Running the Production Process in SAP Business One, Web Client

A Production Order is a command to produce (or repair) a production item.

A Bill of Materials (BOM) is copied into the Production Order document. Then the needed quantity of finished item is entered together with the desired due date of production and other relevant data.

The Production Order also tracks all the material transactions and costs that are involved in the production process.

• Step 1 - the production process starts with creating a Production Order. This is the main document in the production process. It records the progress of the production process for each item produced. After choosing the Bill of Materials (BOM), entering the quantity of finished items and the desired due date of production you add the production order.
• Step 2 - a production order is in a planning state until its status changes to Released.
  • When the production order is released to the shop floor, components (items and resources) can be issued to production (depending on the issuing method) and work can begin. At this point, the production order begins collecting the costs of production.
• Step 3 - components are issued when an Issue for Production document is added.
  • Items and resources can be issued using either the Manual or the Backflush method.
  • With the Backflush method, once you initiate the Report Completion function that creates Receipt from Production - the components are automatically issued for production.
  • The manual issue method allows you to issue the components precisely when they are required in the production process and also issue a partial quantity, even before reporting completion.
• Step 4 - When all work is done, you report completion of the production order. At this point, the finished items are received in the warehouse.
  • The system automatically creates the Receipt from Production that receives the finished product in inventory and issues backflushed components.
  • When the production process is over, the Production Order is closed. This closure creates a journal entry for balancing inventory accounts at perpetual inventory managed companies.

• Routing is used to manage distinct phases in a production process. Each route stage is used to organize and track progress as items move through the shop floor. The routing procedure allows automatic calculation of the start date and end date of stages according to the production time of each stage.
• In the presented example, we see the manufacture process of a gaming table:
  • First, the solid wood desktop panel that needs to be cut. To do this, two resources are required: one machine resource that is the table saw and one labor resource of machine operator employee.
  • Then the cut panel is moved to the construction area. In the Table Build stage three more items are involved: aluminum frame, sit-stand legs, and wood screws and one labor type resource - the technician.
• These two stages of first cutting the wood and then building the table, are captured in the production routing procedure. Wood Cut is route stage 1 and Table Build is route stage 2.

• The screenshot above shows how the gaming table bill of materials with routing looks like in SAP Business One, Web client.
• Each stage has a route stage header and a route sequence number. All rows that follow the header relate to the same stage and have the same route sequence number.
• In this example there are two stages. The route sequence number sets the order of appearance in the bill of materials. Only after the first stage is completed can the production procedure continue to the next stage.
• To change the placement of the entire stage, choose a different sequence number in the header row. When you do this, all associated route sequence numbers are changed as well.
• When any other row is moved from one stage to the other, the row inherits the new stage route sequence number.
• Note that when the issue method is Manual, route stages become operationally important - materials are commonly issued before a specific route stage, between stages (e.g., semi-finished parts) only when needed.

Like every other bill of materials, a bill of materials with routing is copied to a production order. Then, each stage in the production order can be separately issued, transferred, or received from production.

• Issuing components from a production order with routing, can be done per route stage. After a production order is released, the production manager issues components to production one stage at a time.
• From the Production Order Functions menu, the option Issue Components is chosen - which displays the Issue Components - Selection Criteria window. From this window you can adjust the stages or components to issue.

Note that only Manual issue method items are available for issue.

• When using production orders with routing, it is important to understand how the Routing Date Calculation field and function work.​
• There are four methods of routing date calculation: On Start Date, On End Date, Start Date Forwards, and End Date Forwards.​
• The routing date calculation method:
  • Can set date dependencies between the different stages and update the stages dates accordingly.​
  • Can set the resource capacity allocation according to the single run capacity defined for the resource.​
  • Manual changes made in the production order header or rows may raise the need to recalculate row dates and resource capacity allocation. When the system recognizes this scenario, the Update Now button turns red, alerting the user to choose the button and thus activate this update.

The start date and end date in the header are the time range for the consumption of the component in the production order.​​

However different calculation methods may set different start and end dates of the stages within this range.​​

• With methods: On Start Date and On End Date, there are no date dependencies between stages in the order. ​​
• The start date of all stages is defaulted from the start date of the header.​​
• The end date of all stages is defaulted from the due date of the header.​​
• With the On Start Date method, resources are allocated to the stage start date and with the On End Date method, resources are allocated to the end date of the stage.

The other two methods are more sophisticated:

• With the Start Date Forwards method the start date from the header is copied to the start date of the first stage. Then if there is not enough capacity to meet the planned quantity of the resource, the system continues to allocate resource capacity in the coming days until all planned capacity is fully allocated. The end date of this stage is the last day of capacity allocation.

  The next stage start date is the end date of the previous stage.​

  When the last stage is reached, the end date is set to the header’s due date.​

  Note that capacity allocation is calculated from the beginning of the day.

• The End Date Backwards method works similarly but starting from the end date of the last stage.
• The header’s due date is copied to the end date of the last stage. Then if there is not enough capacity to meet the planned quantity of the resource, the system continues to allocate resource capacity for each day backwards, until all planned capacity is allocated. The start date of this stage will be the last day of capacity allocation.

  The previous stage end date will be the start date of the last stage calculated.

• When reaching the first stage, the start date is set to the header’s start date.​
• Note that capacity allocation is calculated from the end of the day.
• Also note that with these two methods the production order will only consider a capacity type called: Single Run Capacity. This type of capacity assumes that only one resource can be used at a time.