Release 12.1
Part Number E13685-05
Contents
Previous
Next
| Oracle Project Manufacturing Implementation Guide Release 12.1 Part Number E13685-05 | Contents | Previous | Next |
This chapter covers the following topics:
This chapter describes the key features related to project execution.
Project Manufacturing uses Oracle Purchasing and iProcurement for project procurement. The system provides:
Project and task references on purchase requisitions
Project and task references on purchase orders
Project and task references on blanket releases
Project and task references on Request for Quotations (RFQs)
Project and task references on purchase quotations
Purchasing for project expense and project inventory items
Commitments for project expense and project inventory items
Project drop shipments
Project outside processing
Project internal requisitions
Receipts into project inventory
Related Topics
Oracle Project Manufacturing without Oracle Projects
The following figure describes a generic high level Project Procurement flow.
Project Procurement Flow
A complete project procurement cycle starts with the generation of a purchase requisition. The sources for creating a requisition are:
Planned orders
Drop shipments
Outside processing operations
Manual entry via Oracle Purchasing or Self Service Applications (iProcurement)
Import from external systems (using ReqImport)
Depending on certain company regulations (or compliance with FAR/DFAR requirements) it might be necessary to generate a Request For Quotation (RFQ) for a requisition. You can use the Auto-Create RFQ function to automatically convert the requisition into a RFQ.
The RFQ is typically sent out to one or more suppliers, who respond by sending in their quotes. The quote can be generated from a RFQ using the Copy functionality. You can analyze and approve a quote and use the quote in Auto-Source Rules.
The last step is to create a project purchase order. The project purchase order can be automatically generated from a project requisition using the Auto-Create Purchase Order functionality, entered manually, or created from a project quotation using the Auto-Create Purchase Quotation functionality.
Project committed costs represent the outstanding requisitions and purchase orders charged to a project, and include recorded but unposted supplier invoices, or recorded but unposted deliveries to inventory or shop floor destination. You can report the total costs of a project by reporting the committed costs along with the actual costs.
Total Project Costs = Committed Costs + Actual Costs
You can report the flow of committed costs through Oracle Purchasing, Oracle Payables, and Oracle Inventory. These can include the following committed cost buckets (asset or expense items):
Open Requisitions (unapproved or approved, unpurchased requisitions). These do not include internal requisitions.
Open Purchase Orders (unapproved or approved, uninvoiced purchase orders).
Pending Invoices (supplier invoices not yet interfaced to Oracle Projects).
Manufacturing (PO delivery to Inventory destination: project subinventory/locator; or Shop Floor (outside processing) destination: project discrete job); all not yet interfaced to Oracle Projects).
Once either the supplier invoice, for expense items, or the PO delivery to inventory or shop floor, for inventory/shop floor destination items, is interfaced and posted to Projects, the related commitment is settled to zero and an actual cost recorded in the Project Cost Subledger.
You can report summary committed cost amounts for your projects and tasks and can review detailed requisitions and purchase orders that backup the summary amounts.
Note: Essentially all of the commitment tracking occurs within Oracle Projects, specifically the Projects PSI (Project Status Inquiry) function. Oracle Purchasing reports PO Commitment Initiations in the Purchase Order Commitment By Period Report, but does not report downstream PO Commitment status changes or commitment settlements. PSI amounts may be exported to a spreadsheet for subsequent reporting.
During the implementation the following notes need to be considered.
MRP, outside processing, internal sales orders, and drop shipments generate one requisition for each planned order with one requisition line and one requisition distribution line.
You can manually enter a requisition with multiple requisition lines. Each line can have a distribution line that can be associated with a project and task. For a Project Manufacturing environment we support the following scenarios for requisitions with inventory destination:
For each requisition line you can enter one distribution line with project and task. (See Note below.)
For each requisition line you can enter multiple distribution lines with the same project and task. (See Note below.)
For each requisition line you can enter multiple distribution lines with different projects and tasks. (See Note below.)
For each requisition line you can enter one or multiple distribution lines without project and task (common inventory).
Note: Manual project requisitions entered via Self Service Applications (iProcurement) have one minor difference when compared to those entered via Oracle Purchasing. For efficiency and ease-of-use, requisitions entered via Self Service Applications allow entry of the Project/Task data at the LINE level (NOT the distribution level).
In the scenario of multiple distribution lines with different projects and tasks, choose the multiple lines option during receiving, and the locator defaulting and validation logic make sure that the correct project and task are propagated on the locator.
For purchases with expense destination you can enter requisition lines with multiple distribution lines that each have a different project and task.
Expense and Inventory Purchases are costed differently in the system. Expense purchases result in invoices, are entered in Payables, and are imported into Oracle Projects using Transaction Import. Oracle Projects incurs the invoice costs.
Inventory Purchases are received into Inventory using receiving functionality. Upon receipt into the destination location the purchase costs are posted to Oracle Cost Management and interfaced to Oracle Projects. For Inventory Purchases you also book invoices and invoice costs in Payables. Oracle Projects ignores these transactions during Transaction Import in order to avoid double counting.
Invoice Price Variances (IPV) can be automatically calculated and transferred to Projects.
For Inventory Purchases the system checks the Project Control Level for the destination inventory organization upon entry of the distribution line project and task. If the control level in the destination (receiving) organization is set to Project, you can optionally enter a project and task. If the control level is set to Project-Task, you can enter a project. If you enter a project, you must also enter a task.
In creating a RFQ from a requisition the following restrictions apply:
A RFQ line with project and task is created for each requisition line during Auto-Create RFQ. The system populates the project and task on the RFQ line from the first requisition distribution line for that requisition line.
Grouping rules should not be used. You should create one RFQ line for each requisition line with one distribution line.
For more information on project locators validation and defaulting during receiving transactions, see the chapter Setting Up.
Note: Oracle Project Manufacturing supports copying of project quote to project purchase orders.
When you perform a Purchase Order Delivery Transaction for a project purchase order, the system defaults the project and task from the distribution line of the PO to the receiving locator.
If you define Item Transaction Defaults for receiving locators for specific items in Inventory Setup (assuming these are physical locators), the system concatenates the default locator with the project and task references from the PO distribution line at the time of receiving into Inventory destination.
If you update the project and task on the receiving locator, they are validated against and must exactly match the project and task on the distribution line of the PO.
When you perform a Purchase Order Return Transaction, the system defaults the project and task from the PO distribution line to the from locator.
If you update the project and task segments of the from locator on a PO return, they are validated against and must exactly match the project and task on the PO distribution line.
When you perform a Purchase Order Adjustment Transaction, the system defaults the project and task from the PO distribution line to the locator.
If you update the project and task segments of the locator on a PO Adjustment, they are validated against and must exactly match the project and task on the PO distribution line.
Note: You can not use a project locator for the above transactions if the PO distribution does not have project and task.
Related Topics
Oracle Purchasing User's Guide
You can add project references to standard and nonstandard discrete jobs. Projects that have been setup on the PJM Project Parameters in the organization performing the job can be entered on the Work Order window. Project jobs make it possible to track the material and manufacturing costs that are specific to a project. You can issue project or common inventory to project jobs. You can also charge resources and overhead to project jobs.
Like other discrete jobs, project jobs can created in several ways:
manually defined in the Discrete Jobs window
planned in Oracle Master Scheduling/MRP and Oracle Supply Chain Planning then implemented using the Planner Workbench
automatically created through FAS program in the case of Configure-to-Order scenarios
Oracle Project Manufacturing uses the progress percentage value for project tasks, which can then be rolled up to the project level for earned value. Work order completion percent information is available through a Project Manufacturing API. Use the WIP_OPERATIONS_GRP API specifically to display the WIP Operations progress percentage rollup value for project tasks.
The following sections describe the behavior of WIP material requirements and transactions when a Discrete Job is created with Project and task references.
When you define a project discrete job for an item that has a bill of material, the bill is copied to the project discrete job. If the components are hard pegged (their pegging attribute is set to either Hard Pegging or End Assembly/Hard Pegging in the MRP Planning tabbed region of the Item Master), then the system defaults the project and task from the project discrete job header to their supply locator. If you assigned supply locators (common locator) on the bills of material, the system concatenates the supply locators with the project and task to create a project locator.
If the components are soft pegged, (their pegging attribute is set to either Soft Pegging or End Assembly/Soft Pegging in the MRP Planning tabbed region of the Item Master) the system does not default the project and task segments to the supply locators.
Component picking, obtaining requirements for specific jobs and schedules, is the process of moving items from source locations and issuing them to work orders. In previous versions of Oracle Work in Process, items were issued from locations specified for each component on the bill of material. Now you can also use a rules based system to determine a recommended source location for each component. The features for component picking include:
The Component Pick Release window is used to select requirements and create move orders for discrete jobs, lot based jobs, repetitive schedules, and flow schedules.
Move orders are created for picked items. Move orders are requests for the movement of material within an organization. They enable the replenishment of material within a warehouse or manufacturing shop floor.
The source for material picked is based on Oracle Inventory allocation rules entered on the Picking Rules window. If Oracle Warehouse Management is installed, rules based picking recommendations are used. Please see PJM and Warehouse Management Integration Chapter for more details.
The destination for picked material depends on the supply type. It can be a staging area, or directly to a job or schedule.
Implementation Notes: In a Project Manufacturing organization, the source for material is matched against the project information on the supply requirements (destination). For a soft-pegged item, the supply information does not have a project/task reference. Hence, during the component pick release process, the system only allocates material with no project/task reference. For a hard-pegged item, the supply information has a project/task reference. Hence, during the component pick release process, the system only allocates material with the matching project/task reference.
The system validates the supply locator for a Component Issue Transaction for a project discrete job. The supply locator must satisfy one of the following criteria:
No project/task reference on the supply locator.
The project and task on the supply locator must match the project and task exactly on the project discrete job.
Same project but different task, if the Organization parameter PJM: Allow Cross Project Issues is set to Yes.
Different project than on the project discrete job within the same Organization: The Organization parameter Allow Cross Project Issues is selected.
If you enter or update the project and task segments of the supply locator on a Component Return, they are validated and must satisfy one of the following criteria:
No project/task reference on the supply locator.
The project and task on the supply locator must exactly match the project and task on the project discrete job.
Same project but different task: Organization parameter Allow Cross Project Issues is checked.
Different project than on the project discrete job within the same Organization: Organization parameter Allow Cross Project Issues is checked.
When you create a project discrete job, the system defaults the project and task from the project discrete job to the project and task segments of the completion locator. If you assigned a completion locator (common locator) to the routing, the system concatenates the common locator segments with the project and task to create a project locator. However, the project discrete job can be completed into the project locator having the project and/or task same as defined on the project job irrespective of the Organization parameter: Allow Cross project issues enabled.
When you enter or update the project and task segments of the completion locator on a Return Assembly to WIP Transaction, they must match the project and task exactly on the project discrete job.
When you perform a project work order-less completion, you must specify the assembly, quantity, project, or project and task, and other information. When the transaction is saved, the system defaults the project and task from the transaction to the completion locator. (The dynamic creation of locator should be allowable). Work order-less completions automatically backflush all operation pull, assembly pull, and push components.
Note: You cannot use a project locator as a completion locator, or a supply locator for all of the above transactions against a non-project (common) discrete job.
You cannot use / install Oracle Shop Floor Management in a Project Manufacturing Organization.
Flow Manufacturing is a set of manufacturing processes and techniques designed to reduce product cycle time through line design and line balancing, reduce product costs by minimizing inventories and increase inventory turns, and to enhance product quality through total quality control. It is significantly different from other manufacturing processes in that it is a just in time (JIT) or demand based pull system that manufactures to customer order.
You can reference project task information on a flow schedule. When you perform the work orderless completion transaction, the system copies project task information from the flow schedule to the project task fields in the transaction. When the transaction is saved, the system defaults the project and task to the completion locator segments. The system also references the project task information on the supply locator for hard-pegged components during the completion transaction. When the transaction is saved, the material for hard-pegged components is pulled from the project task inventory.
Related Topics
Creating Flow Schedules, Oracle Flow Manufacturing User's Guide
Work Order-Less Completions, Oracle Work in Process User's Guide
Oracle Enterprise Asset Management (eAM) enables you to schedule and plan maintenance activities, and track all work activity and costs related to assets throughout an organization. eAM provides you with a set of tools that address asset maintenance requirements for environments that are asset intensive. You can perform the tasks of asset management in the most cost effective, efficient way.
You can associate a maintenance work order with project task information. The WIP accounting class linked to the project is referenced on the work order. If you have setup WIP accounting class at the task level, the system defaults the appropriate value to the work order. If a requisition or purchase order is created for that work order, commitments for the work order is associated project or task are created. When the material is received against the work order, and the appropriate cost transfers have happened, the commitment is converted to cost in Oracle Projects.
As you apply resources or material to the work order, the system appropriately captures the project task information on the resource or material transactions. The Project Cost Collector process passes appropriate costs to Oracle Projects.
Note: You must define at least one standard WIP accounting class in your organization and reference it as a default in the WIP parameters at the organization level. If this information is not present, the system does not allow project task references on enterprise asset management work orders.
Related Topics
eAM Work Orders, Oracle Enterprise Asset Management User's Guide
The system applies the Common Validation logic to the following transactions:
Miscellaneous Issue
Miscellaneous Receipt
Subinventory Transfer
Locator Transfer
Inter organization Transfer (Direct)
Inter organization Transfer (Intransit)
Cycle Count Adjustment
Physical Count Adjustment
When you perform Pick Release for a project sales order, the system ensures that you can only pick release from the project locators that have the same project and task as the sales order line.
Consigned Inventory from Supplier refers to the type of consigned inventory practice in which you receive and maintain goods belonging to one or more of your suppliers. Buyers or plant managers define the items and suppliers for which they have a consignment relationship. Buyers then create purchase orders for consignments in response to requisition demand. Goods are received against the order and held in consignment stock until they are actually consumed for usage. Ownership of the material is transferred from the supplier to the owning organization upon consumption. A consumption advice document informs the supplier that consigned stock is consumed by the buying organization. Once consigned stock is consumed, suppliers are then able to invoice the buying organization. Optionally, if pay on use is used, the buying organization can create invoices on behalf of the supplier and fully automate the payment process.
You can issue consigned items to project inventory/orders. Sourcing rules are used to identify the appropriate purchasing agreement at the time of consumption to obtain the item price for cost transactions. Please note that the consumption advice serves as a financial instrument for supplier invoice creation and does not reference any project/task to which the item has been issued.
Listed below are examples of transactions that you can perform in a Project Manufacturing organization:
You can perform a Project Transfer transaction to transfer ownership of the item from consigned to project inventory. You can enter the locator of the consigned item in the “[from] locator” field and enter a locator with a project in the “to locator” field on the Project Transfer window. The following transactions/accounting distributions are performed (ignoring overhead application):
Item ownership is transferred from Consigned to Common Cost Group
Debit Common Cost Group Material Valuation Account
Credit AP Accrual
Item cost is transferred from Common Cost Group to Project Cost Group
Debit Project Cost Group Material Valuation Account
Credit Common Cost Group Material Valuation Account
You can perform a WIP Component Issue to transfer ownership of a consigned item to a project WIP job (backflush or manual issue). The following transactions/accounting distributions are performed (ignoring overhead distribution):
Item ownership is transferred from Consigned to Common Cost Group
Debit Common Cost Group Material Valuation Account
Credit AP Accrual
Item Cost is transferred from Common Cost Group to Project Cost Group
Debit Project Cost Group Material Valuation Account
Credit Common Cost Group Material Valuation Account
Item Cost is transferred from Project Cost Group to WIP
Debit WIP Accounting Class Material Valuation Account
Credit Project Cost Group Material Valuation Account
Copyright © 2000, 2014, Oracle and/or its affiliates. All rights reserved.