does not copy organization-specific data including: cost type, cost sub-
element, Process Manufacturing Enabled, Oracle Warehouse Management enabled, and cost-
sharing entities.
For more information about copying inventory organizations see Copy Inventory Organization
Implementation Guide.
Inventory Structure
Chapter 2 - Page 46
Organization Hierarchy
Organization Hierarchy
Organization hierarchies enable you to group together organizations and perform operations
across all organizations within a hierarchy. You can perform the following operations across
all organizations within an organization hierarchy:
• Assign items to organizations: You can assign an item to any organization that belongs to
the same master organization within the same hierarchy. You can also assign a range of
items or item categories to a single organization, as well as a range of items or categories
to multiple organizations.
• Copy item attributes: You can manage item attributes for many organizations in one place.
You can verify that an item or group of items were set up correctly, copy organization-
level item attributes from one item to other organizations that use the item, and copy item
attributes from one item to another within an organization.
• View item information: You can view on-hand quantity information as well as item where
used information for organizations.
• Open and close accounting periods: You can open and close accounting periods.
• Purge transactions: You can purge transactions.
• Process transactions with the Inventory Transaction Open Interface: You can use the
Inventory Transaction Open Interface to review, submit, or cancel transactions.
Inventory Structure
Chapter 2 - Page 47
• Manage bills of materials: You can create common bills of material for organizations as
well as delete items, bills, components, routings, and operations.
• Manage engineering change orders You can automatically implement as well as make
changes to engineering change orders.
Inventory Structure
Chapter 2 - Page 48
Organization Reports
Inventory Structure
Chapter 2 - Page 49
Organization Reports (Cont)
Inventory Structure
Chapter 2 - Page 50
Profile Options
Inventory Structure
Chapter 2 - Page 51
Implementation Considerations
When you set up your organizations you need to determine the organization type. For
example, you need to determine if the organization is a process or a discrete organization and if
you are using Oracle Warehouse Management. You can use Oracle Warehouse Management
and Oracle Process Management in the same organization. You should not however, use
Oracle Asset Management with Oracle Warehouse Management or Oracle Process Execution.
If you plan on using Oracle Warehouse Management you need to determine if you are going to
use the Warehouse Control system. If this organization transacts business with Japan, Taiwan,
or Korea you can enable Chargeable Subcontracting for the organization. You must consider
all of this information before you create items or process transactions.
Inventory Structure
Chapter 2 - Page 52
Implementation Considerations (Cont)
Inventory Structure
Chapter 2 - Page 53
Inventory Structure
Chapter 2 - Page 54
Inventory Structure
Chapter 2 - Page 55
Inventory Structure
Chapter 2 - Page 56
Inventory Structure
Chapter 2 - Page 57
Summary
Inventory Structure
Chapter 2 - Page 58
Units of Measure
Chapter 3
Units of Measure
Chapter 3 - Page 1
Units of Measure
Chapter 3 - Page 2
R12 Units of Measure
Units of Measure
Chapter 3 - Page 3
Objectives
Units of Measure
Chapter 3 - Page 4
Units of Measure
Unit of Measure
You define units of measure for tracking, moving, storing, and counting items.
Primary Unit of Measure
When you define an item you establish a primary unit of measure. The system tracks on-hand
quantity and calculates transactions based on the primary unit of measure.
Secondary Unit of Measure
You can optionally establish a secondary unit of measure (dual unit of measure control) for an
item. Secondary unit of measure can be used for cases where you need to track in two units of
measure and there is no constant conversion between the two unit of measures (UOMs). For
example, chickens can be tracked in pounds and eaches.
If an item is under dual unit of measure control the system tracks on-hand quantity based on
both the primary and secondary units of measure. For example, you can track an item in both
eaches and liters.
Units of Measure
Chapter 3 - Page 5
Uses of Units of Measure
Uses of Units of Measure

• Planning Products
- Forecasting and consumption
- Master scheduling
- Material requirements planning
• Work in Process
- Shop floor moves
- Resource transaction
- Completion and return transactions
- Inquiries and reports
• Bills of Material and Engineering
- Defining bills of material
- Defining engineering items
Units of Measure
Chapter 3 - Page 6
Unit of Measure Class
Unit of Measure Class

Unit of measure classes represent groups of units of measure with similar characteristics. A
unit of measure class contains a base unit of measure. You use the base unit of measure to
perform conversions between units of measure in the class. For this reason, the base unit of
measure should represent the other units of measure in the class, and be one of the smaller
units. For example, quantity is a unit of measure class and each, dozen, and gross are examples
of units of measure within the class. The unit of measure each is the base unit of measure for
this class.
Units of Measure
Chapter 3 - Page 7
Guided Demonstration - Creating Units of Measure
1. (N) > Setup > Units of Measure > Units of Measure.
2. (M) File > New.
3. Use the following information to create two new units of measure:
Name UOM Description Class

00-Centimeter 00C 00 Centimeter 00-Metric
00-Kilometer 00K 00 Kilometer 00-Metric
4. (M) File > Save.
Units of Measure
Chapter 3 - Page 8
Guided Demonstration - Creating Unit of Measure Classes
1. (N) > Setup > Units of Measure > Classes.
2. (M) File > New.
3. Enter the following unit of measure information:
− Name: 00-Metric
− Description: 00-Metric Class
− Base Unit 00-Meter
− UOM: 00M
4. (M) File > Save.
Units of Measure
Chapter 3 - Page 9
Unit of Measure Conversions
Units of Measure Conversions

A unit of measure conversion is a mathematical relationship between two different units of
measure. For example, 16 ounces = 1 pound, or 2.2 pounds = 1 kilogram. If you want to
transact items in units of measure belonging to classes other than their primary UOM class,
you must define conversions between the base units of measure in different UOM classes.
Units of Measure
Chapter 3 - Page 10
Guided Demonstration - Defining Unit of Measure Conversions
1. (N) Setup > Units of Measure > Conversions
2. (M) File > New.
3. Enter 00-Centimeter in the Unit field.
4. Enter 0.01 in the Conversion field.
5. (M) File > New.
6. Enter 00-Kilometer in the Unit field.
7. Enter 1000 in the Conversion field.
8. (M) File > Save.
Units of Measure
Chapter 3 - Page 11
Lot-Level Unit of Measure Conversions
Lot-Level Unit of Measure Conversions

Lot specific conversions enable you to perform a specific inter-class conversion for a given lot.
This enables you to establish more granular control over the transactional quantities of a lot.
For example, the standard inter-class conversion for a lot controlled item is one gallon equals
15 pounds; however, when you receive a particular lot of the item, 1 gallon equals 16 pounds.
You can create a lot specific unit of measure for this instance.
You can create lot-specific unit of measure conversions for on-hand lots or lots with a zero
balance. If you create a lot-specific conversion for a lot with on-hand quantities, you can
automatically update the quantities in the system to more accurately reflect the on-hand
quantity.
Units of Measure
Chapter 3 - Page 12
Units of Measure Setup
Units of Measure
Chapter 3 - Page 13
Practice - Defining Units of Measure
Overview
In this lab you will be doing the following:
• Defining Unit of Measure Classes
• Defining Units of Measure
• Setting up Unit of Measure Conversions
• Setting up Lot-Level Units of Measure Conversions
Assumptions
Tasks
Defining Unit of Measure Classes

Define the unit of measure class, Quantity Class with the base unit of measure Each. Use your
team number (##) to uniquely identify your unit of measure class.
Defining Units of Measure

Define the following units of measure for your class. Use your team number (##) to uniquely
identify your units of measure.
− Dozen
− Gross
− Case
Setting up UOM Conversions

Set up Standard conversion for your units of measure. Use your team number to uniquely
identify your class from the other teams in the classroom.
Note: A Gross = 144 each, and a case = 24 each.
Setting up Lot-Level Unit of Measure Conversions

Create a lot-level unit of measure conversion for item CM20001. Use your new base unit of
measure as the destination base unit of measure.
What types of updates can you perform on the Update Quantities window?
Units of Measure
Chapter 3 - Page 14
Solution – Defining Units of Measure
Defining Unit of Measure Classes

1. Navigate to the UOM Classes window.
(N) Setup > Units of Measure > Classes
2. The application prompts you to select an organization if it is a first-time access to the
database. Select M1 Seattle Manufacturing from the list of values.
3. (M) File > New
− Name ##-QTY
− Description ##-Quantity Class
− Base Unit ##-Each
− UOM (abbreviation) ##E
4. (M) File > Save.
Defining Units of Measure

5. Navigate to the Units of Measure window.
(B) Units of Measure
6. (M) File > New
7. Enter the units of measure information according to the following table:
Name UOM Description
##-Dozen ##D ## Dozen UOM
## Gross ##G ## Gross UOM
## Case ##C ## Case UOM
Units of Measure
Chapter 3 - Page 15
Note: Select (M) File > New between each new unit of measure.
8. (M) File > Save.

9. (M) File > Close form
Setting up Unit of Measure Conversions

10. Navigate to the Unit of Measure Conversions window.
(B) Setup > Units of Measure > Conversions
11. (M) File > New
12. Enter the unit of measure conversion information according to the following table:
Unit Class Conversion Base Unit
##-Dozen ##-Qty 12 ##-Each
##-Gross ##-Qty 144 ##-Each
##-Case ##-Qty 24 ##-Each
Note: Select (M) File > New between each new unit of measure conversion.
Note: Verify that you are creating a standard unit of measure conversion.
Units of Measure
Chapter 3 - Page 16
13. (M) File > Save.
14. (M) File >Close Form.
Setting up Lot-Level Unit of Measure Conversions

Navigate to the Lot Inter-Class Unit of Measure Conversions window.
(N) Setup > Units of Measure > Lot Specific Conversions
− Item: CM20001
− Lot: BC2500
− Base Unit 00-Each
− Conversion: 1
16. (B) On-hand Quantities
17. Enter a value in the New Primary quantity field (for example, 480).
Units of Measure
Chapter 3 - Page 17
20. What types of updates can you perform on the Update Quantities window?
______________________________________________________________________
____
______________________________________________________________________
____
Units of Measure
Chapter 3 - Page 18
Unit of Measure Reports
Units of Measure
Chapter 3 - Page 19
Profile Options
Units of Measure
Chapter 3 - Page 20
Organization Parameter Setup
Organization Parameter Setup

If you set the Auto Create Lot UOM Conversion parameter to Yes or User confirmation, then
the system automatically creates lot-specific unit of measure conversions for items under dual
unit of measure control across the organization. The system bases the conversion on lot
quantities that you receive in the transactional unit of measure, and creates a conversion
between the transactional unit of measure and the secondary unit of measure.
Units of Measure
Chapter 3 - Page 21
• You can use a maximum of five decimal places for an individual unit of measure within
Oracle Inventory.
Note- Inventory transactions and on hand balance supports decimal precision to 5 digits
after the decimal point. Oracle Work in Process supports decimal precision to 6
digits. Other Oracle Applications support different decimal precision. As a result of
the decimal precision mismatch, transactions another Oracle Application passes may
be rounded when processed by Inventory. If the transaction quantity is rounded to
zero, Inventory does not process the transaction. It is therefore suggested that the base
unit of measure for an item is set up such that transaction quantities in the base unit of
measure not require greater than 5 digits of decimal precision. For example, in some
industries such as the gold jewellery industry, you may need a more granular level of
control than 5 decimal places. You need to carefully determine the base unit of
measure for each unit of measure class.
• Primary units of measure cannot be changed on items after they are saved.
Units of Measure
Chapter 3 - Page 22
Summary
Units of Measure
Chapter 3 - Page 23
Units of Measure
Chapter 3 - Page 24
Defining and Maintaining
Items
Chapter 4
Defining and Maintaining Items

Chapter 4 - Page 1

Chapter 4 - Page 2
R12 Defining and Maintaining Items Fundamentals

Chapter 4 - Page 3
Objective

Chapter 4 - Page 4
What is an Item?
What Is an Item?
An item is a part or service you:
• Purchase
• Sell
• Plan
• Manufacture
• Stock
• Distribute
• Prototype
Items can also be containers for items as well as components you build into other items.

Chapter 4 - Page 5
Steps to Setup, Define, and Maintain Items
Steps to Define and Maintain Items

The following are the steps for creating and maintaining items:
• Define Inventory organization.
• Create the item templates.
• Use the templates or existing items to define items.
• Enter values for additional item attributes.
• Assign a status to the item.
• Enable the item in organizations.
• Update the organizational-level attributes values.
• Assign categories to the item (optional)
• Assign items to catalog groups (optional)
• Define item relationships (optional)
• Delete items (optional)

Chapter 4 - Page 6
Defining Items
Defining Items
Define only the information you need to maintain the item. You cannot define an item at the
organization level. Oracle Inventory automatically switches to the Master Item window when
you define a new item.

Chapter 4 - Page 7
Defining Items

Chapter 4 - Page 8
Guided Demonstration - Define Item
1. (N) > Items > Master Items.
2. Define an item using the following information.
− Item: AS18456
− Description: Lap Top Assembly
3. (M) Tools > Copy From.
4. Select Finished Good template from LOV.
5. Select Apply.
6. Select Done.
7. (M) File > Save.
8. (M) Tools > Organization Assignment.
9. Enable the Item in M1 Seattle.

Chapter 4 - Page 9
Item Master Organization
Item Master Organization

An item master organization is a logical entity that you use to define items. You use the other
organizations to store and transact inventory. After you define an item in the item master, you
can assign it to any number of other organizations.
There is no functional or technical difference between the item master organization and other
organizations; however, it is recommended that you limit the item master to an item definition
organization.
You should also define one item master organization per implementation. You can use the
same item master for child organizations across different ledgers. Item masters are distinct
entities with no relationship to each other. You cannot associate items in one item master
organization with another item master organization. You cannot copy items across item master
organizations.
Defining the Item Master Organization
You create the item master organization in the same way that you create other inventory
organizations.
• You use the Organization window to create the item master organization
• Use the Organization Parameters window to specify the organization as the Item Master.
• You assign child organizations to the item master organization.

Chapter 4 - Page 10
- Note that the item master uses itself as its item master.

Chapter 4 - Page 11
Item Master
Item Master
Always define items in the master organization. When you define an item, Oracle
automatically changes your current organization to the master organization. You may enable
your new items in as many child organizations as needed.

Chapter 4 - Page 12
Item Attributes
Item Attributes
Item attributes are the collection of information about an item.

Chapter 4 - Page 13
Item Attribute Groups

Chapter 4 - Page 14
Guided Demonstration - Viewing Item Attributes
Responsibility: Oracle Inventory, Vision Operations USA
1. (N) Items > Master Items.
2. (M) View > Query by Example > Enter.
3. Enter item %AS20000.
4. (M) View > Query by Example > Run.
5. (T) Inventory.
6. Select the Master radio button from the Display Attributes zone.
7. Select the Org radio button from the Display Attributes zone.
8. (T) Purchasing
9. (T) Receiving
10. (T) Order Management

Chapter 4 - Page 15
Item Status
Item Status
You can use statuses to provide default values for certain item attributes to control the
functionality of an item. The Item Status attribute has a defined set of yes or no values for the
status attributes. You apply the values to the status attributes when you choose an item status
code when you define an item. For example, in the beginning of a product development cycle
you set the Item Status attribute to Prototype with all of the status attributes defaulted to yes
except for Customer Orders Enabled. When the item is ready, you change the Item Status
attribute to Active to enable all item functions.
You can assign one or more pending statuses for an item, to be implemented on future dates.
These statuses become effective on their assigned effective dates. You can view the status
history of an item if needed.

Chapter 4 - Page 16
Unit of Measure Attributes
Unit of Measure Attributes

You use the units of measure attributes to track your items in the warehouse. The following are
the unit of measure attributes and their definitions:
• Primary Unit of Measure: This is the stocking and selling unit of measure. Any
necessary conversions are based on this unit of measure. The primary unit of measure is
the default for invoices and credit memos entered in Oracle Receivables.
• Tracking: The system can track the item in either the primary only or the primary and
secondary unit of measure. If the system tracks the item by the primary and secondary unit
of measure this is called dual unit of measure control.
• Pricing: This attribute controls if pricing is based on the primary or secondary unit of
measure
• Defaulting: This attribute controls the behavior of dual unit of measure controlled items.
- Fixed: The system stores inventory in both the primary and secondary units of
measure. You can enter an item quantity in one unit of measure, and the system
converts the quantity to the secondary unit of measure and displays both quantities
- Default: The system stores inventory in both the primary and secondary units of
measure. You can enter an item quantity in one unit of measure, and the system
converts the quantity to the second unit of measure and displays both quantities. You

Chapter 4 - Page 17
can change the quantity in the secondary unit of measure, without changing the
quantity in the primary unit of measure.
- No Default: The system stores inventory in both the primary and secondary units of
measure. Use this option when the default conversion between the two units of
measure is usually not the same. The system does not automatically display in the
secondary unit of measure when you specify the quantity for the primary unit of
measure. You manually enter the quantity of the secondary unit of measure before
you process a transaction. The secondary quantity can fluctuate from the default
conversion by the factors that you specify in the Deviation + and Deviation -
attributes.

Chapter 4 - Page 18
Item Statuses and Attributes
Item Statuses and Attributes

You define an item status by selecting the value check boxes for the status attribute. You can
control status attributes and item status at the item level or organization level.

Chapter 4 - Page 19
Status Attributes and Functionality

Chapter 4 - Page 20

Chapter 4 - Page 21

Chapter 4 - Page 22
Status Attribute Interdependencies

Chapter 4 - Page 23

Chapter 4 - Page 24

Chapter 4 - Page 25
Item Attribute Relationships
Item Attribute Relationships

• Required Attributes
You must enter a value for the attribute based on the settings for other related attributes.
• Interdependent Attributes
You can only enter certain values depending on other attribute values.
• Updateable Attributes
You can update values under certain conditions.
• Control Level Dependencies
You can update the control level of some attributes only under special conditions and with
certain consequences.

Chapter 4 - Page 26
Practice - Viewing Item Attributes
Overview
In this lab you will learn how to view item attributes.
Assumptions
• You are skilled at Oracle navigation.
• Responsibility: Inventory, Vision Operations USA.
Tasks
Viewing Item Attributes

1. Find item # AS20000 and answer the following questions
What is the BOM Item Type for the part? _______What is the control level? ______
Is this item Recipe Enabled? _____ What is the control level? ____
2. Find item # AS54888 and answer the following questions about the item's attributes.
What is the Item Status? _______________ What is the control level? ______
Is a Bill of Material allowed for this item? ______ What is the control level? ______
Can I build this item in WIP? ________________ What is the control level? _____
Are customer orders enabled for this item? _________What is the control level?
_____
Is Invoicing Enabled for this item? ______________ What is the control level? _____
Are Internal Orders enabled for this item? _______ What is the control level? ______
Is this item transactable in Inventory? ____________ What is the control level? ______
Is this item purchasable from a Vendor? ___________ What is the control level? _____
Is this item stockable in Inventory? _______________ What is the control level? _____
In how many Organizations can this part be used?

Chapter 4 - Page 27
Solution – Viewing Item Attributes
Viewing Item Attributes

1. Navigate to the Master Items Window.
(N) Items > Master Items
2. Query Item # AS20000.
(M) View > Query by Example > Enter
− Enter AS20000% in the Item field.
(M) View > Query by Example > Run
3. (T) Bills of Material

A BOM is allowed for item for AS20000. This attribute is controlled at the master level.

Chapter 4 - Page 28
4. (T) Process Manufacturing
Item AS20000 is recipe enabled. This attribute is controlled at the organization level.

Chapter 4 - Page 29
5. Find Item AS54888.
(M) View > Find

Chapter 4 - Page 30
Click Find.
6. (T) Main
Item AS5488 Item Status is active, and master controlled.

Chapter 4 - Page 31
7. (T) Bills of Material
A Bill of Material is allowed for this item, and the attribute is master controlled.
8. (T) Order Management
Customer orders are enabled for this item, and the attribute is master controlled.

Chapter 4 - Page 32
9. (T) Invoicing
Invoicing is enabled for this item, and the attribute is master controlled.

Chapter 4 - Page 33
10. (T) Inventory
This item is transactable, and stockable. These attributes are master controlled.

Chapter 4 - Page 34
11. In how many Organizations can this part be used?

Chapter 4 - Page 35
Item Templates
Item Templates
Oracle Inventory has several predefined templates that you can use to define and update items
or you can create your own templates.
If you regularly define many items that share the same values for a number of attributes, you
may want to define item templates. You can only use copy once when you define an item. You
can predefine templates with relatively few attributes enabled because you can apply more than
one template to define one item.
Attributes in Templates
You can enable attributes and assign them values in each template that you create. When you
apply a template to an item, Oracle Inventory updates only the attributes that are enabled for
the template. The order in which templates are applied is extremely important.
Further Item Templates Help
For more information about item templates see Item Templates, Oracle Inventory User’s
Guide.

Chapter 4 - Page 36
Creating Item Templates

Chapter 4 - Page 37
Enabling Attributes in a Template

Chapter 4 - Page 38
Guided Demonstration - Creating Item Templates
Responsibility: inventory, Vision Operations (USA)
1. Navigate to the Item Templates window.
(N) Setup > Items > Templates
2. (B) New
3. Use the following information to create an item template:
− Template: 00-Leadtime
− Description: Standard lead times for new parts
− Organization: M1
4. Save your work.
(M) File > Save
5. Select Lead Times from the show drop-down menu.
6. Enable the following item attributes in the following table:
Attribute Name Value

Prepocessing Lead Time 5
Processing lead Time 44
Post Processing Lead Time 1
7. Save your work.
(M) File > Save
8. Close the window.

Chapter 4 - Page 39
Organization Assignment and Organization Items
Organization Assignment and Organization Items

You can enable an item in all child organizations under your master organization or choose
child organizations where you use the item. Oracle Inventory propagates the item to all
organizations in which you want to enable it. You can enter or change organization-controlled
item attributes. For example, you can choose reorder point planning in one organization and
min-max planning in another organization for the same item.

Chapter 4 - Page 40
Control Levels
Master-Level Control
An attribute you maintain at the master level has identical values across all organizations that
use the item.
Organization-Level Control
An attribute you maintain at the organization level may have different values for each
organization that uses it.
Attribute Control
Some attributes can be maintained at only the master level or the organizational Level. Units of
measure are controlled at the master level. If you are using multiple organizations, then you
should maintain min-max planning at the organization level.
Technical Note
Master-Level Control
For example, suppose you want to ensure that items defined in two organizations are
transactable at the same time in both organizations. If you make the item not transactable in
one organization, you want the same item to become not transactable in the other organization.
Organization-Level Control
Suppose only one of the two organizations in your Oracle Inventory implementation performs
manufacturing operations, while the other organization is strictly a distribution warehouse.

Chapter 4 - Page 41
For a finished good item used in both organizations, you would want the flexibility to select the
Build in WIP status attribute check box in the manufacturing organization, and clear the Build
in WIP status attribute check box in the distribution organization.

Chapter 4 - Page 42
Revision Control
Revision Control
A revision is a particular version of an item, bill of material, or routing. Use the revision
control to track item quantities by item revision and specify a revision for each material
transaction.
Enable revision control for items you must track version changes or changes that are
significant enough to track but do not affect the function and feature of the item.
You cannot change the revision control item attribute when an item has quantity on hand. If
revision control is controlled at the Master Item level, the check for on-hand quantity is against
the sum of on-hand quantity in all child organizations. If revision control is controlled at the
organizational level, the check for on-hand quantity is against the sum of on-hand quantity in
that organization.
Use letters, numbers, and characters such as A, A1, 2B, and so on to define revision numbers.
Letters are always in upper case and numbers may include decimals. To ensure revisions sort
properly, decimals should always be followed by a number. Revisions are sorted according to
ASCII rules, therefore each revision must be greater than the previous revision. For example,
you cannot use revision 10 after revision 9 because, according to ASCII sorting, 10 precedes 9.
For more information about setting up Revision Control, see Defining Item Revisions, Oracle
Inventory User’s Guide

Chapter 4 - Page 43
Defining Items
Overview
In this practice you will learn how to define items, assign item attributes, and enabled items in
organizations.
Assumptions
• Responsibility: Inventory, Vision Operations USA.
Tasks
Create Items
Create an item using the template you created in the previous task. Create eight items using
the Finished Goods template with the following descriptions:
No Inventory Controls
Locator Control ON
Revision Control ON
Lot Control ON
Parent and Child Lot Control ON
Grade Control ON
Serial Number Control ON
Dual Unit of Measure Control and Lot Expiration Control ON
What item attribute do you have to disable if an item if you create an item under dual unit
of measure control? _________________________________________________
Note: Use the following naming convention for your items, ##-Item##, and be sure to
enable your items in M1 Seattle and M2 Boston.

Chapter 4 - Page 44
Solution - Defining Items
Responsibility, Inventory, Vision Operations USA
Create Items
1. Navigate to the Master Items window
2. Create the no inventory controls item:
− Name: ##-Item01
− Description Team ## No Inventory Controls
3. (M) Tools > Copy From
4. Enter Finished Goods in the Template field
5. (B) Apply.
6. (B) Done

Chapter 4 - Page 45
7. (M) File > Save
8. (M) Tools > Organization Assignment
9. Assign the item to the following inventory organizations:
− Org: M1 Seattle Manufacturing
− Org: M2 Boston Manufacturing

Chapter 4 - Page 46
10. (M) File > Save
11. Click the Attribute Groups tab.
12. File > New
13. (T) Inventory
14. Create your locator-controlled item. Enter the item name and description. Repeat steps 2-6
to copy the finished good template. Enable the following additional item attributes for your
locator-controlled item:
− Name: ##-Item02
− Description Team ## Locator Controlled Item
− Locator Control: Prespecified

Chapter 4 - Page 47
15. (M) File > Save
16. Repeat steps 8-10 to enable the item both M1 Seattle Manufacturing, and M2 Boston
Manufacturing.
18. (M) File > New
19. (T) Inventory
20. Create your revision-controlled item. Enter the item name and description. Repeat steps 2-6
revision-controlled item:
− Name: ##-Item03
− Description Team ## Revision Controlled Item
− Revision Control: Selected

Chapter 4 - Page 48
21. (M) File > Save
Manufacturing.
24. (M) File > New
25. (T) Inventory
26. Create your lot-controlled item. Enter the item name and description. Repeat steps 2-6 to
copy the finished good template. Enable the following additional item attributes for your lot-
controlled item:
− Name: ##-Item04
− Description Team ## Lot Controlled Item
− Lot Control: Full Control
− Starting Prefix: A
− Starting Number: 001
− Maturity Days: 10
− Hold Days: 5

Chapter 4 - Page 49
27. (M) File > Save
Manufacturing.
30. (M) File > New
31. (T) Inventory
32. Create your parent and child lot-controlled item. Enter the item name and description.
Repeat steps 2-6 to copy the finished good template. Enable the following additional item
attributes for your parent and child-lot-controlled item:
− Name: ##-Item05
− Description Team ## Child and Parent Lot Item
− Hold Days: 5
− Child Lot Enabled: Selected
− Child Generation: Parent+Child
− Prefix: A

Chapter 4 - Page 50
33. (M) File > Save
Manufacturing.
36. (M) File > New
37. (T) Inventory
38. Create your grade-controlled item. Enter the item name and description. Repeat steps 2-6
grade-controlled item:
− Name: ##-Item06
− Description Team ## Grade controlled item
− Hold Days: 5
− Grade Controlled: Selected
− Default Grade: A

Chapter 4 - Page 51
39. (M) File > Save
Manufacturing.
42. (M) File > New
43. (T) Inventory
44. Create your serial-controlled item. Enter the item name and description. Repeat steps 2-6
serial-controlled item:
− Name: ##-Item07
− Description Team ## Serial Controlled Item
− Generation: Predefined

Chapter 4 - Page 52
45. (M) File > Save
Manufacturing.
48. (M) File > New
49. (T) Main
50. Create your dual unit of measure and lot expiration-controlled item. Enter the item name
and description. Repeat steps 2-6 to copy the finished good template. Enable the following
additional item attributes to enable dual unit of measure control:
− Primary: 00-Each
− Tracking: Primary and Secondary
− Pricing: Primary
− Secondary: 00-Meter
− Defaulting: No Default
− Deviation + 0
− Deviation - 0

Chapter 4 - Page 53
51. (T) Inventory
52. Enter the following lot control parameters:
− Name: ##-Item08
− Description Team ## Dual UOM and Lot expiration controlled tiem
− Lot Expiration (Shelf Life Control) Full Control
− Shelf Life Days: 30
− Retest Interval: 10
− Expiration Action Interval: 5
− Expiration Action: Dispose
− Hold Days: 5

Chapter 4 - Page 54
53. (M) File > Save
Manufacturing.
55. (M) File > Save
Create a Unit of Measure Conversion for your Dual UOM controlled item
57. Navigate to the Unit of Measure Conversions window
58. (N) Setup > Units of Measure > Conversions
59. (T) Inter-Class
60. Enter the following information
− Item: ##-Item-08
− Destination: ##-Meter
− Conversion: .05

Chapter 4 - Page 55
61. (M) File > Save

Chapter 4 - Page 56

Chapter 4 - Page 57
Restricting Items to Subinventories
Restricting Items to Subinventories

You can assign items to a given subinventory. Assigning items to a subinventory does not
restrict the subinventory to that list of items. Rather, the items are restricted to that
subinventory. Thus, you can always issue and receive unrestricted items to any subinventory,
but you can only issue and receive restricted items to those particular subinventories. You
activate the list of subinventories for a restricted item when you set the Restrict Subinventories
attribute. You also use the item-subinventory relationship to specify valid subinventories for
zero quantity cycle counts for an item, and to specify items for an ABC analysis performed at
the subinventory level. In these cases you do not have to set the Restrict Subinventories
attribute, only establish the relationship between the item and subinventory.

Chapter 4 - Page 58
Guided Demonstration - Restricting Items to Subinventories
1. Navigate to the Organization Items window.
(N) Items > Organization Items
2. Enter Item AS18546 in the Item field.
3. (B) Find
4. (M) Tools > Item Subinventories
5. Enter the following information on the Item Subinventories window:
− Subinventory: Stores
− Subinventory FGI
6. (M) File > Save

Chapter 4 - Page 59
Item Relationships
Item Relationships
You can define relationships between items. This allows you to search for items through these
relationships. Except in Oracle Purchasing, these relationships are for inquiry and reporting
purposes only. For example, you can create an item relationship for substitute items or items
for which you can up-sell.

Chapter 4 - Page 60
Guided Demonstration -Establishing Item Relationships
1. Navigate to the Item Relationships window.
(N) Items > Item Relationships
2. Select To from the Direction drop down list.
3. (B) New.
4. Enter the following item relationship information:
From Item To Item Relationship Reciprocal
AS18947 AS54888 Substitute Selected
AS18947 AS44400 Upsell Deselected
5. (M) File > Save


Chapter 4 - Page 61
Categories and Category Sets
Categories and Category Sets

A category is a logical classification of items that have similar characteristics. A category set
is a distinct grouping scheme and consists of categories. You can define an unlimited number
of categories and group subsets of your categories into category sets. A category can belong to
multiple category sets. You can assign a category to a category set either at the time you
define a category set or at the time you assign an item to the category.
Default Category Sets
When you install Oracle Inventory, you must assign a default category set to each of the
following functional areas functional areas: Inventory, Purchasing, Order Management,
Costing, Engineering, and Planning. Product Line Accounting is seeded with the Inventory
category set. Oracle Inventory makes the default category set mandatory for all items defined
for use by a functional area. If your item is enabled for a particular functional area you cannot
delete the item's corresponding default category set assignment. Default category sets are
required so that each functional area has at least one category set that contains all items in that
functional area.

Chapter 4 - Page 62
Assigning Items to Categories
Assigning Items to Categories

When you enable an item in a functional area, the item is assigned to the default (mandatory)
category set and default category of the functional area. You can override the category set's
default category. In addition, you can manually assign your item to an unlimited number of
category sets. You may optionally assign an item to more than one category within a category
set based on the category set definition.

Chapter 4 - Page 63
Practice - Defining Categories
Overview
In this practice you will set up item categories and add your items to these categories
Assumptions
• Replace ## with your terminal number.
Tasks
Create Item Categories

1. Create the following item categories: ##No Controls and ##Controls.
Create a Category Set

2. Create a category set called ##Category set
Assign Categories to Your Items

3. Assign the following items your categories:
Item Category
AS18947 ##No Controls
AS54888 ##No Controls
##Item01 ##No Controls
##Item02 ##Controls
##Item03 ##Controls
##Item04 ##Controls
##Item05 ##Controls
##Item06 ##Controls
##Item07 ##Controls
##Item08 ##Controls

Chapter 4 - Page 64
Solution – Defining Categories
Create Item Categories

1. Navigate to Categories window.
(N) Setup > Items > Categories > Category Codes
2. (B) New
Structure Name Category Description Enabled

Product Family ##No Controls Team ## Items with Selected
No Controls
Product Family ##Controls Team #3 Items with Selected
Inventory Controls
4. (M) File > Save

Create a Category Set

6. Navigate to the Category Sets window.
(N) Setup > Items > Categories > Category Sets
− Name: ##Category Set
− Description: Team ## Category Set
− Flex Structure: Product Family
− Controlled At: Master Level

Chapter 4 - Page 65
− Default Category: 00No Controls
− Category: 00Controls
8. (M) File > Save

Assign Categories to Your Items

10. Navigate to the Master Items window.
11. Query your items and assign them to your Category Set and the appropriate categories.
(M) View > Query By Example
Enter your item in the Item field.
(M) View > Query By Example Run
(M) Tools > Categories
Item Category Set Category

AS18947 ## Category Set ##No Controls
AS54888 ## Category Set ##No Controls

Chapter 4 - Page 66
##Item01 ## Category Set ##No Controls
##Item02 ## Category Set ##Controls
12. (M) File >Save


Chapter 4 - Page 67
Item Catalogs
Item Catalogs
To define your catalog, you set up as many distinct item catalog groups as you need to partition
your Item Master. Each group has unique characteristics (called a descriptive element) that
completely describe items belonging to the group. When you assign an item to an item catalog
group, you define values for the descriptive elements that apply to your item. For example, an
item catalog group called mug could have a descriptive element called material. Possible
values for material might be glass or ceramic.
Descriptive Elements
You can define any number of descriptive elements for an item catalog group. You can also
describe whether the descriptive element is required at item definition, and whether the
descriptive element value is included by default in the item catalog description. Descriptive
element values can be concatenated and used to create an item's description. You turn this
feature off or on for each descriptive element in a catalog group. Turn Description Default on
for any element you want included in a concatenated description. You create a concatenated
description when assign an item to an item catalog group.

Chapter 4 - Page 68
Guided Demonstration - Setting up Catalog Groups
Create an Item Catalog Group

1. (N) Navigate to the Item Catalogs window.
(N) Setup > Items > Catalog Groups
2. Create a new catalog group
(M) File > New
− Name: ## Mugs
− Description: Kinds of Mugs:
4. (M) File > Save
5. (B) Details
6. Enter the details according to the following table:
Seq Name Description Required Des. Default

1 Country Country of origin Deselected Selected
2 Style Style of mug Selected Selected
3 Capacity Number of Selected Selected
ounces
4 Material What is it made Selected Deselected
of?
7. (M) File > Save
9. Navigate to the
Create Items
11. Create items according to the following table:
Note: Use the Finished Goods template and enable all parts in M1 Seattle Manufacturing
and M2 Boston Manufacturing.
Item Description
## Mug 1 Mug 1
## Mug 2 Mug 2
## Mug 3 Mug 3
## Mug 4 Mug 4

Chapter 4 - Page 69
Update Items with Catalog Information
Update the above items with item catalog descriptive elements. If you used the save and
proceed option when you created your mugs you will not have to re-query them for the following
steps.
12. Navigate to the Master Items window
13. (N) Items > Master Items
14. Find your first item
(M) View > Find
− Enter ## Mug 1 in to the item field
(B) Find
15. (M) Tools > Catalog
− Catalog Group: ## Mugs
− Country: US
− Capacity: 12 oz
− Style Covered
− Material: Pewter
17. (B) Update Description
18. (M) File > Save
19. Repeat Steps 14-17 for the rest of your items according to the following table:
Item Country Capacity Style Material

## Mug 2 US 12 oz Uncovered Copper
## Mug 3 US 16 oz Covered Plastic
## Mug 4 US 16 oz Uncovered Glass
Search for items Using Catalog Attributes

Navigate to the Item Search window.
(N) Items > Item Search
− Show: Item Catalog
− Catalog Group: ## Mugs
− Capacity: 16 oz

Chapter 4 - Page 70
Deletion Constraints and Deletion Groups
Deletions Constraints and Deletion Groups

You cannot delete an item if you have on-hand quantity or have performed any type of action
on the item.

Chapter 4 - Page 71
Deletion Constraints

Chapter 4 - Page 72
Deletion Constraints (Cont)

Chapter 4 - Page 73
Item Reports

Chapter 4 - Page 74
Item Reports (Cont)

Chapter 4 - Page 75
Item Reports (Cont)

Chapter 4 - Page 76
Profile Options

Chapter 4 - Page 77
Profile Options (Cont)

Chapter 4 - Page 78

Chapter 4 - Page 79

Chapter 4 - Page 80

Chapter 4 - Page 81

Chapter 4 - Page 82
You should set all costing attributes at the organizational level because costing is most
commonly done at organizational level. WIP requires costing at org level to set up WIP
accounting classes. Costing of individual items is specific to individual organizations because
of location and other considerations.
Costing Method
Costing method is chosen and set at the inventory organization level. Within a set of books, an
enterprise can have multiple cost methods specified at each organization level. For example, a
company may have one average cost org and one standard cost org. Available costing methods
are as follows:
• Standard
• Weighted
• Average
• FIFO
• LIFO

Chapter 4 - Page 83

Chapter 4 - Page 84
Summary

Chapter 4 - Page 85

Chapter 4 - Page 86
Lot and Serial Control
Chapter 5

Chapter 5 - Page 1

Chapter 5 - Page 2
R12 Lot and Serial Control

Chapter 5 - Page 3
Objective

Chapter 5 - Page 4
Lot Control Overview
Lot Control Overview

A lot can represent a quantity of an item that shares the same specifications, one or more
receipts from the same vendor, or whatever you choose. You can divide each lot into child lots
that can reflect whatever characteristics you choose for items within the lot. For example, you
may divide a lot of items from a supplier into child lots to reflect differences in quality
specifications. When you allocate stock for production, you can allocate specific lots to a
production batch based on the potency, age, or other item characteristics. Oracle Inventory
provides complete lot number support for inventory transactions. You can enable lot control
for specific items in your inventory. For items under lot control, you assign lot numbers to each
receipt, and thereafter reference the same lots each time you perform material transactions.
This enables you to have tight control over lot controlled items in your inventory.
All of the material produced in a manufacturing batch may be assigned a lot number. For
example, you can create a manufacturing batch of penicillin and assign it parent lot number
A100. You can then use parent lot A100 to create child lot A100_01 to make pills, child lot
A100_02 to create emulsion, and child lot A100_03 to create capsules. Each child lot has the
same ingredients as the original parent lot A100, but they are in a different format.

Chapter 5 - Page 5
Child Lots
Child Lots
A child lot is a subdivision of a lot that you can use if you produce a lot over a period of time,
but still want to group the material as a single lot. Using a child lot maintains the integrity of
the lot, but enables you to consume it in manageable pieces. When you process transactions for
material under child lot control, you enter the child lot as the lot number. The system also
maintains a genealogy relationship between the parent lot and the child lot.

Chapter 5 - Page 6
Setting up Lot Control (Organization Parameters)
Setting up Lot Control

Organization Parameters
You use the Organization Parameters window to specify whether lot numbers should be
unique for an item. If you do not establish lot number uniqueness, you can assign the same lot
number to multiple items in the same organization and across organizations. If you control lot
number uniqueness at the item level, you can assign a specific lot number only to one item in
the same organization and across organizations. When you perform transactions, Oracle
Inventory checks the lot number uniqueness control to generate lot number defaults.
You use the Organization Parameters window to specify how to generate lot number defaults.
You can generate sequential lot numbers based on an alphanumeric prefix that you specify
when you define an item. Oracle Inventory can also generate lot number defaults for the entire
organization. In this case, you must define a lot number prefix at the Organization level in the
Organization Parameters window.
If you do not want Oracle Inventory to automatically generate lot number defaults for you, you
can enter your own lot numbers when you receive items. You can always override lot number
defaults. For more information See Defining Organization Parameters, Oracle Inventory User's
Guide.

Chapter 5 - Page 7
Guided Demonstration - Setting Up Organizations
1. Navigate to the Organizations window.
(N) > Setup > Organizations > Organizations.
2. (B) New in Find window
3. Set up a new organization using the following information:
− Name: M12 Orlando MFG
− Type: Plant
− Location: M12 Orlando MFG
4. Save your work.
5. In the Organization Classification alternative region, select the following information:
− Name: Inventory Organization
− Enabled: Selected
6. Save your work.
Define Accounting Information

7. (B) Others > Accounting Information.
8. Enter the following accounting information:
− Primary Ledger: Vision Operations
− Legal Entity: Vision Operations
− Operating Unit: Vision Operations
9. Save your work.
Define Inventory Parameters

10. (B) Others > Inventory Information > (T) Inventory Parameters
11. Enter the following inventory parameters:
− Item Master Organization: Vision Operations
− Demand Class: Blank
− Move Order Timeout Period: 60 Days
− Mover Order Timeout Action: Approve automatically
− Locator Control: Determined at Subinventory Level
− Allow Negative Balances: Selected
− Auto Delete Allocations at Move Order Cancel: Selected
Discuss the different types of organizations, Manufacturing Partner Organization, EAM Enabled, Process
Manufacturing Enabled, WMS Enabled, and WCS Enabled.
12. (T) Costing Information
13. Enter the following costing parameters:
− Costing Method: Standard

Chapter 5 - Page 8
− Transfer to GL: Yes
− Reverse Encumbrance: No
− Project Cost Collect Enabled: No
− Defer Logical Transactions: No
− Cost Cutoff Date: Blank
− Default Material Sub-Element: Blank
− Material Overhead Sub-Element: Blank
14. Enter the following valuation accounts:

Material 01-000-1410-0000-000
Outside Processing 01-000-1450-0000-000
Material Overhead 01-000-1420-0000-000
Overhead 01-000-1430-0000-000
Resource 01-000-1440-0000-000
Expense 01-520-7530-0000-000
15. Other Accounts
16. Enter the following other account information:

Purchase Price Variance 01-520-5210-0000-000
Invoice Price Variance 01-520-5220-0000-000
Inventory AP Accrual 01-000-2220-0000-000
Sales 01-520-4110-0000-000
Cost of Goods Sold Account 01-450-5110-0000-000
17. (T) Revision, Lot, Serial And LPN

18. Enter A in the Starting Revision field.
19. Enter the following Lot Control parameters:
− Uniqueness: Across Items
− Generation: At Item Level
− Total Length: 30
− Generation: At item level
− Auto Create Lot UOM Conversion: Blank
− Allow Different Lot Status: With exception
20. Enter the following Serial Control parameters:
− Uniqueness: Within organization
− Generation: At organization level

Chapter 5 - Page 9
− Prefix SER
− Starting Serial Number: 0000000001
21. ATP, Pick, Item-Sourcing
− ATP Defaults Rule: Total ATP, No DC (select second)
− Picking Defaults: Rule: Default Picking Rule PR1
− Subinventory Order: Blank
− Locator Order: Blank
− Pick Confirmation Required: Blank
− Over Picking for Manufacturing: Blank
− Over Picking for Transfer Orders: Selected
− Enable Rules Override for Lot-Level Res.: Selected
− Item Sourcing Detail: Type: Supplier
− Item Sourcing Detail: Organization: Blank
− Item Sourcing Detail: Subinventory: Blank
23. (T) Inter-org Information
− Inter-organization Transfer Charge: Predefined percent
− Predefined Percent: 10%
− Transfer Credit: 01-520-5290-0000-000
− Purchase Price Variance: 01-520-5210-0000-000
− Receivable: 01-000-1810-0000-000
− Payable: 01-000-2370-0000-000
− Intransit Inventory 01-000-1460-0000-000
Define Receiving Information

26. (B) Others > Receiving Information
27. Enter the following Receiving Information:
− Enforce Ship-To: None
− ASN Control Action: None
− Receipt Days Early and Late: 5
− Receipt Days Exceed-Action Warning
− Over Receipt Tolerance (%) 5%
− Over Receipt Action Warning
− RMA Receipt Routing: Standard
− Receipt Routing: Standard
− Allow Substitute Receipts: Selected
− Allow Unordered Receipts: Selected
− Allow Express Transactions: Selected
− Allow Cascade Transactions: Selected

Chapter 5 - Page 10
− Validate Serial Numbers on RMA Receipts: Selected
− Receipt Number Generation: Automatic
− Receipt Number Type: Alphanumeric
− Next Receipt Number: 1
− Validate Lots on RMA Receipts: Restricted
− Receiving Inventory Account: 01-000-1410-0000-000
− Clearing Account: 01-000-1410-0000-000
28. (B) Save
29. Click Close Window.
30. Save your work.
31. Close the Organizations window.
Link the Location to the Inventory Organization

32. Navigate to the Location window.
(N) Setup > Organizations > Location
33. Find M12 Orlando.
(M) > View > Query By Example > Enter
34. Enter %M12% in the Name field.
(M) > View > Query By Example > Run
35. (T) Other Details
− Inventory Organization: M12 Orlando MFG
37. Save your work and close the window.

Chapter 5 - Page 11
Lot Number Uniqueness
Lot Number Uniqueness

You use the Organization Parameters window to specify whether lot numbers should be unique
for an item. If you do not establish lot number uniqueness, you can assign the same lot number
to multiple items in the same organization and across organizations. If you set lot number
uniqueness to Across Items, you can assign a specific lot number only to a single item. When
you perform transactions, Oracle Inventory checks the lot number uniqueness control to
generate lot number defaults.

Chapter 5 - Page 12
Setting up Lot Control (Item Attributes)
Setting up Lot Control

Item Attributes
You can establish lot control for an item when you define it. You can select either No control
or Full control. If you choose Full Control, then you must assign lot numbers when you
receive the item into inventory. Thereafter, when you transact the item, you must provide a lot
number that you specified when you received the item.
You can update lot control options for an item if it has zero on hand quantity. In addition, you
cannot change lot control when open internal orders or inter-org intransit shipments exist. A
lot number is a combination of an alphanumeric prefix and a numeric suffix. When you define
an item, you can specify the starting lot prefix and the starting lot number. Oracle Inventory
uses this information to generate defaults during transaction entry.
Shelf Life Days
Shelf life is the amount of time that an item can reside in inventory before it expires. When
defining items under lot control, you can choose no control, a certain number of item shelf life
days from the date that you receive the item, or a user-defined expiration date for each lot. The
system does not consider the expired lot as on-hand supply when it performs min-max, reorder
point, or MRP planning calculations. You also cannot reserve an expired lot. See Oracle
Inventory User's Guide Inventory Attribute Group control.
Grade Control

Chapter 5 - Page 13
A grade is a rating that you assign to an item lot for quality control purposes. Grades are
usually based on criteria such as color, size, or quality of the lot. For example, the grade of a
lot of paint could be excellent, average, or poor. A grade is a characteristic of an item lot, and
never a lot location.

Chapter 5 - Page 14
Managing Lots
Assigning Lot Numbers

You must assign lot numbers when you receive items under lot control. You can also add
quantities to existing lot numbers and split an inventory receipt into several lots, if necessary.
Oracle Inventory uses the default lot number generation method that you entered in the
Organization Parameters window to determine lot numbers. You also enter the lot prefix and
starting lot number in the Item Master window when you create an item. If the item is under
user-defined expiration date Lot Expiration (shelf life) Control, you must specify the expiration
date for the lot.
You can either use the lot master to generate new lot numbers or assign lot numbers when you
perform transactions. When you create the lot, the system determines the lot origination type.
If you create the lot on the lot master, the origination type is lot master. If you generate the lot
while performing a transaction, the origination type is Inventory. See Item Lots and Assigning
Lots Within Transactions, Oracle Inventory User’s Guide for more information.
Maintaining Lot Information
You can update the expiration date of lots for items under lot expiration (shelf–life) control.
You can view all lots that you created in your current organization and the supplier lot
information that is associated with the lots.

Chapter 5 - Page 15
Expired Lots
Expired Lots
You can assign lot control shelf life days, or enter a lot expiration date to determine when a lot
expires. The expiration date controls the availability of the lot for transacting and planning
purposes. An expired lot:
• Is not considered as on-hand supply when you are performing min-max, reorder point, or
MRP planning calculations.
• Cannot be reserved for a date beyond the expiration date.
• Can be transacted and is included in on-hand quantities.
• Is included in all inquiries and reports, including inventory valuation reports
• Is included in a cycle count and count entry and adjustments are allowed
• Is included in a physical inventory and tag entry and adjustments are allowed
Lot Expiration Action
A lot expiration action is the action that you perform on a lot when it expires. You can assign a
default lot expiration to an item on the Item Master or when you generate a lot. To associate a
lot expiration action with a lot, you must define shelf life days for the item.

Chapter 5 - Page 16
Disabled Lots
Disabled Lots
Disabling a lot only prevents it from appearing in a list of values when you are performing
receipt transactions. If you type in the lot number, it is valid and accepted even though it was
not in the list of values. Disabling is used only for tailoring this specific instance of the list of
values for lot numbers. A disabled lot:
• Is included in available to transact, available to promise, and available to reserve
calculations
• Is included as on-hand supply when you are performing min-max, reorder point or MRP
planning calculations
• Is included as on-hand in all inquiries and reports, including inventory valuation report
• Can be transacted with Inventory functions and the Transaction Open Interface
• Can be reserved

Chapter 5 - Page 17
Guided Demonstration - Generating Lots

Chapter 5 - Page 18
Guided Demonstration - Generating Lots
Responsibility: Inventory, Vision Operations
2. Create an item with the following information
− Item: lot_control_item
− Description: Lot control item
3. (N) Tools > Copy From
− Template: Finished Good
4. (B) Apply
5. (B) Done
6. (T) Inventory
7. Enable the following Item Attributes:
− Hold Days: 5
− Lot Expiration (Shelf Life): Shelf Life Days
− Shelf Life Days: 60
− Retest Interval: 30
− Expiration Action Interval: 10
− Expiration Action: Dispose
− Grade Controlled: Enabled
− Default Grade: A
8. (M) File > Save
9. (T) Organization Assignment
10. Enable the item in the following organizations:
− M1 Seattle Manufacturing
− M2 Boston Manufacturing
11. (M) File > Save
13. Navigate to the Lots window.
(N) On-hand, Availability > Lots
14. (B) New
15. Enter lot_control_item in the Item field.
16. (B) Generate Lot

Chapter 5 - Page 19
Guided Demonstration - Maintaining Grades

Chapter 5 - Page 20
Guided Demonstration - Maintaining Grades
1. Navigate to the Maintain Grades window.
(N) Setup > Maintain Grades
2. (M) File > New
3. Enter the following grade information.
− Grade: AVG
− Description: Average grade
4. (M) File > Save

Chapter 5 - Page 21
Guided Demonstration - Maintaining Lot Actions
Responsibility: Inventory, Vision Operations
1. Navigate to the Action Codes window.
(N) Setup > Action Codes
2. (M) File > New
3. Enter the following lot action information:
− Action: DEST
− Description: Destroy Item
4. (M) File > Save
5. (M) Close > Close Form

Chapter 5 - Page 22
Practice - Using the Lot Master
Overview
In this practice you will use the lot master to generate lots.
• Use List Bullet Format to list practice items here, if needed
• Use List Bullet Format to list practice items here, if needed
Assumptions
• You created lot control, parent and child lot control, grade control, and lot expiration
controlled items in the previous practice.
• Responsibility, Inventory, Vision Operations USA
Tasks
Generating Lots
Generate a lot for the following items:
## - Item04
##- Item05
## - Item06
## - Item 08
1. What is the origination type? _____________________________
2. What field

Chapter 5 - Page 23
Solution – Using the Lot Master
Generating Lots
Responsibility, Inventory, Vision Operations USA

1. Navigate to the Item Lots window.
(N) On-hand, Availability > Lots
2. (B) New
3. Enter Item ##-Item04 in the Item field where ## represents your team number.
4. Press Enter.
5. (B) Generate Lot

6. (M) File > Save

Chapter 5 - Page 24
7. (M) > New
8. Enter item ##-Item05 in the Item field where ## represents your team number.
9. Press Enter.

Chapter 5 - Page 25
10. (B) Generate Parent Lot
12. (M) File > Save

Chapter 5 - Page 26
13. (M) File > New

Chapter 5 - Page 27
16. Where does the Grade field default from? ______________
17. (M) File > Save
18. (M) File > New

Chapter 5 - Page 28
21. Enter the current date in the Origination Date field.

Chapter 5 - Page 29
22. Enter date information in the following fields:
− Expiration Date
− Expiration Action Date
− Expiration Retest Date
Note: The dates do not appear in these fields
23. (M) File > Save
24. (M ) File > Close Form

Chapter 5 - Page 30
Lot Number Purging

Chapter 5 - Page 31
Cycle Counts Under Lot Control

Chapter 5 - Page 32
Physical Inventory Under Lot Control

Chapter 5 - Page 33
Guided Demonstration - Revision, Lot, and Serial Controls
Creating New Revisions

1. If you are not in M1 organization, change your organization to M1.
• (N) Change Organization.
• Select M1 Seattle Manufacturing from the organization list.
2. (N) Items > Organization Items.
4. (T) Inventory.
5. Select the Revision Control check box.
6. (M) Tools > Revisions.
7. (M) File > New.
8. Enter the following revision information:
− Revision: B
− Revision Label: B
− Description: Lap Top Assembly Revision
− Effective Date: Today's Date.
9. (M) File > Save.
Enabling Lot Control

12. Find item AS18456.
13. (T) Inventory.
14. Select Full Control in the Lot alternative region.
15. Enter the starting lot prefix.
16. Enter the lot starting number.
Enabling Serial Control

21. (T) Inventory.
22. Select Predefined from the Serial alternative region:
− Starting Prefix: AS

Chapter 5 - Page 34
Generating Serial Numbers
25. (N) On-hand, Availability > Generate Serial Numbers.
26. Enter the following information to generate serial numbers:
− Item: AS42001
− Quantity: 1000
27. Choose Submit.
Transacting Locator Controlled Items.

28. (N) Transactions > Miscellaneous Transactions.
29. Enter the following transaction information:
− Type: Miscellaneous receipt
− Account: Miscellaneous
30. Choose Transaction Lines.
31. Enter the following receipt information:
− Item: AS18456
− Revision: B
− Subinventory: FGI
− Quantity: 10
32. Choose Lot /Serial.
33. Choose Generate.
− Lot Quantity: 10
34. Choose Done.
35. (M) File > New.
36. Enter the following receipt information:
− Item: AS42001
− Quantity: 15
37. Choose Lot /Serial.
38. Select the first available serial number from the list of values.
Note: The End Serial Number field populates automatically according to the transaction
quantity.
39. Choose Done.

Chapter 5 - Page 35
Serial Number Overview
Serial Numbers Overview

A serial number is an alphanumeric piece of information you assign to an individual unit of an
item. You use serial numbers to track individual item units. Serial number control is a system
technique for enforcing the use of serial numbers during a material transaction. You can use
serial numbers to track items over which you want to maintain very tight control. One serial
number is assigned to per unit of an item.
For more information on setting up serial number control, refer to the online help:
(Help) Oracle Manufacturing Applications > Oracle Inventory > Items > Lot and Serial
Number Control > Setting Up Serial Number Control

Chapter 5 - Page 36
Generating Serial Numbers
Serial Number Generation

How you set up serial number control at the master item level determines serial number
generation. If you specify No Control as the serial number control type, then the system does
not enforce serial number control. If you specify Predefined as the serial number control type,
then you must predefine serial numbers for that item. If you select At inventory receipt or At
sales order issue, then you can optionally predefine serial numbers for the item.
Oracle Inventory uses the starting serial number prefix and the starting serial number you
specify in the Item window to load the number of predefined serial numbers you request. You
can load as many serial numbers as you want for any item under serial number control.
The process of generating serial numbers is done through a concurrent report. This process
does not assign numbers to units in inventory, it simply reserves specific serial numbers for an
item for later use.
For more information on setting up serial number control, refer to the online help:
(Help) Oracle Manufacturing Applications > Oracle Inventory > Items > Lot and Serial
Number Control > Setting Up Serial Number Control

Chapter 5 - Page 37
Serial Uniqueness
Serial Uniqueness
You use the Organization Parameters window to choose a type of serial number uniqueness for
your organization. You can choose to enforce uniqueness Within inventory items, Within an
organization, or Across organizations. The three levels for serial uniqueness are cumulative,
and the definitions are as follows:
• Within Inventory Items: Once you assign a serial number to a particular item you cannot
assign the same serial number to the same item regardless of the organization. For
example if you assign serial number SN100 to item A, you cannot assign serial number
SN100 to any other instance of item A in any organization. This also includes CTO items
derived from base model A. However you could receive item B with serial number
SN100 in any organization.
• Within an Organization: In addition to the Within Inventory Items restrictions, the same
serial number cannot exist twice within the same organization. For example, if you assign
SN100 to item A, you cannot receive item B with the serial number SN100 in the same
organization. You can, however, receive item B with the serial number SN100 in any
other organization.
• Across Organizations: In addition to the Within an Organization restrictions, you cannot
assign the same serial number to any other item regardless of the organization. For
example if you assign SN100 to item A you cannot receive item B with the serial number

Chapter 5 - Page 38
SN100 in any organization. In this example SN101 and SN100 belong to different
organizations. If you assign Across Organizations uniqueness to any organization it
restricts the serial generation in all other organizations. If one organization dictates
Across Organizations, all other organizations must do so.

Chapter 5 - Page 39
Maintaining Serial Numbers

Chapter 5 - Page 40
Practice - Generating and Maintaining Serial Numbers
Overview
In this lab you will learn how to update your revision, lot, and serial control for your items. You
will also learn how to receive items into stock that have revision, lot, and serial control. You will
use the items you created in the defining items lab.
Assumptions
• You are skilled in Oracle Navigation.
• You have completed the Define Items Lab.
Tasks
Generate Serial Numbers

1. Predefine a range of serial numbers using the following information:
− Item: ##-Item07
− Quantity to define: 10000
Note: ## represents your team number.
Find Serial Numbers

2. Find the serial numbers you generated. What state are the serial numbers in?
_______________________________________________________

Chapter 5 - Page 41
Solution –Generating and Maintaining Serial Numbers
Generate Serial Numbers

1. Navigate to the Generate Serial Numbers window.
(N) On-hand, Availability > Generate Serial Numbers.
− Item: ##- Item-07
− Quantity: 10000
3. (B) OK.
4. (B) Submit
5. (B) Yes

Chapter 5 - Page 42
6. (M) File > Save
Find Serial Numbers

8. Navigate to the Serial Numbers window.
(N) On-hand, Availability > Serial Numbers
− Item: ##-Item07
If you place your cursor in the item field then you can enter information in that field.

Chapter 5 - Page 43
10. (B) Find

Chapter 5 - Page 44
11. (B) Serial Info

Chapter 5 - Page 45
The serials are in the Defined but not used state.

Chapter 5 - Page 46
Lot Genealogy
Lot Genealogy
Lot genealogy tracks the relationship between lots and provides lot traceability that results
from inventory transactions. This includes all lot splits, merges, and translations. Lot
genealogy also enables you to view where a particular lot is used. For example, one of your
suppliers informs you that they supplied you with contaminated sugar, which needs to be
recalled, and you used this sugar as an ingredient in the production of orange juice. You can
use lot genealogy to find each lot of orange juice that contain the contaminated lots of sugar.
You can use lot genealogy to view the work order details for a WIP job, material and pending
transactions, and quality results for both WIP jobs and process batches. Oracle Process
Manufacturing does not support serial numbers or serial genealogy.

Chapter 5 - Page 47
Guided Demonstration - Viewing Lot Genealogy
1. (N) On-hand, Availability > Lots
2. Select an item
3. (B)View Genealogy
4. (T) Lot Attributes
5. (T) Material Transactions
6. (T) Pending Txns and Allocations
7. (T) Products or Components
8. (T) Quality Collections or Quality Samples
9. (T) Lot Based Jobs
Explain the Lot Based Job Transactions tab.If you have Oracle Shop Floor Management
installed, then you can see the Lot Based Job Transactions tab. The Lot Based Job Transactions
tab displays the Oracle Shop Floor Management transactions, such as splitting, merging, bonus
lots, and updating assemblies. It displays the previous values for WIP Lot Name, Start Quantity,
and Assembly Number, and the resulting values after the transaction.

Chapter 5 - Page 48
Serial Genealogy
Serial Genealogy
Serial genealogy tracks the transaction and multilevel composition history of any serial-
controlled item from receipt to customer sale. The composition genealogy is captured through
material transactions in Oracle Work in Process and Oracle Process Manufacturing. The serial
genealogy appears in a graphical display, and you can trace an assembly down through all of
its components or from the component to an assembly. This genealogy tracing enables you to
expedite problem isolation and improve customer response times. Serial genealogy also helps
you to track and regulate supplier performance and quality.
You can view the transaction history of the serial across all organizations within an operating
unit and view the current organization where the serial resides. When issuing serialized
components to serial controlled assemblies, you must associate the component serial number
with the assembly serial number. If the component has a supply type of Push, the association
occurs at WIP Issue. If the component has a supply type of Operation Pull, the association
occurs at WIP Move. If the component has a supply type of Assembly Pull, the association
occurs at WIP Completion. If the item is under lot control, then you can also view the lot
genealogy for the same item. When you view the genealogy of the item, the system lists the
item number, followed by the lot number, and finally the serial number.

Chapter 5 - Page 49
Lot and Serial Reports

Chapter 5 - Page 50
Lot and Serial Reports (Cont)

Chapter 5 - Page 51
Lot and Serial Reports (Cont)

Chapter 5 - Page 52
Profile Options

Chapter 5 - Page 53

Chapter 5 - Page 54

Chapter 5 - Page 55

Chapter 5 - Page 56
Summary

Chapter 5 - Page 57

Chapter 5 - Page 58
Transaction Setup
Chapter 6
Transaction Setup
Chapter 6 - Page 1
Transaction Setup
Chapter 6 - Page 2
R12 Transaction Setup
Transaction Setup
Chapter 6 - Page 3
Objectives
Transaction Setup
Chapter 6 - Page 4
Overview
Transactions
A transaction is an item movement into, within, or out of inventory. A transaction changes the
quantity, location, planning responsibility, or cost 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, dual unit of measure, and serial
number) you enable for your items.
For more information about transaction see Overview of Inventory Transactions, Oracle
Transaction Setup
Chapter 6 - Page 5
Inventory Transactions
Inventory transactions enable you to:
• Receive items into your organization.
• Issue items out of your organization.
• Transfer items from one subinventory in your organization to another subinventory in the
same organization
• Transfer items between organizations
Transaction Setup
Chapter 6 - Page 6
Move Orders
Move Orders
Move orders are requests for the movement of material within a single organization. They
formalize the process to request the movement of material within a warehouse or facility for
purposes like replenishment, material storage relocations, and quality handling. Move orders
are generated manually or automatically depending on the source type. To request a material
transfer between organizations requires an internal requisition.
Move Order Requisitions
A move order requisition is a manually generated request for a move order. It is available for
subinventory transfers and account transfers. Once a requisition has been approved, it becomes
a move order. These requests can optionally go through a workflow-based approval process
before becoming move orders. For more information about move order requisitions see
Generating Move Order Requisitions, Oracle Inventory User’s Guide.
Transaction Setup
Chapter 6 - Page 7
Transaction Source Types
Transaction Source Type

Oracle Inventory uses a transaction source type with a transaction action to uniquely identify
the type of transaction performed. You can define additional source types. Predefined
transaction types are as follows:
• Purchase Order
• Account Alias
• Account
• Move Order
• Internal Order
• Standard Cost Update
• Internal Requisition
• Sales Order
• Cycle Count
• Periodic Cost Update
• Physical Inventory
• RMA (Return Material Authorization)
• Inventory
Transaction Setup
Chapter 6 - Page 8
• Job or Schedule
• External Requisition
• Layer Cost Update
• Project Contract
When you perform a transaction, you specify a transaction type and a source. For example, for
a PO receipt transaction, the transaction source type is Purchase Order and the actual PO
number is the source.
Transaction Setup
Chapter 6 - Page 9
Transaction Action
Transaction Action
You use transaction actions with a source type. A transaction action identifies a transaction
type. Oracle Inventory provides the following transaction actions:
• Issue from stores
• Subinventory transfer
• Direct organization transfer
• Cycle count adjustment
• Physical inventory adjustment
• Intransit receipt
• Intransit shipment
• Cost update
• Receipt into stores
• Delivery adjustments
• WIP scrap
• Assembly completion
• Assembly return
• Negative component issue
Transaction Setup
Chapter 6 - Page 10
• Negative component return
• Staging Transfer
• Ownership Transfer
• Logical Issue
• Logical Delivery Adjustment
• Retroactive Price Adjustment
• Logical Receipt
• Delivery Adjustment
• Lot Split
• Lot Merge
• Lot Translate
• Lot Update Quantity
• Logical Expense Requisition Receipt
• Planning Transfer
• Ownership Transfer
• Logical Intercompany Sales
• Logical Intercompany Receipt
• Logical Intercompany Receipt Return
• Logical Intercompany Sales Return
• Container Pack
• Container Unpack
• Container Split
• Cost Group Transfer
• Logical Intransit Receipt
• Logical Intransit Shipment
• Retroactive Price Update
• Container Transaction
• COGS Recognition
• Residual Quantity Issue
• Residual Quantity Return
Transaction Setup
Chapter 6 - Page 11
Transaction Reasons
Transaction Setup
Chapter 6 - Page 12
Transaction Types
Transaction Types
A transaction type is the combination of a transaction source type and a transaction action. It is
used to classify a particular transaction for reporting and querying purposes. Oracle Inventory
also uses transaction types to identify certain transactions to include in historical usage
calculations for ABC analysis or forecasting. A number of transaction types are predefined in
Oracle Inventory. You can also create custom transaction types.
You use the Transaction Types window to define additional transaction types to customize
transaction entry. A user-defined transaction type is a combination of a user-defined
transaction source type and a predefined transaction action. For example, if you frequently
donate items to charity, you might want to define a transaction source type called charity and a
transaction type called Issue to Charity. In this case, the transaction action would be Issue
from Stores. You would then use the Miscellaneous Transactions window to actually issue an
item to charity, using the Issue to Charity transaction type. You would also specify the actual
charity to which you are issuing, such as Goodwill, and the expense account that specifies the
source Goodwill. For more information about transaction types see Transaction Types, Oracle
Transaction Setup
Chapter 6 - Page 13
Guided Demonstration - Creating Customized Transactions
Setting Up Source Types

1. (N) Setup > Transactions > Source Types
2. Select the User tab.
3. (M) File > New.
4. Use the following information to define a source type.
− Name: Charitable Donation
− Description: Charitable Donation
5. (M) File > Save.
Setting Up Transaction Types

7. (N) Setup > Transactions > Types.
8. Select the User tab.
9. (M) File > New.
10. Use the following information to define a transaction type.
− Name: Goodwill Donation
− Description: Goodwill Donation
− Source Type: Charitable Donation
− Action: Issue from Stores
Setting Up Transaction Reasons

13. (N) Setup > Transactions > Reasons
14. (M) File > New.
15. Use the following information to define a transaction reason.
− Name: Goodwill
− Description: Charitable donation to Goodwill
Transaction Setup
Chapter 6 - Page 14
Predefined Transaction Types
Predefined Transaction Types

Oracle predefines transaction types in the system. The table in the slide contains a few
examples of predefined transaction types. For more information on Predefined Transaction
types see Transaction Types, Oracle Inventory User’s Guide.
Transaction Setup
Chapter 6 - Page 15
Transaction Managers
Transaction Setup
Chapter 6 - Page 16
Running Transaction Managers
Running Transaction Managers

Cost Transaction Manager
The material cost transaction manager costs material transactions in Oracle Inventory and
Oracle Work in Process in the background.
Lot Move Transaction Manager
The resource cost transaction manager processes resource transactions in Oracle Work in
Process and resource transactions you import from barcode readers, payroll systems, time
cards, routing sheets, and custom data entry forms using the Open Resource Transaction
Interface.
Material Transaction Manager
The material transaction manager immediately executes a material transaction after you save
your changes in a transaction window. By starting the transaction manager, you can determine
how to execute transactions: immediately through immediate concurrent request submissions,
or through periodic concurrent request submissions. You define this transaction mode for
individual transaction windows in the Personal Profile Values window.
Move Transaction Manager
Transaction Setup
Chapter 6 - Page 17
The move transaction manager processes move transactions in Oracle Work in Process and
move transactions you import from devices such as portable bar code readers or your custom
data entry forms using the Open Move Transaction Interface.
Transaction Setup
Chapter 6 - Page 18
Creating Picking Rules
Creating Picking Rules

You can create picking rules that enable you determine which material to pick and the order in
which material is picked for sales orders, process manufacturing batches, or work in process
jobs. Oracle Inventory reviews the picking criteria order and the options for each criterion.
You can create rules based on the following restrictions:
• Lot shelf life days
• Single lot - controls whether the system can allocate multiple lots for a particular demand
• Partial lot – controls whether the system can allocate quantities of a lot less than the total
lot quantity available
• Customer specification matching – to require quality specification matching
You can also create sort criteria which determines which material is picked first:
• Lot
• Revision
• Subinventory
• Locator
After you create a rule you assign it in the rules workbench. The rule that you created on the
Inventory Picking Rules page appears on the Rules Workbench. The system automatically
Transaction Setup
Chapter 6 - Page 19
assigns a sequence number and return type to the rule. You can modify the sequence number,
but you cannot modify the return type. The return type is a strategy, rule, or value.
You can assign your rule to any combination of criteria the Rules Workbench displays. For
example, if you create a picking rule that allocates material by lot number in ascending order
followed by locator in ascending order, you can assign it to an item in the Rules Workbench.
This means for picking, the system allocates the lowest lot number of the item in the lowest
locator number where the item resides.
Transaction Setup
Chapter 6 - Page 20
Guided Demonstration - Creating Picking Rules
1. Navigate to the Inventory Picking Rules window.
(N) Setup > Rules > Picking
− Name: Sales_Order_Partial_Lot_Subinventry
− Description: Sales order partial lot allocation allowed
− Partial Allocation Allowed: Enabled
− Subinventory: RECEIPT DATE DESC
− Rank: 1
3. (M) File > Save
4. Select the Enabled check box.
5. (M) File > Save
6. (B) Assignment
7. Assign the rule to the following item:
− Item: AS18947
8. (M) File > Save
Transaction Setup
Chapter 6 - Page 21
Account Aliases
Aliases
An account alias is an easily recognized name or label representing a general ledger account
number. You can view, report, and reserve against an account alias. During a transaction, you
can use the account alias instead of an account number to refer to the account.
You must create an inventory account alias for each GL account if you wish to use an alias for
that GL account in inventory transactions. Oracle Inventory does not honor GL account aliases.
Transaction Setup
Chapter 6 - Page 22
Accounting Periods
Accounting Periods
Oracle Inventory uses accounting periods to group material and work in process transactions
for accounting purposes. An accounting period must be open for you to complete a transaction;
that is, the transaction date you enter must fall within the beginning and ending dates you
define for the period.
Closing Accounting Periods
You can close the earliest accounting period with a status of Open or Error. An automatic
general ledger transfer is processed when you close an accounting period.
Transaction Setup
Chapter 6 - Page 23
Guided Demonstration - Opening Accounting Periods
1. Navigate to the Inventory Accounting Periods window.
(N) Accounting Close Cycle > Inventory Accounting Periods
2. Select a Future accounting period.
3. (B) Change Status.
4. (B) OK
Transaction Setup
Chapter 6 - Page 24
Material Shortage Alerts and Notifications
Material Shortage Alerts and Notifications

A material shortage occurs whenever outstanding demand exceeds the available quantity for
incoming supply. During a receipt transaction, Oracle Inventory checks to see if the material
received is needed elsewhere in the organization. If a shortage exists, the system notifies you
either by a real–time material shortage alert or a workflow–based notification. Set up shortage
parameters to enable the system to send material shortage alerts and notifications. For more
information see Defining Shortage Parameters, Oracle Inventory User’s Guide.
The following receipt transaction windows can generate shortage alerts and notifications.
• Receipts
• Receiving Transactions
• Miscellaneous Transactions
• WIP Material Transactions
• WIP Completions
• Work–Orderless Completions - This occurs only if you have used workflow notification
for the transaction.
Shortage Alerts
Transaction Setup
Chapter 6 - Page 25
The shortage alert appears in the window during the transaction with the option to go to the
View Potential Shortages form, showing where the shortage exists. Alerts are automatic once
they are set up. Notifications are optional and can be sent to a pre–specified list of individuals.
Sources of Demand
When generating shortage alerts and notifications, the system considers one or more of the
following to be sources of demand:
• WIP jobs
• WIP schedules
• Sales order lines that have been pick released and detailed but for which adequate quantity
was not sourced
Supply Types
The system considers the transaction types you select as supply for the unsatisfied demand.
Shortage alerts and notifications are triggered for system or user defined transaction types with
transaction actions of:
• Receipt into stores
• Intransit receipt
• Direct organization transfer
• Assembly completion
• Negative component issue
Transaction Setup
Chapter 6 - Page 26
Setting Up Shortage Alerts and Notifications
Setting Up Shortage Alerts and Notifications

• Define the shortage parameters the system will use to detect material shortages.
• Define the transaction types that will trigger shortage alerts and notifications.
• Define which items in the system will trigger a shortage alert or notification when they are
in demand.
• Define the individuals to be notified.
Transaction Setup
Chapter 6 - Page 27
Setting Up for Move Orders
Setting Up Move Orders

Subinventory Source Type
For Oracle Inventory to automatically create move orders when using min–max planning or
replenishment counting, you must define the subinventory source type at one of the following
levels:
• Subinventory
• Item
To automatically create move orders when using the kanban system, you must define the
subinventory source type at the pull sequence level.
Approval Process Parameters
Approval is required only for requisition move orders. Other move orders created by shipping
or replenishment processes are approved automatically. To require planner approval, you
define two parameters at the organization level:
• Move Order Timeout Period
• Move Order Timeout Action
You can also specify individuals to be notified if a shortage occurs. To bypass the approval
process and automatically approve move order requisitions, enter 0 days for the Move Order
Transaction Setup
Chapter 6 - Page 28
Timeout Period and select Automatically Approve for the Move Order Timeout Action. The
approval process is also not enabled for organization items without an assigned planner.
Item Transaction Defaults
You can define the item transaction defaults to automatically populate the destination locator
on the move order line from an organization item.
Move Order Time-Out
Use move order time-out if you want to require approvals for the move orders in your
organization.
Time-out Period
The length of time, in days, you will let your move orders sit in a pending-approval queuing
status.
The following rules apply when you set up time-outs:
• After one time-out period, a reminder is sent to the approver.
• After two time-out periods, the move order time-out action is performed.
• The time-out action is either approved or rejected.
• If the time-out period is 0, all move orders are automatically approved.
• If the time-out period is left blank, the setting defaults to 0.
Transaction Setup
Chapter 6 - Page 29
Setup Steps for Move Orders
Setup Steps for Move Orders

Set Up Planner
Define a planner for the item in the General Planning tabbed region of the Items window.
Designate a Planner
You designate a planner in the Master Item window when you define an item. If you do not
designate a planner, the move order is automatically approved.
Notification List
When you approve or reject the move order, the system sends a courtesy e-mail to the
Engineering Change Order (ECO) approval list (which is used here as a notification list). It is
attached to the move order source and destination subinventory. You do not need to have
Oracle Engineering to use this feature.
Define Picking Rules
Move orders use the standard picking rules of Oracle Inventory to source material. In a WMS
organization, move orders use Oracle Warehouse Management picking rules.
Locator Defaults
If a subinventory or item is locator controlled, when you create the move order receipts,
specify a destination locator. If you do not specify a destination locator, the allocating process
uses the item transaction default.
Transaction Setup
Chapter 6 - Page 30
For more information see:
(Help) Oracle Manufacturing Applications > Oracle Inventory > Transactions > Overview of
Move Orders > Setting Up Move Orders
Transaction Setup
Chapter 6 - Page 31
Profile Options
Transaction Setup
Chapter 6 - Page 32
Transaction Setup
Chapter 6 - Page 33
Transaction Setup
Chapter 6 - Page 34
Transaction Setup
Chapter 6 - Page 35
Transaction Setup
Chapter 6 - Page 36
Transaction Setup
Chapter 6 - Page 37
Implementation Considerations for Shortage Checks
Answer the following questions to determine which of the following demand sources should be
considered potential shortages.
• Which inventory organizations should be checked for shortages?
• Which type and statuses of WIP jobs/schedules should be checked for shortages?
Answer the following questions to determine the individuals and the method for delivering
shortage messages.
• Should workflow alerts and notifications be generated when actual shortages exist?
• Who should be notified?
• How frequently should notifications be sent?
Transaction Setup
Chapter 6 - Page 38
Implementation Considerations for Move Orders
Transaction Setup
Chapter 6 - Page 39
Summary
Transaction Setup
Chapter 6 - Page 40
Issuing and Transferring
Material
Chapter 7
Issuing and Transferring Material

Chapter 7 - Page 1

Chapter 7 - Page 2
R12 Issue and Transfer Material

Chapter 7 - Page 3
Module Objectives

Chapter 7 - Page 4
Overview of Inventory Transactions
Transactions
A transaction is an item movement into, within, or out of inventory. A transaction changes the
quantity, location, planning responsibility, and cost 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, serial number and secondary unit of measure) you enable for items.
See Overview of Inventory Transactions, Oracle Inventory User’s Guide for more information.

Chapter 7 - Page 5
You can perform the following 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.

Chapter 7 - Page 6
Inventory Transactions Without Documents and Requisitions
Inventory Transactions Without Documents and Requisitions

• You can perform Inter-organization transfers 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.

Chapter 7 - 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.

Chapter 7 - Page 8
Control Options and Restrictions

Chapter 7 - Page 9
Miscellaneous Transactions
Miscellaneous Transactions
Miscellaneous Transactions enable you to issue material to individuals or projects that are not
in inventory, receiving, or work in process. These could include a research and development
group or an accounting department. You can also make manual adjustments to the general
ledger by receiving material from one account to inventory, and then issuing that material from
inventory to another account.
For more information see Performing Miscellaneous Transactions Oracle Inventory User’s
Guide
Miscellaneous Transactions Applications

With miscellaneous transactions you can:
• Load items when you implement Oracle Inventory
• Scrap items by issuing them to scrap accounts
• Issue items to individuals, departments, or projects
• Receive items that were acquired without purchase orders
• Enter adjustments and corrections to system quantities due to theft, vandalism, loss, shelf-
life expiration, or inaccurate record keeping

Chapter 7 - Page 10
Practice - Processing Miscellaneous Receipts
Overview
In this lab you perform a miscellaneous receipt to receive the items you created in the define
items lab.
Assumptions
• You completed the Defining Items practice.
• You completed the Creating Subinventories practice.
Tasks
Perform a miscellaneous receipt for the items you created in the Defining Items practice.
1. Receiving the following eight items where ## represent you team number. If the item has
associated inventory controls such as a lot or serial, generate a new lot or serial for the
item.
##-Item-01
##-Item-02
##-Item-03
##-Item-04
##-Item-05
##-Item-06
##-Item-07
##-Item-08
Verify the Transactions Processed

2. Use the Material Transactions window to verify the transaction processed.

Chapter 7 - Page 11
Solution – Processing Miscellaneous Receipts
Responsibility = Inventory, Vision Operations (USA)
1. Navigate to the Miscellaneous Transactions window.
(N) Transactions > Miscellaneous Transactions
− Type: Miscellaneous receipt
− Account: 01-580-7740-0000-000
3. (B) Transaction Lines

− Enter the following information for item ##item-01:
− Item: ##-Item-01
− Quantity: 1000

Chapter 7 - Page 12
4. (M) > New
5. Enter the following information for ##-Item02:
− Item: ##-Item02
− Locator: ##.1.01
− Quantity: 1000
6. (M) File > New
− Item: ##-Item03
− Revision: A
− Quantity: 1000

Chapter 7 - Page 13
8. (M) File > New
9. Enter the following information for ##Item04:
− Item: ##-Item04
− Subinventory: 00FGI
− Quantity: 1000

Chapter 7 - Page 14
10. (B) Lot/Serial
12. Enter the following lot information:
− Quantity: 500
13. (M) File > New


Chapter 7 - Page 15
− Quantity: 500
16. (B) Done

17. (M) File > New
18. Enter following information for ##Item05:
− Item: ##Item05
− Quantity: 1000
− Lot: Select an existing lot from the list of values

Chapter 7 - Page 16
19. (M) File >New
20. Enter the following information for item ##-Item06:
− Item: ##-Item06
− Quantity: 1000
21. (B) Lot/Serial
− Lot Quantity: 1000

Chapter 7 - Page 17
24. (M) File > New
25. Enter the following information for item ##-Item07:
− Item: ##-Item07
− Quantity: 500
26. (B) Lot/Serial
27. Enter a range of serial numbers.

Chapter 7 - Page 18
28. (B) Done
29. (M) File > New
− Item: ##-Item08
− Quantity: 1000
Note: Because of the defaulting rule you selected during setup, the secondary quantity
appears automatically.
31. (B) Lot/Serial
− Quantity: 500

Chapter 7 - Page 19
34. (B) Done
35. (M) File >Save
Verify the Transactions Processed

38. Navigate to the Material Transactions window.
(N) Transactions > Material Transactions
39. Verify today’s date appears in the Transactions Dates fields.

Chapter 7 - Page 20
40. (B) Find
41. What is the Source Type for item ##-Item03?

________________________________

Chapter 7 - Page 21
Subinventory Transfer
Subinventory Transfer
Some of the uses of subinventory transfers are:
• Transferring between asset and expense subinventories
• Transferring between tracked and non-tracked subinventories

Chapter 7 - Page 22
Guided Demonstration - Performing Subinventory Transfers
1. (N) > Transactions > Subinventory Transfer
2. Enter Subinventory Transfer as the Type.
4. Enter the following transfer information:
− Item: AS18947
− Quantity: 45
− To Subinventory: Stores
5. (M) File > Save

Chapter 7 - Page 23
Practice - Processing Subinventory Transfers
Overview
In this practice, you will process a subinventory transfer.
Assumptions
Tasks
Transferring Items Between Subinventories

1. Transfer ten units of ##-Item01 and ##-Item02 from the ##FGI subinventory to the ##Main
subinventory.(## represents your team number)
2. Why do you have to enter a locator for both items in the ##Main subinventory?
Verify the Transaction Processed

3. Use the Material Transaction window to verify the transaction processed.

Chapter 7 - Page 24
Solution – Processing Subinventory Transfers
Transferring Items between Subinventories

1. Navigate to the Subinventory Transfers window.
(N) Transactions >Subinventory Transfer
2. Enter Subinventory Transfer in the Type field.

4. Enter the information according to the following table:
Item Subinventory Quantity To Subinv Locator To Locator

##-Item01 ##FGI 10 ##Main N/A ##.2.01
##-Item-02 ##FGI 10 ##Main ##.1.01 ##.2.01

Chapter 7 - Page 25
Why do you have to enter a locator for both items in the ##Main subinventory? The
##Main subinventory is a Dynamic entry subinventory. All items in this subinventory are
under locator control.
5. (M) File > Save
6. (M) Close > Form
Verify the Transaction Processed

(N) Transactions > Material Transactions
8. Verify today’s date appears in the Transactions Dates fields.

Chapter 7 - Page 26
9. (B) Find
10. Verify the transaction processed.

Chapter 7 - Page 27

Chapter 7 - Page 28
Inter-Organization Direct Shipment
Inter-organization Direct Shipment

The validity of a transfer transaction depends on the controls you have defined in both the
shipping and destination organizations for the items you want to transfer. For example, you
can transfer item A from organization X to organization Y, even though item A is under lot
control only in organization X (you can specify the lot numbers for item A in organization X
during the transfer transaction). You cannot however, transfer item B from organization X to
organization Y if item B is under lot control only in organization Y (you cannot specify lot
numbers for item B in the destination organization because you are performing a direct
transfer)
For more information see Direct Inter-organization Transfers, Oracle Inventory User’s Guide
When you transfer items under dual UOM control between organization, the system honors the
UOM conversion of the destination organization. Consequently, the system could potentially
recalculate the secondary quantity for the item if the conversions differ between the shipping
organization and the destination organization. The system always processes transaction
quantities in the primary UOM. You must define UOM conversions in both the shipping and
destination organization before the system can process the transaction.

Chapter 7 - Page 29
Inter-organization Intransit Shipment
Inter-organization Intranist Shipment

You usually transfer material to intransit inventory when transportation time is significant.
When you 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, depending on the inter-organization transfer charge that applies between the
organizations, a percentage of the transaction value or a discrete amount that Oracle Inventory
uses to compute transfer charges.
If the FOB point is set to Receipt in the Shipping Networks window, the destination
organization owns the shipment when they receive it. If it is set to Shipment the destination
organization owns the shipment when the shipping organization ships it, and while it is
intransit.
While your shipment is intransit, you can update shipping information such as the freight
carrier or arrival date in the Maintain Shipments window.
At the time of shipment, you must define your receiving parameters for the destination
organization. You can receive and deliver your shipment in a single transaction or you can
receive and store your shipment at the receiving dock.
The validity of a transfer transaction depends on the controls you have defined in both the
shipping and destination organizations for the items you want to transfer. For example, you
can transfer item A from organization X to organization Y, even though item A is under lot

Chapter 7 - Page 30
control only in organization X (you can specify the lot numbers for item A in organization X
during the transfer transaction). You can also transfer item B from organization X to
organization Y if item B is under lot control only in organization Y (you can specify lot
numbers for item B in the destination organization when you perform the receiving
transaction).
When you transfer items under dual UOM control between organization, the system honors the
UOM conversion of the destination organization. Consequently, the system could potentially
recalculate the secondary quantity for the item if the conversions differ between the shipping
organization and the destination organization. The system always processes transaction
quantities in the primary UOM.You must define UOM conversions in both the shipping and
destination organization before the system can process the transaction.

Chapter 7 - Page 31
Guided Demonstration - Performing Interorganization Transfers
1. (N) Transactions > Inter-organization Transfer
Note: Verify a shipping network exists between the shipping organization and the
receiving organization.
− To Org: M2
− Type: Intransit Shipment
− Freight: DHL
− Shipment Number: 001
− Containers: 2
− Item: AS18947
− From Subinventory: FGI
− To Subinventory: Stores
− Quantity: 10
5. (M) File > Save

Chapter 7 - Page 32
Practice - Performing Interorganization Transfers
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
Transacting Items
Select an under lot or serial control to transfer from M1 Seattle Manufacturing to M2 Boston
Manufacturing using the following information:
Transact Type: Inventory Intransit shipment
Shipment Number: T##
Freight: DHL
Waybill: T##
Containers: 1
Expected Receipt date: 1 week from today.
Quantity: 1
From Subinventory: ##FGI
To Subinventory: Stores
Viewing Transactions
Use the Material Transactions window to verify the Transaction Processed

Chapter 7 - Page 33
Solution – Performing Interorganization Transfers
Transacting Items

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.

− Item: your choice
− From subinventory: ##-FGI
− To subinventory: Stores
− Quantity: 1

Chapter 7 - Page 34
4. (B) Lot / Serial
5. Select the Lot from the lot LOV. The parent lot appears automatically.
6. Enter the 10 in the Quantity field.
7. (B) Done
Viewing Transactions

Chapter 7 - Page 35
(N) Transactions > Material Transactions.
9. Enter your part number.
10. (B) Find
11. (T) Intransit

Chapter 7 - Page 36

Chapter 7 - Page 37
Managing Receipts
Managing Receipts
You can receive both internally and externally sourced shipments and deliver material directly
to inventory, the shop floor, and You can deliver to inventory, shop floor, and expense
destinations. You can also 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
Entering Receipt Information
To process receipts, you select the items to receive and enter the receipt quantities. If you
change the unit of measure, the system adjusts receipt quantity to reflect the new unit of
measure. You can override this value if you are recording a partial receipt or are receiving
more than the expected quantity.
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. For example, you assign different internal item numbers to mountain

Chapter 7 - Page 38
bikes of the same model number but different color. You have an agreement with your
mountain bike supplier that allows him to ship white bikes in place of blue bikes.
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 receive.
• You have defined substitutes for the items you receive.
When you query in the list of values for the item, the system 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, the system removes the purchase order supply for the
original item.
• If you perform a standard receipt, the system creates receiving supply for the new item.
• If you perform a direct receipt, the system increments on-hand balances for the new item.

Chapter 7 - Page 39
Express Receipts and Receiving Transactions
Express Receipts and Receiving Transactions

The express function is a quick method of entering receipts and receiving transactions. You can
use an express receipt when the physical receipt quantity equals the expected quantity. You
can:
• 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 system must be able to derive the supplier either by
specifying the supplier or a PO number.

Chapter 7 - Page 40
Direct Receipts

Chapter 7 - Page 41
Standard Receipt

Chapter 7 - Page 42
Inspection Receipt

Chapter 7 - Page 43
Guided Demonstration - Receiving Stock into Inventory
Receipts
2. (N) Transactions > Receiving > Receipts.
− Source Type: Internal
− Item: AS18947
4. Choose Find.
5. Select the Item to receive.
6. Enter the M2-Boston as the receiving Location.
7. (M) File > Save.
Receiving Stock
9. (N) Transactions > Receiving > Receiving Transactions.
− Type: Internal
− Item: AS18947
11. Choose Find.
12. Select the transaction to deliver.
13. Enter the following receiving information:
− Location: M2 Boston
− Subinventory: Stores
Verifying Receipts and Receiving Transacitons

16. (N) Transactions > Receiving > View Receiving Transactions
− Type: Internal
− Item: AS18947
18. Choose Find.
19. Select the appropriate receipt number.
20. Choose Transactions.

Chapter 7 - Page 44
Practice - Receiving Material into Inventory
Overview
In this practice you learn how to receive items into inventory.
Assumptions
• You completed the defining items practice
• You completed the interorganization transfer practice
Tasks
Receiving Inventory
Receive the item into stock that you transferred in the interorganization transfer practice.
Moving Items from Receiving into Inventory

1. 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.

Chapter 7 - Page 45
Solution – Receiving Material into Stock
Receiving Inventory

1. Change Organization to M2 Boston.
(N) Change Organization
2. Navigate to the Receiving Receipts window.
(N) Transactions > Receiving > Receipts
− Item: The item you transferred in the Interorganization practice.
3. (B) Find
4. Close the Header when it opens.
5. Select the item to receive.
6. Verify the item quantity.
7. Verify the UOM.

Chapter 7 - Page 46
8. Enter the appropriate inventory control information if necessary.
9. Enter M2 Boston in the Location column.

(M) File > Save
Moving Items from Receiving into Inventory

11. Navigate to the Receiving Transactions window.
(N) Transactions > Receiving > Receiving Transaction.
− Item: The item you transferred in the Interorganization practice.

Chapter 7 - Page 47
13. (B) Find
14. Select the Item to receive.
15. Enter M2 Boston as the Location.
16. Verify Stores is the subinventory.

Chapter 7 - Page 48
17. (B) Lot-Serial
18. Enter the lot or serial information.
19. (B) Done

(M) File > Save

Chapter 7 - Page 49
Verify the Items are in Inventory
(N) Transaction > Receiving > View Receiving Transaction
− Item: The item you transferred in the Interorganization practice
23. (B) Find

Chapter 7 - Page 50
24. (B) Transactions
Verify the receipt and delivery transactions.

Chapter 7 - Page 51
Move Orders
Move Orders
Move orders are requests for the movement of material within a single organization. They
formalize the process to request the movement of material within a warehouse or facility for
purposes like replenishment, material storage relocations, and quality handling.
Move orders are generated manually or automatically depending on the source type used.
Move orders are restricted to transactions within an organization. Transfers between
organizations require an internal requisition.
Move Order Requisitions
A manually generated request, available for subinventory and account transfers.
These requests can optionally go through a workflow based approval process before they
become move orders that are ready to be sourced and transacted.

Chapter 7 - Page 52
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.

Chapter 7 - Page 53
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.

Chapter 7 - Page 54
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.

Chapter 7 - Page 55
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 visibility and
accuracy. Move orders can also be created to cross-dock material to staging locations.

Chapter 7 - Page 56
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
(intra-organization kanbans), or by min-max planned items where the item’s replenishment
source (set at the item-subinventory level) is another subinventory. In this case, the min-max or

Chapter 7 - Page 57
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.

Chapter 7 - Page 58
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
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.

Chapter 7 - Page 59
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.
Defining Project and Task Information

Chapter 7 - Page 60
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

Chapter 7 - Page 61
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.
You can optionally use the Select Available Inventory Window to manually select material.
This window displays available inventory that meets the demand the move order requires. It
displays only material that satisfies the picking rules that are in effect, and presents the material
in order of the sort criteria on the picking rules. You can then manually select the material to
allocate against the move order, and the system creates the allocations.
You can modify or delete existing allocations, as well as create new allocations. If you choose
to create new allocations, the system checks whether the new allocation criteria drives the lot
balances negative or whether the lot is indivisible. The system honors lot-specific conversions,
process manufacturing quality matches, material status, and preferred grade if you set the

Chapter 7 - Page 62
profile option INV: Target Preferred Grade to Yes. The information that appears on this page is
available according to the picking rules you define, and sorted in the order defined on the
allocation rules.
Suggesting a Destination
The picking rules only suggest source locations. If the destination subinventory is locator-
controlled 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.
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.

Chapter 7 - Page 63
Item Allocation
Allocating Items
Reservation
A reservation is a link between a supply source and a demand source. A reservation creates a
permanent data link between a supply source and a demand source, and represents a guaranteed
allotment of material to a specified demand source.
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.

Chapter 7 - Page 64
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. 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.
For more information see Allocating Transacting Move Orders, Oracle Inventory User’s
Guide.

Chapter 7 - Page 65
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
Tasks
Create a Move Order

Create a move order for your item and move 10 pieces from the ##FGI subinventory to your
##Main subinventory using the following information:
− Number: ##-1
− Description: Team ## Move order
− Transaction Type: Move Order Transfer
− Item: ##Item08
Transact Move Order

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

Verify your transaction was processed.

Chapter 7 - Page 66
Solution – Transacting Move Orders
Create a Move Order
Create a Move Order

1. Navigate to the Move Order window.
(N) Move Orders > Move Orders
2. Define a Move Order Using the following Information:
− Number: ##-1
− Description: Team ## move order
− Transaction Type: Move Order Transfer
− Source Subinventory: ##FGI
− Item: ##-Item08
− Quantity: 10
3. (T) Destination
− Locator: ##.02.01

Chapter 7 - Page 67
4. (B) Approve
Transact Move Order

6. Navigate to the Transact Move Orders window.
• (N) Move Orders > Transact Move Orders
7. Find your move order.
• Numbers: ##-1

Chapter 7 - Page 68
8. (B) Find
9. Update your Move Order.

(B) View/Update Allocations
Verify/Update the following:
− To Subinventory: ##Main
− To Locator: ##.2.01

Chapter 7 - Page 69
− Quantity: 10
10. (B) Transact

11. (B) OK
Verify the Results

13. View the results to verify the transaction processed.
(N) Transactions >Material Transactions
14. Enter Item ##-Item08 in the Item field

Chapter 7 - Page 70
15. (B) Find


Chapter 7 - Page 71
Guided Demonstration - Defining Subinventories
2. (M) File > New
3. Enter the following subinventory information:
− Name: Raw
4. (B) Open.
5. Select Receiving as the subinventory Type.
6. (M) File > Save.
10. Select M2 Boston Manufacturing.
13. Enter Raw in the Find Field.
14. Click OK.
15. Note that subinventory Raw is not available in M2.

Chapter 7 - Page 72
Mobile Transactions
Mobile Transactions
Oracle Mobile Materials Management enables you to use mobile devices to perform receiving,
inventory, and shipping transactions. You can:
• Record inspections, deliveries, and material movements during receiving transactions.
• Create transactions for material including kanban movement, cycle counting, and
intraorganization replenishment.
• Perform pick confirm and ship confirm transactions.
• Print labels
• Inquire on item and kanban transactions
• Subinventory transfer
• Transact move order
• Inter-Organization Transfer
• Perform mover orders
• Transfer inventory between organizations
• Transfer material between subinventories
For more information see Mobile Materials Management, Oracle Mobile Supply Chain
Applications User’s Guide.

Chapter 7 - Page 73
Guided Demonstration - Mobile Application Interorganization
Transfers
1. Enter telnet esxxxx.oracle.com 7070 in the Windows 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 the responsibility, “Materials & Mfg” must be
assigned to your user name.
4. If there is more than one responsibility assigned to your user name, select Materials & Mfg
from the Responsibilities list.
5. Select Inventory from the Materials & Mfg menu.
6. Select Transfers.
7. Select Org Transfer.
8. Enter M1 as the Org code.
9. 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.

Chapter 7 - Page 74
Practice - Performing Mobile Transactions
Overview
In this lab you will transfer items from one organization to another.
Assumptions
• If you are in an education center, verify you are logged in to the launch pad.
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

Chapter 7 - Page 75
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.
3. Enter your user name and password. Note that “Materials & Mfg” responsibility must be

Chapter 7 - Page 76
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.

Chapter 7 - Page 77
6. Select Transfers from the Inventory Menu.
7. Select Org Transfer from the Transfers Menu.

Chapter 7 - Page 78
8. Enter your item to transfer using the following information: (The mobile device is case
sensitive)
− Org Code: M1
− To Org: M2
− Trx Type: Intransit Shipment
− Shipment Number: ##
− Item: Your Choice
− From Sub: ##FGI
− Quantity: 1
− To Sub: Stores

Chapter 7 - Page 79
9. Select Done.
Note: Use the down arrow to advance to Done.
10. Select Logout.

Chapter 7 - Page 80
Managing Shipments
Managing Shipments
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.

Chapter 7 - Page 81
Transactions Reports

Chapter 7 - Page 82
Transactions Reports (Cont)

Chapter 7 - Page 83

Chapter 7 - Page 84

Chapter 7 - Page 85

Chapter 7 - Page 86
Summary

Chapter 7 - Page 87

Chapter 7 - Page 88
On-hand and Availability
Chapter 8

Chapter 8 - Page 1

Chapter 8 - Page 2
R12 On-hand and Availability

Chapter 8 - Page 3
Objectives

Chapter 8 - Page 4
Overview of On-hand Quantity
Overview of On-hand Quantity

On-hand quantity is the physical quantity that resides in your subinventory. For example, the
Bulk subinventory has 15 items that reside in it. Therefore, the on-hand quantity for the Bulk
subinventory is 15.

Chapter 8 - Page 5
Overview of Reservations
Overview of Reservations
A reservation is a link between a supply source and a demand source. A reservation creates a
permanent data link between a supply source and a demand source, and represents a guaranteed
allotment of material to a specified demand source. Item reservations prevent the allocation of
material you previously set aside for a sales order, account, account alias, inventory allotment,
user-defined source, process batch components or, Oracle Complex Maintenance and Repair
Overhaul work order components. You can also create reservations for different types of
supplies such as on-hand inventory, purchase orders, internal requisitions, discrete jobs, shop
floor jobs, and process manufacturing batches. In addition, you can create reservations for
advanced shipment notices (ASNs) and material in receiving for Oracle Warehouse
Management enabled organizations.

Chapter 8 - Page 6
Overview of Availability
To Planning functions, avail = supply - demand for a particular time period

To Inventory, avail = on hand-res-pending transactions
Note
• Availability to Inventory is not the same as availability to Planning- Planning looks at
inbound supply in addition to on hand quantity and deducts other demand. Inventory only
looks at what is on hand and subtracts what is committed to other uses (i.e reserved or about
to be moved or issued out the door)
• Availability to Inventory depends on what you want to use the material for. For example, if
you have material that is in a non-reserved subinventory, that quantity will not be available to
reserve but it may be available to transact (for miscellaneous issues etc).

Chapter 8 - Page 7
Reservation Versus Allocation
Reservation Versus Allocation

For Oracle Inventory, a reservation is a guarantee of inventory. These can be made at a variety
of levels. For example, you can reserve five mountain bikes in the FGI subinventory. You can
create a reservation any time you book an order or schedule a job. Reservations do not have to
be for on-hand inventory. You can reserve purchase orders, wip jobs, process manufacturing
batches, and so on.
An allocation is a transaction suggestion generated by the allocation process (essentially a

pending pick). It honors the reservations made, if any, and the picking rules specified.
Allocations are detailed down to the subinventory, locator, and if applicable, lot level.
Allocations are the result of the pick release process. Allocations are only created against on-
hand inventory.
Both allocations and reservations deduct from available inventory but in different ways. There
are checks in place to ensure that the system does not double deduct when you have a reserved
sales order that has also been allocated but not picked.

Chapter 8 - Page 8
Material Workbench
Material Workbench
The Material Workbench enables you to view material in receiving, on-hand quantities, and
inbound material. You can also view material across organizations. In addition, you can create
and save queries, create move orders, and request cycle counts, as well as change material
statuses.
You can view item quantity across organizations. You can view only material in organizations
to which you have access. If you do not enter an organization, you must enter an item.

Chapter 8 - Page 9
Display Options
Display Options
The viewing option that you select dictates the information the Material Workbench displays.
The viewing options are:
• Location: Location information includes the subinventory and associated locators. You
can also view subinventory quantities, including packed and unpacked quantities. This is
the only view by option that you can use if the material location type is Inbound.
• Item: Item information includes the organization, item number, UOM, available quantity,
lot, and serial number. You can use this option only if the material location type is On-
hand.
• Cost Group: Cost Group information that is assigned to the item. You can use this option
only if the material location type is On-hand.
• Status: Status information that includes the statuses assigned to subinventories, locators,
lots, and serials. You can use this option only if the material location type is On-hand.
• LPN: If you are in an Oracle Warehouse Management enabled organization, you can view
LPN information for the item. You can use this option if the material location type is On-
hand, Receiving, or both.

Chapter 8 - Page 10
• Serial: Serial information lists the serial numbers that are generated for an organization
and the items that are associated with the serial numbers. You can use this option only if
the material location type is On-hand.
• Lot: The system lists the lot numbers that are generated for an organization and the items
that are associated with the lot numbers. You can use this option only if the material
location type is On-hand.
• Grade: The system lists the grade and the items that have a particular lot grade. You can
use this option only if the material location type is On-hand.

Chapter 8 - Page 11
Viewing Available Items
Viewing Available Items

You can use the Material Workbench to view item availability. The system can calculate item
availability for a given item at the subinventory, locator, lot, serial, or revision level. You can
view items that are available to reserve as well as available to transact. The system shows the
information in both the primary and secondary quantities if applicable.

Chapter 8 - Page 12
Material Workbench Transactions
Material Workbench Transactions

You can use the material workbench to perform the following transactions:
• Status Update: Enables you to change material status information.
• Cost Group Transfer: Enables you to transfer the item to another cost group.
• Grade Update: Enables you to update a lot grade.
You can use the material workbench to perform the following requests:
• Mass Move: Moves the selected items to a new subinventory.
• Mass Issue: Enables you to mass issue an item.
• Cycle Counting: Enables you to initiate a cycle count for the selected subinventory.

Chapter 8 - Page 13
Guided Demonstration - Using the Material Workbench
1. Navigate to the Material Workbench
(N) On-hand, Availability > On-hand Quantity
− Receiving: Deselected
− Inbound: Selected
− On-hand Deselected
3. (B) Find
4. Click Organizations
5. Click M1
6. Click Inbound
7. Click Purchase Order to view all incoming purchase orders.
8. Click the top purchase order to view information about the purchase.
9. (B) Availability

Chapter 8 - Page 14
Practice - Using the Material Workbench
Overview
In this practice you will use the Material Workbench to view the on-hand quantity for your an
item.
Assumptions
Tasks
Use the Material Workbench to view all On-hand Quantity in a Subinventory

1. Use the Material Workbench to view all items in your ##FGI subinventory and note the
quantities.

Chapter 8 - Page 15
Solution – Using the Material Workbench
Use the Material Workbench to view all On-hand Quantity in a Subinventory

1. Navigate to the Material workbench
(N) On-hand, Availability, On-hand Quantity
− On-hand: Selected
− View by: Location
3. (B) Find

Chapter 8 - Page 16
4. Click Organizations
5. Click M1
6. Click Onhand
7. Select Item ##-03 in the right pane.

8. (B) Availability

Chapter 8 - Page 17
9. What is the total quantity? _______________________________________
10. What is the available to reserve quantity? _____________________________
11. What is the available to transact quantity? _____________________________

Chapter 8 - Page 18
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. Available to promise process looks at existing supply and demand to determine
availability. For example, you have 100 units on hand on Monday, and 100 units of purchase
orders coming on Tuesday and new orders that you plan to release to execution for 100 units
on Wednesday. Consequently, the available to promise on Monday is 100, Tuesday is 200, and
Wednesday is 300.
Capable to promise
The capable to promise computations will try and create new supplies to compute availability.
If there is a demand for 200 units on Monday, then the system determines whether to move the
availability date to Tuesday when the Purchase orders and on-hand make it 200 units or see if
there is enough capacity and upstream materials (components) to make, procure, or transfer
100 additional units to make the availability for Monday.

Chapter 8 - Page 19
What are Supply and Demand?

Chapter 8 - Page 20
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.

Chapter 8 - Page 21
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)

Chapter 8 - Page 22
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.

Chapter 8 - Page 23
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

Chapter 8 - Page 24
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
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.

Chapter 8 - Page 25
Past-due-demand time fence = (current date) – (past-due-demand days)

Chapter 8 - Page 26
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 infinite-supply
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.

Chapter 8 - Page 27
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.

Chapter 8 - Page 28
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

Chapter 8 - Page 29
In addition to Oracle’s 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.

Chapter 8 - Page 30
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 assemble-
to-order environments.
Including User-Defined Supply as a Supply Source
In addition to Oracle’s 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.

Chapter 8 - Page 31
Setting Up Item and Bills for ATP Checking

Chapter 8 - Page 32
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.

Chapter 8 - Page 33
Guided Demonstration - Creating an ATP Rule
1. Navigate to the ATP Rules window.
(N) Setup > Rules > Available to Promise
− Name: ATP_Backward
− Description: ATP Backward consumption
− Backward Selected
− Past Due Days Demand: 10
− Infinite Supply: User-defined time fence
− Aggregate Order Promising Time Fence: User Defined
3. Select the following Demand Sources:
− Sales Orders
− Internal Orders
− Discrete WIP
− Repetitive WIP
4. Select the following Supply Sources:
− Discrete WIP
− Repetitive WIP
− Internal Reqs
− Supplier Reqa
− Purchase Orders
− On-hand Available
− Interorg Transfers
5. (M) File > Save

Chapter 8 - Page 34
Reservation Types
Reservation Types
For on-hand inventory supply, there are two types of reservations, high level reservations, and
low level reservations. High level reservations contain information about the item and the
organization. Low level reservations contain more detailed information about the item such as
revision, lot, subinventory, serial, and locator. You use the Item Reservations window to
create, view, update, transfer, and delete reservation requests.

Chapter 8 - Page 35
Supply Types

Chapter 8 - Page 36
Demand Types
User-Defined Demand
You can create your own demand types based on transaction source types. For example, you
can create a demand type for consigned material that you receive from a supplier. For more
information about creating transaction source types see Defining and Updating Transaction
Source Types, Oracle Inventory User’s Guide.

Chapter 8 - Page 37
Reserving Material
Reserving Material
You can create reservations as high-leveled or as detailed as you would like. You can reserve
material at the subinventory, locator, and if applicable lot and serial level.
You can reserve specific serial number, or reserve multiple serials. You can only enter a serial
for the supply type Inventory using the Reservations window. If you enter a serial number in
the serial column, and the item is uniquely identified in the system, then the quantity and
reserved serial quantity fields default to one, and all other applicable fields such as item, lot,
and LPN default as well. If the item is not uniquely identified, then you must enter the item
number. Once you enter the item number the rest of the information populates automatically. If
you reserve multiple serials, then the column Reserved Serial Quantity displays the amount of
serials you reserved. Though this value can differ from the quantity column, it cannot exceed
the quantity column.
Changes to Supply
If you make changes to supply sources, then the system behaves as follows for the different
supply types:
• Purchase Requisition: If you reduce the quantity of, or cancel a purchase requisition that is
reserved against a demand, then the system reduces or the cancels corresponding
reservation.

Chapter 8 - Page 38
• Purchase Order: If you reduce the quantity of, or cancel a purchase order, that is reserved
against a demand, then the system modifies or cancels the corresponding reservation. Any
other changes to the purchase order that affect the expected quantity also trigger changes
to the associated reservation. Such changes include, changing the organization, or item, or
closing the order line.
• Internal Requisition: You cannot modify an approved internal requisition. You can
however, modify the associated internal sales order. When you modify an internal sales
order, the system updates the supply data. If you modify the quantity of an internal sales
order, then the system also modifies corresponding reservations against the internal
requisition.
• Advance Shipment Notice: If you cancel a reserved ASN then the reservations engine
checks to see if a reservation against the PO existed before the system transferred it to the
ASN. If a previous reservation exists, then the system transfers the reservation back to the
PO. If a previous reservation against the PO does not exist, then the system cancels any
reservations associated with the ASN.
• Process Production Batches and Shop Floor Jobs: If you make a change to a process
production batch or a shop floor job, then the system updates the corresponding
reservations.
Changes to Demand
If you make changes such as canceling or reducing the quantity of a sales order, then Oracle
Order Management modifies corresponding reservations.
If you reserve components for a work order against inventory or a purchase order, and you
modify the demand source, then the system modifies the corresponding reservations.

Chapter 8 - Page 39
Reservation Management- Transfer Supply
Reservation Management- Transfer Supply

You can transfer the supply from an existing reservation from one supply source to another
supply source. For example, you can can transfer the reservation from one lot to another or
from on-hand inventory to a purchase order.

Chapter 8 - Page 40
Reservation Management- Transfer Demand
Reservation Management- Transfer Demand

You can transfer the demand from an existing reservation from one demand source to another
demand source. For example, you can transfer the inventory reserved from one sales order to
another (more important) sales order.

Chapter 8 - Page 41
Guided Demonstration - Creating Reservations
Responsibility: Manufacturing and Distribution Manager, Vision Operations USA
1. Navigate to the Sales Orders window.
(N) Order Management > Orders, Returns > Sales Orders
2. (T) Order Information
3. Enter the following order-header information:
− Customer: AT&T Universal Card
Note: The rest of the required information defaults automatically.
4. (T) Line Items
5. Enter the following line-item information:
− Ordered Item: AS10000
− Qty: 300
− Request Date: Greater than 30 days from today’s date
− Promise Date: Greater than 30 days from today’s date
6. (T) Shipping
7. Verify the following shipping information:
− Warehouse: M1
8. Note your sales order number and line number_____________________________
9. (B) Book Order
11. Navigate to the Reservations window.
(N) Inventory > On-hand Availability > Reservations
12. (B) New
13. (T) Demand
14. Enter the following demand information:
− Item: AS10000
− Type: Sales Order
− Header Number: Your sales order number
− Line Number: Your sales order line number
15. (M) File > Tools > Select Available Inventory
16. Enter enough quantity to satisfy the demand from multiple subinventories in the Selected
Reservation Qty field. For example, select 150 from the FGI subinventory, and 150 from
the Stores subinventory.
17. (B) Done
Note: Oracle Inventory generates a new reservation for each inventory selection you
make.
18. Enter your Header Number and Line Number information as necessary.
(M) File > Save

Chapter 8 - Page 42
Practice - Creating Reservations
Overview
In this practice, you will create a reservation for one of your items.
Assumptions
Tasks
Create a Reservation
1. Use the following information to create a reservation:
− Item: ##-Item02
− Type: Inventory
− Name: Team ## Reservation
− Need By Date: Today’s Date
− Quantity: 10

Chapter 8 - Page 43
Solution – Creating Reservations
Create a Reservation
Responsibility = Inventory, Vision Operations

1. Navigate to the Item Reservations window.
(N) On-hand, Availability > Reservations
2. (B) New
3. Enter the following Demand information:
− Item: ##-Item02
− Type: Inventory
− Need by date: Today’s date
− UOM: Ea
− Quantity: 10
4. (T) Supply
5. Enter the following Supply information:
− Type: Inventory

Chapter 8 - Page 44
6. (M) File > Save

Chapter 8 - Page 45
On-hand and Availability Reports

Chapter 8 - Page 46
Profile Options

Chapter 8 - Page 47

Chapter 8 - Page 48

Chapter 8 - Page 49
Summary

Chapter 8 - Page 50
Material Status Control
Chapter 9

Chapter 9 - Page 1

Chapter 9 - Page 2
R12 Material Status

Chapter 9 - Page 3
Objectives

Chapter 9 - Page 4
Material Status
Explaining Material Status

Material Status control restricts the movement and usage of portions of on-hand inventory.
Using material status control enables you to control whether you can pick or ship an internal
order or sales order, or issue material for a work order. You can also specify whether material
needs to be quarantined until you inspect it. In addition, you can determine whether products
with a particular status can be reserved, included in available to promise calculations, or netted
in production planning. You assign material statuses at four levels: subinventory, locator, lot,
and serial.
Item status drives the item attributes by allowing you to keep an item from being built in
Oracle Work In Process, ordered, procured etc. Material status is a granular control over each
inventory transaction that applies to specific material within your warehouse or manufacturing
facility.

Chapter 9 - Page 5
Material Status Control Levels
Material Status Control Levels

You assign subinventory and locator statuses in the subinventory and locator windows. The
location status applies to the material in the location and not the location itself. To assign a
material status to a lot or serial, you must first enable the item attributes Lot Status Enabled,
and Serial Status enabled on the item in the Item Master. You can also optionally assign a
default lot or serial status to an item on the Item Master. When you receive the item, the system
automatically assigns the default lot or serial status to the item. The lot or serial status remains
the same through all inventory transactions including organization transfers. If necessary, you
can change the material status at receipt, use the material workbench, or mobile status update
page to modify the material status. For more information about setting up lot and serial statuses
see Inventory Attribute Group, Oracle Inventory User’s Guide.
When a material status is assigned to a subinventory or locator, the material is not assigned the
material status of the subinventory or locator; rather, it takes on the behavior indicated by the
material status at the subinventory or locator level.

Chapter 9 - Page 6
Material Status Transactions
Material Status Transactions

A material status is a combination of transactions and planning actions that you choose to
disallow in a particular circumstance. Disallowed transactions and planning actions are
cumulative. When you set up transaction types, you determine whether some transactions can
be restricted by material status. The transactions for which you enable status control in the
Transactions Types window appear in the Material Status Definition window. If you do not
enable status control for a transaction type, then the transaction type is always allowed.
You can also assign the planning attributes Allow Reservations, Include in ATP, and Nettable
to the material statuses that you create. When you transact an item, the system checks all of the
material statuses. If the system finds a status that disallows the transaction, whether at the
serial, lot, locator, or subinventory level, then the transaction fails.

Chapter 9 - Page 7
Cumulative Effective Status
Cumulative Effective Status

A cumulative effective status is the combination of all disallowed transactions. Disallowed
transactions and planning actions are cumulative.
When you transact an item, the system checks all of the material statuses. If the system finds a
status that disallows the transaction, whether at the serial, lot, locator, or subinventory level,
then the transaction fails.
For example, if you have a locator whose status disallows WIP Issue and that locator is in a
subinventory whose status disallows Sales Order Issue, neither of those transactions will be
allowed for material that is in the locator.

Chapter 9 - Page 8
Material Status Examples
Material Status Examples

This example describes four typical material statuses and the actions to allow or disallow:
• Active - This is a typical default for your warehouse. It does not disallow any transaction
types.
• Hold - You might use this status for material that needs to be inspected or whose quality
is suspect. You could not perform certain transactions for material in this status until you
change it to a different status.
• Immature - This status is useful for material that needs to age in the warehouse before
being picked or shipped for a sales order. You may want to allow internal orders to move
the material around your distribution chain, but picking and shipping this material for
orders to customers should be prevented.
• Almost Mature - This material has a very short aging process, or is nearly mature. By
assigning material this particular status, you enable that material to be picked and staged,
but prevent the material from being shipped. As soon as material is completely matured,
it can be assigned a status of Active and shipped immediately.

Chapter 9 - Page 9
Setting Up

Chapter 9 - Page 10
Defining Item Material Status Control
Defining Item Material Status Control

When you define a material status, you can select the Lot or Serial check boxes so the system
can assign a default material status to a serial or lot controlled item at receipt. The receiving
operator can accept the default status that the system suggests, or he or she can assign another
status. You determine the default material status during item definition. Assigning a material
status to an item under lot or serial control is optional.
Any material status defined and enabled for lots can be set as the default material status of a
lot, and similarly, any material status defined and enabled for serials can be set as the default
material status of a serial number. The system uses the default material statuses to determine
which material status should appear on the receipt.

Chapter 9 - Page 11
Assigning Material Status Control to Subinventories and Locators
Assigning Material Status Control to Subinventories and Locators

When you define material statuses, you can select the Subinventory and the Locator check
boxes so you can assign material statuses to subinventories and locators when you define
them.
Subinventories are assigned a material status in the Subinventories window. You also assign a
default locator status for all locators within the subinventory. This default locator status is
used in two situations:
1. When locator control is set to prespecified (all locators in the subinventory must be
defined before they can be used), the default status is used to default the locator status.
However, this status can be changed for each locator as it is defined.
2. When locator control is set to dynamic (locators need not be defined in advance, but will
be created on the fly as users define new locators), the default locator status will be used
for these newly defined locators.

Chapter 9 - Page 12
Assigning Planning Statuses
Assigning Planning Statuses

When you define material statuses, you can choose to enable reservations, ATP, and nettable
control. If you choose to enable reservations for the material status, then you can view
material associated with this status in the Item Reservations window. You can create a
reservation against the material, and the system includes it in the available to reserve
calculations. For more information see Item Reservations, Oracle Inventory User’s Guide.
If you choose to enable ATP for the material status, then the system includes material assigned
to this status in ATP calculations.
If you choose to Nettable, then the MRP planning process considers the requirements of the job
or schedule in its netting calculations.
Note: You cannot apply a status that is non-reservable, non-nettable, or non-ATPable to
serials.

Chapter 9 - Page 13
Disabling Material Statuses
Disabling Material Statuses

You can disable material statuses you no longer use. If a material material status is assigned to
any lot, serial, subinventory, or locator, then you cannot disable it. You can use the Material
Workbench query, all entities with a particular material status, and then update the material
status of those entities. You can disable the material status once you reassign all of the entities
to different material statuses.

Chapter 9 - Page 14
Practice - Setting up Material Status Control
Overview
In this practice you learn how to set up and use material status control.
Assumptions
Tasks
Verify Transaction Type

1. Verify the following Subinventory Transfer Transaction type is set for status control.
Define a Material Status

2. Define a material status to be used only for subinventories that disallows subinventory
transfers. Use the following naming convention for your material status. Team ## Material
Status, where ## represents your team number.
Assign a Material Status

3. Assign your material status to your low value subinventory. (##LV).
Perform a Transaction with Your Material Status

4. Use the following information to perform a miscellaneous receipt:
− Item: ##-Item01
− Subinventory: ##LV
− Quantity: 15
− Account: 01-580-7740-0000-000
5. Attempt to perform a subinventory transfer for material in your ##LV subinventory.
Can you perform the subinventory transfer? _________________________________

Chapter 9 - Page 15
Solution – Setting up Material Status Control
Verify Transaction Type
Responsibility = Inventory, Vision Operations

1. Navigate to the Transaction Types window.
(N) Setup > Transactions > Types
2. (T) System
3. Verify Status Control is selected for the Subinventory Transfer transaction type.
Define a Material Status

5. Navigate to the Material Status window.
(N) Setup > Transactions > Material Status
− Name: Team ## Material Status
− Description: Team ## disallow subinventory transfers
− Usage: Subinventory
7. Select transfer material between subinventories from the Allowed Transactions list.
8. (B) >(A)

Chapter 9 - Page 16
(M) File > Save
Assign a Material Status

Navigate to the Subinventories Summary window.
9. Select your ##LV Subinventory.

Chapter 9 - Page 17
10. (B) Open
11. Select your material status from the Status list of value.
12. (B) Ok

Chapter 9 - Page 18
13. (M) File > Save
Perform a Transaction with Your Material Status

16. Navigate to the Miscellaneous Transactions window.
(N) Transactions > Miscellaneous Transaction
− Type: Miscellaneous Receipt
− Account: 01-580-7740-0000-000

Chapter 9 - Page 19
− Item: ##-Item01
− Quantity: 15

Chapter 9 - Page 20
20. (M) File > Save
23. Navigate to the Subinventory Transfers window.
(N) Transactions > Subinventory Transfer
− Type: Subinventory Transfer

− Item: ##-Item01

Chapter 9 - Page 21
Can you perform subinventory transfer? No, ##LV is missing from the list of
subinventories.
Why is ##LV missing from the list of Subinventories? ____________________
27. (B) Cancel
28. (M) Edit > Clear > Record

Chapter 9 - Page 22
Material Status Reports

Chapter 9 - Page 23
Profile Option

Chapter 9 - Page 24

Chapter 9 - Page 25
Summary

Chapter 9 - Page 26
Inventory Replenishment
Chapter 10
Chapter 10 - Page 1
Chapter 10 - Page 2
R12 Replenishment Fundamentals
Chapter 10 - Page 3
Objectives
Chapter 10 - Page 4
Overview of Inventory Planning

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.
Chapter 10 - Page 5
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.
Chapter 10 - Page 6
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.
Chapter 10 - Page 7
Replenishment Process for Intra-Org Supply Sources
Chapter 10 - Page 8
Replenishment Process for Supplier Supply Sources
Chapter 10 - Page 9
Replenishment Process for Inter-Org Supply Sources
Chapter 10 - Page 10
Replenishment Process for Product Supply Sources
Replenishment Methods
Overview of Inventory Forecasting
Overview of Inventory Forecasting

A forecast is an estimate of future demand on inventory items. A forecast contains information
on the original and current forecast quantities (before and after consumption), the confidence
factor, and any specific customer information. You can assign any number of inventory items
to the forecast and use the same item in multiple forecasts. For each inventory item, you can
specify any number of forecast entries.
Oracle Inventory generates forecasts based on historical transaction activity. 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. If you
do not have Oracle Planning installed, you can create forecasts only for reorder point demand
planning. If you have only Oracle Inventory, forecasts are used for the entry of the annual
demand for reorder point.
Forecast Sets
Forecast sets consist of one or more forecasts. Sets group complimenting forecasts into a
meaningful whole. For example, a forecast set could contain separate forecasts by region.
Forecast Rule
Forecast rules define the bucket type, forecast method, and the sources of demand.
Note: You can manually create forecasts using Oracle Inventory or Oracle MRP. There are no
constraints for manually created forecasts. Manually created forecasts can be based on
transaction activity other than historical data. For more information see Defining a Forecast
Rule and Generate a Forecast, Oracle Inventory User’s Guide.
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 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.
Forecast Setup and Maintenance
Guided Demonstration - Creating a Manual Forecast
Creating a Forecast Set

1. (N) Planning > Forecasts > Sets
2. Enter the following the information to create a forecast set:
− Forecast Set: FG Set
− Description: Finished Goods forecast set
− Bucket Type: Weeks
− Level: Item
− Forecast: FGI
− Description: Finished Goods forecast
3. (M) File > Save.
Setting Up Forecast Entries

5. (N) Planning > Forecasts > Entries
6. (M) View > Find
7. Select the FG Set forecast set.
8. Enter the following forecast entry information
− Item: AS54888
− Bucket: Weeks
− Date: Today’s 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
9. (M) File > Save.
Viewing Forecast Quantities

11. (N) Planning > Forecasts > View Entries
13. Select the FG Set Forecast set.
14. Choose Bucketed
Oracle Inventory Replenishment Methods
Oracle Inventory Replenishment Methods

You can use Oracle Inventory to 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 Overview Inventory of Planning and Replenishment, Oracle
Replenishment Methods Levels
Oracle Inventory Replenishment Methods (continued)

Based on the replenishment method 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 replenishment is performed at the locator level. Also Periodic Automatic
Replenishment (PAR) which is a type of Replenishment Counting is also done at the locator
level.
Safety Stock
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.
Overview of Reorder-Point Planning
Reorder-Point Planning Overview

You can use reorder-point planning to 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 on-hand 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 orders at 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
system calculates the reorder-point 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. You should use reorder point
planning only if demand and leads times are stable.
For more information see Reorder Point Planning, Oracle Inventory User’s Guide.
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.
Reorder-Point Planning Steps
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.
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.
Guided Demonstration - Setting up Reorder Point Planning
Setting up Reorder Point Planning for an Item

(N) Items > Organization Items.
2. Enter item AS18947 in the Item field.
3. (B) Find.
4. (T) General Planning.
5. Change the Inventory Planning Method to Reorder Point.
6. Change the Minimum Order Quantity to 35.
7. Change the Order Cost to 45.
8. Change the Carrying Cost % to 12.
9. (T) Lead Times.
10. Change the Processing lead time to 5.
Running the Reorder Point Planning Report

13. Navigate to the Reorder Point Planning window.
(N) > Planning > Reorder Point Planning.
14. Select Items under reorder point as the Item Selection.
15. Enter Demand and Supply cut off dates.
16. Select FG Set from the list of values.
17. Submit your request.
Viewing the Reorder Point Planning Report

18. (N) Requests.
19. Find your request.
20. Choose View Output.
21. (M) File > Close.
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 Min-Max Planning, Oracle Inventory User’s Guide.
Uses of Min-Max Planning
Min-Max Planning
Min-Max Planning
Recall that Min-max planning is a method of that determines 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 intransit
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.
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
Min-Max Planning Steps
Item Planning Attributes
Min-Max Planning Setup Procedure
Selecting a Planning Level
Entering Planning Attributes
Entering Item Planning Attributes

After you select a planning level enter the appropriate planning attributes.
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 min-
max 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
Oracle Inventory enables you to use on-hand quantities that exist in either nettable or non-
nettable 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
Guided Demonstration - Setting up Min-Max Planning
Setting Up Min-max Planning for an Item

(N) Items > Organization Items.
2. Find Item AS18947
3. (T) General Planning
4. Change the Inventory Planning Method to Min-Max.
5. (M) File > Save.
6. (M) Tools > Item Subinventories.
7. (M) File > New
8. Enter FGI as the subinventory.
9. Select the Min-Max Planning Check box.
10. Enter 300 as the Minimum Qty.
11. Enter 900 as the Maximum Qty.
Running the Min-max Planning Report

14. Navigate to the Min-Max Planning window.
(N) Planning > Min-Max Planning
15. Enter the following planning information.
− Planning Level: Subinventory
− Item Selection: All min-max planned items
16. (B) OK
17. (B) Submit
18. (B) No
Viewing the Min-Max Planning Report

19. (N) Requests.
20. Find your request.
21. Choose View Output.
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.
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
View the Min-Max Planning Report

View your min-max planning report.
Solution – Performing Min-max Planning
Enable Min-Max Planning for Item

1. Navigate to the Organization Items window and find your ##-Item03 item.
(N) Items > Organization Items
2. Find your ##-Item03 item.
3. (T) General Planning
− Inventory planning Method: Min-Max
4. (M) File > Save

5. (M) Tools > Item Subinventories
6. Enter the minimum and maximum quantities for the item/subinventory combination as
follows:
− Name: ##FGI
− Minimum Quantity: 300
− Maximum Quantity: 900
(M) File > Save
Request a Min-Max Planning Report

8. Navigate to the Min-Max Planning window.
(N) Planning > Min-Max Planning
9. Enter the following information in the Parameters window:
− Planning Level: Subinventory
− Subinventory: ##-FGI
− Demand Cuttoff Date: 1 month from today
− Supply Cuttoff Date 1 month from today
10. (B) OK.
11. (B) Submit.
12. (B) No.
View the Min-Max Planning Report
13. (N) Requests
14. Select My Completed Requests
15. Select Find.
16. Select your request.
17. (B) View Output.
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 Min-
Max 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 Overview of Replenishment Counting, Oracle Inventory User’s
Guide.
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.
Replenishment Planning Steps
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 item-
subinventory 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
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.
Subinventories Window
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.
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.
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.
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 min-
max 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
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.
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 item’s 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.
Inventory Responsibility (N) Counting > Replenishment Counts > Purge.
Mobile Replenishment Count Overview
Mobile Device Replenishment Count

Oracle Mobile Materials Management provides windows to perform mobile replenishments.
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 completed the practice on creating subinventories.
• You completed the practice on defining items.
• The quantity of ##-Item02 in your ##FGI subinventory is at least 100.
Tasks
Define Item-Subinventory Relationship and Sourcing Information

Define item-subinventory relationship and sourcing information for the following:
− Item: ##-Item02
− Min-Max Planning: Yes
− Minimum Quantity: 10
− Maximum Quantity: 50
Also define sourcing information in such a way that ##-Item02 for ##Main is replenished from
the subinventory ##FGI.
Enter Replenishment Count Header Information

Create a replenishment count header for forms using the following information:
− Name: ##RC1
Enter Replenishment Count Using Forms

Enter the replenishment count for ##RC1 using the following information:
− Item: ##-Item02
− Count Type: On-hand 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?
Solution - Performing a Replenishment Count Using Forms
Define Item-Subinventory Relationship and Sourcing Information

1. Verify the on-hand quantity of ##-Item02 in your ##FGI subinventory.
• (N) On-hand, Availability > On-hand Quantity
− Item / Revision: ##-Item02
2. (B) Find
3. Navigate to the Subinventories window.
4. Select the ##LV subinventory from the list.
5. (B) Item/Subinventory
6. 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
7. (M) File > Save

8. Navigate to the Replenishment Count Headers window.
(N) Counting > Replenishment Counts > Counts
9. (B) New
10. Create a new replenishment count header using the following information:
− Name: ##RC1
− Count Using Mobile: No
Enter Replenishment Count Using Forms
11. (B) Default Items
− Count Type: Onhand Quantity
− Quantity: 5
13. (M) File > Save
Process the Count Information Using Forms

14. Return to the Replenishment Count Headers window.
15. (B) Process and Report
16. (B) Ok
17. View the details of the Replenishment Count Report by querying for the request number in
the Requests window
Note: Because ##-Item02 is sourced from another subinventory, Oracle Inventory
automatically creates a move order after you process the count. To complete this
transaction you must transact this move order using the Transact Move Orders window.
18. What is the reorder quantity for ##RC1? The reorder quantity is 45 (maximum quantity –
on-hand quantity).
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 completed the practice on performing a replenishment count using forms.
• If you are in an education center, verify you are logged in to the launch pad.
Tasks

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:
− Replenishment Count: ##RC2
− Item: ##-Item02
− Order Quantity: 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?
Solution - Performing a Replenishment Count Using the Mobile
Application

1. Navigate to the Replenishment Count Headers window.
(N) Counting > Replenishment Counts > Counts
2. (B) New
3. Create a new replenishment count header using the following information:
− Name: ##RC2
− Count Using Mobile: Yes
Enter Replenishment Count Lines

4. (B) Default Items.
− Count Type: Order Quantity
6. (M) File > Save
Enter Replenishment Count Using the Mobile Application

instance number.
9. Select <Default> from the Device List.
10. Enter your user name and password. Note that Materials & Mfg responsibility must be
11. Select <Materials & Mfg>
12. Select <Inventory> from the Materials & Mfg Menu.
13. Select <Counting> from the Inventory menu.
14. Select <Repl Count> from the Counting menu.
15. Enter the following information when prompted.

Note: The mobile application screen is case sensitive.
− Replenishment Count Name: ##RC2
16. Select <Count> to enter the order quantity.
17. Enter ##-Item02 in the Item field.
18. Enter 30 in the Order Qty field.
19. Select <Save/Next>
20. Press Ctrl+B to view the Message Page.
Process the Count Information Using the Mobile Application

21. Select <Process and Report>
22. 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.
23. Select Logout to exit the mobile application.
24. 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.
Overview of PAR Counting
Periodic Automatic Replenishment (PAR) Counting

PAR counting is replenishment counting done at the locator level in a subinventory.
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.
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.
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.
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 color-
code 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
For more information see: (Help) Oracle Inventory > Inventory Planning and Replenishment >
Overview of Kanban Replenishment.
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.
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 supplier-
source-type kanban triggers a purchase request to the supplier, while an inter-org- source-type
kanban results in an inter-organization transfer.
Navigation Path
Inventory Responsibility(N) Kanban > Pull Sequences > (T) Source.
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
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.
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.
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.
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.
Guided Demonstration - Performing Kanban Replenishment
Create Kanban Pull Sequence

1. (N) Kanban > Pull Sequences.
2. (B) New.
3. Enter the following information to create the pull sequence.
− Item: AS54888
− Source Type: Supplier
− Supplier: Advanced Network Devices
− Supplier Site: Santa Clara
4. (T) Kanban
− Calculate: Number of Cards
− Size: 10
− Number of Cards: 10
− Minimum Order Qty: 20
5. (M) File > Save
6. (B) Generate Cards
7. (B) Yes
8. (B) Cards
9. Select the first card.
10. (B) Replenish
11. Select the second card.
12. (B) Replenish
13. (N) File > Save
14. (N) File > Close Form.
Practice - Performing Kanban Replenishment
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 must have access to an Oracle Application Vision database or comparable training
Tasks
Setting up a Kanban Pull Sequence

Set up a Kanban pull sequence using the following information:
− Item ##-Item01
− 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.
Solution – Performing Kanban Replenishment
Setting up a Kanban Pull Sequence

1. Navigate to the Pull Sequences window.
(N) Kanban > Pull Sequences > (B) New.
2. Use the following information to define a new pull sequence:
− Item: ##-Item03
(T) Kanban
− Size: 10
− Number of Cards: 10
− Minimum Order Quantity: 20
3. (M) File > Save
Generate Kanban Cards

4. (B) Generate Cards
5. Yes to print Kanban cards.
6. Verify your Kanban cards printed.
(M) View > Requests
Select All My Requests
(B) Find
Replenish Kanban Cards

7. Navigate to the Kanban Cards Summary window.
(B) Cards or (N) Kanban > Kanban Cards.
8. Replenish Kanban cards.
Select the first Kanban card in the list.
(B) Replenish.
Verify the supply status changed to Wait.
Select the second Kanban card in the list.
(B) Replenish.
Verify the supply status is Empty.
9. (N) File > Save.
10. (N) File > Close Form.
Planning and Replenishment Reports
Planning and Replenishment Reports (Cont)
Profile Options
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).
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.
• 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.
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
Summary
Inventory Accuracy
Chapter 11
Inventory Accuracy
Chapter 11 - Page 1
Inventory Accuracy
Chapter 11 - Page 2
R12 Inventory Accuracy Fundamentals
Inventory Accuracy
Chapter 11 - Page 3
Objectives
Inventory Accuracy
Chapter 11 - Page 4
Overview of Inventory Accuracy
Inventory Accuracy
Chapter 11 - Page 5
ABC Analysis Overview
ABC Analysis
An ABC analysis determines the relative value of a group of inventory items based on criteria
you define. ABC refers to the rankings you assign your items as a result of this analysis, where
A items are ranked higher than B items, and so on.
You use the ABC analysis you compile to drive cycle counts. You count items of high value
(A items) very frequently, items of lower (B items) value less frequently, and items of lowest
(C items) value very infrequently.
Inventory Accuracy
Chapter 11 - Page 6
Defining an ABC Analysis
Inventory Accuracy
Chapter 11 - Page 7
Define and Run an ABC Compilation
Define and Run an 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.
Inventory Accuracy
Chapter 11 - Page 8
ABC Compilation Criteria
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.
Historical Usage Value
Inventory Accuracy
Chapter 11 - Page 9
• 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.
Inventory Accuracy
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.
Inventory Accuracy
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.
Inventory Accuracy
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.
Inventory Accuracy
ABC Item Assignments
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.
Inventory Accuracy
% 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.
Inventory Accuracy
Guided Demonstration - Compiling an ABC Analysis
Creating an ABC Compile

1. (N) ABC Codes > ABC Compiles
2. (B) New
3. Enter Finished Goods in the Compile Name field.
4. Enter Finished Goods Analysis in the Description field.
5. Select Subinventory as the Content Scope.
6. Select Subinventory as the Valuation Scope.
7. Select the FGI subinventory.
8. Select Current on hand quantity as the compile criterion.
9. Verify Frozen is the Cost Type.
10. (B) Compile
11. (B) OK
Note: Note the concurrent request number.
12. (B) Yes
13. (B) OK
Note: Note the concurrent request number.
Creating ABC Classes

15. (N) ABC Codes > ABC Classes
16. (M) File > New
17. Create three ABC Classes using the following information.
− Class Name: Finished Goods A
− Description: Finished Goods Class A
− Class Name: Finished Goods B

− Description: Finished Goods Class B
− Class Name: Finished Goods C

− Description: Finished Goods Class C
18. (M) File > Save
ABC Assignment Groups

20. (N) ABC Codes > ABC Assignment Groups
21. (M) File > New
22. Enter Finished Goods ABC as the Group Name.
23. Enter Finished Goods as the compile name.
24. (B) Group Classes
Inventory Accuracy
25. Choose the following ABC Classes.
− Finished Goods A
− Finished Goods B
− Finished Goods C
26. (M) File > Save
27. (B) Assign Items
28. Enter the following values in the % Items fields:
− A items: 50%
− B items 80%
− C items populates automatically
29. (M) File > Save and Proceed
Note: Note the Concurrent request number.
Inventory Accuracy
Practice - Compiling an ABC Analysis
Overview
In this practice you will compile an ABC analysis.
Assumptions
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 Compile for Team ##FGI
− Content and Valuation Scope: Subinventory
− 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: ##Class B
− Description: B items
− Name: ##Class C
− Description: C items
Define an ABC Group

3. Define an ABC group using the following information
− Group Name: ##ABC Group
− Compile Name: ##FGI-ABC
Inventory Accuracy
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.
Inventory Accuracy
Solution – Compiling an ABC Analysis
Compile an ABC Analysis

1. Navigate to the ABC Compile window.
(N) ABC Codes > ABC Compiles
(M) File > New
2. Compile an ABC Analysis using the following information:
− Name: ##FGI-ABC
− Description: ABC Compile for Team ##FGI
− Content and Valuation Scope: Subinventory
− Criterion: Current on hand quantity
− Cost Type: Frozen
(B) Compile
(B) OK
Note your report request number. ___________________
(B) Yes
(B) OK
Note your request number. _________________
Inventory Accuracy
Define ABC Classes
4. Navigate to the ABC Classes window.
(N) ABC Codes > ABC Classes
(M) File > New
5. Define three ABC Classes using the following naming conventions:
− Name: ##Class A
− Description: A items
− Name: ##Class B
− Description: B items
− Name: ##Class C
− Description: C items

(M) File > Save.
(M) File > Close Form.
Define an ABC Group

7. Navigate to the ABC Assignment Groups window.
(N) ABC Codes > ABC Assignment Groups.
(M) File > New
8. 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.
Inventory Accuracy
(B) Group Classes
Define an ABC Sequence

9. Define an ABC Sequence using the classes you created earlier.
Class Name
− ##Class A
− ##Class B
− ##Class C
10. Save your work.

(M) File > Save
Assign Item Valuation

11. (B) Assign Items.
Inventory Accuracy
12. Enter the following percentages in the % Items field:
− ##Class A: 50
− ##Class B: 80
− ##Class C: (system calculates)
13. (B) Assign

14. (B) OK
Update ABC Codes

15. Review and update the ABC codes assigned to items in the ##FGI subinventory.
Select ##ABC Group in the ABC Assignment Groups window.
(B) Update Items
Inventory Accuracy
Change one item from ##Class C to ##Class A.
Change one item from ##Class B to ##Class C.
(M) File > Save
Inventory Accuracy
Cycle Counting Overview
Cycle Counting
Cycle counting is the periodic counting of individual items throughout the course of the year to
ensure the accuracy of inventory quantities and values. Accurate system on-hand quantities are
essential for managing supply and demand, maintaining high service levels, and planning
production. 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.
Inventory Accuracy
Defining and Maintaining a Cycle Count
Inventory Accuracy
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 system on-hand quantity do not agree, the
cycle count is compared to an approval tolerance.
Inventory Accuracy
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
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 item’s cycle count class.
If you do not have any defined for the class, it uses the tolerances at the cycle count header
Inventory Accuracy
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 item’s 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.
Inventory Accuracy
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 item’s 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.
Inventory Accuracy
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.
Inventory Accuracy
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.
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
Inventory Accuracy
or to simply add items as they are defined in the system rather than recompiling your ABC
group and doing a complete reinitialization.
Inventory Accuracy
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.
Inventory Accuracy
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.
Inventory Accuracy
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:
• 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.
Inventory Accuracy
• 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.
Inventory Accuracy
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. If the item is under dual unit
of measure control the system automatically supplies the secondary unit of measure and
secondary quantity.
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.
Inventory Accuracy
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.
Inventory Accuracy
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.
Inventory Accuracy
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.
Inventory Accuracy
Approving Cycle Counts and Adjustments
Approving Cycle Counts and Adjustments

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 or 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 primary and secondary system quantity, primary and
secondary adjustment UOM, primary and secondary adjustment quantity, adjustment
value, and adjustment percent.
Inventory Accuracy
• Item Location: View information for subinventory and locator. You can also view the
primary and secondary adjustment UOM, primary and secondary adjustment quantity,
adjustment value, and adjustment percent.
• 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 primary and secondary adjustment UOM, primary and secondary
adjustment quantity, adjustment value, and adjustment percent.
• Count: View information for primary and secondary UOM, primary and secondary 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.
Inventory Accuracy
Guided Demonstration - Performing a Cycle Count
1. (N) Counting > Cycle Counting > Cycle Counts
2. (B) New
3. 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: Selected
− Display System Qty: Selected
4. Select Specific in the Count Subinventories alternative region.
5. Select the FGI subinventory from list of values.
6. (T) Serial and Schedule
7. Enter the following Serial and Schedule information:
− Auto Schedule: Yes
− Frequency: By period
8. (T) Adjustments and ABC
9. Enter the following approval tolerances:
− Qty Variance: 3
− Adjustment Value: 50
− Hit / Miss Analysis: 10
10. Enter the following ABC Information:
− Group: Finished Goods ABC
− Option: (Re)initialize
11. (B) Classes.
12. Enter the following ABC Class information:
− Class: Finished Goods A
− Count: 150
− Class: Finished Goods B
− Count: 100
− Class: Finished Goods C
− Count: 50
13. (M) File Save.
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
Inventory Accuracy
− Cycle count listing.
16. (B) Submit.
Entering Cycle Count Entries Using a Mobile Device

instance number.
19. Select <Default> from the Device List.
20. Enter your user name and password. Note that Materials & Mfg responsibility must be
21. Select <Materials & Mfg>
22. Select <Inventory>
23. Select <Counting>
24. Select <Cycle Count>
25. Select <Normal>
26. Enter the following cycle count information:
− Org Code: M1
− Cycle count name: FGI Cycle Count
− Item: AS18947
− Quantity: Enter a number plus or minus the system quantity.
27. Select <Done>
Cycle Count Entries and Approvals

28. (N) Counting > Cycle Counting > Cycle Count Entries
29. Enter FGI Cycle Count in the Cycle Count field.
30. Choose find.
31. 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.
32. (T) Adjustments.
33. Enter the count quantities.
36. (N) Counting > Cycle Counting > Approve Counts
37. Enter FGI Cycle Count in the Cycle Count field.
38. (B) Find.
39. At the question: “Query count pending approval only?” choose Yes to view all that require
approval.
Note: Notice the item quantity entered in the mobile counting demonstration appears in
the Count tabbed region.
Inventory Accuracy
40. Choose Approved to approve an item adjustment.
41. Select the Approver from the drop down list in the Approval tabbed region.
42. (M) File Save.
43. (B) OK.
44. Close the Approvals window.
45. Approve or reject the remaining items.
Inventory Accuracy
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 completed the Compile an ABC Analysis practice.
• You completed the Define Items practice.
• You have at least 20 items in your ##FGI subinventory
Tasks
Define a Cycle Count Header

Define a cycle count header using the following information:
− Name: ##Cycle Count
− Description Team ##Cycle Count
− Late Days: 1
− Starting Sequence: ##
− Unscheduled entries Yes
− Display System qty: Yes
− Count Subinventories: Specific
− Frequency: By Period
− Approval Required: If out of Tolerance
− QTY 3%
− Adjust Value: 50
− Hit/Miss: 10%
− Group: ##ABC Group
− Class A: 150 counts per year
− Class B: 100 counts per year
− Class C: 50 counts per year
Perform a Cycle Count

Use the following parameters to perform a cycle count:
Inventory Accuracy
− Name: Generate Automatic Schedule
− Cycle Name: ##Cycle Count
− Name: Generate Cycle Count Requests

− Name: Cycle Count Listing

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.
Inventory Accuracy
Solution – Performing a Cycle Count
Define a Cycle Count Header
Responsibilit: Inventory, Vision Operations USA

1. Navigate to the Cycle Counts Window.
(N) Counting > Cycle Counting > Cycle Counts
2. (B) New
3. Enter a new cycle count header using the following information:
(T) Scope and Control
− Name: ##Cycle Count
− Description Team ##Cycle Count
− Late Days: 1
− Starting Sequence: ##
− Unscheduled entries Yes
− Display System qty: Yes
− Count Subinventories: Specific
Inventory Accuracy
(T) Serial and Schedule
− Count: Not Allowed
− Frequency: By Period
(T) Adjustments and ABC

− Approval Required: If out of Tolerance
− QTY 3%
− Adjust Value: 50
− Hit/Miss: 10%
− Group: ##ABC Group
Inventory Accuracy
(B) Classes
− ##Class A: 150 counts per year
− ##Class B: 100 counts per year
− ##Class C: 50 counts per year
Inventory Accuracy
4. (M) File > Save
5. (B) OK
Perform a Cycle Count

6. (M) Tools > Perform Full Cycle Count
Inventory Accuracy
7. Enter the following parameters. After entering each power click OK.
− Generate automatic schedule (Parameters field): ##Cycle Count
− Generate cycle count requests (Parameters field): ##Cycle Count
− Cycle Count Listing (Parameters field): ##Cycle Count
Inventory Accuracy
8. (B) Submit
9. (B) OK
10. (M) File >Close >Form
11. (M) File >Close Form
Note: Do not proceed until after your concurrent request completes.
Enter Cycle Count Entries

12. Navigate to the Cycle Count Entries window.
(N) Counting > Cycle Counting > Cycle Count Entries
Inventory Accuracy
13. Enter ##Cycle Count in the Cycle Count name field, or select your cycle count from the list
of values.
14. (B) Find
15. (B) Yes
16. (T) Adjustments

17. 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.
Inventory Accuracy
(M) File > Save
Approve, Reject or Recount Cycle Count

19. Navigate to the cycle count approvals window.
(N) Counting > Cycle Counting > Approve Counts
20. Select your cycle count from the LOVs in the Cycle Count field.
21. (B) Find
22. (B) No
Inventory Accuracy
23. Why are some of the items already approved? They fall within set approval limits.
24. Approve, reject or recount your items.
(M) File > Save
(B) OK
Inventory Accuracy
Mobile Inventory Accuracy Overview
Mobile Device Inventory Accuracy

Oracle Mobile Materials Management provides windows to perform cycle counting and
complete physical inventory functions.
Inventory Accuracy
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.
Tasks
Entering Item Quantities Using the Mobile.

Enter cycle count quantities for an item.
Inventory Accuracy
Solution – Mobile Counting
Entering Item Quantities Using the Mobile

instance number.
3. Enter your user name and password. Note that “Materials & Mfg” responsibility must be
Inventory Accuracy
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.
Inventory Accuracy
6. Select Counting from the Inventory Menu.
7. Select Cycle Count from the Counting Menu.
Inventory Accuracy
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
Inventory Accuracy
10. Select Done to apply your cycle count.
11. Select Logout to exit the Mobile.
Inventory Accuracy
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.
Inventory Accuracy
Why Perform Physical Inventories?
Inventory Accuracy
Defining Physical Inventories
Defining Physical Inventories

You can define and maintain an unlimited number of physical inventories in Oracle Inventory.
A physical inventory is identified by a unique name you assign. You use this name to identify
any activity, such as adjustments, pertaining to this physical inventory.
You can define multiple physical inventories to count selected portions of your inventory, or
you can count the total inventory for you organization. For example, if your warehouse has
two large stockrooms, each represented by a subinventory, you can define two physical
inventories, one for each subinventory. You can then perform your physical inventory of the
first stockroom, independent of the second.
Inventory Accuracy
Physical Inventory Tags
Physical Inventory Tags

You use physical inventory tags to record the physical counts of inventory items. Physical
inventory tags represent actual hard copy tags that some companies use to count inventory
items. A tag contains the count for a group of a given item. Although you can record only one
item on a tag, multiple tags can reference the same item, with each tag referring to a unique
physical location for an item
Oracle Inventory can generate default or blank tags for your physical inventory. If you choose
to generate default tags for each item, specify the starting tag number and the increment by
which you want to increase each digit in the tag number. Your tag numbers may be
alphanumeric, but you can increment only the numeric portion. The alphabetic characters in
the tag number stay constant. Inventory then uses these tag numbers to generate a tag for every
unique combination of item number, revision, subinventory, locator, lot, and serial number for
which the system has an on-hand quantity not equal to zero.
If you want to have some empty tags handy to record counts for stock-keeping units for which
Inventory has no on-hand quantity (and therefore does not generate default tags), you can
generate blank tags. Inventory assigns tag numbers to blank tags, but does not include any
item or location detail. You specify this information when you enter your tag counts. You can
generate as many blank tags as you want.
Inventory Accuracy
You can also exclusively use blank tags to perform a physical inventory. If you need to
perform a complete wall-to-wall physical inventory, you can go through your warehouse and
attach blank tags to every item and/or location you see. As you perform the count, you record
the item and stock-keeping unit information along with the actual on-hand quantity.
Inventory Accuracy
Inventory Snapshots
Inventory Snapshots
Before you can generate tags for a physical inventory, you must take a snapshot of all system
on-hand quantities for your items. The snapshot saves all current item on-hand quantities and
costs. Oracle Inventory uses this information as the basis for all physical inventory
adjustments. All tag counts you enter for this physical inventory are compared with these
static quantities. This allows you to resume normal inventory operations after you have
entered your counts but before you have authorized all final physical inventory adjustments.
You can perform your recounts or investigate certain results without holding up transaction
processing.
Note: Oracle Inventory does not stop inventory processing during a physical inventory.
Therefore, you must procedurally coordinate the snapshot of your physical inventory with your
actual counting, and ensure that no transaction activity occurs in a particular location until after
you have performed your adjustments.
Note: It is recommended to clear the Pending Transactions and Transactions Open Interface,
before taking a snapshot of inventory quantities.
Inventory Accuracy
For example, suppose that at the start of your physical inventory the system on-hand quantity
for item WIDGET in a particular bin is 30. Oracle Inventory saves this information with the
physical inventory snapshot. During the warehouse count, you count a total of 25 units of item
WIDGET in the same bin. Before you approve your counts and perform your adjustments, you
resume normal transaction operations, and consequently, item widget reaches a system on-hand
quantity of 45. At this point, you perform your physical inventory adjustments. Oracle
Inventory computes the adjustment as the difference between the tag count and the snapshot
quantity, NOT the current system quantity of the item that has now reached 45. So in this case,
the adjustment is 25 - 30 = -5 units. When the adjustment is posted, the new system on-hand
quantity becomes 40 units.
Inventory Accuracy
Entering Physical Inventory Counts
Entering Physical Inventory Counts

Use the tags that you generated to record your physical counts. If you use physical inventory
default tags for your physical inventory, you can automatically query all tags and fill in the
counts. You can also query a subset of your tags by any combination of tag number, item,
revision, subinventory, locator, lot, and serial number. You would use this partial tag query
feature if you prefer to enter your counts by location or item, or for a particular tag number
range.
Use the tags that you generated to record your physical counts. If you use default tags for your
physical inventory, you can automatically query all tags and fill in the counts. You can also
query a subset of your tags by any combination of tag number, item, revision, subinventory,
locator, lot, and serial number. You would use this partial tag query feature if you prefer to
enter your counts by location or item, or for a particular tag number range.If you enable
dynamic tag entry for your physical inventory, you can enter counts for any item and stock-
keeping unit combination without a pre-generated tag number.
Oracle Inventory uses the counts you enter for your tags to determine if your items need
quantity adjustments; and if so, whether you need to approve them. If you set your approval
option for your physical inventory to Not required for adjustments you are ready to process
your adjustments. If you set your approval option to Required for adjustments out of tolerance,
Oracle Inventory holds for approval all tags with counts that are outside the limits of the
Inventory Accuracy
quantity variance or adjustment value tolerances, If you set your approval option to Required
for all adjustments, Oracle Inventory holds all counts for approval.
Inventory Accuracy
Voiding Tags
Voiding Tags
It is important for auditing purposes to track the status of each physical inventory tag.
Therefore, if you do not use one or more of the tags Oracle Inventory generates, you should
void them in the Physical Inventory Tag Counts window. A voided tag is not reported as a
missing tag in the Physical Inventory Missing Tag Listing.
If you generated blank tags at the beginning of your physical inventory, and ended up not using
all of them, you void the unused tags. When you run the Physical Inventory Missing Tag
Listing for the whole range of tags you generated, the unused tags appear as missing tags.
If you void a default tag, (for example, a tag that identifies a stock-keeping unit for which
there is system on-hand quantity), Oracle Inventory adjusts the quantity in that location to zero.
This indicates that you did not use the tag in question, presumably because the stock-keeping
unit corresponding to the tag did not exist.
Inventory Accuracy
Approval Tolerances
Approval Tolerances
Oracle Inventory supports two types of physical inventory approval tolerances. For each type,
you can specify a positive and a negative limit. When a particular physical inventory tag count
entry results in an adjustment that exceeds any one of these limits, you have a physical
inventory adjustment that exceeds approval tolerances. Based on the approval option you
chose when you defined your physical inventory, this adjustment is or is not held for approval.
If you decide that approval is required for adjustments out of tolerance you must enter at least
one positive or negative value for one type of approval tolerance. The quantity variance
tolerance is a user-defined limit for the difference between the system-tracked on-hand
quantity and the actual tag count quantity. You express positive and negative quantity variance
tolerances as percentages of the system on-hand quantity. You enter these percentages when
defining your physical inventory.
The adjustment value tolerance is a user-defined limit for the total value of a physical
inventory adjustment: adjustment value = (system on-hand qty - actual count qty) x current
cost, where: Current cost is the cost at inventory snapshot. You express positive and negative
adjustment value tolerances as amounts in your ledger currency. You enter these tolerances
when defining your physical inventory.
Inventory Accuracy
Physical Inventory Adjustments
Physical Inventory Adjustments

You can view, reject, or approve physical inventory adjustments pending approval. The
adjustments you can view from this window are determined by the approval option you defined
for your physical inventory. If you approve a particular adjustment, the Process Physical
Inventory Adjustments program adjusts your inventory balance by that quantity. If you reject
an adjustment, Oracle Inventory does not change the system on-hand quantity.
Inventory Accuracy
Accuracy Reports
Inventory Accuracy
Accuracy Reports (Cont)
Inventory Accuracy
Inventory Accuracy
Inventory Accuracy
Inventory Accuracy
Inventory Accuracy
Profile Options
Inventory Accuracy
Inventory Accuracy
Inventory Accuracy
Inventory Accuracy
Summary
Inventory Accuracy
Inventory Accuracy
Table Information
Chapter 12
Table Information
Chapter 12 - Page 1
Table Information
Chapter 12 - Page 2
R12 Table Information
Table Information
Chapter 12 - Page 3
Objective
Table Information
Chapter 12 - Page 4
Organization Tables
Organization Tables
• MTL_PARAMETERS: Associated with an organization. Primary key:
ORGANIZATION_ID.
• MTL_INTERORG_PARAMETERS: Identifies the receiving organizations linked to a
particular organization. You must define the interorganizational relationship before you
perform any interorganization transfers. Units of measure, distance, transfer charge, and
accounting information are also specified in this table. Primary key:
FROM_ORGANIZATION_ID, TO_ORGANIZATION_ID.
• GL_SETS_OF_BOOKS: Stores define set of books data in General Ledger. Each row
includes the set of books name, description, functional currency, and other data.
Corresponds to the Define Set of Books window. Primary key:
GENERAL_LEDGER_UPDATE_CODE.
• GL_CODE_COMBINATIONS: Stores valid Accounting Flexfield segment value
combinations for each accounting flexfield structure within your General Ledger. Primary
key: CODE_COMBINATION_ID.
• HR_ALL_ORGANIZATION_UNITS: Stores generic data about organizations. An
organization can be used for various purposes in Oracle Manufacturing applications. For
example, one organization can represent a business group, an ECO department, a planning
organization, and an inventory organization. Primary key: ORGANIZATION_ID.
Table Information
Chapter 12 - Page 5
Subinventories and Locator Tables
Subinventories and Locator Tables

• MTL_SYSTEM_ITEMS_B is the definition table for items. This table holds the
definitions for inventory items, engineering items, and purchasing items. The flexfield
code is MSTK. The primary key for an item is the INVENTORY_ITEM_ID and the
ORGANIZATION_ID. The same item could be defined in more than one organization.
Each row represents an item in an organization.
• MTL_SYSTEM_ITEMS_TL: This table is holding translated Description column for
Items. The primary key is INVENTORY_ITEM_ID, ORGANIZATION_ID,
LANGUAGE.
• GL_CODE_COMBINATIONS: This table stores valid Accounting Flexfield segment
value combinations for each accounting flexfield structure within your General Ledger
application. The primary key is CODE_COMBINATION_ID.
• MTL_SECONDARY_INVENTORIES: This table is the definition table for the
subinventory. Subinventories are assigned to items, indicating a list of valid places in
which this item may be located. The primary key is
SECONDARY_INVENTORY_NAME, ORGANIZATION_ID.
• MTL_ITEM_SUB_INVENTORIES: This table maintains a listing of subinventories
assigned to an inventory or engineering item. The subinventories make up the valid list of
subinventories when transacting a specific item if the user has specified that the item must
Table Information
Chapter 12 - Page 6
use subinventories from a predefined list. The primary key is INVENTORY_ITEM_ID,
ORGANIZATION_ID, SECONDARY_INVENTORY.
• MTL_ITEM_LOCATIONS: This table is the definition table for stock locators. The
associated attributes describe the subinventory to which this locator belongs, and the
locator physical capacity. The primary key is INVENTORY_LOCATION_ID.
• MTL_SECONDARY_LOCATORS: This table stores all locators within a subinventory
for a specific item. The locators make up the valid list of locators when transacting that
specific item to/from the subinventory when the user has specified that the item must use
locators from a predefined list. The primary key is INVENTORY_ITEM_ID,
ORGANIZATION_ID, SECONDARY_LOCATORS.
• MTL_PARAMETERS: This table stores the parameters for an inventory organization
with which an item is associated. The primary key is the ORGANIZATION_ID.
Subinventories and Locators Tables.
Table Information
Chapter 12 - Page 7
Item Master Tables
Item Master
• MTL_SYSTEM_ITEMS_B: This table is the definition table for items. This table holds
the definitions for inventory items, engineering items, and purchasing items. The flexfield
• MTL_ITEM_ATTRIBUTES: This table stores the item attributes, their user-friendly
names if the item is maintained at the item or item/organization level, and the kind of
validation required for each attribute. This table is seeded on install or upgrade. The
primary key is ATTRIBUTE_NAME.
• MTL_ITEM_TEMPL_ATTRIBUTES: This table stores the attributes and attribute values
for a template. When a template is created, a row is inserted for each available item
attribute. When the template is applied to an item, the enabled attribute values are
propagated to the item. The primary key is TEMPLATE_ID, ATTRIBUTE_NAME.
• MTL_ITEM_STATUS_TL: This table is the definition table for a material status code.
The status code is a required item attribute and indicates the item status (for example,
active, pending, or obsolete). You may define as many additional status codes as you
want. The values of the individual status attributes associated with an item status are
Table Information
Chapter 12 - Page 8
stored in MTL_STATUS_ATTRIBUTE_VALUES. The primary key is
INVENTORY_ITEM_STATUS_CODE.
• MTL_ITEM_TEMPLATES_B: This table is the definition table for item templates. It
contains the user-defined name and description. When the template is applied to an item,
the enabled item attributes are propagated to the item. The primary key is
TEMPLATE_ID.
• MTL_STATUS_ATTRIBUTE_VALUES: This table stores the attribute values associated
with an item status code. One record is created for each of the function-enabling attributes
for each defined item status code. The primary key is
INVENTORY_ITEM_STATUS_CODE, ATTRIBUTE_NAME.
• MTL_PARAMETERS: This table is an inventory organization with which an item is
associated. The primary key is the ORGANIZATION_ID.
Table Information
Chapter 12 - Page 9
Item Status Tables
Item Status Tables

• MTL_ITEM_ATTRIBUTES: This table stores the item attributes, their user-friendly
names if the attribute is maintained at the item or item/organization level, if the attribute is
controlled by an item’s status, and the kind of validation required for each attribute. The
primary key is ATTRIBUTE_NAME. This table is seeded on install or upgrade. The top
eight item attributes are as follows:
- Stockable
- Transactable
- BOM allowed
- WIP allowed
- Purchasable
- OE Orderable
- Internal Orderable
Table Information
- Billable
• MTL_STATUS_ATTRIBUTE_VALUES: This table stores the attribute values associated
with an item status code. One record is created for each of the function-enabling attributes
for each defined item status code. The primary key is
INVENTORY_ITEM_STATUS_CODE, ATTRIBUTE_NAME.
• MTL_ITEM_STATUS_TL: This table is the definition table for a material status code.
The status code is a required item attribute and indicates the item status (for example,
active, pending, or obsolete). You may define as many additional status codes as you
want. The values of the individual status attributes associated with an item’s status are
stored in MTL_STATUS_ATTRIBUTE_VALUES. The primary key is
INVENTORY_ITEM_STATUS_CODE.
• MTL_PENDING_ITEM_STATUS: This table is used to define and store the history of
the item statuses that have been or will be assigned to an item. This table maintains the
status history for each item. This table also stores pending status information. The primary
key is INVENTORY_ITEM_ID, ORGANIZATION_ID, STATUS_CODE,
EFFECTIVE_DATE.
Table Information
Item Categories Tables
Item Categories Tables

• FND_ID_FLEX_STRUCTURES: This table stores structure information about key
flexfields. The primary key is APPLICATION_ID, ID_FLEX_CODE, ID_FLEX_NUM.
• MTL_CATEGORIES_B: This table is the code combinations table for item categories.
Items are grouped into categories within the context of a category set to provide flexible
grouping schemes. The primary key is CATEGORY_ID. The item category is a key
flexfield with a flexfield code of MCAT.
• MTL_CATEGORIES_TL: This table is a table holding translated Description column for
Item Categories. The primary key is CATEGORY_ID, LANGUAGE.
• MTL_CATEGORY_SETS_B: This table contains the entity definition for category sets. A
category set is a categorization scheme for a group of items. Items can be assigned to
different categories in different category sets, but can be assigned to only one category
within a category set. The primary key is CATEGORY_SET_ID.
Table Information
• MTL_CATEGORY_SETS_TL: This table is a table holding translated Name and
Description columns for Category Sets. The primary key is CATEGORY_SET_ID,
LANGUAGE.
• MTL_CATEGORY_SET_VALID_CATS: This table defines the valid category list for a
particular category set. If category validation is required, the list of valid categories is
stored in this table and is used to restrict category selection for the category set. The
primary key is CATEGORY_SET_ID, CATEGORY_ID.
• MTL_DEFAULT_CATEGORY_SETS: This table stores the identifier of the category set
that acts as the default for a particular functional area. This information is used to
determine the mandatory category sets for an item. It is also used to provide a default
category set for forms and reports that require a category set field value or parameter. The
primary key is FUNCTIONAL_AREA_ID, CATEGORY_SET_ID.
• MTL_ITEM_CATEGORIES: This table stores the item assignments to categories within a
category set. For each assignment, this table stores the item, category set, and the
category. Items can be assigned to multiple categories and category sets, but can be
assigned to only one category in a given category set. This table is populated through
either the Define Item or the Update Item/Org Attributes forms. It can also be populated
by performing item assignments when a category set is defined. The primary key is
INVENTORY_ITEM_ID, ORGANIZATION_ID, CATEGORY_SET_ID.
Table Information
Item Reservation Tables
Item Reservation Tables

MTL_DEMAND: This table stores demand and reservation information used in Available to
Promise, Planning, and other manufacturing functions. Four row types are stored in this table:
- Summary Demand rows
- Dependent Demand rows
- Open Demand rows
- Reservation rows
- The primary key is INVENTORY_ITEM_ID, DEMAND_SOURCE_TYPE,
DEMAND_SOURCE_HEADER_ID, DEMAND_SOURCE_LINE (o),
DEMAND_SOURCE_DELIVERY (o), COMPONENT_SEQUENCE_ID (o).
• MTL_SALES_ORDERS: This table stores the Oracle Inventory local definition of sales
orders and maps sales orders between Oracle Inventory and other Oracle Manufacturing
applications. The primary key is SALES_ORDER_ID.
• OE_ORDER_HEADERS_ALL: This table stores header information for orders in Oracle
Order Management. The primary key is HEADER_ID.
• OE-ORDER_LINES_ALL: This table stores information for all order lines in Oracle
Order Management. The primary key is LINE_ID.
Table Information
• GL_CODE_COMBINATIONS: This table stores valid Accounting Flexfield segment
value combinations for each accounting flexfield structure within your General Ledger
application. Available material can be reserved against a valid Accounting Flexfield
combination. The primary key is CODE_COMBINATION_ID.
• MTL_GENERIC_DISPOSITIONS: This table stores the user-defined account alias. An
account alias provides a method to use accounting numbers and makes it easier to transact
account issues and receipts. Available inventory can be reserved against an account alias.
The primary key is DISPOSITION_ID, ORGANIZATION_ID.
• MTL_MATERIAL_TRANSACTIONS: This table stores a record of every material
transaction or cost update performed in Inventory. An issue transaction to an account
number or account alias can relieve a reservation against the account number or alias. The
primary key is TRANSACTION_ID.
• MTL_DEMAND_INTERFACE: This table is the interface point between non-Inventory
applications and the Oracle Inventory demand module. Records inserted into this table are
processed by the Demand Manager concurrent program.
the definitions for inventory items, engineering items, and purchasing items. The primary
key for an item is the INVENTORY_ITEM_ID and the ORGANIZATION_ID.
Table Information
Inventory Transaction Tables
Inventory Transaction Tables

• MTL_TRANSACTIONS_INTERFACE: This is the interface point between non-
Inventory applications and the Inventory transaction module. The Transaction Manager
concurrent program polls this table at a user-specified process interval and submits the
transaction workers to process them. Processing consists of data derivation, validation,
and transfer of records from MTL_TRANSACTIONS_INTERFACE,
MTL_TRANSACTION_LOTS_INTERFACE, and
MTL_SERIAL_NUMBERS_INTERFACE into their respective TEMP tables, from where
they are processed by the transaction processor.
• MTL_MATERIAL_TRANSACTIONS_TEMP: This table is the gateway for all material
transactions. Records are processed from this table into Inventory through the transaction
processor. All Inventory transaction forms write directly to this table. Outside applications
must write transaction records to MTL_TRANSACTSIONS_INTERFACE TXN
Processor makes use of TXN worker to process the transactions from
MTL_TRANSACTIONS_INTERFACE to
MTL_MATERIAL_TRANSACTIONS_TEMP and from
MTL_MATERIAL_TRANSACTIONS_TEMP to
MTL_MATERIAL_TRANSACTIONS..
Table Information
• MTL_MATERIAL_TRANSACTIONS: This table stores a record of every material
transaction or cost update performed in Inventory. Records are inserted into this table
either through the transaction processor or by the standard cost program. The primary key
is TRANSACTION_ID.
• MTL_TRANSACTION_ACCOUNTS: This table holds the accounting information for
each material transaction in MTL_MATERIAL_TRANSACTIONS. Oracle Inventory
uses this information to track the financial impact of your quantity moves.
Table Information
Guided Demonstration - Accessing eTRM
Note: You must have an Oracle Metalink account to access eTRM.
1. Navigate to the Oracle Metalink home page.
https://metalink.oracle.com/
2. Click Log in to Metalink
3. Enter your username and password.
4. (T) Knowledge
5. Click Applications Electronic Technical Reference Manuals (eTRM).
6. (B) I accept
7. Click FND Data Dictionary.
8. Click INV- Inventory.
9. Click 267-Tables.
10. Select any table to show the students.
11. Close the web page.
12. Click Sign Out to exit Metalink.
13. Close the web page.
Table Information
Summary
Table Information
Table Information

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This book was published using: Oracle Tutor

Overview of Oracle Inventory..........................................................................................................................1-1

Inventory Structure ..........................................................................................................................................2-1

R12 Oracle Inventory Management Fundamentals Table of Contents

Units of Measure ..............................................................................................................................................3-1

Defining and Maintaining Items ......................................................................................................................4-1

Copyright © Oracle 2009. All rights reserved.

R12 Oracle Inventory Management Fundamentals Table of Contents

Lot and Serial Control......................................................................................................................................5-1

R12 Oracle Inventory Management Fundamentals Table of Contents

Issuing and Transferring Material...................................................................................................................7-1

Copyright © Oracle 2009. All rights reserved.

R12 Oracle Inventory Management Fundamentals Table of Contents

On-hand and Availability .................................................................................................................................8-1

R12 Oracle Inventory Management Fundamentals Table of Contents

Material Status Control....................................................................................................................................9-1

R12 Oracle Inventory Management Fundamentals Table of Contents

Inventory Replenishment ................................................................................................................................10-1

R12 Oracle Inventory Management Fundamentals Table of Contents

R12 Oracle Inventory Management Fundamentals Table of Contents

Table Information .............................................................................................................................................12-1

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R12 Oracle Inventory Management Fundamentals Table of Contents

Before You Begin This Course

How This Course Is Organized

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R12 Oracle Inventory Management Fundamentals Table of Contents

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R12 Oracle Inventory Management Fundamentals Table of Contents

Typographic Conventions in Text

Convention Element Example

Typographic Conventions in Code

Convention Element Example

R12 Oracle Inventory Management Fundamentals Table of Contents

Passwords DROP USER scott

Lowercase Syntax variables CREATE ROLE role

Typographic Conventions in Oracle Application Navigation Paths

Typographical Conventions in Oracle Application Help System Paths

R12 Oracle Inventory Management Fundamentals Table of Contents

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R12 Oracle Inventory Management Fundamentals Table of Contents

R12 Oracle Inventory Management Fundamentals Table of Contents

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Overview of Oracle Inventory

Overview of Oracle Inventory

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Overview of Oracle Inventory

Copyright © Oracle, 2009. All rights reserved.

Overview of Oracle Inventory

Copyright © Oracle, 2009. All rights reserved.

Overview of Oracle Inventory

Copyright © Oracle, 2009. All rights reserved.

Overview of Oracle Inventory

Copyright © Oracle, 2009. All rights reserved.

Overview of Oracle Inventory

Copyright © Oracle, 2009. All rights reserved.

Overview of Oracle Inventory

Overview of Oracle Inventory

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Overview of Oracle Inventory