Curious if anyone is setup running a quasi make to order style in production? I am referring to making a production job matching the sales order line and date at the time the sales order is entered. (Not a true make to order) The job would be “locked” and MRP would plan everything but the “final” build.
We are exploring different ways of handling our production schedule and this was a suggestion I had received. Thus, I was wondering if anyone is running something similar and how it has or has not been working for them?
Walk us through your thought process… You enter a Sales Order Line. Sounds like you wouldn’t use Order Job Wizard (which would link the Order to the Job). Instead you would manually create a job for the required part?
Your job would be run to stock, finished part is received to inventory and then STK-CUS the shipment to fulfill the order. Is that what you’re thinking?
We do this type of thing often, but trying to get away from it. One pitfall (that impacts my company, perhaps not yours) is, in this model, EVERYTHING is a stock job. Which isn’t necessarily bad. But production/scheduling would not be able to decern (easily) between something that’s needed for a customer order versus something that is truly being made for stock (to sit on the shelf). So, how would they prioritize? If you have a good scheduler, perhaps not an issue.
Don’t get me wrong, again, my company does this a lot because this was our approach in our legacy system. Especially for subassemblies. Instead of building everything on the main job, we would set up the main job with only Materials, and all subassemblies are made on stock jobs, received to inventory, then issued to the main job.
This is beneficial because you end up with transactions bouncing in and out of inventory (which makes it easy to track cost on an assembly-by-assembly basis), but it makes things more difficult to see progress/status of the main job.
Interested to hear from others. There are pluses/minuses to the approach and I suppose they just need to be weighed by your company.
Check out Planning contracts. This is a long, convoluted thread about when I was learning about them. But you can make a planning contract per order, and have everything linked so that it’s like make to order.
We are thinking of a very similar situation to what David is/has done. I will take a look at planning contracts. One of the main drivers is allowing production to see a “physical” true due date for the finished product. Between MRP and planners sometimes it is challenging for production to rely on the need by dates. We need a method that allows some control of the real need by date. MRP does some wonky things when the date gets past due and causes production issues.
The hardest part of this process creation will be deciding what are the most important things to your organization. I’ve been part of so many of these discussions. If Production wanting a true due date is paramount, how is your Scheduling process? Are you using the Epicor Scheduling engine and is the Global Scheduling Process properly updating dates, or are you doing it outside the system and updating them manually? Do you WANT to have a field on the Job record that show the sales order number?
Functionally they are the same. The only real difference is, perhaps, how the bean counters want to see the financials.
Make to Order will never hit inventory. You would ship direct to the customer from the job (MFG-CUS).
Quasi (or true stock), you would ship from inventory to the customer (STK-CUS).
It really comes down to how you want to track/view costs in your system. and/or may impact which GLs the accountants want the costs to bounce through? A little muddy on that, myself.
Running everything through stock provides a nice/clean receipt/disbursement record. Again, my company used to run everything through stock in our legacy system, so we started out in Epicor the same way (as @klincecum described above). We’re now doing more and more Make to Order jobs.
On larger projects, we will make the top level part a Make to Order job, but still often run subassemblies through stock jobs and then issue the part to the main job. It does certainly get very confusing trying to track things through the system at times.
There are some differences, one large difference which is what made us move away from them. with make direct there is no usage of stock or even awareness of stock.
It assumes the human has it figured out. We have had a situation where we have stock to ship and are late to the customer. but make direct is only going to ship from the job and does not look at stock.
I use the pegging data to show when the sales order(s) this job is supplying is needed to ship.
Typical use case for Make-To-Order is when a product is semi-or fully-custom, and only ordered by a small number of customers. You don’t want to hold these in inventory… you want to build 'em and then ship 'em. Hence the name “NonStock” for the field in the Part master that flags parts for this purpose.
Our sales order dates are the main driver for us looking into this. We use the Epicor scheduling engine to drive production but as I stated MRP d gives a distorted view when things fall behind. Sometime MRP will create a second job for the same item just because the first job is past due.
I appreciate the thoughts and ideas everyone is sharing. It looks like we are not the only ones having challenges. Scheduling can be challenging is some situations.