This post covers the entire business process for outside processing. In case of Manufacturing, outside processing job can be one operation among several operations for making a finished good. To simplify the business case I am considering only 1 operation for our Routing which is an Outside processing operation
RKFinishOPItem – Finished Subassembly
RKOPItem – This is the part that we ship it to outside processing vendor for value addition.
OPRKRawOPItem – This is the part that we receive from outside processing vendor after value addition. Requisition is created for this part
Create Outside Processing Resource
This is the outside processing resource. Costing happens as soon as PO Move occurs because of ‘PO Move’ Charge type.
Outside processing item ‘OPRKRawOPItem’ is associated to this resource so that when the resource gets used, requisition is created for this item
Associate Frozen cost for this Resource
Associate applicable Overheads for this Resource. Actual overhead cost will be determined when you associate this resource to the department
Create ‘Lead time’ Resource
It is a good practice to create a resource to capture lead time. This is primarily used to capture the number of days Outside processing operation takes.
Create Department and associate Resource
Association of Overhead rates to the Department
Associate Outside Operation resource and Lead time resource to the Department. Default Units for each department resource can be defined here. It can overwritten at Routing level.
Create Routing with outside processing operation
Resources for the operation
Lead Time operation will be scheduled
Create Bill of Material
Create Discrete Job
Create Work order for RKFinishOPItem.
Operations of the Job
Note that completion date is offset by 10 working days because of Lead Time Resource
Components of operation 10
When Discrete Job is in Unreleased status, nothing is in ‘In Queue’, Running or ‘To Move’ or Completed Status
Resources for the operation 10
Change Discrete Job Status to Released
Discrete Job ‘In Queue’ quantity changed to 1
Move the Operation 10 from Queue to move status
Operation Move status updates to 1 and Completed also updates to 1
This will trigger ‘Requisition Import’ program
Ensure that the requisition is created for our Job ‘RKDemoOPJob’. Also notice that the item that is used for requisition is the item that is associated to the outside processing resource
Perform Autocreate for 96494 requisition to create a purchase order
Approve the Purchase order
Receive the Purchase Order
Close the Work order