Presentation on theme: "Production Planning Processes EGN 5620 Enterprise Systems Configuration (Professional MSEM) Fall, 2012."— Presentation transcript:
Production Planning Processes EGN 5620 Enterprise Systems Configuration (Professional MSEM) Fall, 2012
Production Planning Processes SAP Implementation EGN 5620 Enterprise Systems Configuration (Professional MSEM) Fall, 2012 Production Planning Processes SAP Implementation EGN 5620 Enterprise Systems Configuration (Professional MSEM) Fall, 2012
Production Order– Preliminary Cost A production order includes preliminary estimates for various cost components, such as material and overhead. Material costs are based on the costs of the components assigned to the production order. These costs are maintained in master data of each component. Production costs are based on data in work center, such as activity types and formulas that identify which activities (e. g. lab and setup) are required and in what quantity.
Production Order– Preliminary Cost The costs are associated with appropriate accounts in general ledger, such as material consumption accounts. As production is executed, actual costs are assigned in the production order along with the preliminary cost estimates. After a production order has been completed, the cost accumulated in the production order must be settled. During settlement, the actual costs incurred are allocated to cost objects based on specified settlement rules.
Production Order– Schedule SAP calculates the production dates and capacity requirements for all operations within an order Scheduling function uses data from production order (quantity and dates) and work centers. ◦Determines a Routing Operation specific time lines Material Consumption Points ◦Links to Material Master Scheduling Margin Key (Floats) ◦Links to Work Center Formulas Standard Inter-operation Times
Production Order (Document Link ) A production order may contain reference to various documents. A BOM for example, may include a document item. Production order often includes links to documents in the document management system (DMS). DMS is used to ensure the most current version of documents is employed during production.
Production Order (Availability Check) Automatic check to determine whether the components, production resources tools, and capacities in an order are available ◦It can be automatic or manually executed ◦It determines availability on the required date ◦Unlike scheduling, availability checks are not repeated automatically if the production order is changed. It generates an availability log which displays: ◦Results of the check ◦Missing parts list ◦Reservations that could not be verified
Production Order Release The time between scheduling and releasing an order is used for preparation needed for the processing of the order Once an order is released, it is ready for execution. At this time, the user can: ◦print shop floor documents ◦execute goods movements ◦accept confirmations against the order
Goods Issue for production Order Note: ◦That when a production order is being created, it references a BOM that determines the necessary components to produce the goods, it also places a reservation on each of the components Upon release of the order (or operation) the reserved materials can be issued from inventory; and the system (SAP): ◦Updates the reservation ◦Updates the inventory ◦Assigns costs to the order as actual costs
Goods Issue for production Order Effects of the Goods Issue ◦updates stock quantity ◦updates stock value ◦Updates production order status Three documents are created: ◦material document ◦accounting document ◦controlling document
Confirmation of Production Order Completion Confirmations are used to monitor and track the progression of an order through its production cycle ◦confirmation can be done at the operation or order level Exact confirmation shortly after completion of an operation is essential for realistic production planning and control
Confirmation of Production Order Completion (Labor cost is added)
Goods Receipt for Production Order Acceptance of the confirmed quantity of output from the production order into stock ◦Effects of the Goods Receipt update stock quantity update stock value update production order (status) store price for future valuation changes ◦Three documents are created material document accounting document controlling document
Production Order Settlement Settling a Production Order to Stock ◦postings are made to the materials & labor and production order accounts with the value of the material and labor and received finished goods. ◦difference between the debt posting and credit posting is posted to a price difference account **Material Price determined by the quantity produced times the Standard Price in the Material Master.
Production Order Settlement Costs analyzed ◦Primary Materials External Processing ◦Secondary Production, Administrative Overhead, and Labor Cost Analysis Reporting Calculate and analyze planned costs, target costs, and actual costs of the production order. Calculate and analyze variances
Exercises: 259. Create purchase order 260. Create goods receipt 262. Post invoice receipt from vendor 263. Display vendors invoice (gross) document 264. Post payment to vendor 276. Create a production plan 277. Display stock/requirements list 278. Transfer planning data to demand management 279. Review demand management 280. Display stock/requirements list 281. Run master production schedule 282. Display stock/requirement list 283. Convert planned order to production order 284. Issue goods to production order 285. Confirm production completion
Exercises: 286. Receipt of goods from production order 287. Settle costs of production order 287A. Display stock/requirements list