Use Supply Chain Orchestration in Your Back-to-Back Flows

Supply Chain Orchestration uses three types of back-to-back flows: make, buy, and transfer.

Here's what orchestration does.

• Create and manage the supply order.

• Send a request depending on the type of flow.

  • Make. Send work order to Manufacturing in Inventory.

  • Buy. Send purchase order to Purchasing.

  • Transfer. Send transfer order to Inventory.

• Track updates and statuses and send them to Order Management.

• Close the supply order after Order Management ships the item to your customer.

Supply Chain Orchestration also supports available-to-promise (ATP), where inventory already exists in the warehouse ready for shipping.

Back-to-back Fulfillment

Supply Chain Orchestration creates the supply request only after Order Promising schedules the sales order. Use it for an item that your fulfillment systems select not to stock. Use it to expand your item offering when you don't stock the item.

Supply Chain Orchestration maintains a firm link between the demand document, such as a sales order, and the supply document, such as the purchase order, transfer order, or work order, in back-to-back flow. A firm link makes sure the supply chain can't allocate supply incorrectly or divert it to fulfill some other demand. Use back-to-back when fulfillment must happen on time and you must meet high customer satisfaction.

Use the Product Information Management work area to enable the item for back-to-back fulfillment.

Use the Order Promising work area to set up the sourcing rules that determine your options for creating supply.

Use back-to-back when you must view demand, supply, and exceptions in the flow.

Supply Chain Orchestration and Order Orchestration

Back-to-back fulfillment doesn't keep supply on hand in the warehouse, so your back-to-back flow does supply chain orchestration and order orchestration. Supply Chain Orchestration gets the goods that the sales order needs into the warehouse, then order orchestration ships it to your customer.

Supply Chain Orchestration orchestrates how to create and get supply into the warehouse.

• An application, such as Order Management, sends a supply request to Supply Chain Orchestration. Different applications can send a request. Supply Chain Orchestration might or might not fulfill a sales order from Order Management.

• Supply Chain Orchestration creates a supply order.

• The supply order uses orchestration processes and business rules that Oracle has optimized to orchestrate supply.

• These processes and rules create and manage the purchase orders, work orders, and transfer orders that create supply in your warehouse.

Order orchestration orchestrates how to fulfill and deliver the item to your customer.

• Order orchestration fulfills a sales order from Order Management.

• Order orchestration doesn't fulfill supply requests. Instead, it sends a supply request to Supply Chain Orchestration.

• Order orchestration uses a set of orchestration processes that Oracle has optimized to orchestrate your fulfillment system.

• Your fulfillment system uses the warehouse to ship the item to your customer in the most cost-effective way while meeting the requested delivery date.

An Orchestration Process Does the Work

An orchestration process contains steps, and each step does a task. Supply Chain Orchestration uses different orchestration processes depending on the flow.

Flow	Steps
Sales Order	Create and stock supply before you need it. Reserve supply. The supply already exists, so the flow reserves enough supply to meet demand from the sales order. Ship the item. Invoice the item.
Sales Order with Back-to-Back Flow	Create supply only when you need it, on demand, in direct reply to a purchase request. Request supply. Back-to-back doesn't keep supply in inventory, so it must request supply. Wait for flow to create supply. It usually takes time to purchase, make, or transfer the item, get it into the warehouse and ready for shipping. Ship the item. Invoice the item.
Sales Order with Drop Shipment	Drop ship the item from your supplier. Schedule the item so your supplier is ready to fulfill it when you need it. Create requisition to get purchase order approved. Create purchase order so you can buy the item from your supplier. Your supplier ships the item. Invoice the item.

Your Setup Selects the Orchestration Process

Settings you make for the item and the business rules you create at design time will select the orchestration process to use for each item at run time.

Note

1. Set the Back-to-Back Enabled option in the Sales and Order Management area of the Specifications tab for the item in the Product Information Management work area.

2. Create available-to-promise rules and sourcing rules in the Global Order Promising work area. These rules optimize flow according to various aspects of your supply chain and your fulfillment goals, such as profitability, availability, capacity of supplier, distance to delivery destination, the type of flow, such as buy, make or transfer, and other aspects specific to your environment.

   The result of the rules determine whether to use your warehouse or outsource supply to a supplier in a drop ship flow.

3. Order Management uses the orchestration process to fulfill the item.

Make Flow

Here's an example of how Supply Chain Orchestration fulfills an item in a make flow for a sales order.

Note

1. Your user adds an item in the Order Management work area and submits it. Order Management sends a request to Supply Chain Orchestration. The request includes details about the item.

2. Order Management submits the item, then sends the sales order to Global Order Promising, and Promising schedules it.

   Promising considers a wide range factors to determine how to schedule supply so it meets the requested delivery date.

   • Examines inventory, lead time, backlog, and other factors to determine availability for the item.

   • Considers the type of request. For example, it might take longer to fulfill a make order that to fulfill a transfer order.

   • Uses available-to-promise rules and sourcing rules to determine where to create supply.

   Promising sends a recommendation to Supply Chain Orchestration to create the supply needed to fulfill the item. For this example, assume Promising determines the most efficient and cost-effective way to fulfill the item and meet delivery dates is to make it, so it sends a make request.

3. Supply Chain Orchestration creates a supply order, then sends it to Materials Management in Inventory Management to create a work order.

4. Materials Management creates the work order and makes the item.

5. Planning monitors fulfillment. For example, assume you order a configured item. Planning monitors the components that the work order uses to fulfill the configure options, the item it creates, whether items are in stock or need replenishment, and so on.

6. Shipping ships the item to your customer.

Here are some important concepts.

Entity	Description
Supply order	Contains the supply order lines that Supply Chain Orchestration creates to fulfill one supply request.
Supply order line	Contains details about each supply request.
Tracking line for supply order	Tracking line that monitors the process that fulfills the supply request according to the supply type.
Details for transfer order	Contains details about the request to transfer supply. Captures details in the fulfillment document for the transfer order from Inventory. Applies when the supply type for the tracking line is Transfer.
Details for buy order	Contains details about the request to buy supply. Captures details in the fulfillment document for the purchase order from Purchasing. Applies when the supply type for the tracking line is Buy.
Details for make order	Contains details about the request to make supply. Captures details in the fulfillment document for the work order from Manufacturing. Applies when the supply type for the tracking line is Make.

Buy Flow

How Global Order Promising Sends a Buy Request

Assume Promising analyzes the supply chain and determines the buy flow is the best way to fulfill the sales order, so it sends a buy request.

The flow is the same as the make flow but with a few differences.

1. Global Order Promising sends a buy request instead of a make request.

2. Supply Chain Orchestration creates and sends a supply order to Purchasing to create a purchase order.

3. Purchasing creates the purchase order and sends it to the warehouse in Inventory Management.

4. Shipping ships the item to your customer.

Supply Planning works just like it does for the make flow. It isn't in the diagram for brevity.

Supply Chain Orchestration also uses the buy flow for procure-to-pay, Min-Max, and outside processing (OSP).

Other Flows

Supply Chain Orchestration supports other flows.

• Available-to-promise. Assume you ship a configured item, the AS54888 Desktop Computer. Your customer receives it, realizes they ordered the wrong configuration, and sends it back unused and unopened. You add the item back into inventory, so its now available to fulfill demand for another order.

• Transfer. Create a transfer order to do an internal material transfer from one warehouse to another warehouse, then ship it. If Global Order Promising determines that the exact configured item is available in another warehouse, then it might recommend to transfer supply to the shipping warehouse, or ship it directly from the warehouse that contains the item. Supply Chain Orchestration creates the supply request documents and sends them to Inventory Management.

• Drop. Drop ship item AS54888, Standard Desktop, directly from your contract manufacturer to your customer. The flows goes from Order Management directly to Purchasing.

A More Detailed View

Supply Chain Orchestration orchestrates and manages the flow between systems that request supply and systems that fulfill the supply request.

Supply Chain Orchestration can receive a supply request from an Oracle Application, such as Planning, Order Promising, Order Management, or Inventory. It can fulfill supply in a fulfillment application, such as Purchasing, Manufacturing, Shipping, or Receiving.

Here's an example flow where Supply Chain Orchestration receives a sales order from Order Management. Supply Chain Orchestration does some or all steps, depending on what its processing.

1. Receive a request to create supply.

   Application That Sends Request	Description
   Supply Planning	Receive a request for a planned order. The request might be for a make, buy, or transfer order, or for an inventory organization that you set up as a contract manufacturing organization.
   Order Management, Order Promising, or Oracle Transactional Business Intelligence	Receive a recommendation from Order Promising. Receive demand data from Order Management after it schedules a back-to-back sales order. Supply Chain Orchestration matches the data it receives from Order Promising and Order Management, treats it as one set of data, then uses it to start a make, buy, or transfer flow.
   Inventory Management	Receive a request for internal transfer order for minimum or maximum replenishment.
   File-Based Data Import	You use a spreadsheet to upload orders or requests for internal material transfers into Supply Chain Orchestration.

2. Supply Chain Orchestration prepares to fulfill the request.

   Preparation	Description
   Transform Attributes	Attributes in the supply request might not match attributes in the fulfillment system. So a transformation rule transforms them. For example, a rule might transform the attribute that identifies the supplier in Supply Planning to the attribute that identifies the supplier in Procurement. The rule might transform the attribute name, data type, and so on.
   Create Supply Order	Supply Chain Orchestration creates the supply order so it can set default values in the order and so the orchestration process can process it.
   Set Default Values	Run a rule that sets default values.
   Assign and Call Orchestration Process	Run a rule that assigns and calls the orchestration process. Supply Chain Orchestration comes predefined with different orchestration processes. Each process creates supply differently depending on flow. For example, one process optimizes the back-to-back flow, while another optimizes flow for contract manufacturing. Assume this example requests to make the item, so it calls the orchestration process that optimizes the make flow.

3. Run the orchestration process.

   An orchestration process is a sequence of steps that automate fulfillment across fulfillment systems.

   The flow in this example is a make flow that uses back-to-back fulfillment. Here's a summary of what the orchestration process that optimizes the make flow does.

   • Send a request to Procurement to create a purchase order.

   • Send a request to Inventory Management to reserve demand for the purchase order.

   • Send supply that the purchase order created to the warehouse.

   Each orchestration process does quite a few fulfillment tasks. For example:

   • Plan the entire schedule, including the start and end date for each process step.

   • Make adjustments if supply or demand changes during fulfillment so it can meet the requested delivery date.

   • Track the status for each step across fulfillment systems.

   For details, see Overview of Orchestration Processes.

   Interface

   The orchestration process uses the interface to run tasks that involve an application that resides outside of Supply Chain Orchestration, such as Procurement or Inventory Management. Here's a summary of what Supply Chain Orchestration does through the interface.

   Step	Description
   Integrate	The integration accepts notifications, processes them, and manages exceptions. Creates a payload that's specific for the fulfillment system, then calls it. The fulfillment system notifies Supply Chain Orchestration of changes that happen, such as a purchase order status or quantity decrease.
   Do fulfillment tasks	Identify the service or fulfillment system that will fulfill the request. Use a connector to transform the data. Send the supply request to the fulfillment system.
   Communicate status	Send request to get the supply request status or to update the fulfillment document. The fulfillment system creates, updates, or cancels the document according to the request. Record status responses that Orchestration receives from each fulfillment system. Record exceptions in fulfillment systems and notify the application that's request supply that an exception happened. Here are some of the fulfillment systems. Inventory Management Procurement Manufacturing Shipping Receiving

Contract Manufacturing

Assume you contract out manufacturing to a contract. You create your own manufacturing work order, and the contract manufacturer uses a matching purchase order.

• The purchase order serves as an agreement between you and the manufacturer.

• The work order tracks the progress of the contract manufacturer in creating supply.

• Supply Chain Orchestration links the work order and purchase order documents to make sure the document parameters and the progress are synchronized.

• Supply Chain Orchestration provides visibility into the processes that your contract manufacturer uses. It also uses automated exception management to balance supply and demand, and to avoid excess supply or short supply.

Outside Processing

You can outsource one or more manufacturing operations in the work order to a partner. For example, assume you're an Original Equipment Manufacturer (OEM). You do some of your own manufacturing operations but also outsource other operations to a Manufacturing Partner (MP). You pay the partner for the work they do, which might include various value-added services.

For example, Supply Chain Orchestration receives a supply request from Oracle Manufacturing, then.

• Starts the purchase request to process the outside item.

• Sends purchase requisition or purchase order details to Manufacturing, such as purchase order number, purchase order line number, and supplier.

• Starts the shipment request for a partially finished assembly.

• Receives shipment confirmation from Shipping.

  Sends shipment details to Manufacturing.

Supply Chain Orchestration also monitors the outside processing operations, and automatically processes change orders.

The Outside Processing column on the Supply Lines Overview page indicates which supply orders include outsourced manufacturing operations.

Prevent Duplicate Supply Requests

Oracle Supply Chain Orchestration will prevent you from creating duplicate requests for supply when there's a problem in communicating the request from Oracle Order Management to Supply Chain Orchestration. Sometimes there's a disruption that prevents Order Management from sending a supply request to Supply Chain Orchestration.

The disruption might never get resolved and orchestration never receives the request, or receive it only after a long delay. If Order Management doesn't receive a reply from Supply Chain Orchestration after a specific amount time, then Order Management might resend a create, update, or cancel request, and this makes it difficult for Supply Chain Orchestration to interpret how to handle the resent request.

For example, if you send a request to create supply, then Supply Chain Orchestration will reject the request and display a message if:

• The order line that needed supply is in Shipped or Canceled status.
• Supply Chain Orchestration already successfully fulfilled a supply order for the demand and set the supply order's status to Closed.
• Supply Chain Orchestration is using another supply request to process supply for the fulfillment line. You can use the Manage Supply Request Exceptions page in the Supply Orchestration work area to find the request that orchestration is currently processing, then wait for it to successfully finish. If it doesn't successfully finish, then cancel it, and resubmit your request.