Understanding Reservations for Different Types of Items
The section discusses how the reservation processes handle different types of orders, including:
Soft reservations
Non-soft reservations
ATP-reservations
Lot allocations
Pegged supply and demand
Product Kits
Work orders
With soft-reservation processing, part of the business unit's total available quantity for the item is reserved for an order line and cannot be consumed by other orders staged for fulfillment processing.
To manage short-supply situations, you can require that soft-reserved items be reserved only manually, using the Shortage Workbench, which enables you to control which orders receive the available quantity of an item. You can also control the sequence in which orders for soft-reserved items are processed by establishing inventory priority rules that help to ensure the stock is soft reserved for the most profitable orders first.
Defining Soft-Reserved Items
To flag items for soft reservations processing, the Soft Reserve check box must be selected. You can set this option at the business unit level on the Setup Fulfillment-Reservation page and override it for specific items on the Setup Item Fulfillment page.
Requiring Manual Soft Reservation
To require that a soft-reserved item be reserved only manually using the Shortage Workbench, select the Reserve Online option for the business unit on the Setup Fulfillment-Reservation page or for a specific item on the Setup Item Fulfillment page.
Reserving orders manually enables you to control how the business unit's available quantity is distributed among the order lines flagged for soft reservation processing. All non-lot-allocated order lines identified for soft reservations can be soft reserved manually using the Shortage Workbench. However, those identified only for manual reservations (the Reserve Online check box) must be reserved in this manner, as the Reserve Materials process, online reservations, Fulfillment Workbench, and Inventory Reservation EIP do not pick up order lines that require manual reservations.
Soft Reservation Processing
Order lines identified for soft reservations, but not requiring manual reservations using the Shortage Workbench, can be processed by the Reserve Materials process, online reservations, Fulfillment Workbench, and Inventory Reservation EIP using the reservation and backorder rules to determine when to reserve and move the fulfillment state from unfulfilled to releasable. The reservation processes only pick up demand lines that match the search criteria of the process and that have scheduled shipment dates falling within the reservation lead days. The number of reservation lead days is specified at on the Setup Fulfillment-Reservation page (business unit level) and can be adjusted for specific items using the Setup Item Fulfillment page (item level). The reservation lead days can be overridden on the fulfillment transaction request.
If there are no reservation and backorder rules, the reservations process reviews the Partial Quantities Can Ship and Cancel Backorder check boxes on the order line to determine whether partial quantities are permitted and whether backorders should be created for any unfulfilled quantity. These options can be set during order entry using the Order Entry Form component in PeopleSoft Order Management or the Create/Update Stock Requests component in PeopleSoft Inventory. For stock requests created automatically by other PeopleSoft application processes (except for stock requests created from planned messages), the default values come from the Setup Fulfillment and Setup Item Fulfillment components.
The Partial Quantities Can Ship and Cancel Backorder check boxes work together to determine the reservation and backorder decisions. The following actions are taken depending on the settings:
If the Cancel Backorder check box is not selected and the Partial Quantities Can Ship check box is selected, then partial quantities are reserved and a backorder created for the shortage.
If the Cancel Backorder check box is not selected and the Partial Quantities Can Ship check box is not selected, then either the full requested quantity is reserved and released or no quantity reserved and released.
A backorder is created for the full quantity if no quantity is reserved
If the Cancel Backorder check box is selected and the Partial Quantities Can Ship check box is selected, then a partial quantity is reserved and the backorder is canceled for the shortage.
If the Cancel Backorder check box is selected and the Partial Quantities Can Ship check box is not selected, then full quantity is canceled if it is not available to be reserved.
At shipping time, if the Partial Orders Can Ship check box on the Setup Fulfillment page is not selected, then the shipping processes do not allow any of the lines on the order or unit of work to be shipped unless all of the lines within the order or unit of work can be shipped.
Note: When a backorder is created and the Create Adhoc Requisitions check box on the Setup Fulfillment page has been selected, then an adhoc replenishment request is created to be processed by PeopleSoft Purchasing or a third-party purchasing application.
Calculating the Available Quantity
The reservation processes calculate the available quantity to reserve as:
Quantity requested on the demand line (QTY_REQUESTED_BASE).
Less the quantity already allocated or promised (QTY_ALLOCATED_BASE or QTY_PROMISED_BASE)
Less the quantity backordered (QTY_BACKORDER_BASE)
Less the quantity pegged to an incoming supply (QTY_PEGGED_BASE)
Less the quantity shipped (QTY_SHIPPED_BASE). This can apply when a work order demand line has been issued at least once.
Interunit Transfer Order Lines
The fulfillment engine handles interunit transfers slightly differently from other order lines.
For interunit transfer orders for soft-reserved items, the fulfillment engine calculates the available quantity to reserve by subtracting the interunit par quantity (BU_ITEMS_INV.qty_iut_par) defined for the item from the current available quantity (BU_ITEMS_INV.qty_available) for the item.
The interunit par quantity is defined for the business unit on the Define Business Unit Item - Inventory: Shipping/Handling page.
If reservation or backorder rules are not used on the demand line then the reservation process uses the Partial Quantities Can Ship check box and the Allow Interunit Backorders check box on the Setup Fulfillment page.
If both the Partial Quantities Can Ship check box and the Allow Interunit Backorders check box are selected, the fulfillment engine soft reserves or promises as much of the requested quantity as possible and backorders the remaining quantity. If the Allow Interunit Backorders check box is clear, the fulfillment engine does not create a backorder for the remaining quantity.
Non-soft reserve items refer to items that are not identified for soft-reservations or ATP reservations. For non-soft reserve items, the reservation processes do not reserve or promise stock, the line is not checked for whether partial quantity fulfillment is permitted, the line is not checked for whether it is in the reservation lead days window, and no backorders or adhoc requisitions are created. In fact, the reservation processes can be skipped for non-soft reserve items by using the Non-Soft Reserved State field on the Setup Fulfillment page. Select the Releasable option to initially add a demand line for non-soft reserved items in the releasable state, bypassing the reservation process. If you select the Unfulfilled option, then the demand line must go through the reservation processes and meet the criteria of a reservation rule to be set to the releasable state.
For non-soft-reserved order lines, the partial quantity option is verified by the Order Release Request process to determine whether the line can be included on a picking plan. If partial quantity fulfillment is not permitted, and there is not enough quantity available to pick the full demand quantity, the order line is excluded from the pick batch ID. Before generating a picking plan for non-soft-reserved orders, you can confirm that enough quantity is available to pick using the Picking Shortage report and adjust picking quantities as necessary using the Shortage Workbench.
For non-soft-reserved order lines, backorders are created when you:
Partially lot-allocate a sales order line from the Order Entry Form component in PeopleSoft Order Management or from the Allocate Lots page in PeopleSoft Inventory.
Ship a smaller quantity than requested for an order line using either the Shipping/Issue component or the fulfillment engine shipping request.
Pick a smaller quantity than requested and run the Picking Confirmation process (INPBCONF) for an auto-processed demand line.
Note: This section does not apply to non-soft reserve items on a work order from PeopleSoft Maintenance Management.
Defining Non-Soft-Reserved Items
To flag items for non-soft reservations processing, the Soft Reserve check box must be clear. You can set this option at the business unit level on the Setup Fulfillment-Reservation page and override it for specific items on the Setup Item Fulfillment page.
ATP-reserved order lines are promised, not actually reserved. ATP-reservation processing refers to the ability to promise a scheduled shipment date based on available-to-promise (ATP) calculations of future supply and demand. Orders for ATP-reserved items can be promised by the Reserve Materials process, online reservations, Fulfillment Workbench, and Inventory Reservation EIP in PeopleSoft Inventory. Quantity for promised orders is not subtracted from the business unit or storage location's available quantity until the order line has been allocated by the Order Release Request process or confirmed as picked by the Picking Confirmation process.
Defining ATP-Reserved Items
The ATP-reservations option is an item attribute that you set at the SetID level. However, due to data validation requirements, you must complete item attributes and fulfillment setup data for ATP-reserved items at the business unit level before activating the ATP-reservation option for the SetID.
Here's how to define an ATP-reserved item:
Define the SetID attributes for the item, except for the promise option.
Define the SetID attributes for the ATP-reserved item as you would for any other item using the Define Item component. Do not, however, select a promise option for the item on the Define Item - General: Common page.
Define the business unit attributes for the item at all applicable business units.
Using the Define Business Unit Item component, define the business unit level attributes for the item in all of the business units in which the item is to be used.
Define non-soft reservation processing for the item in all business units in which it is defined.
In each of the business units that contain the item, define non-soft reservation processing for the item. To flag items for non-soft reservations processing, the Soft Reserve option must be clear. You can set this option at the business unit level on the Setup Fulfillment-Reservation page and override it for specific items on the Setup Item Fulfillment page.
Once the business unit item attributes and setup fulfillment data have been established for the item, return to the Define Item - General: Common page and select Perform ATP Reservations as the item's Promise Option field.
ATP-Reservation Processing
Order lines identified for ATP-processing, but not requiring manual reservations using the Shortage Workbench, can be processed by the Reserve Materials process, online reservations, Fulfillment Workbench, and Inventory Reservation EIP using the reservation and backorder rules to determine when to promise and move the fulfillment state from unfulfilled to releasable. The reservation processes only pick up demand lines that match the search criteria of the process and that have scheduled shipment dates falling within the ATP lead days enter on the Setup Fulfillment-ATP Reservations page. The reservation processes call the ATP function to calculate the cumulative ATP quantity of an item that can be shipped on a given scheduled ship date and then promise cumulative ATP quantity to the demand line.
If the scheduled shipment date of the demand line is outside the reservations lead days time period, but within the ATP lead days time period, then the reservation process may promise either the entire requested quantity or nothing at all. When the demand line is within the reservation lead days time period, then partial quantities may be promised based on the reservation rules or the Partial Quantities Can Ship check box.
Create an order line for quantity that can be promised on the requested ship date.
Select the next ship date on which the full requested quantity can be promised.
Break the requested quantity into multiple schedule lines, each having the maximum quantity that can be promised for different schedule ship dates.
If a demand line meets the criteria of a reservation rule, then the ATP item is promised and set to the releasable state.
Note: ATP items on a work order from PeopleSoft Maintenance Management cannot be promised.
Allocations can take place before the demand line is in the Released state in the demand fulfillment cycle; this is called a pre-allocation. PeopleSoft Inventory defines the following types of pre-allocations:
Pre-Allocation: Refers to an allocation to a material storage location (MSL) that is created before the picking fulfillment step; that is, while the demand line is in the Unfulfilled or Releasable state. Pre-allocations can occur when pegged stock is putaway in the inventory business unit or when you pre-allocate stock to a demand line.
Lot-Allocation: Refers to allocating a specific lot ID to fulfill a lot-controlled item on a demand line. This is a type of pre-allocation since it takes place when the demand line is in the Unfulfilled or Releasable fulfillment state. It differs from other pre-allocations in that the demand line is allocated to a particular lot ID, then the system selects the MSLs related to the lot ID.
Order lines for items defined for both soft reservation and non-soft reservation processing (including ATP-reserved items) can be pre-allocated. Order lines for lot-controlled items can be lot allocated or pre-allocated, but not both.
A pre-allocation can be created by:
The pegging feature.
The Allocation Workbench.
The Create/Update Stock Request component.
The Shortage Workbench.
For sales orders, the Order Entry Form component within PeopleSoft Order Management.
The Inventory Create Stock Request EIP (Enterprise Integration Point) or the Inventory Reservation EIP
A lot allocation for a lot-controlled item can be created by:
The Allocation Workbench.
The Allocate Lots component.
The Create/Update Stock Request component.
For sales orders, the Order Entry Form component within PeopleSoft Order Management
The Inventory Create Stock Request EIP (Enterprise Integration Point) or the Inventory Reservation EIP using the LLS level of the message where the ALLOCATE_SOURCE field, MSL, and lot ID are located.
Pegging links demand to incoming supply. You can create a peg chain between a supply transaction and a demand transaction from either side. Only soft-reserve items can be pegged when working with material stock requests and sales orders.
When pegged supply is received and putaway into a PeopleSoft Inventory business unit, the Complete Putaway process reserves or pre-allocates the putaway quantity to an outgoing demand (materials stock request, interunit transfer, sales order, or work order). This prevents the incoming supply from being used to fulfill another demand transaction. The Complete Putaway process performs a soft-reserve or pre-allocation based on your setting in the Pegging Setup page or the Pegging Item Setup page. The outgoing pegged demand line is still in the unfulfilled state, except for work order demand lines that stay in the pending state. The pre-allocation reserves quantity both at the business unit and the material storage location levels for the order line and inserts the demand line for the allocated quantity into the IN_DEMAND table. The soft-reservations is the same as the soft reserve described earlier in this section.
Select the Release Multiple Kits check box on the Setup Fulfillment-Reservation page to allow only complete product kits to be set to releasable status by the reservation processes. When processing product kits from PeopleSoft Order Management, there may be insufficient quantity of one or more of their required components to reserve all of the complete kits requested. This check box instructs the Reserve Materials process, online reservations, Fulfillment Workbench, and Inventory Reservation EIP to send only complete kits downstream to the releasable state. For example; suppose that product kit X consists of 2 units of item A and 1 unit of item B. The demand line requests a quantity of 10 product kit X. Available stock includes 22 units of item A and 4 units of item B. The system can reserve 20 units of item A and 4 units of item B, then 8 units of item A and 4 units of item B (4 complete kits) are set to releasable status and passed downstream for picking.
For any quantities initially reserved, promised, or lot-allocated but could not be set to releasable, in this case, 12 units of item A, the system follows the backorder rules to determine if the items stay reserved, promised, or lot-allocated. On the backorder rules:
If the action is Create a Backorder, then the leftover quantity is backordered and any reserved, promised, or lot-allocated quantity remains reserved, promised, or lot allocated.
If the action is Cancel Backorder, then the quantity is canceled and made available to other demand lines.
If the action is Release as Shortage, then the backorder decision should be made based on the shipping line-level backorder rule. If no line-level shipping backorder rule exists, the backorder decision should be made based on the Cancel Backorder flag.
Note: Kit components with the Optional Ship flag set on their definition, are ignored, when calculating the multiples of kits that can be sent downstream to the releasable state.
Before reserving product kit components, you may want run the Kit Re-Explode process. The Kit Re-Explode process gives you to ability to synchronize the product kits on a sales order or material stock request with the latest product kit definition on the Product Kit Summary page.
PeopleSoft Maintenance Management manages the maintenance and repair of a capitalized asset. Maintenance and repair of an asset may require parts from PeopleSoft Inventory. Work Orders from PeopleSoft Maintenance Management can place demand for items into a PeopleSoft Inventory business unit.
Inventory item quantities located on a work order from Maintenance Management can be:
Committed
When a work order part is committed to inventory, then the item is placed in the demand fulfillment (IN_DEMAND) table, displayed in the Product/Item Availability page, and used by the Create Replenishment Requests process. When a work order line is committed there is no reservation or allocation; only visibility of the demand line in PeopleSoft Inventory. A work order line is committed to PeopleSoft Inventory based on the inventory commit rule found on the work order. Work order demand lines containing both soft-reserve items and non-soft reserve items can be committed to the demand fulfillment table.
Reserved
For soft reserve items only, a work order line can be reserved in PeopleSoft Inventory using the:
Online reserve process from the Work Order pages in PeopleSoft Maintenance Management.
Reserve Materials process in PeopleSoft Inventory.
Shortage Workbench in PeopleSoft Inventory. The workbench can also unreserve stock on a work order line.
Complete Putaway process when pegged supply is received into the inventory business unit.
Online reserve process in PeopleSoft Maintenance Management can automatically run after a work order has been created by the Run Projections or Run Preventive Maintenance processes. This is based on the WO reserve rules.
Note: Work order demand lines do not follow the same fulfillment process as demand lines from sales orders or material stock requests. Work orders use different fulfillment pages to pick and issue stock.