Manufacturing - Production Overview

The Production module manages and maintains inventory integrity, gives you a feel for ongoing activities and production order release status, and provides you with variance tools to compare anticipated or planned material and resource use to actual use.

You enter production orders into the system, and later release them. The release process reads through the bill of material (BOM), which represents what you intend to build, and prepares or “explodes” a list of materials and resources that must be available to complete the manufacturing process. This list of requirements becomes a “working BOM,” because it is essentially a BOM with real quantities that match the quantities to be manufactured as you defined them in the production order release. You can edit and change the working BOM to meet unique requirements for a particular run. This includes planned material substitutions or any change in the routing.

You handle unplanned substitutions during the actual recording of activity and not in the edit process. Once the working BOM is correct, you can record production activity. This process tells the system the quantity of materials you pulled from stock and the quantity of finished goods you put back into stock. You can also record machine and labor set up and run time.

The system offers special optional provisions for subcontracting and by-product handling. When you complete the order release, you close it and post it to the history database. History reports show production activity and variance analysis between estimated machine and labor time, subcontracting expenses, by-product and materials, and actual use of these elements.

A major responsibility of the Production application is to accurately maintain the inventory on hand, available, in use, and on order as manufacturing activity takes place. The relationship of production with inventory is a real time, online system to maintain inventory accuracy.

A second responsibility is to record the use of other cost factors such as labor, machinery, tooling, and other non-material production factors. This online approach enables you to use software tools to keep abreast of what is happening on the shop floor from a cost and progress standpoint.

Frequently used functions

The most frequently used functions are on the Production Orders and Reports and Worksheets menus. Use these functions for the following tasks:

  • Enter production orders.
  • Release production orders
  • Edit Released Orders
  • Record Production activity.
  • Record Labor Time
  • Post production orders
  • Print production schedules
  • Print order travelers

Reports

Reports and worksheets provide a means of seeing the information stored in the system. Use the Reports and Worksheets and History & Variance Reports menu functions to select the information for your reports.

Interactive Views

Production schedules, order statuses, production history and lot and serial information can be displayed through the interactive view functions.

Production Workflow

The Production module manages and maintains inventory integrity, gives you a feel for ongoing activities and production order release status, and provides you with variance tools to compare anticipated or planned material and resource use to actual use. The following section discusses the tasks required to prepare for production runs, maintain the inventory as manufacturing activity is recorded, and to record the use of other factors such as labor, machinery, tooling and other non-material production factors to be performed when you record production activity.

Analyze Production Needs

Depending on your environment, the first step when using the Production module may be to run the Sales Order Analysis report to review the current need for production orders based on sales orders. Once you establish your production order needs, you can either automatically generate the production orders using the Generate Orders from Sales function or enter them manually using the Production Orders function.

Generate Orders from Sales

If you want to automatically generate the production orders based on existing sales orders, use this function. The Generate Orders from Sales function uses the same logic as the Sales Order Analysis report when looking at existing sales orders and generating production orders from them, except it creates production orders instead of just reporting what orders will be created. Only sales orders with a status of New, Picked, or Backordered are considered. The sales order item must be a legitimate inventory item and have a bill of material (BOM) in the manufacturing BOM master table.

Prepare Production Orders

If you manually enter production orders or if you want to review and adjust orders, use the Production Orders function to create new orders or change existing unreleased orders. Traverse Manufacturing uses a two-tier production order process in which you create production orders and then release them individually. You do not need to create production orders if you used the Generate Orders from Sales function because that function automatically creates them.

Review Production Orders

After you create production orders, use the Production Schedule report to review all production order releases in the system to insure that specific products are scheduled to be produced, and to review the workload, review start dates, and so on.

Release Production Orders

After you review the production orders, use the Release Production Orders function to release them. The release process reads through the BOM and creates records in a series of production tables. It creates a list of all materials and resources needed to produce the assembly. During the release, the system calculates how many material components, machine hours, labor hours, and subcontracted processes are required. It also calculates the lead time and required date of each one of the requirements based on the order release due date. After you release production orders, you can edit them, record activity information against them, and produce a variety of reports. This is one option to release orders. The other option is to release orders while setting up the order.

Verify Material Availability

Use the Requirements Availability report to review material component availability based on existing demand. Each component appears with the quantity required and a running net available quantity. The total quantity needed appears as well as the quantity on order, committed, sold, and in production, to give you an idea of what is needed, what is on order, or what is being made. This report assumes that you need all requirements immediately.

Edit Production Orders

After you release and explode production orders, you can record production activity. If you want to change the structure of the release so that it is different from the original BOM (for example, for last minute changes in design or at the request of a customer looking for a unique twist to a standard product) use the Edit Released Orders function.

Print Lists and Preparatory Reports

Next, use the Production Picking List function to print a list of materials to pull from stock for your upcoming production orders. The list is a simple checklist of the material components that make up the working BOM. It leaves a free text area open on the right side for recording information such as quantity pulled, quantity scrapped, initials, and so on.

Use the Order Traveler to print a list that is routing- or process-oriented rather than materials-oriented. This worksheet lists what needs to be done and provides room for recording time and quantities as you complete the work. The worksheet is printed in production order and release number sequence listing each step and the anticipated times respective to each step.

Print the Subcontract Services Worksheet if you use a subcontractor for any step in the production order. This report, similar to a purchase order, is designed to be sent or faxed to the subcontractor. The form indicates valid vendor information as well as the internal production order number and release, requirement ID and routing step, quantity of materials to process, and notes.

You may set the priority of your released orders using the Prioritize Order Releases. The Prioritize Order Releases function allows the user to “sequence” production orders in the same manner very similar to the way that we “sequence” production processes in the dispatching process. Upon opening the screen, the user will see all order releases appear on the screen. At that point the user may drag and drop the orders into sequence. Once orders have been moved to a new sequence, the Update button would become activated. Upon clicking on the Update button, the system will reassign the priority based on the sequence viewed on the screen. The field Priority will actually show the results of this process when you open the Production Order screen and review the Order Release.

Use the Dispatch Production function to view and resequence the workload for any specific work centers, machine groups, or labor types. Use this function as a tool to help you determine the sequence in which production orders should flow through the selected resource.

If you choose not to use the Dispatch Production function, you may instead want to print the Dispatch List to view upcoming loads for a specific work center, machine group, or labor type and to plan the day’s or week’s activity. Print the Work Centers Load Profile report to view the upcoming workload and make necessary preparations to accommodate the size or nature of the process requirements. The information is based solely on work center information and shows both current and closed activity within a work center.

Print the Resource Availability to compare the hours required to the hours available, according to the associated Routing and Resources calendar. If there are more hours in the day than a process step requires, the report shows that you can begin the next process. If there are less hours in the day than a process requires, the process is carried over to the next day, or the next day when hours are available. As a result, some days may reflect many process steps and others only one, depending on the length of the processes.

Record Activity

After you release orders to production, and edit the working BOM, you can record production activity. Use the Record Production Activity function to tell the system how much of a raw material or stocked subassembly was used, how much scrap was incurred, labor and machine times, subcontracting information, and so on.

Use the Record Labor Time function as another way to record activity. Using this function is optional because you can use the Record Production Activity function to do the same thing–both functions access and write to the same data. Which function you use depends on how you record time ticket information. The Record Labor Time function is quicker and more efficient when you record information in Employee ID sequence (such as a time card or time clock report).

If you record data using other systems (such as portable data collection units and time card systems), use the Import Production Activity function to import the data. The information you import should be in an ASCII file, either in a comma-delimited or flat file format. Use this function to greatly increase your efficiency by automating the entry of production activity.

Post Activity

After you record production activity, use the Post Production Activity function to perform these tasks:

  • Post activity to General Ledger (if Production interfaces with General Ledger).
  • Post transactions stored with closed order releases to the manufacturing history database.
  • Clear the production order release and related information.
  • Clear production orders with no releases from the system.
  • Post the time recorded for labor to the payroll transactions table (if Production interfaces with Payroll).

Reports and Views

The Production module includes inquiry functions, reports, and lists that provide you with the manufacturing information you need to analyze your business practices. To make the most of your manufacturing processes, use the functions described below.

Order Status

This report provides you with the status or progress of a specific production order release. It lists the percentage of completion for each of the process steps, the quantity of material components issued to the release, as well as the status of subassembly completion. It shows each routing step and component item in detail as well as the number of partially completed items at each routing step.

Work in Process Valuation

This report helps you determine the value of inventory pulled from stock and currently on the shop floor. As you pull materials from inventory, the value of inventory is reduced–an inventory valuation shows less inventory than actually exists because pulled inventory is now work in process (which can change its value) and is not reflected in current inventory. To calculate the true value of inventory, include the values shown on the Work In Process Valuation report.

Employee Time Log

As you record time and activity information for specific employees, you may want to print a log that focuses on employee time rather than production results. The Employee Time Log provides you with the hours worked by each employee. It also provides a preview of the data that will post to Payroll, if you interfaced it with Production.

The History and Variance reports provide a history of variances that have taken place and give you a way to trace information for old production orders that you have already processed.

At first glance, these history reports may appear to be similar. However, although each report uses the same historical data, each has a unique purpose or focus. These reports compare expected production results with actual production results and display different sorts of variances, pointing out problem areas.

  • Use the Cost Variance Analysis report to review past production and analyze situations where the actual production cost was notably different from the expected cost.
  • Use the Time Variance Analysis report to review the difference between anticipated time and actual time spent. The report shows each routing step, its machine group or labor type, setup times, run times, wait times, and so on.
  • The Production Variance Analysis report examines unplanned variances in finished goods. Use this report to compare the quantity you planned to produce against the actual production quantity, and to compare the actual finished good unit cost against the standard unit cost. The report serves as a great starting point for locating quantitative or cost-oriented output variances.
  • Use the Transaction History report to review detailed information relating to past production. This report deals with the use of materials, labor, subcontracting, machinery, and the finished production. The report is grouped into up to five sections showing material use, process-related time and expense, subcontracted activity, usage or creation of subassemblies, and finished production.
  • Use the Production History report to access the results of production runs. The report groups information together for each order, providing production run information for one order release at a time and includes a specific breakdown of the lot and serial numbers created if you are using serialized or lotted inventory.
  • If you use the Variance Code field when you record production activity, variance codes are recorded in the production history tables. The Variance Code History report displays manufacturing history based on the variance codes grouped by sources such as materials or operations.

The Interactive Views functions give you access to manufacturing information in less detail than a report. The summary nature of inquiries delivers information to you efficiently so you don’t have to sort through a lot of additional information.

  • The Production Schedule View is a summary of all production order releases in the system. It contains information about each production order release, but does not contain any component information.
  • The Dispatched Production View provides a view of the workload for any specific work center, machine groups or labor type. Use the Dispatch Production function within Production Orders to make and save changes to the production sequence.
  • The Order Status View provides you with detailed information about a specific production order release and the status of all its elements. It shows the overall percentage of completion as well as specific information on materials, labor, machinery, subcontracting, and costs. The tabs on the screen provide progress information in each of the order areas.
  • The GL WIP Transactions View enables you to determine the value of inventory you pulled from stock and is currently on the shop floor. As you pull materials from inventory, the value of inventory is reduced – inventory valuation reports show less inventory than actually exists because pulled inventory is now work in process. To see the full value of existing inventory, consider the value shown on the WIP transactions view as well as the inventory valuation reports.
  • Use the Production History View to review and locate information about previous production order releases. The Production History inquiry allows you to select ranges of information so you can quickly locate specific history information by defining your search criteria. This allows you to see history information for an order number, even if all you know is, for example, the customer purchase order.
  • Use the Lot Numbers Where Used View to find what products a particular lot number was used to make. Example: I have a lot number that is suspect or known to be defective. Knowing that lot number, I want to know what it went into so I know what finished products might have quality or recall issues. The following screen shows an example of the data used.
  • Use the Serial Numbers Where Used View to find what products a particular serial number was used to make. Example: I have a serial number that is suspect or known to be defective. Knowing that serial number, I want to know what it went into so I know what finished products might have quality or recall issues. The following screen shows an example of the data used.
  • Use the Finished Goods Lot Number View to find what lot numbers and serial numbers and part numbers, went into a given finished good lot number, so theoretically the user would know the finished good lot number. Example: I have a finished good that's defective. I know the lot number. I need to know what went into it because I suspect one of the raw materials was defective. The following screen shows an example of the data used.
  • Use the Finished Goods Serial Number View to find what lot numbers and serial numbers and part numbers, went into a given finished good serial number, so theoretically they would know the finished good serial number. Example: I have a finished good that's defective. I know the serial number. I need to know what went into it because I suspect one of the raw materials was defective. The following screen shows an example of the data used.
  • Use the Sales Order Analysis View when you generate production orders based on sales orders. If the environment in which you are using Traverse Manufacturing is a make-to-order or job shop environment in which production orders are entered as a direct result of an incoming sales order, you may want to automatically generate the production orders from the sales orders.

Some Frequently Asked Questions about the Manufacturing modules

 

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