Overview

This integration enables users to associate goods and services used in Oracle Process Manufacturing (OPM) to a resource (machinery, raw material, manpower) that is used in a batch which requires outside processing. In process manufacturing industries, a number of operations (or process steps) may not be performed in-house. The operations or steps are sometimes outsourced to a supplier (or another manufacturer or third-party). This outsourcing of operations or process steps is called Outside Processing (OSP). For example, in the food processing industry, the labelling of tins/bottles is done frequently as an outside processing step, while the actual food production is carried out in-house.

Oracle Purchasing supports outside processing in that it enables users to create, approve and receive OSP items that are then placed on requisitions and purchase orders associated to the batches that are created in Oracle Process Manufacturing.

The resource (machinery, raw material, manpower) is associated with an Inventory Item that is classified as an OSP item type. When the batch is released, a requisition and then a purchase order get created (by autocreating it from a requisition) to capture the outside processing details. The purchase order can also be created at the start of the batch or Outside Processing step or operation, if required. Based on your setup, you can define the start point of the purchase order creation. The two documents, batch and purchase order, are maintained in sync.

When the OSP item in the purchase order is received (using the Receiving module), the corresponding resource transactions are generated for the outside processing batch step, and the OSP Actual step quantity gets updated with the receipt quantity. If Oracle Quality is installed, the OSP actual step quantity will get updated with the inspected and accepted quantity.

The service charges for the OSP resource are defined as part of resource costs and are taken in the cost calculation for the product based on the cost source setup as Resource Cost in the OSP resource definition. If the cost source is set to the PO Price, the OSP resource charges are calculated as per the PO Price.

Outside Services in Requisitions

The Requisitions Summary window and Requisitions form include the OPM-OSP fields that enable users to process OSP items. The conditions that determine the display of the OPM-OSP labels in the popup are:

• Line Type should be Outside Processing

• Ship-To Org should be Process Manufacturing enabled

• Destination Type should be Shop Floor

In the Requisitions Summary form, Lines Summary window, click the Show Field icon on the menu bar at the top of the main window to view the OPM fields. Batch, Step No, Batch Step Resource, Activity, etc, are some of the fields you will see in the list. Select these fields in order to show them in the Requisitions Summary form.

Outside Processing in Purchase Orders

Labels are displayed in the Outside Processing popup (click the Outside Services button to see this popup), depending on whether a regular item is entered or an OSP item is entered. The conditions that determine the display of labels in the popup are:

• Line Type should be Outside Processing

• Ship-To Org should be Process Manufacturing enabled

• Destination Type should be Shop Floor

In the Purchase Order Summary form, Distributions Summary window, click the Show Field icon on the menu bar at the top of the main window to view the fields that are process org enabled. Batch, Step No, Batch Step Resource, Activity, etc, are some of the fields you will see in the list. Select these fields in order to show them in the Purchase Orders Summary form.

The conditions that determine the display of labels in the Line Details page are:

• Line Type should be Outside Processing

If the line has a single shipment which is process manufacturing enabled and a destination type of Shop Floor, with a single distribution, then the new label(s) (Batch, Product, Step, etc.) are displayed in the page. If the line has multiple distributions with same batch value, then the batch value shows Multiple for the Batch field.

The conditions that determine the display of labels in the Shipment Details page are:

• Line Type should be Outside Processing

• Ship-To Org should be Process Manufacturing enabled

• Destination Type should be Shop Floor

Additionally, if there are multiple distributions with the same value, the batch value will be read-only. If there are different batch values for the distributions, the value is Multiple (read-only text) for the Batch field.

If there is a single distribution that is that has a Destination Type of Shop Floor, then the new label(s) (Batch, Product, Step, etc.) are displayed in the page.

The conditions that determine the display of labels in the Distribution Details page are:

• Line Type should be Outside Processing

• Ship-To Org should be Process Manufacturing enabled

• Destination Type should be Shop Floor

User Procedures for OPM-OSP Integration with Oracle Procurement

Pre-requisite steps:

Using an appropriate OPM responsibility (such as Production Supervisor), navigate to the Setup > Parameters window. This opens the Process Execution Parameters form. You can specify at which stage the requisition will be created (At Batch Creation, At Batch Release, Step Control Batch Status) along with other parameters.

1. Using an appropriate OPM responsibility, navigate to the Batch Details window. The Find Batches window opens. Use this window to search for a batch that you have already created.

2. If the value of the process execution parameter Requisition Creation Time is set to At Batch Creation: To create a batch, select a process enabled organization in the Organization popup. Click New to open the Create Batch/Firm Planned Order window. Select an appropriate Recipe and Version that are used for outside processing. Click Ok and the Batch Details window displays, with a Batch Number. Note the Batch Number. The status of the batch is Pending. Change the status of the batch to WIP, as explained in the following paragraphs.

   If the value of the process execution parameter Requisition Creation Time is set to At Batch Release: To release a batch, find a previously created batch. Click Find in the Find Batches window after entering the batch number. The batch details show in the Batch Details form. Select Pick the Release from the Actions menu. Enter the Actual Start Date (the default system date can be used too). The Batch Status changes to WIP.

   If the value of the process execution parameter Requisition Creation Time is set to Step Control Batch Status: Click New to open the Create Batch/Firm Planned Order window. Select an appropriate Recipe and Version that are used for outside processing. Click Ok and the Batch Details window displays, with a Batch Number. Note the Batch Number.

   Release the batch using Step Control by clicking Step > OSP Steps. The Batch Steps window opens and you can select Pick Release Step from the Actions menu. This displays the Release Batch Step window where you need to enter the Actual Start Date (the default system date can be used too). Click Go in order to change the Batch Status to WIP. Close the window to return to the Batch Details form. The status of the Batch is now WIP.

   If the value of the process execution parameter Requisition Creation Time is At Step Release: Click New to open the Create Batch/Firm Planned Order window. Select an appropriate Recipe and Version that are used for outside processing. Click Ok and the Batch Details window displays, with a Batch Number. Note the Batch Number. Click Pick Release Step from the Actions menu, the Release Batch Step window opens. Enter the Actual Start Date (the default system date can be used too). Click Go and the Step status changes to WIP.

3. Use a Purchasing responsibility to run the Requisition Import concurrent program. This concurrent program enables import of requisitions that have OSP items enabled for Oracle Process Manufacturing.

   Open the Requests/Find Requests window. Click Submit a New Request, and the Submit a New Request window displays. Select a single request and then find the Requisition Import concurrent request. In the Parameters window, select 'OPM-OSP'. Click Ok and then Submit your concurrent request. Note your request ID. When your request ID completes successfully, you can click View Log. The View Log page has the requisition number and the details of the requisition that was created from the batch.

   Approve the requisition that was created using the concurrent program with the approval process you usually use to approve requisitions.

   If the value of the process execution parameter Requisition Creation Time is Manual, you can create a requisition manually, without using the Requisition Import concurrent program. For more information on creating requisitions manually, please refer to the Requisitions chapter in this guide.

4. Create a Purchase Order from the OSP approved Requisition using the AutoCreate tool. Using an appropriate Purchasing responsibility, open the AutoCreate window. The Find Requisition Lines window displays. Enter the process enabled operating unit and the requisition number. Ensure that the requisition is approved, otherwise AutoCreate will not convert the requisition to a purchase order.

   Click Automatic and a New Document window displays. Check if the supplier is an OSP supplier, if not, you can change the supplier to an OSP supplier. Click Create and the purchase order is created automatically from the OSP requisition. View and approve the purchase order in either the Purchase Orders window or the Purchase Order Summary window. Use the purchase order number to retrieve the purchase order information in either of the windows.

   You can also create a purchase order manually with OSP items, and enter each purchase order line, and assign the OSP batches for each line. Please ensure that the purchase order is approved after it is created.

   When the OSP purchase order is fulfilled by the supplier and the outsourced processing takes place, the supplier sends the items to the buying organization. The buying organization receives the items and then pays the supplier based on the invoice created.

Receiving for OPM-OSP Integration with Oracle Procurement

The Purchase Order can be received for full or partial quantities in an OPM organization and the quantity delivered to the shop floor updates the OSP Actual step quantity. The OSP Actual step quantity is updated by OPM later after Receiving is complete. Return of OSP item/service in an OPM organization can also be done, provided the item/service needs rework. Additionally, over-receipts that are erroneously transacted can also be reversed or corrected.

When the OSP item on the purchase order is received in an OPM enabled operating unit, corresponding resource transactions are initiated for the OSP batch step and the OSP Actual step quantity gets updated with the receipt quantity. The Production Supervisor needs to take the action of completing the step once the complete step quantity is received.

The following table explains what happens when you receive purchase order items/services partially or fully for a batch with different statuses:

The following list outlines the considerations for receiving OSP items/services:

• Receiving enables you to receive an OSP item in an OPM organization against the OSP Batch Step specified in the purchase order distribution. You can query the purchase order in the Receipts form and then enter the receipt. The Find Receiving windows enable you to query eligible OPM batches to receive OSP items.

• You can perform returns/corrections for an OSP item in the same way you would for regular items.

• Only those Batch Steps which have a status of WIP or Complete are eligible for receiving in an OPM organization. Batch Steps with any other statuses are not eligible for receiving. Thus, Receiving validates the batch step and checks the status of the batch before processing it.

• The following Receiving forms will show the labels Batch and Step in the Outside Services tab while receiving OSP items. This is achieved by renaming the columns Job/Schedule and Operation Sequence to Job/Schedule/Batch and Operation Sequence/Step respectively when the receiving organization is OPM enabled.

  • Enter Receipts

  • Receiving Transactions

  • Returns

  • Corrections

  • Receiving Transaction Summary

  • Transaction Status Summary

• The system does not allow Receiving Open Interface (ROI) transactions for batches with a status other than WIP or Complete.

User Procedures for Receiving an OSP Item/Service

Pre-requisites: Create an OPM-OSP batch, release it, create a requisition and then create a purchase order from the requisition. For more information, see the preceding sections.

1. Select the PO shipment receipt routing with the value Standard, Direct Delivery or Inspection Required.

   Note: Inspect the receipt by entering the Inspection details using Oracle Purchasing inspection (with profile QA: PO Inspection = Purchasing). Alternatively, inspection can also be performed using Quality collection plans (with profile QA: PO Inspection = Quality).

2. Query the purchase order in the Find Expected Receipts window (Receiving > Receipts).

3. Ensure the Batch and Step Number fields show up in the Outside Services tab and their values are correctly populated.

4. Select the line and create a Standard Receipt.

5. Ensure that the Receiving Transaction Processor (RTP) completes successfully. (Receiving > Receiving Transactions)

6. Check the receipt data in the Receiving Transactions Summary form.

7. Check that the field names are Batch and Step Number and their values are displayed in the Transactions block.

Invoicing and Payments - an overview

When the OSP item is received, you can make payments for it in the same way you would for regular items:

1. Navigate to Payables > Invoices > Entry > Invoices.

2. Enter the Purchase Order Number, Invoice Date, Invoice Number, Invoice Amount and click the Match button.

3. The Find Receipts for Matching window displays. Enter the Receipt number that was generated in Receiving. Click Find.

4. The Match To Receipts window opens and shows you the matching receipts. Click the Match checkbox on the left, enter the Quantity and save your work.

5. Click the Match button. The Invoice Actions popup opens. Select the Validate and Validate Related Invoices checkboxes and click Ok.

6. The status of the invoice is Validated.

7. Click the Actions...1 button, to open the Invoice Actions popup. Check the Pay in Full and Create Accounting checkboxes and click Ok.

8. In the Payments window that displays, enter the Bank Account details, Mode of Payment and then click the Actions...1 button.

9. The Invoice Actions popup is displayed. Select the Create Accounting checkbox and then select the Final Post radiobutton. A confirmation message is displayed when the invoice is processed successfully and that the accounting transactions are performed successfully.

10. Finally, verify that the purchase order status shows a value of Closed. Navigate to the Purchase Orders Summary window to see the purchase order status, it should show Approved, Closed.