1-Item Vs 2-Item

FASCO Project Team

Solution Options for 2- items

Pre-go live activities for 2 items

Item Conversion (Number of Records increasing D Part Numbers) Item Cost Conversion Supplier X-ref Customer X-Ref ??

Additional Setup-Tasks for 2 items (After Go Live)

Item definition, maintenance, cost, categories, weight, templates, revisions. Supplier X-Ref maintenance. Maintain latest revision. Vendors, Sourcing Rule, ASL, Blankets Customer Item cross from Plants??

Option1: PO-SO Process. Define D in FDC and 71 in RY2

CSO orders always entered using D Part number in FDC for stock product and using MFG number for Special Build. ASCP Recommend release Blanket in FDC for Vendor as Reynosa using Sourcing rule using D Part number and MFG Part number as supplier X-Ref. Manually/Automatic Create sales order on RY2 with Customer as FDC using D part number as Customer X-ref and mfg item as Internal item (Enter PO number of FDC as Customer PO on sales order). As soon as order is booked, ASCP/MTO will create WIP job on RY2. (Yield factor need to be added??) WIP job goes through MFG and production reported against 7 digit part number.

Sales order will be shipped against 7 digit part number. Products will be received using D part number against purchase order in FDC.

Replenishment Order
CSO created with D Part # in FDC Op Unit ASCP recommends PO in FDC Op Unit with Supplier : Reynosa or XXX Part # : D Supplier Part # : MFG Part # Item Source Reynosa, or XXX ? Reynosa EDI process will create SO in US Op Unit with Customer : FDC Customer Part # : D Internal Part # : MFG Part #

Manual SO in external ERP with Customer : FDC

MTO process will create WIP Job on Reynosa in US Op Unit with MFG Part #

PO Received in FDC Op Unit using ASN or manually Supplier : Reynosa or XXX Part # : D Supplier Part # : MFG Part #

External ERP will ship order to FDC and generate AR invoice

Production reporting and SO on Reynosa will be Shipped to FDC and ASN Generated for receiving

AP invoice created in FDC Op Unit with Supplier : Reynosa or XXX Part # : D

AR invoice created in US Op Unit with Customer : FDC Internal Part # : MFG Part #

Special Build Ship Direct

CSO created in FDC Op Unit with Internal Part # : MFG Part # Warehouse : RY2 MTO process will create WIP Job on Reynosa in US Op Unit with MFG Part # Reship or Direct? Re-Ship Next Page Reship Process Direct? Production Reporting in RY2

AP invoice created in FDC Op Unit with Supplier : Reynosa or XXX Part # : MFG Part #

AR invoice created in US Op Unit with Customer : FDC Internal Part # : MFG Part #

CSO Shipped from RY2 & Oracle Intercompany process will trigger

Special Build Re-Ship via FDC

CSO created in FDC Op Unit with Internal Part # : MFG Part # Warehouse : RY2 MTO process will create WIP Job on Reynosa in US Op Unit with MFG Part # Reship or Direct? Re-Ship

ReShip CSO updated in FDC Op Unit with Warehouse : FDC

IR Created in FDC Op Unit with Supplier : Reynosa Part # : MFG Part # Ship To : FDC

ISO Created in US Op Unit with Customer : FDC Internal Part # : MFG Part # Warehouse : RY2

ISO Shipped & Oracle Intercompany process will trigger

AP invoice created in FDC Op Unit with Supplier : Reynosa or XXX Part # : MFG Part #

AR invoice created in US Op Unit with Customer : FDC Internal Part # : MFG Part #

Benefits with 2 items using PO + SO

Customer Service ability to place order using D Part number. No need to check which MFG Part# has on-hand. Simplify warehouse process. No restriction on Warehouse in terms of mixing of locations and inventory mismatch. Inventory maintained with D Part#. Approach supported by iStore and requires no customization. Easy to implement Warehouse Management System on Reynosa plant and WMS Direct Ship functionality supported with this approach. No customization needed to split Customer Order lines based on availability. Minimum customization on Manufacturing and Order to Cash track. Complete end to end traceability of Purchase Order Sales Order WIP Job. Standard Oracle process will be used. ASCP for Purchase Order, EDI for sales order and EDI for advance shipment notification for receiving purpose to show intransit.

Issues with 2 items using PO + SO

Sales order in RY2 would create COGS and Revenue. Purchase order in FDC would create Accruals and invoices. AR invoice & AP invoice needs to be matched & closed. Interface could be written to accomplish that. AP invoice process can put invoice on hold because of pricing or any other issues. Inventory AP Accruals will be sum of Inter-company + Regular (Need effort to cleanup). More maintenance in terms of items, supplier cross reference, customer cross reference, ASLs, blanket agreement. Purchase orders changes need to be handled manually. Two process based on product type. Inter-company process for special builds and PO-SO process for FDC stock replenishments.

Appendix

Other Options

Option1: PO-SO Process. Define D in FDC and 71 in RY2 Option2: PO-SO Process with 712-713 (Customization) extension. Option3: Define BOM using D item & MFG Item as Component Option4: One Item Number with Item Substitution Option5: Use D number as MFG Number

Option2: PO-SO Process with 712-713 (Customization Extension)

CSO orders always entered using D Part number in FDC for stock product and using MFG number for Special Build. ASCP Recommend release Blanket in FDC for Vendor as Reynosa using Sourcing rule using D Part number and MFG Part number as supplier X-Ref. Automatic Create sales order on RY2 with Customer as FDC using D part number as Customer X-ref and mfg item as Internal item (Enter PO number of FDC as Customer PO on sales order). As soon as order is booked, ASCP/MTO will create WIP job on RY2. (Yield factor need to be added??) WIP job goes through MFG and production reported against 7 digit part number. Plant to manually run concurrent program to initiate 712-713 process using parameters (SO#, PO#, Item, Qty, Org# etc). Need to extend existing customization. Products will be in Transit. FDC will receive using Int-org Shipment# instead of PO.

712-713 process: Once Production done, Misc Issue 71 item (RY2), Misc Rcpt D item in RY2, Create Int-org from RY2 to FDC, Cancel PO &SO to reflect Qtys being shipped and Int-org to FDC.

Option2: Issues & Concerns

How do we handle Shipping Errors. PO tracking would be not be possible. Inter-company receivable & Payable Issue? Customization failures can cause issues in Planning, Shipping, Receive in both locations. Data error would results in customization failures. More customizations.

Option-3: Define BOM using D item & MFG Item as Component

Assign D item to plant. Create parent BOM using D having component as MFG number 71. Cost rollup to D part Number. ASCP will recommend IR-ISO based on demand in FDC and WIP Job on RY2. It will create two WIP Job (J1 For D item & J2 for 71 item). Planner needs to release both jobs from ASCP. WIP jobs will be scheduled and released to plant. Production build takes place. Once product ready, complete WIP job J2 and then corresponding WIP job J1 Manual process. Ship product to FDC using Internal Sales order on D item. Will use Inter-company process with Internal Sales order and receipt.

Option-3 Issues & Concerns

Scheduling of D job as well as 71 wip job. Any changes due to scheduling will need update on both. Shop paperwork & Interfaces should send only send WIP job for 71. Needs to release both WIP job from ASCP. WIP completion of D job can happen without completing 71 WIP job can cause ve Balances and still ship orders. Additional WIP job completion for D part number. Plant could possibly complete against incorrect D WIP job and could can confusions and rework at plants for shipping purposes.

Option4: One Item Number with Item Substitution

CSO created with D Catalog and MFG part number. Global ATP will replace existing MFG Part number with substitute MFG part number if complete inventory available or becoming available. This is Standard OM-ASCP functionality. Warehouse will stock products in different locations for each Plant/Vendor for same D Catalog# mapped to different MFG part number. In cases where partial qty available system is going to schedule based on Lead time for the MFG item selected if there is no onhand / incoming supply. Whenever entering sales order, Customer Service can check ATP availability for product selected. FASCO Thailand product will get replaced with RY2 MFG part Number when both products are not available or RY2 becomes available before FASCO Thailand product. Separate report can be provided that tells availability by MFG number for same catalogue with Order and Line# that can be splitted by Customer service. Existing report can be extended to FASCO with additional info if any. Alternative solution could be to automatically split order lines for partial quantities based on ATP inquiry for such items. Add Manufacturing part number on Each box label coming from Plants.

Option4: Issue with One Item Number with Item Substitution

IStore doesnt support OM-ASCP Global ATP substitution functionality. Need to be re-looked. Warehouse will stock products to different locations for D catalog mapped to different MFG part number. Warehouse team needs to be make sure to pick the product from the specified location's on pick ticket or make sure they pick product for correct MFG Part number to avoid issues in shipping and inventory accuracy. Potential space issue in warehouse by allocating separate location for each MFG Part number. Warehouse team need to start looking at MFG Part number on Box additional verification during picking to avoid inventory issues. Cycle counting and physical inventory will be done using MFG Part number. Additional steps for Customer service to verify availability (when partially available) Productivity concern.

Option5: Use D number as MFG Number

Define D number as Internal item and MFG Part number and store MFG Part number as part of Desc, Catalog or Flex-field.

Order entry will be using D part number and manufacturing WIP job will be created using D part number. Production reporting and plant activities using D Part number.
USE standard inter-company process and standard processes for pricing, shipping etc.

Option5: Concerns & Issues

Impact to conversions and need mapping: BOM, Routing, WIP, Onhand, Intransits

Inquiries by existing MFG Part numbers will not be possible.

Issues from customer / Legal standpoing?

Impact to Engineering data base / ECO and history.

Update to Engineering Drawing??

Thank You

Benefits of 1-item

Allows us to utilize most of the standard features designed for inter-company transactions or Supply chain across business. These processes are bringing lot of efficiencies and accuracy in recording different business transactions and more productive to operations. Make To ORDER (MTO) process becomes seamless and benefits along with intercompany transaction. Avoids mapping between two part numbers in two different business. In fact, cant use MTO without one item. Reship process from Plant of MFG is feasible only if we go with one item. Reship process significantly reduces freight cost and improves our ability to deliver to customer on / before time and also provides flexibility to ship from any RBC location. No need to define as Vendor and Approved Supplier list for different Internal Vendors. No need to define and maintain quotations for pricing. No Purchase orders, approvals and payments required since handled through Inter-company processes. Supply Demand picture is available in one screen instead of going through two different screen provides complete picture on inventory. Disciplined dealing with one item Define one internal item instead of TWO would simply process across business for buy-sell transactions. Inventory & sub-ledger reconciliation between business becomes easier with one item. Item cost maintenance process becomes seamless and efficient.

Limitations Of 1 item

Same item can be RM in one org but FG in other org. This may have impact on reporting Pricing (Price list & Modifiers) needs to be defined for each MFG Part No and always will be using MFG Part Number. Supply Demand, Material TXN,Onhand availability & Inventory Planning is done using MFG Part Number only. Order Entry (orders & Returns) needs to select right MFG Part number depending on availability if the same Catalogue sourced by multiple MFG plants with different number. Warehousing / Shipping TXNs such as confirming pick or Shipping Transactions form (STF) does not show Item Cross Reference. Some of the item attributes on item are controlled at master level. This may put some limitations/impact on future processes, if any. Since Inventory & Planning category are controlled at master level, we will not be able to assign two different categories for financial purposes. Hence, Sourced Product Inventory cannot be tracked at GL level in FDC Operating unit. Would be addressed using reporting tool. Customers will be exposed to new Part numbers. Can cause confusion for sometime. This is not a concern from business.

Decision (05/03/2010)

Team: Ulises, Kevin, Connie, Arun, Tim, Sudhakar, Pandurang, Bruce, Jay, Aaron, Frances, Lisa, Tami, JW, Ahmed, Jim, Stef

Collectively we as team will go with one item Number with assumption that:

There might be some critical oracle screens that may need to be looked at as we go and provide lookup using cross-reference. Needs to be thought through during subsequent design process. Please note some of the very complex screen change would impact timelines. Hence, analysis needs to be done during design. Ebusiness system should allow customer to select D part number and select appropriate MFG Part no that has inventory. In case when both are there, select one from Thailand. Reporting requirements for FDC should be addressed using Cross-reference. Order entry process to select right MFG part number based on availability.

2- Item Limitations

Cannot use standard Oracle Inter-company process with internal sales order with advance supply chain planning. Managing supply chain would be completely manual process (especially fluctuations in demand in FDC and impact to RY2 plant). Supply Demand screen would Not reflect corresponding Reynosa production status as part numbers would be different. PO-SO would be an option but requires to lot of maintenance especially Vendors, ASLs, Sourcing rule, Quotations, Blankets etc. Any changes to purchase order date because of capacity / prioritization needs to be communicated to FDC and updated manually. MTO process cannot be used if using two different internal items and Linking PO to SO would be challenge. Define and Maintain items, costs, Categories, weights and relations between them. Manual process for invoice payments on both sides of businesses and inter-company profit elimination if any.

Approach (1-Single item)

Define Manufacturing Part as Internal Item (Only for Reynosa MFG item, Leeson, Genteq, Marathon, Grove Gear). FDC Catalog Number will be defined as item Cross Reference for these manufacturing part numbers. Item X-ref will be made specific to FDC. FDC catalogue number referring to Piegras, Casaville parts number will be defined as Internal Item using FDC Catalogue Number. For Other FDC sourced products, FDC Catalogue number will continue to be internal Part Number. Two Different MFG Part Number having same FDC Catalogue ??? (19 items makes 40% of Sale). Needs to be addressed in planning discussion.
Note: When FASCO Piegras, Casaville comes to 11i, there will be conversion activity to convert FDC Catalogue number into X-Ref and their manufacturing part number become internal part number.