If your company uses outside processing for any or all of your manufacturing work, the software enables you to track the manufacturing process just as if it was performed internally. However, the software also tracks the associated costs and ties into your accounts payable system so that you can record payment for the work, and store records of all associated purchase orders.
Before you can track outside processing, you must set up your system to track the associated manufacturing costs. For information on setting up outside processing, see Setting Up Outside Processing.
To use outside processing:
If you use different suppliers for components and manufacturing work each time a product is built, create purchase orders for the components and service products (for the work) with the appropriate costs. If you regularly use the same manufacturing suppliers for outside processing, you can skip this step, and generate the purchase orders after the work orders are created.
Create work orders using one of the following methods:
In Summary DRP Management, review DRP product forecast and create work orders to meet demand.
In Work Order Create, create work orders based on open sales orders for a finished good, the Min-Max buying method parameters for a finished good, and/or actual planned receipts for a finished good.
In Work Order Maintenance, manually create work orders. When you create a work order, you are asked if you want to create the associated purchase orders for service products and components. You can create the purchase orders at this time or manually create the purchase orders later.
Create and order purchase orders for component products if the purchase orders were not created and ordered previously in step 1 or 2. This can be done manually in Work Order Maintenance or through DRP.
Create and order purchase orders for service products if the purchase orders were not created and ordered previously in step 1 or 2. You can click the Service Items Create button in the ribbon in Work Order Maintenance to create the purchase orders.
In Work Order Maintenance, review work order routing details and operations, and update the work orders if necessary. If purchase orders were manually created, click the Link button in the ribbon to display Work Order Purchase Order Select, which allows you to link the related purchase orders to the work order.
When purchase orders are ordered, a supplier production monitoring workflow can be automatically launched to track production activities. For more information, see Using Supplier Production Monitoring.
Process the work orders using the same methods as used for internal manufacturing. For more information, see Work Order Process Flows. As work orders are confirmed, any backflushed components that have purchase orders attached and have not been received can be automatically received. As work orders are completed (inventory adjusted), a receipt record is automatically created for the service products so that the supplier’s invoice can be reconciled in accounts payable with the related purchase order. For information on creating a voucher for the supplier's invoice, see Voucher Entry.
Create transfer orders in Order Entry or Summary DRP Management to transfer manufactured products to the shipping location. For more information on processing transfer orders, see Transfer Order Process Flow.
You can use Summary DRP Management to view the scheduled work orders and purchase orders for multi-level bills of material.
For a visual representation of outside processing, see Outside Processing Diagram.