Make to Order Process for Managing Product Variants

Objectives

After completing this lesson, you will be able to:

  • Discuss the Make to Order (MTO) Variant Management Process
  • Configure product variants using Make to Order

Make to Order Process with Variant Configuration

When and Why to use Make to Order

Make to Order (MTO) is used to produce a finished product in response to a customer order. A

sales order for a finished product, triggers the automatic creation of a production order, which is used to produce a variant configuration item.

The following video shows the roles individual users play in the MTO process.

Applicable Process Steps

As you just saw, the process steps for an Engineer to Order process include:

  • Internal Sales Representative: Creates a sales order for a configurable material
  • Production Planner: Executes a MRP run and works with production order
  • Production operator: Picks components and confirms activities
  • Warehouse clerk: Posts goods receipts
  • Shipping specialist: Creates a delivery, executes picking and post goods issues

Benefits

The benefits of the Make to Order process for Variant Configuration are:

  • Improve your company's sales and manufacturing performance with integrated Advanced Variant Configuration covering single-level and multi-level configurable materials
  • Enable your business processes to handle highly individualized products in sales and manufacturing
  • Leverage the sophisticated algorithms in the performance-optimized rules engine within a state-of-the-art configurator
  • Use dependencies to prevent combinations of options that are not allowed and can be used to select exactly the right components
  • Get sales pricing and print-out according to the configuration
Note

This process flow is covered in scope Item: 1YT- Make-to-Order Production with Variant Configuration

How to Configure Product Variants Using Make to Order

Introduction: Make to Order process with Variant Configuration

These process videos show a Make-to-Order Production scenario using the Advanced Variant Configuration for an efficient state-of-the-art configuration of a material ordered by a customer, covering single-level and multi-level configurable materials.

Task 1: Create a Sales Order

In this first scenario you get an impression how Kate, our internal sales representative, creates a sales order for a configurable material. The main forklift material is a configurable one and also one component, the forkseat. This is captured by defining the different component characteristics desired by the customers and considering the constraints and dependencies of the components.

At the end Kate checks also the sales price and the variant conditions. The sales price calculation is then based on the individually chosen characteristics of the components.

Task 2: Perform a MRP run for a Sales Order

The sales order creation is finished. Kate sends out this information to Nikhil, our production planner. He starts a MRP run for the forklift sales order. The created planned order becomes visible.

A MRP run is also executed for the component forkseat. A purchase requisition number becomes visible.

Task 3: Post goods receipt for Sales Order components

The forkseat is ordered. Tom, your purchaser creates a purchase order.

Goods arrive at warehouse. A goods receipt is posted by Jim, our warehouse clerk.

Task 4: Create a Production Order for the main component

After MRP run a planned order is created. Nikhil, production planner, converts this planned order into a production order and releases it.

Kathy, production operator picks all components and confirms their processing.

Jim, warehouse clerk post the goods receipt.

Task 5: Perfom a forklift delivery

Marc, your shipping specialist, creates an outbound delivery to the customer.

Task 6: Perform a component picking

The outbound delivery is done. Marc performs a picking before he posts the goods issues.

Task 7: Create a customer invoice

Shipping specialist Marc handles the billing. At the end he creates a customer invoice.

Now you should have an impression of "How to maintain an Make to Order process with Variant Configuration".

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