Oracle Outside Processing

By: Devendra Gulve

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Oracle Outside Processing

Overview of Outside Processing
• The competitive advantages of outside processing include:
– using specialized supplier skills in manufacturing process to help lower engineering and manufacturing costs and increase production quality – using supplier capacity to temporarily or permanently increase overall production capacity

• Oracle Manufacturing allows to include suppliersourced components and resources in manufacturing processes.
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Outside Processing Items and Outside Resources
• Outside processing items represent supplier-sourced items, resources, and services included to build process • Can define outside resources and associate them with these outside processing items. The outside resources are included on your routings for scheduling and costing purposes. • Work in Process automatically sends requisitions for the outside processing items associated with outside resources when you perform move transactions on jobs or repetitive schedules with outside processed assemblies • Purchasing charges outside resources to jobs or repetitive schedules when you receive the outside processing items
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Setups in Inventory
• Define an item representing the outside processing vendor labor for Purchasing to place on the vendor PO. In the Item Master Purchasing Attributes region, make sure the following attributes are set correctly:
– – – – Purchased = Yes (required). Purchasable = Yes (required). Outside Processing Item = Yes (required) Outside Processing Unit Type = Assembly or Resource
Oracle Outside Processing

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Setups in Inventory
• Outside Processing Unit Type = Assembly or Resource (Assembly is recommended if a tangible item) If the item has an Outside Processing Unit Type of Assembly and the outside resource has a basis of Item, you receive one outside processing item for each assembly you receive. If the outside resource has a basis of Lot, you receive one outside processing item for each job or repetitive schedule. If the outside processing item has an Outside Processing Unit Type of Resource and the outside resource has a basis of Item, you receive the extended quantity (using the outside resource usage rate or amount) of the outside processing item for each assembly you receive. For example, if you purchase 3 hours of plating service for each assembly, (usage rate or amount is 3), then you receive a quantity of 3 hours for each assembly you receive from the supplier. If the outside resource has a basis of Lot, you receive 1 outside processing item extended by the outside resource usage rate or amount for each job or repetitive schedule.
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Define OSP Item

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Oracle Outside Processing

Setups in Bills of Material
• REQUIRED: Define an Outside Processing Department. Enter the location where the outside processed item is to be delivered (example: “Shop Floor” or “Assembly”) as you define the Outside Processing Department. Note: the location must have been previously defined under Purchasing > Setup > Organizations > Locations. • REQUIRED: Add the outside processing resource to a step on the routing. If it is added to the last step, then the item can be received into inventory as soon as the PO receipt is entered and the transaction managers run.

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Oracle Outside Processing

Setups in Bills of Material
• Make sure that the autocharge attribute is set to PO MOVE, not PO Receipt. If you set this attribute to PO MOVE, then the PO receipt automatically generates the WIP Move transaction from the outside processing operation to the next operation on the routing. If you use PO RECEIPT, you must manually perform the WIP Move transaction. The quantity of outside processing items you receive can relate to the assembly quantity on the job or repetitive schedule in several ways depending on the outside processing item’s Outside Processing Unit Type and the outside resource’s basis. In all cases, Purchasing charges the job or repetitive schedule using the extended quantity of the associated outside resource.

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Oracle Outside Processing

Define OSP Resource

Assign OSP Item here

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Oracle Outside Processing

Assign Resource to OSP Dept.

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Oracle Outside Processing

Define Std. Operation
Std. Operation

Assign OSP Resource to the operation

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Oracle Outside Processing

Define Routing

Add OSP Operation to the routing

Note Operation Seq.

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Oracle Outside Processing

Check / Add resources

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Oracle Outside Processing

Define BOM

Assign OSP Operation to required component

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Oracle Outside Processing

Enter Discrete Job
• Create a discrete job for the assembly. If the outside processing step is on the first step on the routing, releasing the job will trigger creation of the requisition. If the outside processing step is NOT the first step, then a move transaction must be performed using the Move Transaction window. Move the quantity to be processed by the outside vendor into the Queue step of the outside processing operation step. This triggers creation of the requisition
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Enter Discrete Job

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Oracle Outside Processing

Check Routing for Assembly

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Oracle Outside Processing

Check Resources for OSP operation

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Oracle Outside Processing

Release Job

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Oracle Outside Processing

Move Transactions

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Oracle Outside Processing

Move Transactions

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Oracle Outside Processing

Requisition Import
• Now the job is in Queue step of operation 40, which is Out-Side Processing operation (OSP). As explained before at this point in time one requisition gets triggered for item assigned to resource of OSP operation. • Requisition import program needs to be run to create requisition. • Run program with Import Source= WIP

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Oracle Outside Processing

Requisition Import

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Oracle Outside Processing

Requisition Import

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Oracle Outside Processing

Search for Req. Created

Item assigned to resource of OSP Operation

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Oracle Outside Processing

Requisition Details

Note the details

PO has not yet created

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Oracle Outside Processing

Auto Create PO

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Oracle Outside Processing

Auto Create PO
• Select the line. • Provide Supplier Details on next screen

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Oracle Outside Processing

Auto Create PO

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Oracle Outside Processing

Requisition Details
• Query the requisition once again and see the PO number populated.

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Oracle Outside Processing

PO Details

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Oracle Outside Processing

PO Shipment Details
• In the PO line, set the over receipt tolerance for the item to zero so that no one can receive a quantity greater than on the PO. If a quantity greater than that in the work order is received, it will cause problems with the WIP move transaction to the next operation. THIS IS VERY IMPORTANT. There will be problems if more is received than is on the work order outside processing operation step. This is another reason to use a blanket PO

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Oracle Outside Processing

Submit PO for Approval

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Oracle Outside Processing

Approved PO

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Oracle Outside Processing

Query PO for Receipt

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Oracle Outside Processing

Save Receipt

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Oracle Outside Processing

Receiving Transaction Summary

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Oracle Outside Processing

PO received and delivered
• Once the PO has been received and delivered, and the Move transaction manager has run, you can see that the discrete job has been updated and the item is now in the “To Move” intra-operation step of the outside processing operation step. • Go to WIP > Job/Schedule Details > Operations and select the Quantity alternative region. You should see the received quantity in the To Move intra-operation step of the outside processing operation step. • If the Move transaction has failed or has not yet run, you will see it in WIP > Move Transactions > Pending Transactions.
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Checking Status of Job

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Oracle Outside Processing

Checking Status of Job

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Oracle Outside Processing

Completion Transactions
• If the step is the last step on the routing, do a WIP completion transaction into inventory. Otherwise, continue with the routing steps until complete

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Oracle Outside Processing

Completion Transactions

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Oracle Outside Processing

Completion Transactions

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Oracle Outside Processing

Complete Discrete Job

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Oracle Outside Processing

Thank You
• Please post your comments on

• http://functionalguy.blogspot.com/2008/10/out-side-processing

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Oracle Outside Processing

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