HandSCMInternalTraining

--VMI&ConsignAndy.Lin

Sep,2008HandSCMInternalTraining

1AgendaConsignStandardFunctionalities3VMIStandardFunctionalities2VMI&ConsignConcepts1VMI&ConsignCaseDiscussion4AgendaConsignStandardFunctio2WhatisVMIVendorManagedInventory(VMI)isaprocurementandplanningpracticeinwhichacompanydelegateskeyinventorymanagementfunctionstooneormoreofitssuppliers.Underthisarrangementthesupplierdeterminestheitems,quantities,anddeliveryschedulesonbehalfofthecustomerbasedoninformationitreceivesfromthecustomer’sinventoryandprocurementsystems.UsingVMI,manufacturersanddistributorscananticipatecustomerneedsandprovideinventorymoreproactivelythanispossibleusingtraditionalprocurementmethods.WithVMI,companiesarerealizingincreasesinavailableworkingcapital,reducedinventoryholdingcosts,andultimatelyincreasedcustomersatisfactionandprofitability.WhatisVMIVendorManagedInve3WhatisconsignmentItemswillbedeliveredtothebuyingorganizationbutthesupplierwillnotsendaninvoice(andthusnopaymentwillbemade)untiltheitemshaveactuallybeenconsumed.ConsumptionnormallyoccurswhentheitemsareusedupinWIPoraresoldbythebuyingorganizationbutotherscenariosarepossible.WithConsignment,companiesreducedinventoryholdingcosts,increaseinventoryturnandultimatelyincreasedcustomersatisfactionandprofitability.WhatisconsignmentItemswill4AgendaConsignStandardFunctionalities3VMIStandardFunctionalities2VMI&ConsignConcepts1VMI&ConsignCaseDiscussion4AgendaConsignStandardFunctio5VMIStandardProcessVMIStandardProcess6VMISetupPrerequisites--ProfilesFND:DebugLogEnabled:shouldbesettoNo(orNull).PO:AutomaticDocumentSourcing(IfsettoYes,thelatestblanplier/sitecombinationisalwaysusedirrrespectiveoftheblanketspecifiedintheASL)PO:ConvertRequisitionUOMtoSourceDocumentUOM(Yes)PO:ReleaseduringReqImpor(Yes)MSC:Configuration(APS&CP)MSC:CollaborativePlanningDefaultCalendar(NeedtorunBuildCollaborativePlanningCalendar)VMISetupPrerequisites--Profi7VMISetupPrerequisites—ItemMasterPurchasableitemDefaultListprice(0)MRPPlanedorMRP/DRPplanned(inordertoenableDataCollectionstopublishtheitemtoCollaborativePlanningandtoallowtheplannertoreviewthelongtermforecastonthePlannerWorkbench.)ReleaseTimeFence:settoDoNotRelease(Kanban)DefaultBuyerDefaultPlanner(mustlinktoavalidemployee)VMISetupPrerequisites—ItemM8VMISetupPrerequisites—ASLCreateItemCreateSupplierCreateBPACreateASL:Releasemethod:AutomaticRelease/ReviewVMIEnabledAutomaticAllowedMin&MaxQtyVMISetupPrerequisites—ASLCre9VMISetupPrerequisites—ASLVMISetupPrerequisites—ASL10VMISetupPrerequisites—SupplierUserPath:PurchasingSU>SupplyBase>RegisterSupplierUserRegistersupplierusernameandemailaddress

VMISetupPrerequisites—Suppli11VMISetupPrerequisites--DataCollectionDefineInstanceforyourorganizationPath:AdvancedPlanningSystem(APS)Administrator:Collections>OracleSystems>StandardCollectionVMISetupPrerequisites--Data12VMIProcess—RunVMIReplenishmentEngineRunVMIReplenishmentEngineafterDataCollectionSuggesttoscheduleDataCollectionandVMIReplenishmentEngineVMIProcess—RunVMIReplenishm13SupplierSide—ViewNotificationsLoginwiththeusername:Andy.lin@/woshiViewNotificationsSupplierSide—ViewNotificatio14SupplierSide—MonitorVMIstatusSwitchtotheVMIpageandViewVMIinformationVerifythesuggestedreplenishmentquantitySupplierSide—MonitorVMIstat15SupplierSide—RequestGoodsReleaserequisitiontocustomerSupplierSide—RequestGoodsRel16CustomerSide—ScheduleRequisitionImportScheduletherequest:RequisitionImportCustomerSide—ScheduleRequisi17CustomerSide—ReviewandApprovePOSystemautomaticallycreateanincompletePOrelease(ifyousetASLreleasemethodtoAutomaticrelease/review)CustomerSide—ReviewandAppro18SupplierSide—CreateASN-1Path:iSupplierPortalFullAccess>Shipments:ShipmentNoticesSupplierSide—CreateASN-1Path19SupplierSide—CreateASN-2FillintheshipmentlineinformationSupplierSide—CreateASN-2Fill20SupplierSide—CreateASN-3FillintheshipmentheaderinformationandsubmitSupplierSide—CreateASN-3Fill21CustomerSide-ScheduleReceivingProcessorScheduleReceivingTransactionProcessortoimportASNCustomerSide-ScheduleReceivi22CustomerSide—ManageShipmentsUsePurchasingSU>Receiving>ManageShipmentstoViewASNCustomerSide—ManageShipments23CustomerSide—ReceiveagainstASNYoucanuseASN#orContainer#orBarcodelabletodoreceiptCustomerSide—Receiveagainst24CustomerSide—MonitorVMIOnhandUsePurchasingSU>Receiving>ManageShipmentstoViewASNCustomerSide—MonitorVMIOnha25CustomerSide—ReceiptDistributionTheVMIreceiptanddeliverydistributionarethesamewithnormalreceiptanddelivery.CustomerSide—ReceiptDistribu26CustomerSide—PlanningTransferPlanningtransferisnotaninventorytransaction.itsimplychangestheplanningorganizationfromthesuppliersitetotheinternalorganizationinwhichthegoodsareheld.CustomerSide—PlanningTransfe27CustomerSide--VMIMaterialConsumptionVMImaterialsareconsumedonaFIFObasis.MovedgoodsaretransferredintoregularstockandarenolongervisibleassupplieronhandquantitiesviaCollaborativePlanning. CustomerSide--VMIMaterialCo28AgendaConsignStandardFunctionalities3VMIStandardFunctionalities2VMI&ConsignConcepts1VMI&ConsignCaseDiscussion4AgendaConsignStandardFunctio29ConsignSetupPrerequisites—ItemSetupNothingspecialhere,justmakesurethattheitemisstockableandpurchasable.ConsignSetupPrerequisites—It30ConsignSetupPrerequisites—ASLCreateBPASetupASLlinkwithBPAandchecktheconsignedflagConsignSetupPrerequisites—AS31ConsignProcess—CreateStandardPOEventhoughwehavecreatedaBlanketAgreementasthesourcedocument,

consignmentrequiresaPO(andnotaRelease)tobeginthecycle.ConsignProcess—CreateStandar32ConsignProcess—ReceivetheGoodsReceivethegoodsinthedestinationinventory:nodistributionscreatedforthisreceiptNodistributionforthisreceiptConsignProcess—ReceivetheGo33ConsignProcess—TransfertoRegularConsignedstockisautomaticallyconvertedtoregularstockwhencertaininventorytransactionstakeplace(e.g.shipping).Thenormalreceivingaccountingtransactionshavebeencreatedoncethestockwastransferredtoregularstock.ConsignProcess—TransfertoRe34ConsignProcess—CreateConsumptionAdviceRunrequest:INVSU>Report>Transaction>CreateConsumptionAdvicetogenerateconsumptionadvice.ConsignProcess—CreateConsump35ConsignProcess—AutoCreateInvoiceRunrequest:PurchasingSU>Request>PayOnReceiptAutoInvoicetoAutocreateinvoiceaccordingtoconsumptionadviceConsignProcess—AutoCreateIn36ConsignProcess—MiscTransactionYoumayneedtousemiscellaneoustransactiontoadjusttheConsignInventoryConsignProcess—MiscTransacti37ConsignProcess—ReturntoVendor(1)Aslongasthereareplentyofconsigninventory,youcanreturngoodstovendor.Ifthereisnoenoughconsigninventory,youneedtotransferregularinventorytoconsign.ConsignProcess—ReturntoVend38ConsignProcess—ReturntoVendor(2)YoucandoreturntransactiononlyifthevendorownedonhandquantityisequaltoormorethanthereturnquantityConsignProcess—ReturntoVend39AgendaConsignStandardFunctionalities3VMIStandardFunctionalities2VMI&ConsignConcepts1VMI&ConsignCaseDiscussion4AgendaConsignStandardFunctio40IsMRPsuitableforVMIitems?MRPwillbalancethetotaldemandagainstthetotalsupply,includingboththeinternallyreplenishedstockandtheVMIstock.Ifthereisasuddenincreaseofdemand,thenMRPwillsuggesttoreleaseanon-VMIordertomeettheincreaseddemand.Mypointofview:IfyouwanttopublishMRPresulttosuppliers,pleaseusesupplierscheduleandISP;VMIisbasedonMIN-MAXplanninglogic.VMIitemsshouldnotplanedbyMRP.ButyoucanuseMRPasanassistantIsMRPsuitableforVMIitems?41WillMin-MaxplanningconflictwithVMI?TraditionalMin-MaxonlyconsidertheinternalplanedstockwhileVMIonlyconsiderthesupplierplanedstock.SetitemlevelMin-Max=totalMinMax-totalsuppliermanagedMinMaxWillMin-Maxplanningconflict42CanVMIbecombinedwithConsignmentVMIisaplanningmethod,involvesuppliersintomaterialplanning.ItisakindofCollaborativePlanning.Consignmentismoreafinancialpolicy.Thekeypointofconsignmentis‘PayonUse’.Itcanreducetheinventoryholdingcostandincreaseinventoryturn.Mypointofview:mostofconsignmentbusinessaresuitabletouseVMI(orcollaborativeplanning).CanVMIbecombinedwithConsi43WhatisConsignSolutionforSuppliersAsupplierusingtheOracleApplicationsinternallywillneedtoshipinventorybutnotbillthecustomeruntilconfirmationisreceivedthattheinventorywasconsumed.

Usetheshippingfeatureoftripstopplanning.IncaseofFOBpointbeingcustomerdestinationthenperfor