11i Inventory Management Fundamentals: D16356GC20 Edition 2.0 January 2005 D16356

11i Inventory Management
Fundamentals
Student Guide
D16356GC20
Edition 2.0
January 2005
D16356
Copyright © Oracle Corporation, 2003. All rights reserved.
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Author
Tyra Crockett, Yuvaraj Kandhaswamy
Technical Contributors and Reviewers
Jennifer Sherman, Alain Roth, Mary Hartman, Lata Sundar, Vanessa Graziano, April Nelson, Neeta Gera
This book was published using: oracletutor

Table of Contents
11i Receipt to Issue ..........................................................................................................................................1-1

11i Receipt to Issue........................................................................................................................................1-2
Objectives ......................................................................................................................................................1-3
Agenda...........................................................................................................................................................1-4
Overview .......................................................................................................................................................1-5
Agenda...........................................................................................................................................................1-7
Receipt to Issue Life Cycle............................................................................................................................1-8
Agenda...........................................................................................................................................................1-10
Receiving Inventory ......................................................................................................................................1-11
Agenda...........................................................................................................................................................1-14
Transferring Inventory...................................................................................................................................1-15
Agenda...........................................................................................................................................................1-16
Issuing Inventory ...........................................................................................................................................1-17
Agenda...........................................................................................................................................................1-19
Oracle Inventory Application Integration.....................................................................................................1-20
Integration of Oracle Inventory to Financial Applications ...........................................................................1-22
Agenda...........................................................................................................................................................1-23
Summary........................................................................................................................................................1-24
11i Defining Inventory Organizations............................................................................................................2-1
11i Defining Inventory Organizations ...........................................................................................................2-2
Objective........................................................................................................................................................2-3
Agenda...........................................................................................................................................................2-4
Multi-Org Structure .......................................................................................................................................2-5
Organization Model.......................................................................................................................................2-6
Sample Organization Structure......................................................................................................................2-8
Enterprise Structure Considerations ..............................................................................................................2-10
Inventory Organizations ................................................................................................................................2-12
Inventory Organization Structure ..................................................................................................................2-13
Sample Inventory Organization.....................................................................................................................2-14
Agenda...........................................................................................................................................................2-15
Setting up Locations ......................................................................................................................................2-16
Defining Organizations..................................................................................................................................2-17
Organization Setup ........................................................................................................................................2-18
Additional Set Up Steps ................................................................................................................................2-20
Additional Organizational Setups..................................................................................................................2-21
Guided Demonstration: Creating an Inventory Organization ........................................................................2-22
Guided Demonstration - Setting Up Locations..........................................................................................2-23
Guided Demonstration - Setting Up Organizations ...................................................................................2-24
Agenda...........................................................................................................................................................2-27
Summary........................................................................................................................................................2-28
11i Overview of Defining and Maintaining Items .........................................................................................3-1
11i Overview of Defining and Maintaining Items .........................................................................................3-2
Objective........................................................................................................................................................3-3
Agenda...........................................................................................................................................................3-4
Items ..............................................................................................................................................................3-5
Agenda...........................................................................................................................................................3-6
Oracle Organization.......................................................................................................................................3-7
Inventory Organizations ................................................................................................................................3-8
Defining Organizations..................................................................................................................................3-9
Agenda...........................................................................................................................................................3-10
Defining Items in Item Master.......................................................................................................................3-11
Copyright © Oracle, 2005. All rights reserved.
11i Inventory Management Fundamentals Table of Contents

i
Steps to Setup, Define, and Maintain Items..................................................................................................3-12
Defining Items ...............................................................................................................................................3-13
Agenda...........................................................................................................................................................3-14
Item Attributes...............................................................................................................................................3-15
Item Statuses and Attributes ..........................................................................................................................3-16
Item Attribute Groups....................................................................................................................................3-17
Agenda...........................................................................................................................................................3-18
Creating Item Templates ...............................................................................................................................3-19
Enabling Attributes in a Template .................................................................................................................3-20
Agenda...........................................................................................................................................................3-21
Organization Assignment and Organization Item..........................................................................................3-22
Agenda...........................................................................................................................................................3-23
Deletion Constraints and Deletion Groups ....................................................................................................3-24
Agenda...........................................................................................................................................................3-25
Summary........................................................................................................................................................3-26
11i Defining and Maintaining Items Fundamentals .....................................................................................4-1
11i Defining and Maintaining Items Fundamentals.......................................................................................4-2
Objectives ......................................................................................................................................................4-3
Agenda...........................................................................................................................................................4-4
Unit of Measure .............................................................................................................................................4-5
Units of Measure ...........................................................................................................................................4-7
Use of Units of Measure ................................................................................................................................4-8
Defining UOM Classes..................................................................................................................................4-9
Units of Measure Conversions.......................................................................................................................4-10
Units of Measure Setup .................................................................................................................................4-11
Guided Demonstration Overview: Units of Measure ....................................................................................4-12
Guided Demonstration - Units of Measure................................................................................................4-13
Practice Overview: Units of Measure............................................................................................................4-15
Practice - Defining Units of Measure ........................................................................................................4-16
Solution – Defining Units of Measure .......................................................................................................4-18
Agenda...........................................................................................................................................................4-21
Item Statuses and Attributes ..........................................................................................................................4-22
Item Status .....................................................................................................................................................4-23
Status Attributes ............................................................................................................................................4-24
Item Attribute Relationships..........................................................................................................................4-25
Status Attribute Interdependencies ................................................................................................................4-26
Status Attributes and Functionality ...............................................................................................................4-29
Guided Demonstration Overview: Viewing Item Attributes .........................................................................4-31
Guided Demonstration - Viewing Item Attributes.....................................................................................4-32
Practice Overview: Viewing Item Attributes.................................................................................................4-33
Practice - Viewing Item Attributes ............................................................................................................4-34
Solution – Viewing Item Attributes...........................................................................................................4-35
Agenda...........................................................................................................................................................4-41
Defining the Item Master Organization .........................................................................................................4-42
Agenda...........................................................................................................................................................4-44
Defining Items ...............................................................................................................................................4-45
Steps to Setup, Define, and Maintain Items..................................................................................................4-46
Defining Items ...............................................................................................................................................4-47
Item Templates ..............................................................................................................................................4-48
Organization Assignment and Organization Item..........................................................................................4-49
Item Control Level.........................................................................................................................................4-50
Guided Demonstration: Defining Items.........................................................................................................4-52
Guided Demonstration - Define Item ........................................................................................................4-53
Practice Overview: Defining Items................................................................................................................4-54
Defining Items ...........................................................................................................................................4-55
Solution - Defining Items ..........................................................................................................................4-57

ii
Agenda...........................................................................................................................................................4-61
Deletion Constraints ......................................................................................................................................4-62
Agenda...........................................................................................................................................................4-64
Profile Values ................................................................................................................................................4-65
Item Profile Options ......................................................................................................................................4-67
Agenda...........................................................................................................................................................4-69
Implementation Considerations .....................................................................................................................4-70
Agenda...........................................................................................................................................................4-71
Summary........................................................................................................................................................4-72
11i Inventory Controls Concepts....................................................................................................................5-1
11i Inventory Controls Concepts ...................................................................................................................5-2
Objectives ......................................................................................................................................................5-3
Agenda...........................................................................................................................................................5-4
Inventory Control Overview..........................................................................................................................5-5
Agenda...........................................................................................................................................................5-6
Subinventories Overview ..............................................................................................................................5-7
Agenda...........................................................................................................................................................5-8
Locator Control Overview.............................................................................................................................5-9
Agenda...........................................................................................................................................................5-10
Revision Control Overview ...........................................................................................................................5-11
Agenda...........................................................................................................................................................5-12
Lot Control Overview....................................................................................................................................5-13
Agenda...........................................................................................................................................................5-14
Serial Number Overview ...............................................................................................................................5-15
Agenda...........................................................................................................................................................5-16
Summary........................................................................................................................................................5-17
11i Inventory Controls Fundamentals ...........................................................................................................6-1
11i Inventory Controls Fundamentals............................................................................................................6-2
Objectives ......................................................................................................................................................6-3
Agenda...........................................................................................................................................................6-4
Inventory Control Overview..........................................................................................................................6-5
Agenda...........................................................................................................................................................6-6
Defining Subinventories ................................................................................................................................6-7
Subinventory-Locator Relationship...............................................................................................................6-8
Locator Structuring........................................................................................................................................6-10
Locator Control Reports ................................................................................................................................6-11
Guided Demonstration Overview: Defining Subinventories .........................................................................6-12
Guided Demonstration - Creating Subinventories .....................................................................................6-13
Practice Overview: Defining Subinventories.................................................................................................6-14
Practice - Creating Subinventories ............................................................................................................6-15
Solution - Creating Subinventories............................................................................................................6-16
Guided Demonstration Overview Setting Up Locator Control......................................................................6-20
Guided Demonstration - Locator Control ..................................................................................................6-21
Practice Overview Setting Up Locator Control .............................................................................................6-23
Practice - Setting Up Locator Control .......................................................................................................6-24
Solution – Setting Up Locator Control ......................................................................................................6-26
Agenda...........................................................................................................................................................6-33
Revision Control............................................................................................................................................6-34
Agenda...........................................................................................................................................................6-36
Lot Control ....................................................................................................................................................6-37
Lot Number Purging......................................................................................................................................6-38
Maintaining Lot Information .........................................................................................................................6-39
Cycle Counts Under Lot Control...................................................................................................................6-40
Physical Inventory Under Lot Control...........................................................................................................6-41
Disabled Lots.................................................................................................................................................6-42
Lot Control Reports .......................................................................................................................................6-43

iii
Agenda...........................................................................................................................................................6-44
Generating Serial Numbers............................................................................................................................6-45
Maintaining Serial Numbers..........................................................................................................................6-46
Serial Genealogy ...........................................................................................................................................6-47
Serial Number Control Reports .....................................................................................................................6-48
Guided Demonstration Overview: Revision, Lot, and Serial Controls..........................................................6-49
Guided Demonstration - Revision, Lot, and Serial Controls .....................................................................6-50
Practice Overview: Revision, Lot, and Serial Controls .................................................................................6-53
Practice - Revision, Lot, and Serial Controls.............................................................................................6-54
Solution – Revision, Lot and Serial Controls ............................................................................................6-56
Agenda...........................................................................................................................................................6-67
Locator Flexfield Structure............................................................................................................................6-68
Changing Locator Control .............................................................................................................................6-69
Transacting Controlled Items ........................................................................................................................6-70
Agenda...........................................................................................................................................................6-72
Summary........................................................................................................................................................6-73
11i Transacting Inventory Concepts ..............................................................................................................7-1
11i Transacting Inventory Concepts ..............................................................................................................7-2
Module Objectives.........................................................................................................................................7-3
Agenda...........................................................................................................................................................7-4
Inventory Structure ........................................................................................................................................7-5
Overview .......................................................................................................................................................7-6
Agenda...........................................................................................................................................................7-7
Inventory Transactions ..................................................................................................................................7-8
Agenda...........................................................................................................................................................7-9
Transaction Types..........................................................................................................................................7-10
Transaction Source Types..............................................................................................................................7-11
Transaction Action ........................................................................................................................................7-13
Transaction Reasons ......................................................................................................................................7-15
Transaction Managers....................................................................................................................................7-16
Agenda...........................................................................................................................................................7-17
Move Orders..................................................................................................................................................7-18
Agenda...........................................................................................................................................................7-19
Shortage Alerts and Notifications..................................................................................................................7-20
Agenda...........................................................................................................................................................7-21
Mobile Transactions ......................................................................................................................................7-22
Agenda...........................................................................................................................................................7-23
Summary........................................................................................................................................................7-24
11i Transaction Setup......................................................................................................................................8-1
11i Transaction Setup ....................................................................................................................................8-2
Objectives ......................................................................................................................................................8-3
Agenda...........................................................................................................................................................8-4
Running Transaction Managers.....................................................................................................................8-5
Predefined Transaction Types .......................................................................................................................8-7
Guided Demonstration Overview: Defining a Customized Transaction .......................................................8-8
Guided Demonstration - Customized Transactions ...................................................................................8-9
Practice Overview: Defining a Customized Transaction...............................................................................8-11
Practice - Defining a Customized Transaction ..........................................................................................8-12
Solution – Defining a Customized Transaction .........................................................................................8-13
Agenda...........................................................................................................................................................8-18
Inter–organization Shipping Network ...........................................................................................................8-19
Shipping Method ...........................................................................................................................................8-21
Agenda...........................................................................................................................................................8-22
Movement Statistics ......................................................................................................................................8-23
Movement Statistics Parameters....................................................................................................................8-25
Collecting and Reporting Movement Statistics .............................................................................................8-26

iv
Agenda...........................................................................................................................................................8-28
Account Aliases.............................................................................................................................................8-29
Agenda...........................................................................................................................................................8-30
Setting Up for Move Orders ..........................................................................................................................8-31
Setup Steps for Move Orders.........................................................................................................................8-33
Agenda...........................................................................................................................................................8-35
Material Shortage Alerts and Notifications ...................................................................................................8-36
Setting Up Shortage Alerts and Notifications................................................................................................8-38
Movement Statistics Reports .........................................................................................................................8-39
Transaction Reports and Inquiries .................................................................................................................8-41
Agenda...........................................................................................................................................................8-42
Transaction Profile Options...........................................................................................................................8-43
Agenda...........................................................................................................................................................8-49
Implementation Considerations .....................................................................................................................8-50
Implementation Considerations for Shortage Messages................................................................................8-51
Agenda...........................................................................................................................................................8-52
Summary........................................................................................................................................................8-53
11i Issue and Transfer Material .....................................................................................................................9-1
11i Issue and Transfer Material .....................................................................................................................9-2
Module Objectives.........................................................................................................................................9-3
Agenda...........................................................................................................................................................9-4
Transaction Flows..........................................................................................................................................9-5
Inventory Transactions ..................................................................................................................................9-6
Inventory Transactions Without Documents and Requisitions......................................................................9-7
Inventory Transactions With Documents and Requisitions...........................................................................9-8
Agenda...........................................................................................................................................................9-9
Control Options and Restrictions...................................................................................................................9-10
Agenda...........................................................................................................................................................9-11
Subinventory Transfer ...................................................................................................................................9-12
Guided Demonstration: Subinventory Transfer.............................................................................................9-13
Guided Demonstration - Subinventory Transfers ......................................................................................9-14
Miscellaneous Transaction (Account Receipt) ..............................................................................................9-15
Application of Miscellaneous Transactions...................................................................................................9-17
Inter-organization Direct Shipment ...............................................................................................................9-18
Interorganization Intransit Shipment .............................................................................................................9-20
Guided Demonstration Overview: Interorganization Transfer ......................................................................9-22
Guided Demonstration - Interorganization Transfer..................................................................................9-23
Practice Overview: Interorganization Transfer..............................................................................................9-24
Practice - InterOrganization Transfer ........................................................................................................9-25
Solution – InterOrganization Transfer .......................................................................................................9-26
Agenda...........................................................................................................................................................9-29
Managing Receipts ........................................................................................................................................9-30
Using Locations in Receiving........................................................................................................................9-31
Entering Receipt Lines ..................................................................................................................................9-32
Express Receipts and Receiving Transactions...............................................................................................9-34
Receiving Unordered Items ...........................................................................................................................9-35
Direct Receipts ..............................................................................................................................................9-37
Inspecting Received Items.............................................................................................................................9-39
Guided Demonstration Overview: Receiving Items into Inventory ..............................................................9-41
Guided Demonstration - Receiving Stock into Inventory..........................................................................9-42
Practice Overview: Receiving Items into Inventory ......................................................................................9-44
Practice - Receiving Material into Inventory.............................................................................................9-45
Solution – Receiving Material into Stock..................................................................................................9-46
Returns to Receiving .....................................................................................................................................9-51
Returns to Inventory ......................................................................................................................................9-52
Entering Returns ............................................................................................................................................9-53

v
Guided Demonstration Overview: Receiving Returns to Inventory ..............................................................9-55
Guided Demonstration - Receiving Returns ..............................................................................................9-56
Agenda...........................................................................................................................................................9-57
Receiving Reports..........................................................................................................................................9-58
Agenda...........................................................................................................................................................9-59
Move Orders Process Flow............................................................................................................................9-60
Move Order Requisition Approval Process ...................................................................................................9-61
Benefits of Managed Material Flow in a Facility ..........................................................................................9-63
Move Order Source Types.............................................................................................................................9-65
Move Order Components ..............................................................................................................................9-67
Move Order Allocating..................................................................................................................................9-69
Generate Move Orders...................................................................................................................................9-71
Item Allocation ..............................................................................................................................................9-73
Transact Move Orders ...................................................................................................................................9-74
Guided Demonstration Overview: Transacting Move orders ........................................................................9-75
Guided Demonstration - Transacting Move Orders...................................................................................9-76
Practice Overview: Transacting Move orders................................................................................................9-78
Practice - Transacting Move Orders ..........................................................................................................9-79
Solution – Transacting Move Orders.........................................................................................................9-81
Agenda...........................................................................................................................................................9-91
Transactions Using a Mobile Device.............................................................................................................9-92
Guided Demonstration Overview: Mobile Transactions ...............................................................................9-94
Guided Demonstration - Mobile Application Inter-organization Transfer ................................................9-95
Practice Overview: Mobile Transactions.......................................................................................................9-96
Practice - Mobile Transactions ..................................................................................................................9-97
Solution – Mobile Transactions.................................................................................................................9-98
Agenda...........................................................................................................................................................9-103
Managing Shipments .....................................................................................................................................9-104
Agenda...........................................................................................................................................................9-105
Summary........................................................................................................................................................9-106
11i Replenishment Concepts...........................................................................................................................10-1
11i Replenishment Concepts .........................................................................................................................10-2
Objectives ......................................................................................................................................................10-3
Agenda...........................................................................................................................................................10-4
Overview .......................................................................................................................................................10-5
Overview of Inventory Planning ...................................................................................................................10-6
Order Planning...............................................................................................................................................10-7
How Much to Order.......................................................................................................................................10-8
Replenishment Process for Intra-Org Supply Sources...................................................................................10-9
Replenishment Process for Supplier Supply Sources ....................................................................................10-10
Replenishment Process for Inter-Org Supply Sources...................................................................................10-11
Replenishment Process for Product Supply Sources .....................................................................................10-12
Agenda...........................................................................................................................................................10-13
Overview of Oracle Inventory Forecasting....................................................................................................10-14
Forecast Types...............................................................................................................................................10-15
Agenda...........................................................................................................................................................10-16
Oracle Inventory Replenishment Methods ....................................................................................................10-17
Replenishment Methods Levels.....................................................................................................................10-18
Safety Stock...................................................................................................................................................10-19
Economic Order Quantity..............................................................................................................................10-20
Overview of Reorder-Point Planning ............................................................................................................10-21
Overview of Min-max Planning ....................................................................................................................10-22
Overview of Kanban Replenishment.............................................................................................................10-23
Overview of Replenishment Counting ..........................................................................................................10-25
Overview of PAR Counting...........................................................................................................................10-26
Agenda...........................................................................................................................................................10-27

vi
Mobile Replenishment Count Overview .......................................................................................................10-28
Agenda...........................................................................................................................................................10-29
Summary........................................................................................................................................................10-30
11i Replenishment Fundamentals ..................................................................................................................11-1
11i Replenishment Fundamentals.................................................................................................................11-2
Objectives ......................................................................................................................................................11-3
Agenda...........................................................................................................................................................11-4
Overview .......................................................................................................................................................11-5
Agenda...........................................................................................................................................................11-6
Focus Forecasting ..........................................................................................................................................11-7
Focus-Forecasting (continued) ......................................................................................................................11-8
Using Focus Forecasting ...............................................................................................................................11-10
Focus Forecasting Example...........................................................................................................................11-11
Statistical Forecasting....................................................................................................................................11-13
Exponential Smoothing Forecast (ESF) ........................................................................................................11-14
Trend-Enhanced Forecast (TEF) ...................................................................................................................11-16
Season-Enhanced Forecast (SEF)..................................................................................................................11-18
Trend- and Season-Enhanced Forecast (TSEF).............................................................................................11-20
Forecast Setup and Maintenance ...................................................................................................................11-22
Guided Demonstration Overview: Creating a Manual Forecast ....................................................................11-23
Guided Demonstration - Creating a Manual Forecast ...............................................................................11-24
Practice Overview: Creating a Manual Forecast ...........................................................................................11-26
Practice - Creating a Manual Forecast .......................................................................................................11-27
Solution – Creating a Manual Forecast......................................................................................................11-28
Agenda...........................................................................................................................................................11-31
Uses of Reorder-point Planning.....................................................................................................................11-32
Reorder-point Planning: Safety Stock ...........................................................................................................11-33
Reorder-Point Planning: Lead Time ..............................................................................................................11-34
Reorder-Point Planning: Reorder Quantity....................................................................................................11-35
Reorder-Point Planning Steps........................................................................................................................11-37
Entering Item Planning Attributes .................................................................................................................11-38
Entering General Planning Attributes for Reorder-point Planning................................................................11-39
Entering Lead Times .....................................................................................................................................11-41
Entering Safety Stocks...................................................................................................................................11-42
Performing Reorder-point Planning...............................................................................................................11-44
Guided Demonstration: Reorder Point Planning ...........................................................................................11-46
Guided Demonstration - Reorder Point Planning ......................................................................................11-47
Agenda...........................................................................................................................................................11-48
Uses of Min-max Planning ............................................................................................................................11-49
Min-max Planning .........................................................................................................................................11-50
Min-max Planning: When to Order? ............................................................................................................11-51
Min-max Planning: How Much to Order? ....................................................................................................11-52
Min-max Planning Steps ...............................................................................................................................11-53
Item Planning Attributes................................................................................................................................11-54
Min-max Planning Setup Procedure ..............................................................................................................11-55
Selecting a Planning Level ............................................................................................................................11-56
Entering Planning Attributes .........................................................................................................................11-57
Submitting the Min-max Planning Requests .................................................................................................11-58
Guided Demonstration Overview: Min-max Planning ..................................................................................11-60
Guided Demonstration - Min-max Planning..............................................................................................11-61
Practice Overview: Min-max Planning..........................................................................................................11-63
Practice - Performing Min-max Planning ..................................................................................................11-64
Solution – Performing Min-max Planning.................................................................................................11-65
Agenda...........................................................................................................................................................11-71
Uses of Replenishment Counting ..................................................................................................................11-72
Replenishment Planning Steps ......................................................................................................................11-73

vii
Subinventories Window ................................................................................................................................11-75
Item Subinventories Window ........................................................................................................................11-76
Item Subinventories: Order Modifier Tab ....................................................................................................11-77
Replenishment Count Headers ......................................................................................................................11-78
Replenishment Count Lines...........................................................................................................................11-79
Processing Replenishment Counts................................................................................................................11-81
Practice Overview: Performing a Replenishment Count Using Forms..........................................................11-83
Practice - Performing a Replenishment Count Using Forms .....................................................................11-84
Solution - Performing a Replenishment Count Using Forms ....................................................................11-86
Practice Overview: Performing a Replenishment Count Using the Mobile Application...............................11-91
Practice - Performing a Replenishment Count Using the Mobile Application ..........................................11-92
Solution - Performing a Replenishment Count Using the Mobile Application .........................................11-94
Processing PAR Counts.................................................................................................................................11-102
Reorder Quantity For PAR Count .................................................................................................................11-103
Agenda...........................................................................................................................................................11-105
Kanban Cards ................................................................................................................................................11-106
Kanban Planned Items ...................................................................................................................................11-107
Kanban Cards ................................................................................................................................................11-109
Kanban Supply Status....................................................................................................................................11-111
Kanban Replenishment Sources ....................................................................................................................11-112
Kanban Card Printing ....................................................................................................................................11-113
Guided Demonstration Overview: Generating Kanban Cards.......................................................................11-114
Guided Demonstration - Kanban ...............................................................................................................11-115
Practice Overview: Generating Kanban Cards ..............................................................................................11-116
Practice - Generating Kanban Cards..........................................................................................................11-117
Solution – Generating Kanban Cards ........................................................................................................11-118
Agenda...........................................................................................................................................................11-122
Available to Promise .....................................................................................................................................11-123
ATP Rules and ATP Checks..........................................................................................................................11-124
Uses of ATP in Oracle Inventory ..................................................................................................................11-125
Steps for Checking ATP ................................................................................................................................11-126
ATP Rules Setup Steps..................................................................................................................................11-127
Defining Computation Options......................................................................................................................11-128
Specifying Supply and Demand Time Fences ...............................................................................................11-130
Specifying Demand Sources..........................................................................................................................11-134
Specifying Supply Sources ............................................................................................................................11-136
Setting Up Item and Bills for ATP Checking ................................................................................................11-137
ATP Checking ...............................................................................................................................................11-138
Viewing ATP Criteria....................................................................................................................................11-141
Agenda...........................................................................................................................................................11-142
Planning and Forecasting Profile Options .....................................................................................................11-143
Setting Up the Min-Max System Profile Value.............................................................................................11-145
Subinventory Setup Windows .......................................................................................................................11-146
Agenda...........................................................................................................................................................11-147
Min-Max Order Type and Order Source .......................................................................................................11-148
Replenishment Method Selection ..................................................................................................................11-151
Agenda...........................................................................................................................................................11-152
Summary........................................................................................................................................................11-153
11i Inventory Accuracy Concepts ..................................................................................................................12-1
11i Inventory Accuracy Concepts..................................................................................................................12-2
Objectives ......................................................................................................................................................12-3
Agenda...........................................................................................................................................................12-4
Overview of Inventory Accuracy ..................................................................................................................12-5
Agenda...........................................................................................................................................................12-6
ABC Analysis Overview ...............................................................................................................................12-7
Agenda...........................................................................................................................................................12-8

viii
Cycle Counting Overview .............................................................................................................................12-9
Agenda...........................................................................................................................................................12-10
Physical Inventory Overview ........................................................................................................................12-11
Why Perform Physical Inventories? ..............................................................................................................12-12
Agenda...........................................................................................................................................................12-13
Mobile Inventory Accuracy Overview ..........................................................................................................12-14
Agenda...........................................................................................................................................................12-15
Summary........................................................................................................................................................12-16
11i Inventory Accuracy Fundamentals..........................................................................................................13-1
11i Inventory Accuracy Fundamentals ..........................................................................................................13-2
Objectives ......................................................................................................................................................13-3
Agenda...........................................................................................................................................................13-4
Defining an ABC Analysis ............................................................................................................................13-5
Define and Run an ABC Compilation ...........................................................................................................13-6
ABC Compilation Criteria.............................................................................................................................13-7
Agenda...........................................................................................................................................................13-9
ABC Valuation Scope ...................................................................................................................................13-10
Agenda...........................................................................................................................................................13-11
Defining ABC Groups ...................................................................................................................................13-12
Defining ABC Classes...................................................................................................................................13-13
ABC Item Assignments .................................................................................................................................13-14
Guided Demonstration Overview: Compiling an ABC Analysis ..................................................................13-16
Guided Demonstration - ABC Analysis ....................................................................................................13-17
Practice Overview: Compiling an ABC Analysis..........................................................................................13-19
Practice - Compiling an ABC Analysis .....................................................................................................13-20
Solution – Compiling an ABC Analysis....................................................................................................13-22
Agenda...........................................................................................................................................................13-28
Defining and Maintaining a Cycle Count ......................................................................................................13-29
Agenda...........................................................................................................................................................13-30
Cycle Count Approval Tolerance ..................................................................................................................13-31
Approval Tolerances......................................................................................................................................13-32
Hit/Miss Tolerance ........................................................................................................................................13-34
Measurement Errors ......................................................................................................................................13-35
Cycle Count Items .........................................................................................................................................13-36
Agenda...........................................................................................................................................................13-38
Automatic Scheduling ...................................................................................................................................13-39
Manual Scheduling ........................................................................................................................................13-40
Count Requests ..............................................................................................................................................13-41
Entering Cycle Counts...................................................................................................................................13-43
Cycle Count Open Interface ..........................................................................................................................13-44
Agenda...........................................................................................................................................................13-45
Count Adjustments and Approvals ................................................................................................................13-46
Automatic Recounts ......................................................................................................................................13-47
Approving Cycle Counts and Adjustments ...................................................................................................13-48
Guided Demonstration Overview: Performing Cycle Counts .......................................................................13-50
Guided Demonstration - Cycle Counting ..................................................................................................13-51
Practice Overview: Performing Cycle Counts...............................................................................................13-54
Practice - Performing a Cycle Count .........................................................................................................13-55
Solution – Performing a Cycle Count........................................................................................................13-57
Practice Overview: Mobile Counting ............................................................................................................13-66
Practice - Mobile Counting........................................................................................................................13-67
Solution – Mobile Counting ......................................................................................................................13-68
Agenda...........................................................................................................................................................13-73
Summary........................................................................................................................................................13-74

ix
Preface
Profile
Before You Begin This Course
Before you begin this course, you should have the following qualifications:
• Working experience with Oracle Applications.
Prerequisites
• There are no prerequisites for this course.
How This Course Is Organized
11i Inventory Management Fundamentals is an instructor-led course featuring lecture and hands-
on exercises. Online demonstrations and written practice sessions reinforce the concepts and
skills introduced.

xi
Related Publications
Oracle Publications
Title Part Number
Oracle Inventory User’s Guide A83507–08
Additional Publications
• None

xii
Typographic Conventions
Typographic Conventions in Text
Convention Element Example
Bold italic Glossary term (if The algorithm inserts the new key.
there is a glossary)
Caps and Buttons, Click the Executable button.
lowercase check boxes, Select the Can’t Delete Card check box.
triggers, Assign a When-Validate-Item trigger to the ORD block.
windows Open the Master Schedule window.
Courier new, Code output, Code output: debug.set (‘I”, 300);
case sensitive directory names, Directory: bin (DOS), $FMHOME (UNIX)
(default is filenames, Filename: Locate the init.ora file.
lowercase) passwords, Password: User tiger as your password.
pathnames, Pathname: Open c:\my_docs\projects
URLs, URL: Go to http://www.oracle.com
user input,
User input: Enter 300
usernames
Username: Log on as scott
Initial cap Graphics labels Customer address (but Oracle Payables)
(unless the term is a
proper noun)
Italic Emphasized words Do not save changes to the database.
and phrases, For further information, see Oracle7 Server SQL Language
titles of books and Reference Manual.
courses, Enter user_id@us.oracle.com, where user_id is the
variables name of the user.
Quotation Interface elements Select “Include a reusable module component” and click Finish.
marks with long names
that have only This subject is covered in Unit II, Lesson 3, “Working with
initial caps; Objects.”
lesson and chapter
titles in cross-
references
Uppercase SQL column Use the SELECT command to view information stored in the
names, commands, LAST_NAME
functions, schemas, column of the EMP table.
table names
Arrow Menu paths Select File > Save.
Brackets Key names Press [Enter].
Commas Key sequences Press and release keys one at a time:
[Alternate], [F], [D]
Plus signs Key combinations Press and hold these keys simultaneously: [Ctrl]+[Alt]+[Del]

xiii
Typographic Conventions in Code
Convention Element Example
Caps and Oracle Forms When-Validate-Item
lowercase triggers
Lowercase Column names, SELECT last_name
table names FROM s_emp;
Passwords DROP USER scott

IDENTIFIED BY tiger;
PL/SQL objects OG_ACTIVATE_LAYER
(OG_GET_LAYER (‘prod_pie_layer’))
Lowercase Syntax variables CREATE ROLE role

italic
Uppercase SQL commands and SELECT userid
functions FROM emp;
Typographic Conventions in Oracle Application Navigation Paths

This course uses simplified navigation paths, such as the following example, to direct you
through Oracle Applications.
(N) Invoice > Entry > Invoice Batches Summary (M) Query > Find (B) Approve
This simplified path translates to the following:
1. (N) From the Navigator window, select Invoice then Entry then Invoice Batches
Summary.
2. (M) From the menu, select Query then Find.
3. (B) Click the Approve button.
Notations:
(N) = Navigator
(M) = Menu
(T) = Tab
(B) = Button
(I) = Icon
(H) = Hyperlink
(ST) = Sub Tab

xiv
Typographical Conventions in Oracle Application Help System Paths
This course uses a “navigation path” convention to represent actions you perform to find
pertinent information in the Oracle Applications Help System.
The following help navigation path, for example—
(Help) General Ledger > Journals > Enter Journals
—represents the following sequence of actions:
1. In the navigation frame of the help system window, expand the General Ledger entry.
2. Under the General Ledger entry, expand Journals.
3. Under Journals, select Enter Journals.
4. Review the Enter Journals topic that appears in the document frame of the help system
window.

xv

xvi
11i Receipt to Issue
Chapter 1

Chapter 1 - Page 1

Chapter 1 - Page 2
Objectives

Chapter 1 - Page 3
Agenda

Chapter 1 - Page 4
Overview

Chapter 1 - Page 5
Overview

Chapter 1 - Page 6
Agenda

Chapter 1 - Page 7
Receipt to Issue Life Cycle
Receipt To Issue
Oracle Inventory uses the receipt to issue process to manage your inventory. The three main
pieces of the process are as follows:
Receiving
When you take delivery of inventory into your warehouse you receive it. You can receive
inventory using the following applications:
• Oracle Purchasing
• Oracle Work in Process
• Oracle Inventory
Transferring
You can transfer inventory within an organization and from one organization to another
organization using the following applications:
• Oracle Shipping
• Oracle Order Management

Chapter 1 - Page 8
• Issuing
Issuing
When you send materials out of inventory you issue it. You use the following applications to
issue inventory:
• Oracle Order Management
• Oracle Purchasing

Chapter 1 - Page 9
Agenda

Chapter 1 - Page 10
Receiving Inventory
Receiving Inventory
There are different ways you can receive inventory into stock.
Purchasing
You can receive inventory from outside of your organization using Oracle Purchasing. The
ways you use Oracle Purchasing in relation to receiving stock are:
• Purchase Order Receipt
• Internal Requisition
• In-transit Receipt
• Return Material Authorization
• Unexpected Receipt
Work in Process
You can receive inventory from the manufacturing floor using Oracle Work in Process
• Component Return
• Negative Component Issue
• Assembly Return

Chapter 1 - Page 11
Inventory
You may receive inventory into stock using Oracle Inventory in the following ways:
• Miscellaneous Account
• Receipt from Project
• User Defined
• Inter-organization receipt

Chapter 1 - Page 12
Receiving Inventory

Chapter 1 - Page 13
Agenda

Chapter 1 - Page 14
Transferring Inventory
Transferring Inventory
Different applications can generate requests to transfer inventory.
Shipping
Oracle Shipping can generate a transfer to move stock from a finished goods area to a staging
to for shipping.
Order Management
Oracle Order Management can generate a transfer to move stock from a finished goods area to
a staging area for shipping.
Work in Process
Oracle Work in Process can generate a transfer to acquire components for a project.
Inventory
Oracle Inventory transfers materials using the following methods:
• Transfer between Organizations
• Replenish materials
• Request transfers

Chapter 1 - Page 15
Agenda

Chapter 1 - Page 16
Issuing Inventory
Issuing Inventory
You can issue stock out of inventory using the following applications:
Order Management
Oracle Order Management can generate an inventory issue through:
• Sales Orders
• Internal Orders
Purchasing
Oracle Purchasing can generate an inventory issue for:
• Return to Vendor materials
Work in Process
Oracle Work in Process can generate an inventory issue through:
• Component Issue
• Assembly Return
Inventory
You can issue stock using Oracle Inventory in the following ways:

Chapter 1 - Page 17
• User Defined
• Inter-organization Transfer
• Cycle Count Negative
• Request Issue

Chapter 1 - Page 18
Agenda

Chapter 1 - Page 19
Oracle Inventory Application Integration
Integration of Oracle Inventory to Manufacturing Applications

Oracle Inventory interacts with the other applications by sharing information:
• Oracle Cost Management receives cost information and transaction rates from Oracle
Inventory.
• Oracle Work in Process provides WIP activity and ATP supply information to Oracle
Inventory and receives information regarding UOM, items, and on-hand quantity from
Oracle Inventory.
• Oracle Advanced Supply Chain Planning and Oracle Global Order Promising provide
ATP supply information and receive on-hand quantity and forecast information from
Oracle Inventory.
• Oracle Bill of Materials receives UOM and item information from Oracle Inventory.
• Oracle Engineering provides engineering item information and receives UOM and item
information from Oracle Inventory.
• Oracle Order Management provides shipping, reservations, and demand information and
receives UOM, items, and ATP/on-hand quantity information from Oracle Inventory.

Chapter 1 - Page 20
• Oracle Purchasing provides receipts/deliveries, ATP supply, and planning supply
information and receives UOM, items, requisition, and inter-org shipment information
from Oracle Inventory.

Chapter 1 - Page 21
Integration of Oracle Inventory to Financial Applications
Integration of Oracle Inventory to Financial Applications

• Oracle General Ledger provides set of books and currency exchange rates and receives
transaction accounting summary and/or detail from Oracle Inventory.
• Oracle Payables receives UOM and Item information from Oracle Inventory.
• Oracle Receivables provides intercompany invoice information and receives UOM and
item information from Oracle Inventory.
• Oracle Assets receives UOM and item information from Oracle Inventory.

Chapter 1 - Page 22
Agenda

Chapter 1 - Page 23
Summary

Chapter 1 - Page 24
11i Defining Inventory
Organizations
Chapter 2
11i Defining Inventory Organizations

Chapter 2 - Page 1

Chapter 2 - Page 2
Objective

Chapter 2 - Page 3
Agenda

Chapter 2 - Page 4
Multi-Org Structure
Multi-Org
Multi-Org is an enhancement to Oracle applications that enables you to model multiple
business units in an enterprise using a single installation of Oracle applications. In a multi-org
architecture you can keep data secure and separate from each business unit.
The following are the benefits of multi-org:
• You can use a single installation of any Oracle Applications product to support any number
of business units, even if those business units use different set of books. Set of books is
explained in the following slide.
• Secure access to data so that users can access only information that is relevant to them.
• You can define a organizational model that best suits your business requirements.

Chapter 2 - Page 5
Organization Model
Organization Model
The multi-org model provides a hierarchy that dictates how transactions flow through different
business units and how those business units interact. You define the organizations and the
relationships between them.
Business Group
This is an Organization that represents the consolidated enterprise, a major division, or an
operation company and has no accounting impact. The Business Group partitions Human
Resources information and the Purchasing Approval Hierarchy. If you request a list of
employees (in any module) you will see only those employees in the Business Group of which
your Operating Unit is a part. Multiple Legal Entities can relate to a single Business Group.
You must have at least one Business Group. For a new installation, Oracle Applications
provides a default business group called Setup Business Group. You can define additional
business groups as required for your enterprise.
Set of Books
A set of books (SOB) is a financial reporting entity that shares the three Cs: a particular chart
of accounts (accounting flexfield structure), functional currency, and financial accounting

Chapter 2 - Page 6
calendar. You create sets of books using the Set of Books window in Oracle General Ledger.
You define all other types of organizations using the Organizations window.
Legal Entity
A legal entity represents a legal company for which you prepare fiscal or tax reports. You
assign tax identifiers and other legal entity information to these types of organizations.
Operating Unit
An operating unit represents an organization that uses any Oracle subledger application, for
example, Order Management, Payables. It may be a sales office, a division, or a department.
An operating unit is associated with a legal entity. Information is secured by operating unit for
these applications. Each user sees information only for their operating unit. Responsibilities are
linked to a specific operating unit by the MO: Operating Unit profile option.
Inventory organizations are explained in detail in the following slides.

Chapter 2 - Page 7
Sample Organization Structure
Organization Structure
Using Oracle Applications accounting, distribution, and materials management functions, you
define the relationships between inventory organizations, operating units, legal entities, and set
of books to create a multilevel company structure. Oracle Applications enables you to set up a
simple to complex organization structure. Analyze your current and future business
requirements when making this decision.
The following points describe how the multi-org model relates organizations:
• A Business Group is the highest level of the structure and has no accounting impact. The
Business Group determines which employees will be available to Sets of Books and
Operating Units related to that Business Group.
• Set of Books is the highest level which impacts the accounting side of business.
• Set of Books is associated with a single Business Group, multiple Sets of Books may be
associated with a single Business Group.
• Each Set of Books may have a different chart of accounts structure, calendar, or functional
currency.
• Each Legal Entity is associated with a single Set of Books, multiple Legal Entities may be
associated with a single Set of Books.

Chapter 2 - Page 8
• Each Operating Unit is associated with a single Legal Entity, multiple Operating Units may
be associated with a single Legal Entity.
• An Inventory Organization may be associated with any Operating Unit within the same Set
of Books.

Chapter 2 - Page 9
Enterprise Structure Considerations
Enterprise Structure Considerations

An inventory organization is an inventory location, which can have its own set of books,
costing method, workday calendar, and list of items.
Sets of Books
You can tie one Oracle General Ledger set of books to each inventory organization.
Costing Methods
You choose your costing method, which can be standard or average, at the organizational level.
The item attribute control level determines the costing organization.
Item Costs
Oracle Inventory keeps one standard cost per item per inventory organization.
Movement Between Inventory Organizations
You can use intransit inventory for interorganization transfers.
Planning Method
You can perform reorder point planning at the organizational level, and you can perform min-
max planning at both the organization and subinventory level. Subinventories are explained in
the next slide.

Chapter 2 - Page 10
In Multi-Org
You can tie one government reporting entity/legal entity to each inventory organization. You
can also tie one operating unit to each inventory organization.
Forecasting
Oracle Inventory forecasts item usage at the organization level only.
Accuracy Analysis
You can perform a physical inventory, ABC classifications, and cycle counting at both the
organization and subinventory levels.

Chapter 2 - Page 11
Inventory Organizations
An inventory organization is a facility in your enterprise where you store and transact your
inventory items. The items in an inventory organization can be in the form of raw materials,
semi-finished goods, or finished goods for varying periods of time.
Before you use Oracle Inventory, you need to define one or more inventory organizations.
Inventory organizations represent distinct entities in your enterprise and can be one of the
following:
• A physical entity such as a manufacturing facility, warehouse, distribution center, or a
branch office.
• A logical entity such as an item master organization, which you can use just to define items
but no transactions. The item master organization is discussed in detail in the lesson titled
“Defining and Maintaining Items Fundamentals.”
An inventory organization may have the following attributes:
• An inventory organization can have its own location with a set of books, a costing method,
a workday calendar, and a list of items.
• An inventory organization can share one or more of these characteristics with other
organizations.

Chapter 2 - Page 12
Inventory Organization Structure
Inventory Organization Structure

An inventory organization, where you store and transact items can have one or more
subinventories. Subinventories are unique physical or logical separations of material inventory,
such as raw material inventory, finished goods inventory, or defective goods inventory. In
Oracle Inventory, all material within an organization is held in a subinventory. Therefore, you
must define at least one subinventory.
Item quantities can be tracked by subinventory. Items can also be restricted to specific
subinventories.
The subinventories in an inventory organization may be made up of one or more locators such
as row, rack, bin. You use locators to identify physical areas where you store inventory items.
Item quantities can be tracked by locator. Items can also be restricted to specific locators.

Chapter 2 - Page 13
Sample Inventory Organization

Chapter 2 - Page 14
Agenda

Chapter 2 - Page 15
Setting up Locations
Setting up Locations
• Define information describing the physical locations of Employees and Organizations.
• Locations are shared between Inventory, Purchasing, and Human Resource Management.
Locations flagged as global locations are available to all Business Groups. Each
organization can be associated with only one location. One or more organizations can be
associated with the same location.

Chapter 2 - Page 16
Defining Organizations
Classify the Organization
• Choose an organization classification to describe the general purpose of your organization.
• Examples of organization classifications are inventory organization, legal company, and
HR organization.
• Choose inventory organization as your organization classification to use your organization
for inventory management.
Set of Books
• Tie each inventory organization to an operating unit. Each operating unit is associated to a
legal entity and a general ledger set of books.

Chapter 2 - Page 17
Organization Setup
Organization Setup
Use the Organization Parameters window to complete your organization definition for
inventory purposes.
• You must specify the item master organization. The system defaults this field to the
organization for which parameters are being entered. It must be changed for any
organization that is not an item master organization.
• The item master organization should be the first inventory organization for which
parameters are defined.
• You must define the control options and account defaults for your organization before you
can define items or perform any transactions.
• Define receiving parameters if you receive items on purchase orders, internal orders, and
in-transit interorganization shipments.
• You must assign a unique short code to your organization and use this code to identify the
organization with which you want to work.
• You must specify shipping parameters to specify whether the move order line allocation is
automatic or manual in Oracle Shipping Execution.

Chapter 2 - Page 18
• Define the WIP parameters if you are using Oracle Work in Process.
• You must define project parameters if the organization is classified as a project
manufacturing organization.
• Define and update default inventory and costing parameters for your organization.

Chapter 2 - Page 19
Additional Set Up Steps
Setting Up Employees and Planners

Entering Employees
Employees who perform cycle and physical inventory counts.
Defining Planners
Identify persons responsible for planning items or groups of items.
Defining Freight Carriers
Allows assignment of a general ledger account to one or more carriers to collect costs
associated with their use.
A carrier can be assigned to each inter-organization transfer.

Chapter 2 - Page 20
Additional Organizational Setups
Material Shortage Parameters

Define the parameters for the system to determine when unsatisfied demand exceeds available
quantity of incoming supply. This condition can be used by the system to trigger shortage
alerts and notifications.
Organization Access
This controls access to organizations based on the user responsibility assigned to a user by the
system administrator.
When implemented for one user responsibility, it is then required for all other user
responsibilities accessing the same organization.

Chapter 2 - Page 21
Guided Demonstration: Creating an Inventory Organization

Chapter 2 - Page 22
Guided Demonstration - Setting Up Locations
Responsibility = Inventory, Vision Operations USA
1. (N) > Setup > Organizations > Locations.
2. Define a Location using the following information:

− Name: M12 Orlando MFG
3. Select the Address field.
4. Enter the following address information:

− Address Line 1: 100 Buena Vista Drive
− City: Orlando
− State: FL
− Zip Code: 32803
− County: Orange
− Country: United States
− Telephone: (407) 828-5000
5. (B) OK.
6. Save and Close form.

Chapter 2 - Page 23
Guided Demonstration - Setting Up Organizations
Responsibility: Inventory, Vision Operations USA
1. (N) > Setup > Organizations >Organizations.
2. Set up a new organization using the following information:

− Name: M12 Orlando MFG
− Type: Plant
− Location: M12 Orlando MFG
3. (M) File > Save.
4. Under Organisation Classifications, choose 'Inventory Organization' in the Name field and
select the Enabled checkbox.
5. (M) File > Save.
6. (B) Others > Accounting Information.
7. Enter the following accounting information:

− Set of Books: Vision Operations
− Legal Entity: Vision Operations
− Operating Unit: Vision Operations
8. (M) File > Save.
9. (B) Others > Inventory Information > (T) Inventory Parameters
10. Enter the following inventory parameters:

− Organization Code: M12
− Item Master Organization: Vision Operations
− Calendar: Vision01
− Locator Control: Determined at Subinventory Level
11. (T) Costing Information
12. Click the flexfield button in the Material field. The Operations Accounting Flex window
opens.
13. Click the OK button in the Operations Accounting Flex window.
14. Enter the following details in the Operations Accounting Flex window:
− Department: No Department
− Account: Inventory Material Value
15. (T) Other Accounts

Chapter 2 - Page 24
16. Click the flexfield button in the Purchase Price Variance field. The Operations Accounting
Flex window opens.
− Department: M1, Seattle Manufacturing Plant
− Account: Purchase Price Variance
19. Click the flexfield button in the Invoice Price Variance field. The Operations Accounting
Flex window opens.
− Account: Invoice Price Variance
22. Click the flexfield button in the Inventory AP Accrual field. The Operations Accounting
Flex window opens.
− Account: Accounts Payable Clearing
25. Click the flexfield button in the Sales field. The Operations Accounting Flex window opens.
− Account: Hardware
28. Click the flexfield button in the Cost of Goods Sold field. The Operations Accounting Flex
window opens.
− Account: Cost of Sales
31. (M) File > Save.
32. (M) File > Close Form.
33. (B) Others > Receiving Information

Chapter 2 - Page 25
34. Enter the following receiving options:
− Receipt Date, Days Early: 5
− Receipt Date, Days Late: 5
− Over Receipt Control, Tolerance: 5%
35. Click the flexfield button in the Receiving Inventory Account field. The Receiving Accrual
Account window opens.
36. Click the OK button in the Receiving Accrual Account window.
37. Enter the following details in the Receiving Accrual Account window:
38. Click the flexfield button in the Clearing Account field. The Clearing Account window
opens.
39. Click the OK button in the Clearing Account window.
40. Enter the following details in the Clearing Account window:


Chapter 2 - Page 26
Agenda

Chapter 2 - Page 27
Summary

Chapter 2 - Page 28
11i Overview of Defining and
Maintaining Items
Chapter 3
11i Overview of Defining and Maintaining Items

Chapter 3 - Page 1

Chapter 3 - Page 2
Objective

Chapter 3 - Page 3
Agenda

Chapter 3 - Page 4
Items
What is an Item?
An item is a part or service you:
• Purchase
• Sell
• Plan
• Manufacture
• Stock
• Distribute
• Prototype

Chapter 3 - Page 5
Agenda

Chapter 3 - Page 6
Oracle Organization

Chapter 3 - Page 7
An inventory organization is an inventory location with its own set of books, costing method,
workday calendar, and list of items. An organization can be a company, subsidiary, or a
warehouse.
Consider the following when you plan your enterprise structure:
• Sets of Books: You can tie one Oracle General Ledger set of books to each inventory
organization.
• Costing Methods: You set your costing method (Standard or Average) at the organizational
level. The item attribute control level determines the costing organization.
• Item Costs: Oracle Inventory keeps one cost per item per inventory organization.
• Movement Between Inventory Sites: You can use intransit inventory for interorganization
transfers.
• Planning Method: You can choose how to plan your items.
• Forecasting: You can forecast your items.
• Accuracy Analysis: You can perform a cycle count or a physical inventory.

Chapter 3 - Page 8
Classify the Organization
• Choose an organization classification to describe the general purpose of your organization.
• Examples of organization classifications are inventory organization, legal company, and
HR organization.
• Choose inventory organization as your organization classification to use your organization
for inventory management.
Set of Books
• Tie each inventory organization to an operating unit. Each operating unit is associated to a
legal entity and a general ledger set of books.
Inventory Parameters
• Use the Organization Parameters window to complete your organization definition for
inventory purposes.
• Define receiving parameters if you receive items on purchase orders, internal orders, and
intransit interorganization shipments.

Chapter 3 - Page 9
Agenda

Chapter 3 - Page 10
Defining Items in Item Master
Item Master
Always define items in the master organization. When you define an item, Oracle
automatically changes your current organization to the master organization. You may enable
your new items in as many child organizations as needed.

Chapter 3 - Page 11
Steps to Setup, Define, and Maintain Items
Steps to Define and Maintain Items

Following are the steps for creating and maintaining items:
1. Create the item templates.
2. Use the templates and existing items to define items.
3. Enter values for additional item attributes.
4. Assign a status to the item.
5. Assign categories to the item.
6. Enable the item in other organizations.
7. Update the organizational-level attributes values.
8. Define the item relationships.
9. Search for items.
10. Delete items.

Chapter 3 - Page 12
Defining Items

Chapter 3 - Page 13
Agenda

Chapter 3 - Page 14
Item Attributes
Item Attributes
Item attributes are the collection of information about an item.

Chapter 3 - Page 15
Item Statuses and Attributes

You define an item status by selecting the value check boxes for the status attribute. You can
control status attributes and item status at the item level or organization level.

Chapter 3 - Page 16
Item Attribute Groups

Chapter 3 - Page 17
Agenda

Chapter 3 - Page 18
Creating Item Templates

Chapter 3 - Page 19
Enabling Attributes in a Template

Chapter 3 - Page 20
Agenda

Chapter 3 - Page 21
Organization Assignment and Organization Item

You can enable your item in all child organizations under your master organization or you can
choose to enable your item in specific child organizations. You can use the master item
window, in each organization, to enter or change organization-level attribute values for items
that are enabled in the organization. For example you can select Reorder Point planning for an
item in one child organization and select Min-Max planning for the same item in another child
organization.

Chapter 3 - Page 22
Agenda

Chapter 3 - Page 23
Deletion Constraints and Deletion Groups
Deletions Constraints and Deletion Groups

You cannot delete an item if you have on-hand quantity or have performed any type of action
on the item.

Chapter 3 - Page 24
Agenda

Chapter 3 - Page 25
Summary

Chapter 3 - Page 26
11i Defining and Maintaining
Items Fundamentals
Chapter 4
11i Defining and Maintaining Items Fundamentals

Chapter 4 - Page 1

Chapter 4 - Page 2
Objectives

Chapter 4 - Page 3
Agenda

Chapter 4 - Page 4
Unit of Measure
Unit of Measure
A unit of measure (UOM) is a value that specifies the quantity of an item. For example, “each”
is a unit of measure that you would use to specify the number of units of an item.
Unit of Measure Class
A unit of measure class is a group of units of measure with similar characteristics. For
example, “weight” can be a unit of measure class with UOMs such as kilogram, gram, pound,
and ounce.

Chapter 4 - Page 5
Unit of Measure

Chapter 4 - Page 6
Units of Measure
Explaining Units of Measure

Each item you define in Oracle Inventory must have a primary unit of measure, and each item-
transaction you perform in Oracle Applications must have a unit of measure associated with
the transaction quantity and a conversion defined back to the primary unit of measure.

Chapter 4 - Page 7
Use of Units of Measure
Some Uses of Units of Measure

Planning Products
• Forecasting and consumption
• Master scheduling
• Material requirements planning
Work in Process
• Shop floor moves
• Resource transaction
• Completion and return transactions
• Inquiries and reports
Bills of Material and Engineering
• Defining bills of material
• Defining engineering items

Chapter 4 - Page 8
Defining UOM Classes

You need to define unit of measure classes and the base unit of measure for each class. Unit of
measure classes represent groups of units of measure with similar characteristics such as
volume or length. Oracle Inventory uses the base unit of measure to perform conversions
between units of measure in each class and between two different unit of measure classes.

Chapter 4 - Page 9
Units of Measure Conversions
Units of Measure Conversions

A unit of measure conversion is a mathematical relationship between two different units of
measure. For example, 16 ounces = 1 pound, or 2.2 pounds = 1 kilogram. If you want to
transact items in units of measure belonging to classes other than their primary UOM class,
you must define conversions between the base units of measure in different UOM classes.

Chapter 4 - Page 10
Units of Measure Setup

Chapter 4 - Page 11
Guided Demonstration Overview: Units of Measure

Chapter 4 - Page 12
Guided Demonstration - Units of Measure
Units of Measure Classes
1. (N) > Setup > Units of Measure > Classes.
2. (M) File > New.
3. Enter the following unit of measure information:

− Name: 00-Metric
− Description: 00-Metric Class
− Base Unit 00-Meter
− UOM: 00M
4. (M) File > Save.
5. Choose Units of Measure.
6. (M) File > New.
7. Create two units of measure using the following information

− Name: 00-Centimeter
− UOM: 00C
− Description: 00-Centimeter
− Name: 00-Kilometer
− UOM: 00K
− Description: 00-Kilometer.
8. (M) File > Save.
Unit of Measure Conversions
10. (N) Setup > Units of Measure > Conversions
11. (M) File > New.
12. Select 00-Centimeter from the list of values.
13. Enter 0.01 in the conversion field.
14. (M) File > New.
15. Select 00-Kilometer from the list of values.

Chapter 4 - Page 13
16. Enter 1000 in the conversion field.

Chapter 4 - Page 14
Practice Overview: Units of Measure

Chapter 4 - Page 15
Practice - Defining Units of Measure
Overview
In this lab you will be doing the following:
• Defining Units of Measure Classes
• Defining Units of Measure
• Setting Up Units of Measure Conversions
Assumptions
• You are skilled in Oracle Navigation
• You must have access to an Oracle Application Vision database or comparable training
or test instance at your site on which to complete this practice.
Tasks
Define a unit of measure class using your team number (##) to uniquely identify your class from
the other team’s in the classroom. The UOM class information to enter is as follows:
• Description: ##-Quantity Class
• Base Unit: ##-Each
• UOM abbreviation ##E
Defining UOMs
Define the following UOM’s for your class. Be sure to use your team number to uniquely
identify your class from the other team’s in the classroom.
• Dozen
• Gross
• Case
UOM Conversions
Set up Standard conversion for your UOMs. Be sure to use your team number to uniquely
identify your class from the other team’s in the classroom.

Chapter 4 - Page 16
Note: A Gross = 144 each, and a case = 24 each.

Chapter 4 - Page 17
Solution – Defining Units of Measure
1. Navigate to the UOM Classes window.
• (N) Setup > Units of Measure > Classes
2. The application prompts you to select an organization if it is a first-time access to the

database. Select M1 Seattle Manufacturing from the list of values.
3. (M) File > New.

− Name ##-QTY
− Description ##-Quantity Class
− Base Unit ##-Each
− UOM (abbreviation) ##E
4. (M) File > Save.
5. (M) File >Close Form.
Defining UOMs
6. Define multiple units of measure for you UOM class.
• (N) Setup > Units of Measure > Units of Measure
7. (M) File > New.

Chapter 4 - Page 18
− Name: ##-Dozen
− Abbreviation: ##D
− Description: Team ## Dozen U of M
− Class: The U of M class you created in Step 1
8. Repeat step 6 to create units of measure for ##-Gross and ##-Case using the same
conventions.
9. (M) File > Save.
10. (M) File > Close form.
UOM Conversions
11. Set up Standard conversions for your units of measure.
• (N) Setup > Units of Measure > Conversions
12. (M) File > New (make sure your conversion type is “Standard” conversion).
− UOM: ##-Dozen
− Class: ##-Quantity
− Conversion: 12
− Base Unit: ##-Each
13. Create Standard Conversions for Case and Gross UOMs.

− ##-Gross = 144 ##-Each
− ##-Case = 24 ##-Each

Chapter 4 - Page 19

Chapter 4 - Page 20
Agenda

Chapter 4 - Page 21

You define an item status by selecting the value check boxes for the status attribute. You can
control status attributes and item status at the item level or organization level.

Chapter 4 - Page 22
Item Status
Explaining Item Status

The Item Status attribute has a defined set of yes/no values for the status attributes. You apply
the values to the status attributes when you choose an item status code when you define an
item. For example, in the beginning of a product development cycle you set the Item Status
attribute to Prototype with all of the status attributes defaulted to yes except for Customer
Orders Enabled. When the item is ready, you change the Item Status attribute to Active to
enable all item functions.
You can assign one or more pending statuses for an item, to be implemented on future dates.
These statuses become effective on their assigned effective dates. You can view the status
history of an item if needed.
More detailed information see the online help:
(Help) Oracle Inventory > Setting Up > Item Set Up and Control > Status Attributes and Item
Status

Chapter 4 - Page 23
Status Attributes
Status Attributes Help

For more information on status attributes, refer to the online help:
Status Control

Chapter 4 - Page 24
Item Attribute Relationships
Explaining Item Attribute Relationships

Required Attributes
You must enter a value for the attribute based on the settings for other related attributes.
Interdependent Attributes
You can only enter certain values depending on other attribute values.
Updateable Attributes
You can update values under certain conditions.
Control Level Dependencies
You can update the control level of some attributes only under special conditions and with
certain consequences.

Chapter 4 - Page 25
Status Attribute Interdependencies

Chapter 4 - Page 26

Chapter 4 - Page 27

Chapter 4 - Page 28
Status Attributes and Functionality
Status Attributes and Functionality Help

For more information on this table, refer to the online help:
Status Control
(Help) Oracle Inventory > Setting Up > Item Set Up and Control > Relationships between
Attributes

Chapter 4 - Page 29
Status Attributes and Functionality

Chapter 4 - Page 30
Guided Demonstration Overview: Viewing Item Attributes

Chapter 4 - Page 31
Guided Demonstration - Viewing Item Attributes
Responsibility: Oracle Inventory, Vision Operations USA
1. (N) Items > Master Items.
2. (M) View > Query by Example > Enter.
3. Enter item %AS18947.
4. (M) View > Query by Example > Run.
5. (T) Inventory.
6. Choose the Master radio button from the Display Attributes zone.
7. Choose the Org radio button from the Display Attributes zone.

Chapter 4 - Page 32
Practice Overview: Viewing Item Attributes

Chapter 4 - Page 33
Practice - Viewing Item Attributes
Overview
In this lab you will learn how to view item attributes.
Assumptions
• You are skilled at Oracle navigation.
• Responsibility: Inventory, Vision Operations USA.
Tasks
Viewing Item Attributes
1. Find item # AS18947 and answer the following questions
• What is the BOM Item Type for the part? _______What is the control level? ______
• Is this item under Revision Control? _____ What is the control level? ____
2. Find item # AS54888 and answer the following questions about the item's attributes.
• What is the Item Status? _______________ What is the control level? ______
• Is a Bill of Material allowed for this item? ______ What is the control level? ______
• Can I build this item in WIP? ________________ What is the control level? _____
• Are customer orders enabled for this item? _________What is the control level? _____
• Is Invoicing Enabled for this item? ______________ What is the control level? _____
• Are Internal Orders enabled for this item? _______ What is the control level? ______
• Is this item transactable in Inventory? ____________ What is the control level? ______
• Is this item purchasable from a Vendor? ___________ What is the control level? _____
• Is this item stockable in Inventory? _______________ What is the control level? _____
• In how many Organizations can this part be used?

Chapter 4 - Page 34
Solution – Viewing Item Attributes
Viewing Item Attributes
1. Navigate to the Master Items Window.
• (N) Items > Master Items
2. Query Item # AS18947.
• (M) View > Query by Example > Enter

− Enter AS18947% in the Item field.
• (M) View > Query by Example > Run

Chapter 4 - Page 35
3. BOM Item Type for AS18947 is Standard, and Master controlled.

Chapter 4 - Page 36
4. Item AS18947 is not under revision control or lot control. These attributes are organization
controlled.
5. Find Item AS54888.
• (M) View > Find

Chapter 4 - Page 37
• Select Find.
6. Item AS5488 Item Status is active, and master controlled.
7. A Bill of Material is allowed for this item, and the attribute is master controlled.
8. Customer orders are enabled for this item, and the attribute is master controlled.

Chapter 4 - Page 38
9. Invoicing is enabled for this item, and the attribute is master controlled.
10. This item is transactable, and the attribute is master controlled.

Chapter 4 - Page 39
11. The item is stockable, and the attribute is master controlled.
12. In how many Organizations can this part be used?
13. Close Forms.

Chapter 4 - Page 40
Agenda

Chapter 4 - Page 41
Defining the Item Master Organization
Item Master Organization

An item master organization is a logical entity that you can use just to define items. The other
organizations (child organizations), where inventory is stored and transacted, refer to the item
master organization for item definition. After you define an item in the item master, you can
assign it to any number of other organizations.
There is no functional or technical difference between the item master organization and other
organizations. However, for simplicity it is recommended that you limit the item master to just
an item definition organization.
It is also recommended that you do not define multiple item masters. This can make item
definition and maintenance confusing. You can even use the same item master for child
organizations across different set of books. In addition, multiple item masters are distinct
entities with no relationship to each other. You cannot associate items in one item master
organization with another item master organization. You cannot copy items across item master
organizations.
Defining the Item Master Organization
Creating the item master organization is similar to creating the inventory organizations:

Chapter 4 - Page 42
• Use the Organization window to create the organization you want to use as the Item
Master.
• Use the Organization Parameters window to specify the organization as the Item Master.
You can also assign child organizations to an item master in this window. Note that the
item master uses itself as its item master.

Chapter 4 - Page 43
Agenda

Chapter 4 - Page 44
Defining Items
Defining Items
Define only the information you need to maintain the item. You cannot define an item at the
organization level. Oracle Inventory automatically switches to the Master Item window when
you define a new item.

Chapter 4 - Page 45
Steps to Setup, Define, and Maintain Items
Steps to Define and Maintain Items

Following are the steps for creating and maintaining items:
1. Create the item templates.
2. Use the templates and existing items to define items.
3. Enter values for additional item attributes.
4. Assign a status to the item.
5. Assign categories to the item.
6. Enable the item in other organizations.
7. Update the organizational-level attributes values.
8. Define the item relationships.
9. Search for items.
10. Delete items.

Chapter 4 - Page 46
Defining Items

Chapter 4 - Page 47
Item Templates
Templates
Oracle Inventory has several predefined templates that you can use to define and update items
or you can create your own templates.
If you regularly define many items that share the same values for a number of attributes, you
may want to define item templates to avoid duplicating effort. You can only use “Copy” once
when adding an item. You can predefine templates with relatively few attributes enabled
because you can apply more than one template to define one item.
Attributes in Templates
You can enable attributes and assign them values in each template that you create. When you
apply a template to an item, Oracle Inventory updates only the attributes that are enabled for
the template. The order in which templates are applied is extremely important.
Further Item Templates Help
For more information on item templates, refer to the online help:
(Help) Oracle Manufacturing Applications > Oracle Inventory > Setting Up > Item Setup and
Control > Item Templates

Chapter 4 - Page 48

You can enable your item in all child organizations under your master organization or choose
child organizations where you use the item. Oracle Inventory propagates your item to all
organizations in which you want to define it. You can enter or change organizational attributes
for item attributes which are enabled in that organization. For example, go to an organization
to choose reorder point planning for an item, and then go to another organization and choose
Min-Max planning for the same item.

Chapter 4 - Page 49
Item Control Level
Master-Level Control
An attribute you maintain at the master level has identical values across all organizations that
use the item.
Organization-Level Control
An attribute you maintain at the organization level may have different values for each
organization that uses it.
Attribute Control
Some attributes can be maintained at only the Master level or the Organizational Level.
Unit of Measure must be entered at the Master level.
If using multiple organizations, the Min-Max attribute should be maintained at the organization
level.
Technical Note
Master-Level Control
For example, suppose you want to ensure that items defined in two organizations are
transactable at the same time in both organizations. If you make the item not transactable in
one organization, you want the same item to become not transactable in the other organization.

Chapter 4 - Page 50
Organization-Level Control
Suppose only one of the two organizations in your Oracle Inventory implementation performs
manufacturing operations, while the other organization is strictly a distribution warehouse.
For a finished good item used in both organizations, you would want the flexibility to select the
Build in WIP status attribute check box in the manufacturing organization, and clear the Build
in WIP status attribute check box in the distribution organization.

Chapter 4 - Page 51
Guided Demonstration: Defining Items

Chapter 4 - Page 52
Guided Demonstration - Define Item
1. (N) > Items > Master Items.
2. Define an item using the following information.

− Item: AS18456
− Description: Lap Top Assembly
3. (M) Tools > Copy From.
4. Select Finished Good template from LOV.
5. Select Apply.
6. Select Done.
7. (M) File > Save.
8. (M) Tools > Organization Assignment.
9. Enable the Item in M1 Seattle.

Chapter 4 - Page 53
Practice Overview: Defining Items

Chapter 4 - Page 54
Defining Items
Overview
In this practice you will learn how to define items, assign item attributes, and enabled items in
organizations.
Assumptions
• You are skilled in Oracle navigation.
• Responsibility: Inventory, Vision Operations USA.
Tasks
1. Create an item template and enable the following item attributes
• BOM Item Type: Standard
• Build in WIP
• Costing Enabled
• Customer Ordered
• Inventory Asset Value
• Inventory Item
• Invoiceable Item
• Stockable
• Transactable
• Cycle count enabled
• Shippable
• User Item Type: Finished Good

Chapter 4 - Page 55
Create Items
Create an item using the template you created in the previous task. Create 5 items using the
Finished goods template with the following descriptions:
• No Inventory Controls
• Locator Control ON
• Revision Control ON
• Lot Control ON
• Serial Number Control ON
Note: Use the following naming convention for your items, ##Item, and be sure to enable
your items in M1 Seattle and M2 Boston.

Chapter 4 - Page 56
Solution - Defining Items
1. Navigate to the Item Template Window.
• (N) Setup > Items > Templates
2. (B) New.
− Template = ##-Template
− Description = Team ## Finished Goods Template
− Organization = Leave Blank
3. Select the appropriate attribute groups from the Show dropdown list. Enable the following
item attributes:
• BOM Item Type: Standard
• Build in WIP
• Costing Enabled
• Customer Ordered

Chapter 4 - Page 57
• Inventory Asset Value
• Inventory Item
• Invoiceable Item
• Stockable
• Transactable
• Cycle count enabled
• Shippable
• User Item Type: Finished Good
4. Save and Close the form.
• (M) File > Save
• (M) File > Close Form
Creating Items
5. Create an item using the template you created in the previous task.
• (N) Items > Master Items

− Item: ##-Item01
− Description: Team ## - Item created from template

Chapter 4 - Page 58
6. (M) Tools > Copy from
• Select the LOV
• Select the template you created in the previous task (##-Template)
• Select the Apply Button
• Select the Done Button.
7. (M) Save.
8. (M) Tools > Organization Assignment
• Select the Assigned box next to M1 Seattle.
• Select the Assigned box next to M2 Boston.

Chapter 4 - Page 59
9. (M) File > Save.
10. (M) File > New.
11. Repeat Steps 5-10 using the following item numbers and descriptions.
− Item: ##-Item02
− Description: ##-No Inventory Controls
− Item: ##-Item03
− Description: ##-Locator Control ON
− Item: ##-Item04
− Description: ##-Revision Control ON
− Item: ##-Item05
− Description: ##- Lot Control ON
− Item: ##-Item06
− Description: ##-Serial Number Control ON
12. Save and Close window.
• (M) File > Save.
• (M) File > Close Form.

Chapter 4 - Page 60
Agenda

Chapter 4 - Page 61
Deletion Constraints

Chapter 4 - Page 62
Deletion Constraints
Deletion Constraints Help

For more information on deleting items, or to review a list of entities that Oracle Inventory
checks before deleting an item, refer to the online help:
(Help) Oracle Manufacturing Applications > Oracle Inventory > Items > Item Deletion

Chapter 4 - Page 63
Agenda

Chapter 4 - Page 64
Profile Values
Profile Values
Profile values are one of the methods used to specify how Oracle Inventory processes and
controls access to data. In general, profile values can be set at one or more of the following
levels:
• User
• Organization
• Server
• Responsibility
• Application
• Site
Setting Profile Values
System administrators use the System Profile Values window to set profile options for their
users. System administrators can set values for user profile options at each profile level.
Site: Option settings pertain to all users at an installation site.
Application: Option settings pertain to all users of any responsibility associated with the
application.

Chapter 4 - Page 65
Responsibility: Option settings pertain to all users currently signed on under the responsibility.
Server: Option settings pertain to an individual server.
Organization: Option settings pertain to a particular organization.
User: Option settings pertain to an individual user, identified by their application username.
When a profile option may be set at more than one level, site has the lowest priority,
superseded by application, then responsibility, with user having the highest priority. For
example, a value entered at the site level may be overridden by values entered at any other
level. A value entered at the user level has the highest priority, and overrides values entered at
any other level.
System Administrators can use the hierarchy type enhancement to group and set profile options
according to the business needs. There are three types of hierarchy - security, server, and
organization. Profiles that use the Security hierarchy type follow the hierarchy: Site >
Application > Responsibility > User. Profiles using the Server type use the hierarchy: Site >
Server >User. Profiles using the Organization type use the hierarchy: Site > Organization >
User. System administrators can further control security by assigning a set of books to a
responsibility, application, or site.
As application users, you can use the Personal Profile Values window to set your own personal
profile options at the user level. Not all profile options are visible in the Personal Profile
Values window, and some profile options though visible might not be updatable. Required
profiles have no default; they require input from you or the system administrator. Optional
profiles have defaults that may be accepted or manually overridden.

Chapter 4 - Page 66
Item Profile Options
Profile Option
INV: Default Item Status: Indicates the default item status for new items you define.
INV: Default Primary Unit of Measure: Indicates the default primary unit of measure for new
items you define.
INV: Item Master Flexfield: Indicates which flexfield is used to define items in
MTL_SYSTEM_ITEMS.

Chapter 4 - Page 67
Item Profile Options
Profile Option
INV: Updateable Customer Item: Indicates if you can change the customer item number.
INV: Updateable Item Name: Indicates whether you can update the item flexfield.

Chapter 4 - Page 68
Agenda

Chapter 4 - Page 69
Implementation Considerations
You should set all costing attributes at the organizational level because costing is most
commonly done at organizational level. WIP requires costing at org level to set up WIP
accounting classes. Costing of individual items is specific to individual organizations because
of location and other considerations.
Costing Method
Costing method is chosen and set at the inventory organization level. Within a set of books,
an enterprise can have multiple cost methods specified at each organization level. For
example, a company may have one average cost org and one standard cost org. Available
costing methods are as follows:
• Standard
• Weighted
• Average
• FIFO
• LIFO

Chapter 4 - Page 70
Agenda

Chapter 4 - Page 71
Summary

Chapter 4 - Page 72
11i Inventory Controls
Concepts
Chapter 5
11i Inventory Controls Concepts

Chapter 5 - Page 1

Chapter 5 - Page 2
Objectives

Chapter 5 - Page 3
Agenda

Chapter 5 - Page 4
Inventory Control Overview
Item Control Overview

Within Oracle Inventory you can implement locator, revision, lot, and serial number control for
your items. Inventory controls are optional for all items. You can implement any combination
of the four controls for each item.

Chapter 5 - Page 5
Agenda

Chapter 5 - Page 6
Subinventories Overview
What is a Subinventory?
You define one or more subinventories for each inventory organization. A subinventory is a
physical or logical grouping of inventory such as raw material, finished goods, defective
material, or a freezer compartment. A subinventory can be the primary place where items are
physically stocked. You must specify the subinventory for every inventory transaction.

Chapter 5 - Page 7
Agenda

Chapter 5 - Page 8
Locator Control Overview
Locator Control Overview

Stock locators are structures within subinventories and are the third level in the enterprise
structuring scheme of Oracle Inventory. Locators may represent rows, aisles, or bins in
warehouses. You can transact items into and out of stock locators.

Chapter 5 - Page 9
Agenda

Chapter 5 - Page 10
Revision Control Overview
Revision Control Overview

A revision is a particular version of an item, bill of material, or routing. You use a revision
when you change the form, fit, or function of an item. Use a number or letter to signify the
number of times you change an item.

Chapter 5 - Page 11
Agenda

Chapter 5 - Page 12
Lot Control Overview
Lot Control Overview

A lot identifies a specific batch of an item you receive and store in your organization. Lot
control is a technique for enforcing the use of lot numbers during material transactions, thus
enabling the tracking of batches of items throughout their movement in and out of inventory. If
lot control is turned on for an item, you must indicate the lot number to perform a transaction.
Oracle Inventory provides complete lot number support for inventory transactions.

Chapter 5 - Page 13
Agenda

Chapter 5 - Page 14
Serial Number Overview
Serial Numbers Overview

A serial number is an alphanumeric piece of information you assign to an individual unit of an
item. You use serial numbers to track individual item units. Serial number control is a system
technique for enforcing the use of serial numbers during a material transaction. You can use
serial numbers to track items over which you want to maintain very tight control. One serial
number is assigned to per unit of an item.
For more information on setting up serial number control, refer to the online help:
(Help) Oracle Manufacturing Applications > Oracle Inventory > Items > Lot and Serial
Number Control > Setting Up Serial Number Control

Chapter 5 - Page 15
Agenda

Chapter 5 - Page 16
Summary

Chapter 5 - Page 17

Chapter 5 - Page 18
11i Inventory Controls
Fundamentals
Chapter 6
11i Inventory Controls Fundamentals

Chapter 6 - Page 1

Chapter 6 - Page 2
Objectives

Chapter 6 - Page 3
Agenda

Chapter 6 - Page 4
Inventory Control Overview
Item Control Overview

You can implement locator, revision, lot, and serial number control for your items. Inventory
controls are optional for all items. You can implement any combination of the four controls for
each item.

Chapter 6 - Page 5
Agenda

Chapter 6 - Page 6
Defining Subinventories
Defining Subinventories
You define subinventories by organization. Each subinventory must contain the following
information:
• Unique alphanumeric name
• Status
• Cost Group (feature enabled if you have WMS installed)
• Parameters
• Lead times
• Sourcing information
• Account information
For more information on defining subinventories see:
(Help) Oracle Manufacturing Applications > Oracle Inventory > Setting Up > Inventory
Structure > Defining Subinventories

Chapter 6 - Page 7
Subinventory-Locator Relationship
Explaining Locator Structuring

You can structure Oracle Inventory in such a way that some of the subinventories and items
have locator control while others do not. If locator control is turned on at the item level, you
must specify a locator when transacting the item into or out of a subinventory. If locator
control is turned on at the subinventory level, you must specify a locator when transacting any
item into or out of that subinventory. Each stock locator you define must belong to a
subinventory, and each subinventory can have multiple stock locators. The possible locator
control types are:
• None
• Prespecified
• Dynamic entry
• Item Level
For more information on setting up Locator Control, refer to the online help:
Structure > Defining Subinventories

Chapter 6 - Page 8
Structure > Defining Stock Locators

Chapter 6 - Page 9
Locator Structuring
Locator Structuring
You can restrict specific item numbers to a specific Stock Locator. For example you may stock
an item that is too large to fit into a standard locator. You can specify this item to be stocked in
an oversized locator only.

Chapter 6 - Page 10
Locator Control Reports
Locator Control Reports

Locator Quantities Report
You use the Locator Quantities Report to identify items and their quantities stored in the
specified stock locators. If the stock locator has a zero on-hand quantity, then the locator is not
included in the report.
Locator Listing Report
You use the Locator Listing Report to list stock locators you defined. You also use this report
to review volume and weight allowed in a location before transacting items.

Chapter 6 - Page 11
Guided Demonstration Overview: Defining Subinventories

Chapter 6 - Page 12
Guided Demonstration - Creating Subinventories
1. (N) Setup > Organizations > Subinventories
2. (M) File > New
3. Enter the following subinventory information:

− Name: Raw
− Description: Raw Materials
4. (M) File > Save.
Verifying Subinventories
6. (N) Change Organization.
7. Select M2 Boston Manufacturing.
8. (N) Setup > Organizations > Subinventories
9. (M) View > Find.
10. Note that subinventory Raw is not available in M2.

Chapter 6 - Page 13
Practice Overview: Defining Subinventories

Chapter 6 - Page 14
Practice - Creating Subinventories
Overview
In this practice you will learn how to create two subinventories.
Assumptions
• Responsibility > Inventory, Vision Operations USA
Tasks
If you are not already in Seattle, change Organization to Seattle (M1).
Create four subinventories for your team. Create one subinventory for your finished goods (FGI)
stock, a subinventory as your Main inventory, a subinventory for Raw Materials, and a
subinventory for Low Value items. Your Low Value subinventory must be a non-tracked
subinventory. Use the following naming convention to differentiate your team from other teams
i.e. ##FGI where the pound sign represents your team number.
After completing the lab, answer the following questions.
1. In which organization are your new subinventories?
2. Change to the Boston (M2) organization and ascertain if there is an FGI subinventory in that
organization.

Chapter 6 - Page 15
Solution - Creating Subinventories
1. Change Organization to M1 Seattle.
• (N) Change Organization
• Choose Seattle Manufacturing
• Select OK
2. Navigate to the Sub-inventories window
• (N) Setup > Organizations > Subinventories
3. (M) File > New.

− Name: ##FGI
− Description: ## Finished Goods Inventory
− Organization: M1

Chapter 6 - Page 16
4. (M) File > Save
5. (M) File > New.

− Name = ##Main
− Description = ## Main Stores
6. (M) File > Save.
7. (M) File > New.

− Name = ##RM
− Description = ## Raw Materials
8. (M) File > Save.
9. (M) File > New

− Name = ##LV
− Description = ##Low Value Inventory

Chapter 6 - Page 17
10. Clear the Quantity Tracked check box to make this a non-tracked
inventory.
• (M File > Close Form.
12. In which organization are your new subinventories? M1 Seattle Manufacturing
Verifying Subinventories
13. Does a subivnentory called FGI exist in M2 Boston Manufacturing? Yes.
• Select M2 Boston Manufacturing.

Chapter 6 - Page 18
15. (N) Setup > Organizations > Subinventories.
16. (M) View > Find.

Chapter 6 - Page 19
Guided Demonstration Overview Setting Up Locator Control

Chapter 6 - Page 20
Guided Demonstration - Locator Control
Setting Up Subinventories for Locator Control
1. (N) Setup > Organizations > Subinventories.
2. (M) View > Find.
3. Select a Subinventory.
4. (B) Open.
5. Choose Item Level as the locator control level.
6. (M) File > Save.
7. (M) File > Close Form
Setting Up Locator Control for Items
8. (N) Items > Organization Items.
9. Find an Item.
10. (T) Inventory
11. Choose Dynamic entry as the locator control level.
Note: You cannot change the locator control for items for which on-hand quantity exists.
Setting Up Stock Locators
14. (N) Setup > Organizations > Stock Locators.
15. Choose New.
16. Enter a new Row Rack and Bin.
Note: Locators must be unique across an organization.
17. Enter a Description.
18. Enter the Subinventory.

Chapter 6 - Page 21
Transacting Locator Controlled Items
21. (N) Transactions > Miscellaneous Transaction
22. Select Miscellaneous receipt as the transaction type.
23. Select Miscellaneous as the Account type from the LOV.
24. Choose Transaction Lines.
25. Enter the following transaction information:

− Item: The item for which you enabled locator control
− Subinventory: The subinventory for which you enabled locator control
− Locators: Select the locator that you created from the list of values
− Quantity: 5

Chapter 6 - Page 22
Practice Overview Setting Up Locator Control

Chapter 6 - Page 23
Practice - Setting Up Locator Control
Overview
In this lab you will learn how to set up locator control for subinventories and items.
Assumptions
Tasks
Setting up Subinventories for Locator Control.
1. Change the locator control in your ##FGI subinventory to Item Level.
2. Change the locator control in your ##Main subinventory to Dynamic Entry.
Setting up Items for Locator Control
3. Change the locator control of ##-Item03 to Dynamic Entry.
Defining Stock Locators
4. Define some stock locators for your ##FGI subinventory and your ##Main subinventory.
For this exercise use the following convention:
− Row: (your team #) ## ##
− Rack: 01 01
− Bin: 01 02
− Subinventory: ##FGI
− Row: ## ##
− Rack: 02 02
− Bin: 01 02
− Subinventory: ##Main
Receiving Locator Controlled Items
5. Receive the following items into ##FGI subinventory using a miscellaneous receipt.
− ##-Item02 Quantity 100
− ##-Item 03 Quantity 25
6. Receive the following item into ##Main subinventory using a miscellaneous receipt.
− ##Item02 Quantity 25

Chapter 6 - Page 24
7. Your Main subinventory is set up to require locator control for all items that are transacted
in it. Your FGI subinventory is not set up to require locator control for all items that are
transacted in it. Why, then were you prompted for a locator when you received ##-Item03
into the FGI subinventory?

Chapter 6 - Page 25
Solution – Setting Up Locator Control
Setting up Subinventories for Locator Control.
1. Navigate to the Subinventories window
2. Find your ##FGI subinventory
• (M) View > Find
3. Open your ##FGI subinventory and make the following change:

− Locator Control: Item Level
4. (M) File > Save.

Chapter 6 - Page 26
5. Find your ##Main subinventory
• (M) View > Find
6. Make the following change to the ##Main subinventory

− Locator Control: Dynamic Entry
7. Save your work.
• (M) File > Save
Setting up Items for Locator control
8. Find Item ##-Item03 Locator control on.
• (N) Items > Organization Items.
• Enter the item number and select Find.

Chapter 6 - Page 27
9. Change the Locator control for ##-Item03.
• (T) Inventory

Chapter 6 - Page 28
Defining Stock Locators
12. Navigate to the Stock Locators window.
• (N) Setup > Organizations > Stock Locators.
• Select New.
13. Enter the following new locators using the following information:
− Row: (your team #) ##
− Rack: 01
− Bin: 01
− Description: Anything you want
− Locator Status: Active
− Row: ##
− Rack: 01
− Bin: 02

Chapter 6 - Page 29
− Row: ##
− Rack: 02
− Bin: 01
− Subinventory ##Main
− Row: ##
− Rack: 02
− Bin: 02
− Subinventory ##Main
14. Select (M) File > Save.
15. Select (M) File > Close.
Receiving Locator Controlled Items
16. Navigate to the Miscellaneous Transactions window.
• (N) Transactions > Miscellaneous Transaction.

− Date: Today’s Date

Chapter 6 - Page 30
− Type Miscellaneous Receipt
− Account: Select Miscellaneous from the LOV.
• Select Transaction Lines
17. Enter the following information in the subsequent fields:

− Item: ##-Item02
− Quantity: 100
− Item: ##-Item02
− Subinventory: ##Main
− Locator: ##.2.1 (Row ##, Rack 2, Bin 1)
− Quantity: 25
− Item: ##-Item03
− Locator: ##.1.2
− Quantity: 25

Chapter 6 - Page 31
18. Your Main subinventory is set up to require locator control for all items that are transacted
in it. Your FGI subinventory is not set up to require locator control for all items that are
transacted in it. Why, then were you prompted for a locator when you received Item03?
19. You set your FGI subinventory to item level locator control, and you changed Item03
locator control to dynamic entry.
20. Save and Close form.
• (M) File > Save

Chapter 6 - Page 32
Agenda

Chapter 6 - Page 33
Revision Control
Revision Control
A revision is a particular version of an item, bill of material, or routing. Use the revision
quantity control option to track item quantities by item revision and specify a revision for each
material transaction.
Enable revision quantity control for items you must track version changes or changes that are
significant enough to track but do not affect the function and feature of the item.
You cannot change the revision control item attribute when an item has quantity on hand. If
revision control is controlled at the Master Item level, the check for on-hand quantity is against
the sum of on-hand quantity in all child organizations. If revision control is controlled at the
organizational level, the check for on-hand quantity is against the sum of on-hand quantity in
that organization.
Use letters, numbers, and characters such as A, A1, 2B, and so on to define revision numbers.
Letters are always in upper case and numbers may include decimals. To ensure revisions sort
properly, decimals should always be followed by a number. Revisions are sorted according to
ASCII rules, therefore each revision must be greater than the previous revision. For example,
you cannot use revision 10 after revision 9 because, according to ASCII sorting, 10 precedes 9.
For more information on setting up Revision Control, refer to the online help:

Chapter 6 - Page 34
(Help) Oracle Manufacturing Applications > Oracle Inventory > Items > Defining Item
Revisions

Chapter 6 - Page 35
Agenda

Chapter 6 - Page 36
Lot Control
Lot Control
Turn on lot control at the item level. For items under lot control, assign lot numbers to each
receipt into inventory and reference the same lots for each material transactions. This enables
you to have tight control over batches of items in your inventory.
You can split an inventory receipt into several lots as necessary. You can add quantities to
existing lot number, and Oracle Inventory uses the default lot generation method to generate
default lot numbers.
For more information on setting up Lot Control, refer to the online help:
Number Control > Setting Up Lot Control

Chapter 6 - Page 37
Lot Number Purging

Chapter 6 - Page 38
Maintaining Lot Information
Lot Expiration
You can use the Item Lots window to update the expiration date of lots for items under lot
expiration (shelf-life) control. If you attempt to transact an item, to or from an expired lot,
Oracle Inventory displays a warning but does not prevent you from transacting the lot.
You can determine whether a lot has an expiration date by assigning a number of lot control
shelf life days or by entering a lot expiration date at the item level. The expiration date controls
the availability of the lot for transacting and planning purposes.
An expired lot is not considered as on-hand supply when performing min-max, reorder point,
or MRP planning calculations. It cannot be reserved for a date beyond the expiration date,
however, it can be transacted and is included in on-hand quantities. An expired lot is included
in all inquires and reports, cycle count, count entry, physical inventory, tag entry, and
adjustments in both cycle counting and physical inventory are allowed.

Chapter 6 - Page 39
Cycle Counts Under Lot Control

Chapter 6 - Page 40
Physical Inventory Under Lot Control

Chapter 6 - Page 41
Disabled Lots
Disabled Lots
• Are included in available to transact, available to promise, and available to reserve
calculations.
• Are included as on-hand supply when performing min-max, reorder point, or MRP
planning calculations.
• Are included as on-hand in all inquiries and reports, including inventory valuation
reports.
• Can be transacted with Inventory functions and the Transaction Open Interface.
• Can be reserved.

Chapter 6 - Page 42
Lot Control Reports
Lot Control Reports

Lot Transactions Register
You can use the Lot Transactions Register to report comprehensive lot number material
transaction detail within a specific date range. You can run the report for a range of lots, items,
transactions types, transaction reasons, and subinventories. You can also specify a specific
category set and display transaction quantities in their primary or transacted unit of measure.
Supplier Lot Trace Report
You can use the Supplier Lot Trace Report to trace a specific lot to its supplier lots. You can
run the report for a range of lot numbers and items and a specific supplier lot number. The
report shows you the lot material transactions related to the selected items as lot numbers,
transaction dates, and transaction quantities.
Expired Lots Report
You can use the Expired Lots Report to show lots in your organization that expire on or before
the date you specify. You can run the report for a range of items or for a specific item only.

Chapter 6 - Page 43
Agenda

Chapter 6 - Page 44
Generating Serial Numbers
Serial Number Generation

How you set up serial number control at the master item level determines serial number
generation. If you specify No Control as the serial number control type, then the system does
not enforce serial number control. If you specify Predefined as the serial number control type,
then you must predefine serial numbers for that item. If you select At inventory receipt or At
sales order issue, then you can optionally predefine serial numbers for the item.
Oracle Inventory uses the starting serial number prefix and the starting serial number you
specify in the Item window to load the number of predefined serial numbers you request. You
can load as many serial numbers as you want for any item under serial number control.
The process of generating serial numbers is done through a concurrent report. This process
does not assign numbers to units in inventory, it simply reserves specific serial numbers for an
item for later use.
For more information on setting up serial number control, refer to the online help:
Number Control > Setting Up Serial Number Control

Chapter 6 - Page 45
Maintaining Serial Numbers

Chapter 6 - Page 46
Serial Genealogy

Chapter 6 - Page 47
Serial Number Control Reports
Serial Number Control Reports

Serial Number Transactions Register
You can use the Serial Number Transactions Register to report comprehensive serial number
material transaction detail within a specific date range. You can run the report for a range of
serial numbers, items, transaction types, transaction reasons, and subinventories. You can also
specify a specific category set and display transaction quantities in their primary or transacted
unit of measure.
Serial Number Detail Report
You can use the Serial Number Detail Report to report on information about current serialized
units in your organization for a specific source type or serialized unit status. Oracle Inventory
enables you to run the report for a range of serial numbers, items, suppliers, and supplier serial
numbers.

Chapter 6 - Page 48
Guided Demonstration Overview: Revision, Lot, and Serial
Controls

Chapter 6 - Page 49
Guided Demonstration - Revision, Lot, and Serial Controls
Creating New Revisions
1. If you are not in M1 organization, change your organization to M1.
• (N) Change Organization.
• Select M1 Seattle Manufacturing from the organization list.
4. (T) Inventory.
5. Select the Revision Control check box.
6. (M) Tools > Revisions.
7. (M) File > New.
8. Enter the following revision information:

− Revision: B
− Revision Label: B
− Description: Lap Top Assembly Revision
− Effective Date: Today's Date.
9. (M) File > Save.
Enabling Lot Control
12. Find item AS18456.
13. (T) Inventory.
14. Select Full Control in the Lot alternative region.
15. Enter the starting lot prefix.
16. Enter the lot starting number.

Chapter 6 - Page 50
Enabling Serial Control
21. (T) Inventory.
22. Select Predefined from the Serial alternative region:

− Starting Prefix: AS
− Starting Number: 000001
Generating Serial Numbers
25. (N) On-hand, Availability > Generate Serial Numbers.
26. Enter the following information to generate serial numbers:

− Item: AS42001
− Quantity: 1000
27. Choose Submit.
Transacting Locator Controlled Items.
28. (N) Transactions > Miscellaneous Transactions.

− Type: Miscellaneous receipt
− Account: Miscellaneous
31. Enter the following receipt information:

− Item: AS18456
− Revision: B
− Subinventory: FGI
− Quantity: 10
32. Choose Lot /Serial.
33. Choose Generate.

Chapter 6 - Page 51
− Lot Quantity: 10
34. Choose Done.
35. (M) File > New.
36. Enter the following receipt information:

− Item: AS42001
− Quantity: 15
37. Choose Lot /Serial.
38. Select the first available serial number from the list of values.
Note: The End Serial Number field populates automatically according to the transaction
quantity.
39. Choose Done.

Chapter 6 - Page 52
Practice Overview: Revision, Lot, and Serial Controls

Chapter 6 - Page 53
Practice - Revision, Lot, and Serial Controls
Overview
In this lab you will learn how to update your revision, lot, and serial control for your items. You
will also learn how to receive items into stock that have revision, lot, and serial control. You will
use the items you created in the defining items lab.
Assumptions
• You are skilled in Oracle Navigation.
• You have completed the Define Items Lab.
Tasks
Revision Control
1. Find item ##-Item04, and enable revision control for this item.
2. Create two revisions for this item with the following information
− Revision: B
− Effective Date: Today
− Revision: C
− Effective Date: 1st of next month
3. Notice that a revision record already exists for this item (Revision A). Why is there already a
revision for this item? ______________________________________
Lot Control
4. Update ##-Item05 to enable lot control using the following information.

− Lot Expiration (Shelf Life) Control: User defined
− Lot Control: Full control
− Starting Prefix: ## (team number)
Serial Number Control
5. Update ##-Item06 to enable serial control using the following information.

− Serial Number Generation: Predefined
− Starting Serial Prefix: T##

Chapter 6 - Page 54
− Starting Serial Numbers: 0001
6. Predefine a range of serial numbers using the following information:

− Item: ##-Item06
− Quantity to define: 1000
Note: Please note your request ID.
Receiving Revision, Lot, and Serial Controlled Items
7. Use a miscellaneous receipt transaction to receive item ##-Item04 into stock as follows:
− Item: ##-Item04 ##-Item04 ##-Item04
− Revision: A B C
− Subinventory: ##FGI ##FGI ##FGI
− Quantity 200 10 5
− Item: ##-Item05
− Quantity 50
− Expiration Date: Two Months from today
− Quantity 50
− Item: ##-Item06
− Quantity 40
− Entry Type: Ranges
10. Verify that the transactions have taken place.

Chapter 6 - Page 55
Solution – Revision, Lot and Serial Controls
Revision Control
1. Find Item ##-Item04.
• Enter your item number.
• Select Find.
2. Enable the Revision Control attribute.
• (T) Inventory
• Select the Revision Control Attribute.
3. Create two revisions for ##-Item04.
• (M) Tools > Revisions.

Chapter 6 - Page 56
− Revision: B
− Revision Label: B
− Effective Date: Today
− Revision: C
− Revision Label: C
− Effective Date: 1st of next month
4. Save and Close Item.
• (M) File >Save.
5. Notice that a revision record already exists for this item (Revision A). Why is there already a
revision for this item?
The starting revision for organization M1 is set as A. Therefore, the first revision record
(Revision A) is created by default for revision-controlled items in M1. You can define and
update default values for revision, lot, and serial parameters at the organization level using
the Organization Parameters window.
(N) Setup > Organizations > Parameters.

Chapter 6 - Page 57
Lot Control
6. Find ##-Item05.
• (N) Organization Items
• Enter ##-Item05
• Select Find
7. Update ##-Item05 to enable lot control.
• (T) Inventory
− Lot Expiration (Shelf Life) Control: User Defined
− Lot Control: Full Control
− Starting Prefix: ## (team number)
• (M) File >Save.

Chapter 6 - Page 58
9. Find Item ##-Item06.
• Enter your item number.
• Select Find.
10. Enable serial number control for ##-Item06.
• (T) Inventory
− Serial Number Generation: Predefined
− Starting Serial Prefix T##
− Starting Serial Numbers: 0001
• (M) File >Save.
12. Predefine a range of serial number.
• (N) On-hand, Availability > Generate Serial Numbers.

Chapter 6 - Page 59
• Enter ##-Item06.
• Select OK.
• Enter 1000 as the quantity to define.
• Select OK.

Chapter 6 - Page 60
• Select Submit.
Receiving Revision, Lot, and Serial Controlled Items
13. Navigate to the Miscellaneous Transaction window.

− Transaction Type: Miscellaneous Receipt
• Select Transaction Lines.
14. Receive ##-Item04 into stock as follows:

− Item: ##-Item04 ##-Item04 ##-Item04
− Revision: A B C
− Subinventory: ##FGI ##FGI ##FGI
− Quantity 200 10 5

− Item: ##-Item05
− Quantity 50

Chapter 6 - Page 61
• Select the Lot/Serial Button.
• Enter the following Lot information. (The Lot number is displayed automatically when
you click in the Expiration Date field).
− Expiration Date: Two Months from today
− Quantity 50
• Select Done.

− Item: ##-Item06
− Quantity: 40
• Select the Lot/Serial button.

− Entry Type: Ranges
− Select the Starting Serial Number from the LOV. The End Serial Number
populates automatically.

Chapter 6 - Page 62
• Select Done.

Chapter 6 - Page 63
17. Save and Close the Miscellaneous Receipt window to receive your items.
• (M) File >Save.
18. Verify that the transactions have taken place.
• (N) Transactions > Material Transactions
• Enter your ##FGI subinventory in the subinventory field.
• Ensure that the date of your transaction falls within the dates shown in the Transaction
Dates field.

Chapter 6 - Page 64
• Select Find.

Chapter 6 - Page 65
Note: You can also verify that the items have been received into stock using the
Materials Workbench.
• (N) On-hand, Availability > On-hand Quantity.

Chapter 6 - Page 66
Agenda

Chapter 6 - Page 67
Locator Flexfield Structure
Locator Flexfield Structure

Locator flexfield structure is common across all organizations. For Example if you set up Row
1A Rack 1A and Bin 1A in M1 Seattle, the same structure appears in M2 Boston. For more
information see the Oracle Applications Flexfields Guide.

Chapter 6 - Page 68
Changing Locator Control
Changing Locator Control

You may change the locator control for an item even if you have on-hand balances for the
item. However, this is not encouraged unless the items are expired, damaged, or unusable.

Chapter 6 - Page 69
Transacting Controlled Items
Transacting Controlled Items

If an item is controlled in one subinventory and you move it to another subinventory, the
destination subinventory must have item control.
Locator Control
During a material transaction, Oracle Inventory checks the locator control options you
specified. If locator control is enabled, you must enter a valid locator into which to receive or
from which to issue the item you are transacting.
Lot Control
You can optionally assign expiration dates to items. If you enable lot control for an item, you
must assign lot numbers when you receive the item into inventory. Thereafter, when you
transact the item, you must provide a lot number.
If you enable serial number control for an item, you must provide a serial number when you
transact it.
Revision Quantity Control

Chapter 6 - Page 70
You can define and enforce revision quantity control for any item to track quantities by
revision. If you enable revision quantity control for an item, you must provide a revision
number when you transact it.

Chapter 6 - Page 71
Agenda

Chapter 6 - Page 72
Summary

Chapter 6 - Page 73

Chapter 6 - Page 74
11i Transacting Inventory
Concepts
Chapter 7
11i Transacting Inventory Concepts

Chapter 7 - Page 1

Chapter 7 - Page 2
Module Objectives

Chapter 7 - Page 3
Agenda

Chapter 7 - Page 4
Inventory Structure
Inventory Structure
Oracle Inventory is one of Oracle’s enterprise applications products. Oracle Inventory enables
companies to satisfy business needs such as these:
• Defining part numbers
• Modeling organization structures
• Tracking perpetual inventory
• Maintaining accurate on-hand balances
• Planning material replenishments
• Forecasting anticipated demand

Chapter 7 - Page 5
Overview
Transactions
A transaction is an item movement into, within, or out of inventory. A transaction changes the
quantity, location, planning responsibility, and/or cost of an item.
Oracle Inventory supports a number of predefined and user-defined transaction types. Every
material movement has a corresponding set of accounting transactions that Oracle Inventory
automatically generates.
All transactions validate the various controls (revision, locator, lot number, and serial number)
you enable for your items.
You can choose your own transaction processing methods to use available computing
resources most effectively.
(Help) Oracle Manufacturing Applications > Oracle Inventory >Transactions > Overview

Chapter 7 - Page 6
Agenda

Chapter 7 - Page 7
Inventory Transactions
• Receive items into your organization using a general ledger account number.
• Issue items from your organization using general ledger account number.
• Transfer items from a subinventory in your organization to another subinventory in the
same organization.
• Transfer items directly between organizations.
• Transfer items between organizations by way of intransit.
• Reserve items for a specific account or temporarily prevent the release of items onto the
shop floor.
(Help) Oracle Manufacturing Applications > Oracle Inventory >Transactions > Overview

Chapter 7 - Page 8
Agenda

Chapter 7 - Page 9
Transaction Types
Transaction Types
• A transaction type is the combination of a transaction source type and a transaction action.
• It is used to classify a particular transaction for reporting and querying purposes.
• Oracle Inventory also uses transaction types to identify certain transactions to include in
historical usage calculations for ABC analysis or forecasting.
• A number of transaction types are predefined in Oracle Inventory. The user can also define
additional types by setting up new combinations of source types and actions.
(Help) Oracle Manufacturing Applications > Oracle Inventory > Setting Up > Transaction
Setup > Defining and Updating Transaction Types

Chapter 7 - Page 10
Transaction Source Types
Transaction Source Type

Oracle Inventory uses a transaction source type with a transaction action to uniquely identify
the type of transaction performed. Oracle Inventory provides the following predefined
transaction source types. You can define additional source types. Predefined transaction types
are as follows:
• Purchase Order
• Account Alias
• Account
• Move Order
• Internal Order
• Standard Cost Update
• Sales Order
• Cycle Count
• Periodic Cost Update
• Physical Inventory

Chapter 7 - Page 11
• RMA (Return Material Authorization)
• Inventory
• Job or Schedule
Setup > Defining and Updating Transaction Source Types

Chapter 7 - Page 12
Transaction Action
Transaction Action
You use transaction actions with a source type. A transaction action identifies a transaction
type. Oracle Inventory provides the following transaction actions:
• Assembly completion
• Issue from stores
• Subinventory transfer
• Direct organization transfer
• Cycle count adjustment
• Physical inventory adjustment
• Intransit receipt
• Intransit shipment
• WIP assembly scrap
• Cost update
• Receipt into stores
• Negative component issue

Chapter 7 - Page 13
• Delivery adjustments
• Negative component return
• Assembly return
• Staging Transfer

Chapter 7 - Page 14
Transaction Reasons
Setup > Defining Transaction Reasons

Chapter 7 - Page 15
Transaction Managers
Setup > Transaction Managers

Chapter 7 - Page 16
Agenda

Chapter 7 - Page 17
Move Orders
Move Orders
Move orders are requests for the movement of material within a single organization. They
formalize the process to request the movement of material within a warehouse or facility for
purposes like replenishment, material storage relocations, and quality handling.
Move orders are generated manually or automatically depending on the source type used.
Move orders are restricted to transactions within an organization. Transfers between
organizations require an internal requisition.
Move Order Requisitions
A manually generated request, available for subinventory and account transfers.
These requests can optionally go through a workflow based approval process before they
become move orders that are ready to be sourced and transacted.

Chapter 7 - Page 18
Agenda

Chapter 7 - Page 19
Shortage Alerts and Notifications
Shortage Alerts and Notifications

A material shortage occurs whenever outstanding demand exceeds the available quantity for
incoming supply of material. Oracle Inventory can check, during a receipt transaction, to see if
the material received is needed elsewhere in the organization. If a shortage exists, the system
can notify you either by a real–time material shortage alert or a workflow–based notification.
Shortage messages configure real time alerts/notifications. During a material transaction,
Oracle Inventory checks to see if the material is needed elsewhere in the organization. Again, if
a shortage exists, the system notifies you either by a real-time material shortage alert or by a
workflow-based notification. You can use this technology to increase the product flow through
your warehouse, streamline order fulfillment, and reduce unnecessary material handling.
Alerts are real-time messages sent to a window before a transaction is committed, allowing you
to immediately redirect delivery. Notification messages are workflow-based notifications that
may be created by business events or periodic processes and require that you initiate action to
address the identified shortages.
(Help) Oracle Manufacturing Applications > Oracle Inventory >
Transactions > Shortage Alerts and Shortage Notifications

Chapter 7 - Page 20
Agenda

Chapter 7 - Page 21
Mobile Transactions
Mobile Transactions
Oracle Mobile Materials Management provides the ability to do inventory receiving and
shipping transactions using mobile devices. You can record inspections, deliveries, and
material movements when entering receiving transactions. The Mobile Server enables you to
perform Oracle Application transactions using the Telnet Protocol Server. Information is sent
from mobile industrial devices to the Telnet Listener. The information is processed and
updated in the application database. Mobile devices enable you to enter inventory transactions
at the point of use. Recording transactions in this way avoids duplicate data entry and mobile
device scanning can improve data entry accuracy.
See: Mobile Materials Management: Oracle Mobile Supply Chain Applications User’s Guide.

Chapter 7 - Page 22
Agenda

Chapter 7 - Page 23
Summary

Chapter 7 - Page 24
11i Transaction Setup
Chapter 8

Chapter 8 - Page 1

Chapter 8 - Page 2
Objectives

Chapter 8 - Page 3
Agenda

Chapter 8 - Page 4
Running Transaction Managers
Running Transaction Managers

Cost Manager
The material cost transaction manager costs material transactions in Oracle Inventory and
Oracle Work in Process in the background.
Lot Move Transaction Manager
The resource cost transaction manager processes resource transactions in Oracle Work in
Process and resource transactions you import from barcode readers, payroll systems, time
cards, routing sheets, and custom data entry forms using the Open Resource Transaction
Interface.
Material Transaction Manager
The material transaction manager immediately executes a material transaction after you save
your changes in a transaction window. By starting the transaction manager, you can determine
how to execute transactions: immediately through immediate concurrent request submissions,
or through periodic concurrent request submissions. You define this transaction mode for
individual transaction windows in the Personal Profile Values window.
Move Transaction Manager

Chapter 8 - Page 5
The move transaction manager processes move transactions in Oracle Work in Process and
move transactions you import from devices such as portable bar code readers or your custom
data entry forms using the Open Move Transaction Interface.

Chapter 8 - Page 6
Predefined Transaction Types
Predefined Transaction Types

Oracle predefines transaction types in the system. The table in the slide contains a few
examples of predefined transaction types. For more information on Predefined Transaction
types see:
Setup > Transaction Types

Chapter 8 - Page 7
Guided Demonstration Overview: Defining a Customized
Transaction

Chapter 8 - Page 8
Guided Demonstration - Customized Transactions
Setting Up Source Types
1. (N) Setup > Transactions > Source Types
2. Select the User tab.
3. (M) File > New.
4. Use the following information to define a source type.

− Name: Charitable Donation
− Description: Charitable Donation
5. (M) File > Save.
Setting Up Transaction Types
7. (N) Setup > Transactions > Types.
8. Select the User tab.
9. (M) File > New.
10. Use the following information to define a transaction type.

− Name: Goodwill Donation
− Description: Goodwill Donation
− Source Type: Charitable Donation
− Action: Issue from Stores
Setting Up Transaction Reasons
13. (N) Setup > Transactions > Reasons
14. (M) File > New.
15. Use the following information to define a transaction reason.

− Name: Goodwill
− Description: Charitable donation to Goodwill

Chapter 8 - Page 9

Chapter 8 - Page 10
Practice Overview: Defining a Customized Transaction

Chapter 8 - Page 11
Practice - Defining a Customized Transaction
Overview
In this lab you will learn how to define a customized transaction.
Assumptions
Tasks
Define a Transaction Source
Define a Transaction Source using the following information:

− Name: ##-Donations
− Description: Donation source type for team ##
− Validation Type: None
Define a Transaction Type
Define a Transaction type and associate it with your newly created Source type using the
following information:
− Name: ##-Donation
− Description: ##-Goodwill Transaction
− Transaction Source Type: ##-Donations
− Transaction File: Issue from Stores
Define a Transaction Reason
Define a Transaction Reason using the following information:

− Name: ##-Reason
Processing a Customized Transaction
Process a miscellaneous transaction using your customized transaction.

Chapter 8 - Page 12
Solution – Defining a Customized Transaction
Define a Transaction Source
1. Navigate to the Transaction Source Type window.
• (N) Setup > Transactions > Source Types.
• (T) User
2. Create a New Transaction Source type.
• (M) File > New

− Name: ##-Donations
− Description: Donation source type for team ##
− Validation Type: None
3. Save and close the window.

Chapter 8 - Page 13
Define a Transaction Type
4. Navigate to the Transaction Type Window.
• (N) Setup > Transactions > Types
• (T) User
5. Define a Transaction Type and associate it with the new Source Type.
• (M) File > New

− Name: ##-Donation
− Description: ##-Goodwill Transaction
− Transaction Source Type: ##-Donations
− Transaction File: Issue from Stores
6. Save and Close the window.
Define a Transaction Reason
7. Navigate to the Transaction Reason window.
• (N) Setup > Transactions > Reasons.

Chapter 8 - Page 14
8. Define new transaction reason.
• (M) File > New

− Name: ##-Reason
Processing a Customized Transaction
10. Navigate to the miscellaneous transactions window.
11. Enter a customized transaction.

− Type: ##-Donation
− Account: Select one from LOV

Chapter 8 - Page 15
12. Select Transaction Lines.
13. Enter the transaction information:

− Item: ##-Item02
− Quantity: 5
− Reason: ##-Reason

Chapter 8 - Page 16

Chapter 8 - Page 17
Agenda

Chapter 8 - Page 18
Inter–organization Shipping Network
Inter-organization Shipping Network

An inter-organization shipping network describes the relationships and accounting information
between a shipping organization and a destination organization. You must define a shipping
network between organizations before you can conduct inter-organization transfers. For each
organization relationship, you must indicate what type of shipment is used. If you choose to
use intransit inventory, Oracle Inventory moves material to intransit inventory before it reaches
the destination organization when you perform an interorganization transfer. If you do not
choose intransit inventory, Oracle Inventory moves your material directly to the destination
organization when you perform an inter-organization transfer.
You can specify if transfers will go through intransit. If so, you can also determine:
• Shipping methods
• GL accounts to use in transit
• Material ownership during transfers
• Planning lead-times
• Transfer charges
• Default receipt routing

Chapter 8 - Page 19
• Whether internal orders are required
For more information see: (Help) Oracle Manufacturing Applications > Oracle Inventory >
Setting Up > Transaction Setup > Inter-organization Shipping Network

Chapter 8 - Page 20
Shipping Method
Shipping Method
A Quick Code used to define specific shipping methods. For example: Ground, Express, or
Air.

Chapter 8 - Page 21
Agenda

Chapter 8 - Page 22
Movement Statistics
Movement Statistics
You can collect statistics to satisfy the European Union’s reporting requirements for
INTRASTAT, the declarations for imports and exports between countries belonging to the
European Union, and EXTRASTAT, the declaration for imports and exports between a country
belonging to the European Union and a country external to the European Union.
Navigation to the Movement Statistics Window
You can navigate to the Movement Statistics window from the Inter-organization Transfer
window. Use the Tools menu to navigate to the Movement Statistics window from the Inter-
organization transfer window. You can also navigate to the Movement Statistics window from
the navigator.
(N) Transactions > Movement Statistics
Country-Specific List of Values
• Oracle Inventory supports a country-specific list of values.
• Certain lists of values are seeded with a country prefix.
• The prefix used is the two-character upper case ISO code of the country.
Confirm Shipment (Oracle Order Management)

Chapter 8 - Page 23
(N) Shipping > Confirm Shipments-Departures (B) Delivery
Movement statistics entered through the Oracle Order Management Confirm Shipment window
are linked automatically to the corresponding accounts receivable invoice.
You can use the Invoices window to link movement statistics entered in the Receipts window
to the accounts payable invoices.
(Help) Oracle Manufacturing Applications > Oracle Inventory > Transactions > Overview of
Movement Statistics
../ Entering and Maintaining Movement Statistics
../ Automatically Generating Movement Statistics

Chapter 8 - Page 24
Movement Statistics Parameters
Movement Statistics Parameters

(N) Setup > Transactions > Movement Statistics > Parameters
You use a specific rate type to convert foreign currency transactions to the currency of the
legal entity. You can record the appropriate rate type for this conversion. You define currency
conversion rate types in the Oracle General Ledger.
For more information see:
Movement Statistics > Setting Up Movement Statistics
and
Setup > Defining Movement Statistics Parameters

Chapter 8 - Page 25
Collecting and Reporting Movement Statistics
Collecting and Reporting Movement Statistics

Define Movement Statistics Parameters
Use the Movement Statistics Parameters window to define the parameters for gathering
movement statistics. Oracle Inventory uses this information to validate the entry of statistical
movement transactions and to properly report the information. You define parameters to
automate the movement statistics functionality in the Movement Statistics Parameters and
Economic Zones windows.
Enter Movement Statistics Information
You can manually enter movement information associated with material transactions such as
fixed assets that Oracle Inventory and Purchasing do not capture.
Link Movement Statistics to Financial Documents
Movement statistics records link automatically to various financial documents based on
transaction types. For example purchase order receipts link to payables invoices and sales order
shipments link to receivables invoices.
Report and Review Movement Statistics

Chapter 8 - Page 26
You can generate both summary and detail reports for movement statistics, including hard
copies for government agencies and your own files.
Freeze Movement Statistics
The Movement Statistics Reports run time parameter allows you to freeze movement
information for official INTRASTAT and EXTRASTAT reporting.
Movement Statistics

Chapter 8 - Page 27
Agenda

Chapter 8 - Page 28
Account Aliases
Aliases
An account alias is an easily recognized name or label representing a general ledger account
number. You can view, report, and reserve against an account alias. During a transaction, you
can use the account alias instead of an account number to refer to the account.
You must create an inventory account alias for each GL account if you wish to use an alias for
that GL account in inventory transactions. Oracle Inventory does not honor GL account aliases.

Chapter 8 - Page 29
Agenda

Chapter 8 - Page 30
Setting Up for Move Orders
Setting Up Move Orders

Subinventory Source Type
For Oracle Inventory to automatically create move orders when using min–max planning or
replenishment counting, you must define the subinventory source type at one of the following
levels:
• Subinventory
• Item
To automatically create move orders when using the kanban system, you must define the
subinventory source type at the pull sequence level.
Approval Process Parameters
Approval is required only for requisition move orders. Other move orders created by shipping
or replenishment processes are approved automatically. To require planner approval, you
define two parameters at the organization level:
• Move Order Timeout Period
• Move Order Timeout Action

Chapter 8 - Page 31
You can also specify individuals to be notified if a shortage occurs. To bypass the approval
process and automatically approve move order requisitions, enter 0 days for the Move Order
Timeout Period and select Automatically Approve for the Move Order Timeout Action. The
approval process is also not enabled for organization items without an assigned planner.
Item Transaction Defaults
You can define the item transaction defaults to automatically populate the destination locator
on the move order line from an organization item.
Move Order Time-Out
Use move order time-out if you want to require approvals for the move orders in your
organization.
Time-out Period
The length of time, in days, you will let your move orders sit in a pending-approval queuing
status.
The following rules apply when you set up time-outs:
• After one time-out period, a reminder is sent to the approver.
• After two time-out periods, the move order time-out action is performed.
• The time-out action is either approved or rejected.
• If the time-out period is 0, all move orders are automatically approved.
• If the time-out period is left blank, the setting defaults to 0.

Chapter 8 - Page 32
Setup Steps for Move Orders
Setup Steps for Move Orders

Set Up Planner
Define a planner for the item in the General Planning tabbed region of the Items window.
Designate a Planner
You designate a planner in the Master Item window when you define an item. If you do not
designate a planner, the move order is automatically approved.
Notification List
When you approve or reject the move order, the system sends a courtesy e-mail to the
Engineering Change Order (ECO) approval list (which is used here as a notification list). It is
attached to the move order source and destination subinventory. You do not need to have
Oracle Engineering to use this feature.
Define Picking Rules
Move orders use the standard picking rules of Oracle Inventory to source material. In a WMS
organization, move orders use wms picking rules.
Locator Defaults

Chapter 8 - Page 33
If a subinventory or item is locator controlled, when you create the move order receipts,
specify a destination locator. If you do not specify a destination locator, the allocating process
uses the item transaction default.
For more information see:
Move Orders > Setting Up Move Orders

Chapter 8 - Page 34
Agenda

Chapter 8 - Page 35
Material Shortage Alerts and Notifications
Material Shortage Alerts and Notifications

A material shortage occurs whenever outstanding demand exceeds the available quantity for
incoming supply. During a receipt transaction, Oracle Inventory checks to see if the material
received is needed elsewhere in the organization. If a shortage exists, the system notifies you
either by a real–time material shortage alert or a workflow–based notification. Set up shortage
parameters to enable the system to send material shortage alerts and notifications. For more
information see:
Structure > Defining Shortage Parameters
The following receipt transaction forms can generate shortage alerts and notifications.
• Receipts
• Receiving Transactions
• Miscellaneous Transactions
• WIP Material Transactions
• WIP Completions

Chapter 8 - Page 36
• Work–Orderless Completions - This occurs only if you have used workflow notification
for the transaction.
Shortage Alerts
The shortage alert appears in the window during the transaction with the option to go to the
View Potential Shortages form, showing where the shortage exists. Alerts are automatic once
they are set up. Notifications are optional and can be sent to a pre–specified list of individuals.
Sources of Demand
When generating shortage alerts and notifications, the system considers one or more of the
following to be sources of demand:
• WIP jobs
• WIP schedules
• Sales order lines that have been pick released and detailed but for which adequate
quantity was not sourced
Supply Types
The system considers the transaction types you select as supply for the unsatisfied demand.
Shortage alerts and notifications are triggered for system or user defined transaction types with
transaction actions of:
• Receipt into stores
• Intransit receipt
• Direct organization transfer
• Assembly completion
• Negative component issue

Chapter 8 - Page 37
Setting Up Shortage Alerts and Notifications
Setting Up Shortage Alerts and Notifications

• Define the shortage parameters the system will use to detect material shortages.
• Define the transaction types that will trigger shortage alerts and notifications.
• Define which items in the system will trigger a shortage alert or notification when they
are in demand.
• Define the individuals to be notified.

Chapter 8 - Page 38
Movement Statistics Reports
All Reports
Oracle Inventory provides both summary and detail reports for movement statistics. Use these
reports to validate information and identify missing or incomplete entries. You may make
corrections before freezing the information.
The Movement Statistics Report provides a run-time parameter that allows you to freeze
movement information for official INTRASTAT reporting. This Official/Summary option,
updates the database with any information calculated at report run time to provide a complete
history of information reported. This option also allows you to assign a reference number for
the information processed by the particular run of the report.
If you identify a mistake after the information has been frozen, you can either reverse the
freeze (nullifying the official report) or enter a movement adjustment entry to record the
appropriate change.
(N) Reports > Movement Statistics
Reports and Processes
../ Movement Statistics Exception Report

Chapter 8 - Page 39
../ Movement Statistics Processor
../ Movement Statistics Report
../ Movement Statistics Reset Status Report

Chapter 8 - Page 40
Transaction Reports and Inquiries
Reports and Inquiries

(N) Reports > Transactions
(Help) Oracle Manufacturing Applications > Oracle Inventory > Transactions > Transaction
Reports

Chapter 8 - Page 41
Agenda

Chapter 8 - Page 42
Transaction Profile Options

Cycle Count Approvals Form
Indicates the processing control of cycle count approvals in the Cycle Count Approvals
window. Available values are:
• Background Processing- Upon commit returns control immediately to you, and allows
you to continue working. The cycle count transaction execute on a periodic basis.
• On-line processing- Processes your cycle count transactions while you wait, and returns
control to you once transaction processing is complete.
Cycle Count Entries Form
Indicates the processing control of cycle count entries in the Cycle Count Entries window.
Available values are:
• Background Processing- Upon commit returns control immediately to you, and allows
you to continue working. The cycle count transaction execute on a periodic basis.
• On-line processing- Processes your cycle count transactions while you wait, and returns
control to you once transaction processing is complete.
Enter Replenishment Count Form

Chapter 8 - Page 43
Indicates processing control in the Enter Replenishment Count window. Available values are:
• Background processing- Upon commit, control returns to you immediately and allows
you to continue working. The replenishment count transaction executes on a periodic
basis.
• Concurrent processing- Upon commit, Oracle Inventory spawns the concurrent process
and returns control to you immediately, and allows you to continue working. It displays
the concurrent request number that represents the concurrent process that executes the
replenishment count transactions.

Chapter 8 - Page 44

Transaction Processing Mode
Indicates the processing control for transacting items. Available values are as follows:
• On-line processing- Processes transactions while you wait, and returns control to you
once transaction processing completes.
you to continue working. The transactions execute on a periodic basis.
• Immediate concurrent processing- Upon commit, Oracle Inventory spawns the concurrent
process and returns control to you immediately and allows you to continue working. It
displays the concurrent request number of the concurrent process executing the
transaction.
• Form level processing- Processes transactions using the processing control option you
choose for the particular transaction. You must also set the Inventory profile options for
Inter-Organization Transfer, Miscellaneous Issue and Receipt, Receive Customer Return,
Return to Customer, and Transfer Between Subinventories. If you use Oracle Work-in
Process, you must set the following WIP profile options: Completion Material

Chapter 8 - Page 45
Processing, Completion Transaction From, Material Transaction Form, Move
Transaction, Operation Backflush Setup, and Shop Floor Processing.
The value you choose for this profiles overrides values you set for individual transactions
unless you choose Form level processing.
Miscellaneous Issue and Receipt
Indicates the processing control of miscellaneous issues and returns on the Miscellaneous Issue
window. Available values are:
you to continue working. The miscellaneous issue and receipt transactions execute on a
periodic basis.
and returns control to you immediately and allows you to continue working. It displays
miscellaneous issue and receipt transactions.
• On-line processing- Processes the miscellaneous issue and receipt transactions while you
wait and returns control once transaction processing completes.
Server Side On-line Processing
Indicates if Oracle Inventory and Work-In-Process transactions that use on-line processing are
processed on the server or client side.
Transfer Between Subinventories Form
Indicates the processing control of transferring items between subinventories in the
Subinventory Transfer window. Available values are:
you to continue working. The transfer between subinventories execute on a periodic
basis.
and returns control to you immediately and allows you to continue working. It displays
transfer between subinventories.
• On-line processing- Processes subinventory transfers while you wait and returns control
once transaction processing completes.

Chapter 8 - Page 46

Update Average Cost Form
Indicates the processing control for updating average costs. Available values are:
• Background Processing- Upon commit, control returns immediately to you, allowing you
to continue working. The update average costs transactions execute on a periodic basis.
• Concurrent Processing- Upon commit, Oracle Inventory spawns the concurrent process
and returns control immediately to you, allowing you to continue working. It displays the
concurrent request number representing the concurrent process executing the update
average costs transactions.
• On-line processing- Processes your update average costs transactions while you wait, and
returns control once transaction processing completes.
Transaction Date Validation
Controls the date you can enter for transactions. Available values are:
• Allow date in any open period- Allows entry of a past date if it is in an open period.
• Do not allow past date- Does no allow entry of a date before the current date.
• Do not allow date in past period- Allows entry of dates in the current period only.

Chapter 8 - Page 47
• Provide warning when date in past period- Allows entry of dates in prior periods after a
warning.
Move Order Transact Form
Indicates the move order transaction mode. Available values are:
• Background Processing- Upon commit, control returns immediately to you, allowing you
to continue working. The move order transactions execute on a periodic basis.
• Concurrent Processing- Upon commit, Oracle Inventory spawns the concurrent process
and returns control immediately to you, allowing you to continue working. It displays the
concurrent request number representing the concurrent process executing the move order
transactions.
• On-line processing- Processes your move order transactions while you wait, and returns
control once transaction processing completes.

Chapter 8 - Page 48
Agenda

Chapter 8 - Page 49
Item Restrictions
On the master item you can indicate if the item has subinventory and locator restrictions. If you
choose to implement subinventory and locator restrictions, you must indicate which
subinventories and locators can store the item. Transactions honor these restrictions and you
cannot transact to other locations.
Receipt Transaction Default
The subinventory and locator default from the transaction defaults. More importantly, if you
create an internal requisition to ship material between two organizations where the shipping
network is direct, you cannot indicate on the requisition the locator of the destination. If the
destination is locator controlled, the receipt transaction attempts to use the time transaction
default for receiving. If one does not exist, your shipment will fail.

Chapter 8 - Page 50
Implementation Considerations for Shortage Messages
Answer the following questions to determine which of the following demand sources should be
considered potential shortages.
• Which inventory organizations should be checked for shortages?
• Which type and statuses of WIP jobs/schedules should be checked for shortages?
Answer the following questions to determine the individuals and the method for delivering
shortage messages.
• Should workflow alerts and notifications be generated when actual shortages exist?
• Who should be notified?
• How frequently should notifications be sent?

Chapter 8 - Page 51
Agenda

Chapter 8 - Page 52
Summary

Chapter 8 - Page 53

Chapter 8 - Page 54
11i Issue and Transfer
Material
Chapter 9
11i Issue and Transfer Material

Chapter 9 - Page 1

Chapter 9 - Page 2
Module Objectives

Chapter 9 - Page 3
Agenda

Chapter 9 - Page 4
Transaction Flows
Transaction Flows
• A transaction is an item movement into, within, or out of inventory.
• A transaction can change the quantity, location, and inventory value of an item.
• Oracle Inventory supports a number of predefined and user-defined transaction types.
• Every material movement has a corresponding set of accounting transactions that Oracle
Inventory automatically generates.
• All transactions validate the various controls (revision, locator, lot number, and serial
number) that you enable for your items.
• You can choose your own transaction processing methods to use available computing
resources most effectively.

Chapter 9 - Page 5
You Can Perform the Following Oracle Inventory Transactions

• Receive items into your organization from a general ledger account number.
• Issue items from your organization to a general ledger account number.
• Transfer items from a subinventory in your organization to another subinventory in the
same organization.
• Transfer items directly between organizations.
• Transfer items between organizations by way of intransit.
• Reserve items for a specific account or temporarily prevent the release of items onto the
shop floor.

Chapter 9 - Page 6
Inventory Transactions Without Documents and Requisitions
Inventory Transactions Without Documents and Requisitions

• Inventory organization transfers can be accomplished without using an internal
requisition or internal sales order.
• You can use miscellaneous receipts to receive material without a purchase order number.
• Use miscellaneous issues to issue material without approvals or a document number.
• Use subinventory transfers to transfer the location of material without a document
number.

Chapter 9 - Page 7
Inventory Transactions With Documents and Requisitions
Inventory Transactions with Documents and Requisitions

You can use internal requisitions and internal sales orders as an approval mechanism and to
provide a document to track when you transport material between warehouses or transfer
material across inventory organizations.
Within a single warehouse or inventory organization:
• Use move orders with a Move Order Issue transaction type to approve a transaction and
to provide a document to track the issue of the material. Previously, sales orders with
approvals in the order cycle were used to issue the material and track the movement.
• Use move orders with a Subinventory Transfer transaction type to approve a transfer and
to provide a document to track the transfer of the material.

Chapter 9 - Page 8
Agenda

Chapter 9 - Page 9
Control Options and Restrictions

Chapter 9 - Page 10
Agenda

Chapter 9 - Page 11
Subinventory Transfer
Subinventory Transfer
(N) Transactions > Subinventory Transfer (B) Transaction Lines
Choosing a Transaction Type
You can use one of your user-defined transaction types or one of the system predefined
transaction type, Subinventory Transfer.
Entering a Transaction Source
You can enter source information for the source type associated with the transaction type you
chose. The source type corresponding to the transaction type determines whether Oracle
Inventory validates the source information.
Application of Subinventory Transfers
You can move items from one bin to another.
You can replenish floor stock inventories or move items from one stockroom to another.
(Help) Oracle Manufacturing Applications > Oracle Inventory > Transactions > Transferring
Between Subinventories

Chapter 9 - Page 12
Guided Demonstration: Subinventory Transfer

Chapter 9 - Page 13
Guided Demonstration - Subinventory Transfers
1. (N) > Transactions > Subinventory Transfer
2. Enter Subinventory Transfer as the Type.
4. Enter the following transfer information.

− Item: AS18947
− Quantity: 45
− To Subinventory: Stores
5. (M) File > Save.

Chapter 9 - Page 14
Miscellaneous Transaction (Account Receipt)
Miscellaneous Transaction
(N) Transactions > Miscellaneous Transaction
Choosing a Transaction Type
You can use one of your user-defined transaction types or
one of the system-defined transaction types:
• Account alias issue
• Account alias receipt
• Account issue
• Account receipt
• Miscellaneous issue
• Miscellaneous receipt
Enter source information for the source type associated with the transaction type you chose.
The source type corresponding to the transaction type determines whether Oracle Inventory
validates the source information.

Chapter 9 - Page 15
If you enter an account or an account alias, the account is credited or debited depending on
whether you are conducting an issue or a receipt. When your transaction type has a user-
defined source type, enter a source for your miscellaneous transaction. For example if your
transaction type is Issue to Charity, you might enter Goodwill as your source and the expense
account corresponding to Goodwill or Charities in the Account field.
Entering an Account Number
Charge each miscellaneous transaction to an account number or an account alias. If your source
type is Account alias, your account number is not displayed but Oracle Inventory uses the
account identified by your account alias.
(Help) Oracle Manufacturing Applications > Oracle Inventory > Transactions > Performing
Miscellaneous Transactions

Chapter 9 - Page 16
Application of Miscellaneous Transactions
When do You Perform Miscellaneous Transactions

• Initial loading of item on-hand quantities when you start implementing Oracle Inventory
• Scrapping items by issuing them to expense accounts denoting scrap
• Issuing items to individuals, departments, or projects
• Receiving items that were acquired by assorted means (without purchase orders)
• Entering adjustments and corrections to system quantities due to theft, vandalism, loss,
shelf-life expiration, or inaccurate record keeping

Chapter 9 - Page 17
Inter-organization Direct Shipment
Inventory Direct Shipment

(N) Transactions > Inter-organization Transfer (B) Transaction Lines
Transaction Type
You must use a transaction type that corresponds to the type of transfer (direct or intransit).
Use either a user-defined or a system-defined transaction type.
You can enter source information for each interorganization transfer transaction. Enter source
information for the source type associated with the transaction type you chose.The source type
corresponding to the transaction type determines whether Oracle Inventory validates the source
information.
Entering Freight Information
You can choose the freight carrier to use for your shipment. Update the default inter-
organization transfer accounts, freight charge, and transfer credit information.
You can specify the expected receipt date for your shipment. Oracle Inventory and MRP/MPS
use intransit shipments as supply sources for ATP checking and the planning processes.

Chapter 9 - Page 18
(Help) Oracle Manufacturing Applications > Oracle Inventory > Transactions > Inter-
Organization Transfers

Chapter 9 - Page 19
Interorganization Intransit Shipment
Intransit Shipment
(N) Transactions > Inter-organization Transfer > (B) Transaction Lines
When you use the Intransit Shipment window to perform the transfer transaction:
• You do not need to specify the delivery location.
• You only need to enter the subinventory you are shipping from, a shipment number, the
freight information, and a percentage of the transaction value or a discrete amount that
Oracle Inventory uses to compute transfer charges.
Transaction Type
You must use a transaction type that corresponds to the type of transfer (direct or intransit).
Use either a user-defined or a system-defined transaction type.
You can enter source information for each interorganization transfer transaction. Enter source
information for the source type associated with the transaction type you chose. The source type
corresponding to the transaction type determines whether Oracle Inventory validates the source
information.
Entering Freight Information

Chapter 9 - Page 20
You can choose the freight carrier to use for your shipment. Update the default
interorganization transfer accounts, freight charge, and transfer credit information.
You can specify the expected receipt date for your shipment. Oracle Inventory and MRP/MPS
use intransit shipments as supply sources for ATP checking and the planning processes.
(Help) Oracle Manufacturing Applications > Oracle Inventory > Transactions > Inter-
Organization Transfers

Chapter 9 - Page 21
Guided Demonstration Overview: Interorganization Transfer

Chapter 9 - Page 22
Guided Demonstration - Interorganization Transfer
1. (N) Transactions > Inter-organization Transfer
Note: Verify a shipping network exists between the shipping organization and the receiving
organization.

− To Org: M2
− Type: Intransit Shipment
− Freight: DHL
− Shipment Number: 001
− Containers: 2
3. Choose Transaction Lines

− Item: AS18947
− From Subinventory: FGI
− To Subinventory: Stores
− Quantity: 10
5. (M) File > Save.

Chapter 9 - Page 23
Practice Overview: Interorganization Transfer

Chapter 9 - Page 24
Practice - InterOrganization Transfer
Overview
Your instructor has validated the shipment of product from the Seattle, WA organization (M1) to
the Boston, MA Organization (M2). Now we will ship a part between M1 and M2.
Note: Make sure the part you decide to ship has been assigned to both M1 and M2.
Assumptions
Transacting Items
Transfer an item from M1 Seattle Manufacturing to M2 Boston Manufacturing using the

following information:
• Transact Type: Inventory Intransit shipment
• Shipment Number: T##
• Freight: DHL
• Waybill: T##
• Containers: 1
• Expected Receipt date: 1 week from today.

Chapter 9 - Page 25
Solution – InterOrganization Transfer
Transacting Items
1. Navigate to the Inter Organization Transfer Window.
• (N) Transactions > Inter-organization Transfer

− To Org: M2 Boston Manufacturing
− Transact Type: Intransit shipment
− Shipment Number: T##
− Freight: DHL
− Waybill: T##
− Containers: 1
− Expected Receipt date: 1 week from today.
2. Select Transaction Lines.

− Item: Your Choice
− From subinventory: ##-FGI
− To subinventory: FGI (this is Boston’s subinventory)
− Quantity: 1

Chapter 9 - Page 26
NOTE: If you choose an item that has inventory controls, the system requires you to enter
that information for both the shipping organization and the receiving organization.
3. (M) File > Save.
Viewing Transactions
5. Navigate to the Material Transactions window.
• (N) Transactions > Material Transactions.
6. Enter your part number and select the Find button.

Chapter 9 - Page 27
7. Select the Intransit tab.

Chapter 9 - Page 28
Agenda

Chapter 9 - Page 29
Managing Receipts
Managing Receipts
Receive both internally and externally sourced shipments. You can deliver to inventory, shop
floor, and expense destinations.
You can satisfy the following receiving business needs:
• Increased receiving process control
• Streamlined receiving throughput
• Increased transaction visibility and traceability
• A common process for all receipt types

Chapter 9 - Page 30
Using Locations in Receiving
Using Locations in Receiving

This slide shows the use of several receiving locations and the delivery of ten items each to
multiple destinations.

Chapter 9 - Page 31
Entering Receipt Lines
Specifying Receipt Line Information (Oracle Purchasing)

You typically process receipts by selecting the items you want to receive and noting actual
quantities. There are minor differences between the different Receiving transactions you will
process. See the next few slides for information on these different types and when each should
be used.
Purchasing displays the Quantity due for the shipment. If you change the unit of measure, the
receipt quantity is adjusted to reflect the new unit of measure. You can override this value if
you are recording a partial receipt or an over-receipt.
The quantity received on the corresponding purchase order or return material authorization
(RMA) is updated to reflect the received quantity.
Substitutions
You can receive predefined substitute items when you allow suppliers to ship alternatives to
the items that you order.
Scenario
• You sell bicycles and assign unique internal item numbers to mountain bikes of the same
model but different colors.

Chapter 9 - Page 32
• You also have an agreement with your mountain bike supplier that allows him to ship
white bikes in place of the blue bikes you order if that is all he has in stock.
Specifying Substitute Receipt Details
You can select a substitute item in the Lines region based on the following restrictions:
• You must allow substitute receipts for the shipments you want to receive.
• You have defined substitutes for the items you want to receive.
When you query in the list of values for the item, Oracle Purchasing displays all valid
substitutes for the item you want to receive. All subsequent receipt processing is identical to
other standard and direct receipts.
Supplying Handling of Substitute Items
When you receive a substitute item, Oracle Purchasing removes the purchase order supply for
the original item.
• If you perform a standard receipt, Purchasing creates receiving supply for the new item.
• If you perform a direct receipt, Oracle increments on-hand balances for the new item.
(Help) Oracle Manufacturing Applications > Oracle Purchasing >
Receiving > Entering Receipt Lines

Chapter 9 - Page 33
Express Receipts and Receiving Transactions
Specifying Express Receipt Details Options

• Create a new receipt or add to an existing receipt for the supplier who shipped the items
you want to transact.
• Specify the supplier for new receipts.
• Click Express to select either the final destination or the default receiving location.
• Omit individual shipments that you do not want to process by selecting the Omit action in
the Receipt Lines region.
• Any receipts that cannot be transacted with an express receipt will remain in the Receipt
Line region after you save your work.
In order to enable the Express button, the Find Expected Receipts window must be able to
derive the supplier either by specifying the supplier or a PO number.
Receiving > Express Receipts and Receiving Transactions

Chapter 9 - Page 34
Receiving Unordered Items
Unordered Items
You can receive items for which there is no corresponding purchase order. The first step is to
create a record of the receipts, citing Supplier, Item, and Quantity details. Match these received
items to an existing purchase order in a second step, and then continue transacting them as you
would any other supplier receipt.
Scenario
• You receive items that you actually did order, but the shipping documentation is illegible
or missing.
• You have an agreement with the supplier that allows overruns against existing orders;
however, you do not allow over-receipts for this item.
In both cases you want to receive the items so you can track them on the system while you wait
for a buyer to decide which purchase order to use for the match transaction.
Receipt Header window (Oracle Purchasing)
Navigate to the Find Expected Receipts window.
Choose the Supplier and Internal tabbed region to create an unordered receipt that will later be
matched to a purchase order or release.

Chapter 9 - Page 35
Choose the Customer tabbed region to create an unordered receipt that will later be matched to
a Return Material Authorization (RMA). An RMA is created in Order Management to
authorize a customer's returning an item to your company.
Initiating an Unordered Receipt
• Click Unordered in the Find Expected Receipts window.
• Enter receipt header information such as Freight Carrier, Packing Slip, Number of
Containers in the Receipt Header window.
• You cannot add to an unordered receipt header but you can attach detail lines to that
header.
Specifying Unordered Receipt Lines
Enter specific line information such as quantity, unit of measure, item, or item description for
all unordered items received. This information is critical to the subsequent process of matching
this receipt to its actual order.
• Create a new receipt for the supplier who shipped the unordered items.
• Perform a standard receipt for the unordered item shipment quantity.
• Note that the Destination Type defaults to Receiving.
• Location is a required field and must be a receiving location.
• Optionally, you can provide receipt details or attachments for this transaction.
Specifying Unordered Receipt Details (Oracle Purchasing)
You can enter specific line information such as quantity, unit of measure, item, or item
description.
Supplying Handling of Unordered Items
When you receive unordered items, the supply is invisible to Oracle’s planning and inventory
products until you match this receipt to a purchase order.
When you perform the match, Oracle Purchasing reduces the purchase order supply by the
received quantity and replaces it with a receiving supply for that same quantity
Receiving > Unordered Receipts

Chapter 9 - Page 36
Direct Receipts
Performing a Direct Receipt

If the associated receipt Routing is Standard Receipt or Inspection Required, you cannot
perform a direct receipt unless your Allow Routing Override profile is set to Yes.
You can specify the quantity you want to receive in your selected unit of measure. Optionally
you can enter receipt line details and attachments for this shipment.
Delivery Requirements for Direct Receipts
Oracle Purchasing requires that all destination details be complete for direct receipts. When
you save your work, Oracle Purchasing prompts you for any missing destination details,
including:
Destination Type Destination Details
Inventory Lot and serial numbers if required by Inventory setup
Inventory Subinventory
Inventory Locator if required by Inventory setup
Inventory Item revision if required by Inventory setup
Expense Deliver to location
Direct Receipts with Multiple Distributions

Chapter 9 - Page 37
If you record a direct receipt for a shipment with multiple distributions, Oracle Purchasing also
prompts you to allocate your receipt quantity manually across these distributions. You can
double-click the plus sign to expand, or the minus sign to collapse, the multiple distributions.

Chapter 9 - Page 38
Inspecting Received Items
Specifying Inspection Details (Oracle Purchasing)

Select Accept or Reject for each transaction you want to inspect.
Enter the quantity associated with this inspection result.
You can add additional information, including a user-defined Quality Code.
Multiple Inspection Results by Transaction
You can record multiple inspection results for each transaction. For example, if a lot of 15
items fails inspection due to four discrete quality problems, you can record four Reject actions
for the inspected quantity. Oracle Purchasing constructs this transaction history as follows:
Receive 15
Reject 15
Reject 15
Reject 15

Receiving > Inspections
and

Chapter 9 - Page 39
Receiving > Inspecting Received Items

Chapter 9 - Page 40
Guided Demonstration Overview: Receiving Items into Inventory

Chapter 9 - Page 41
Guided Demonstration - Receiving Stock into Inventory
Receipts

− M2 Boston Manufacturing
2. (N) Transactions > Receiving > Receipts.

− Source Type: Internal
− Item: AS18947
4. Choose Find.
5. Select the Item to receive.
6. Enter the receiving Location.
7. (M) File > Save.
Receiving Stock
9. (N) Transactions > Receiving > Receiving Transactions.

− Type: Internal
− Item: AS18947
11. Choose Find.
12. Select the transaction to deliver.
13. Enter the following receiving information:

− Location: M2 Boston
− Subinventory: Stores
Verifying Receipts and Receiving Transacitons
16. (N) Transactions > Receiving > View Receiving Transactions

Chapter 9 - Page 42
− Type: Internal
− Item: AS18947
18. Choose Find.
19. Select the appropriate receipt number.
20. Choose Transactions.

Chapter 9 - Page 43
Practice Overview: Receiving Items into Inventory

Chapter 9 - Page 44
Practice - Receiving Material into Inventory
Overview
In this practice you learn how to receive items into inventory.
Assumptions
• You completed the defining items practice
• You completed the interorganization transfer practice
Tasks
Receiving Inventory
Receive the item into stock that you transferred in the interorganization transfer practice.
Moving Items from Receiving into Inventory
After you take delivery of the item in receiving, move it into inventory.
Verifying the Items are in Inventory
Verify that the transaction is processed and the resulting on-hand quantity.

Chapter 9 - Page 45
Solution – Receiving Material into Stock
Receiving Inventory
1. Change Organization to M2 Boston.

− M2 Boston Manufacturing
2. Navigate to the Receiving Receipts window.
• (N) Transactions > Receiving > Receipts

− Source Type: Internal
− Item: The item you transferred in the Interorganization practice.
3. Select Find.
4. Close the Header when it opens

Chapter 9 - Page 46
5. Select the item you want to receive
6. Verify the item quantity
7. Verify the UOM.
8. Enter the appropriate inventory control information if necessary.
9. Enter M2 Boston in the Location column
10. Save and Close window
• (M) File > Save
Moving Items from Receiving into Inventory
11. Navigate to the Receiving Transactions window.
• (N) Transactions > Receiving > Receiving Transaction.
12. Find your item in the Find Receiving Transactions window.

Chapter 9 - Page 47
13. Select the Item to receive.
14. Enter M2 Boston as the Location.
15. Verify FGI is the subinventory.
16. Save and Close window
• (M) File > Save
Verifying the Items are in Inventory
17. Verify the transaction processed.
• (N) Transaction > Receiving > View Receiving Transaction
• Find your item
• View the Receipt Headers Summary

Chapter 9 - Page 48
• Select Transactions
• Verify the transaction receipt and delivery.

Chapter 9 - Page 49
18. Close the window.

Chapter 9 - Page 50
Returns to Receiving
Returns
Oracle Purchasing allows you to perform returns to suppliers and returns to customers in the
Receiving Returns window. Use the Receiving Returns window to return delivered items to
Receiving and to return received or delivered externally sourced items to the Supplier if the
purchase order has neither been cancelled nor final closed. For controlled items, you must
specify lot numbers, serial numbers or locators as appropriate. If the Quality module is
installed, you can enter quality information.
You can use the Receiving Returns window to return items back to a customer. For example, a
customer returns to your company a part that does not work properly. You receive and fix the
part, then return the part to the customer.
Note: You cannot enter returns for internal shipments.
For more information on returns, refer to the Online Help:
Receiving > Returns

Chapter 9 - Page 51
Returns to Inventory

Chapter 9 - Page 52
Entering Returns
Receiving Returns (Oracle Purchasing)

You can return both received and delivered items to the source supplier when you experience
quality problems, purchased the wrong item, or have excess inventory.
Specifying Return to Supplier Details
You can choose the Return To Supplier action and enter the quantity you want to return. Oracle
Purchasing populates the Return To field with the source supplier for your items.
You can update the Return From subinventory for Inventory deliveries. You cannot update the
Return From information for Expense and Shop Floor deliveries. You can specify additional
return information such as Reason Code and RMA Number and a lot and serial information, if
required.
Purchase Order Effects
When you perform a Return To Supplier transaction, Oracle Purchasing reopens the associated
purchase order for the return quantity by reducing the original receipt quantity. You cannot
perform a Return To Supplier transaction against a Finally Closed or Cancelled purchase order.
Return to Supplier Transaction History

Chapter 9 - Page 53
When you perform a Return To Supplier transaction, Oracle Purchasing automatically creates
both a Return To Receiving and a Return To Supplier transaction.
For example, if you receive, deliver, and return ten items to their supplier, Oracle Purchasing
constructs your transaction history as follows:
Receive 10
Deliver10
Step 1 Return to receiving 10
Step 2 Return to supplier 10

Receiving > Entering Returns

Chapter 9 - Page 54
Guided Demonstration Overview: Receiving Returns to Inventory

Chapter 9 - Page 55
Guided Demonstration - Receiving Returns
Receiving Returns

− M1 Seattle Manufacturing
2. (N) Transactions > Receiving > Receipts.
3. (T) Customer.
4. Enter the RMA number.
5. Choose Find.
6. Close the Receipt Header
7. Verify the receipt information.
8. Select M1 Seattle as the receiving location.
9. Select the subinventory from the list of values.
10. (M) File> Save.
Viewing Returns
(N) Transactions > Receiving > View Receiving Transactions
12. (T) Customer.
13. Enter the Item number.
14. Choose Find.
15. Choose Transactions.

Chapter 9 - Page 56
Agenda

Chapter 9 - Page 57
Receiving Reports
Further Help
For more information on expected receipts or overdue supplier shipments, refer to the Online
Help:
Reports and Processes
../ Expected Receipts Report
../ Overdue Supplier Shipments Report

Chapter 9 - Page 58
Agenda

Chapter 9 - Page 59
Move Orders Process Flow
Move Order Requisition Process Flow

Move orders can be created manually or automatically. Oracle Order Management
automatically creates them to support the staging of Picking Waves.
Move Orders can be one of the following three types:
• Requisition Move Order - to relocate material or adjust perpetual inventory records
• Inventory Replenishment Move Orders - to refill depleted inventory locations
• Pick Release Move Orders - to replenish forward pick locations
Move orders will be manually or automatically generated, depending on the source of the
transaction.
Move orders must be assigned detailed source and destination locations, or used to identify
shortages for further action. This process is called Allocating, and must occur for all move
orders.
If the material could not be fully sourced because of a lack of available quantity, the Move
Order is in backorder and the unsourced balance can be re-released at a later time.
Move instructions can now be issued for available quantities either through printing of a paper
pick slip or transmission to a mobile device through Move Order APIs.

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Move Order Requisition Approval Process
Move Order Approvals

If approvals are required on Move Order requisitions, Oracle Inventory manages the approval
process through Oracle Workflow.
When the requisition is created, the workflow approval process sends a notification to the item
planner that a move order requisition line is awaiting approval.
Timeout Period is an organization-level attribute that determines the number of days the order
can wait for an approval action. After one timeout period, if the order is still not approved or
rejected, a reminder notice is sent to the item planner. After another timeout period the order is
automatically approved or rejected depending on the move order timeout action you determine
at the organization level.
The Move Order Timeout Period and Timeout Action are both inventory organization
parameters. These inventory parameters do not override any periods set up by Oracle
Workflow.
The Item Planner is an item attribute. If no planner is specified for the item, the requisition line
is automatically approved.
If no approvals are required in your organization, set the Timeout Period to 0 and the timeout
action to Approve Automatically.

Chapter 9 - Page 61
Once the order line is approved, notices are sent to a notification list that is attached to the
source and destination subinventories to let the subinventory planners know that material will
be moved to or from their areas.
Note: Replenishment and pick wave move orders are pre-approved.

Chapter 9 - Page 62
Benefits of Managed Material Flow in a Facility
Benefits of Managed Material Flow

Oracle Inventory uses move orders to distinguish the user roles that should manage inventory
levels from those who carry out actual transactions. The following are the benefits of managed
material flow through move orders:
• Quick Response - You can now request a transaction and forward the request on to a
picker for actual transaction execution. The request is tracked in Oracle Inventory to
minimize inaccurate information transfer. When required, replenishment mechanisms
automatically generate move orders without the intervention of an item planner for
simple cases where the material is drawn from within the facility. This results in faster
inventory replenishment with minimal human intervention.
• Warehouse Visibility - Move orders use inventory picking rules to determine where to
source material for a subinventory or Move Order Issue. This ensures that the same
mechanisms created to rotate material properly for deliveries is used to rotate material
within the facility. It also uses the material visibility in Oracle Inventory to automatically
suggest source locations, lots, and so on.
• Tracking - Move orders can be transacted through Application Program Interfaces
(APIs). APIs enable you to use mobile devices to transact, giving you better material

Chapter 9 - Page 63
visibility and accuracy. Move orders can also be created to cross-dock material to staging
locations.

Chapter 9 - Page 64
Move Order Source Types
Move Order Source Types

Oracle Inventory provides three types of move orders:
• Move Order Requisitions
• Replenishment Move Orders
• Pick Wave Move Orders
The move order type refers to the entity that created the move order. For all move orders, the
final result is one of the two supported transactions: subinventory or move order issue.
Move Order Requisition
The requisition is a manually generated request for a move order. You can generate requests
for subinventory transfers or move order issues. The requisition can optionally go through an
Oracle Workflow approval process before it becomes a move order. If no approval process is
used, the requisition becomes a move order immediately.
Replenishment Move Order
These move orders are generated automatically. For example, kanban cards can create a
replenishment move order where the pull sequence calls for a subinventory transfer (intra-
organization kanbans), or by min-max planned items where the item’s replenishment source

Chapter 9 - Page 65
(set at the item-subinventory level) is another subinventory. In this case, the min-max or
replenishment count report automatically generates a move order. Replenishment move orders
are pre-approved and ready to be transacted.
The type of move order generated depends on the replenishment source:
• If the replenishment source is a supplier, then a move order requisition is created.
• If the replenishment source is another inventory organization, then an internal requisition
is created.
• If the replenishment source is a subinventory then a replenishment move order is created.
Note that the source subinventory must be set up at the item subinventory level. For the
min-max report to generate a move order, the report must be generated at the
subinventory level.
For kanban to generate a move order, the pull sequence source type must be set to Intra-org.
Pick Wave Move Order
The pick release process generates move orders to bring the material from its source location in
stores to a staging location, which you define as a subinventory in Oracle Inventory. This
transaction is a subinventory transfer.
These move orders are generated automatically by the Oracle Shipping Execution pick release
process.
These orders are pre-approved and ready to transact. Pick slips and other shipping and
inventory reports will also be available with Oracle.
WIP Issue Move Orders
An optional process in Oracle WIP allows you to run pick release for the components of a
range of jobs or schedules. This process creates move orders to either directly issue the
material to WIP, or to move the material to the backflush locator. These orders are
automatically approved, the picking rules are sued to allocated material for the job, and pick
slips can be printed for warehouse users.

Chapter 9 - Page 66
Move Order Components
Move Order Components

Move Order Header
The move order header contains the move order source type. This refers to the entity that
created the move order. An order could be a pick wave for sales order picks, a replenishment
type move order, a requisition for subinventory transfer, and so on. The move order header also
contains the default source and destination if available, the order number, and the requested
date.
Move Order Lines
Move order lines are the requests on a move order. They contain the item, requested quantity,
the completed quantity (if the move order has been partially fulfilled), and a source and
destination, if known. The move order lines also include any project and task references, if the
organization is project-manufacturing enabled. You can also enter specific serial or lot
numbers on the move order lines.
Move Order Line Details
The line details are the inventory transactions that will occur to fulfill a particular request line
(move order line). If the material is locator-, lot-, or serial-controlled, this information is filled
in at the line detail level. These details are automatically filled in by Oracle Inventory using the

Chapter 9 - Page 67
inventory picking rules and the item-transaction defaults for destination locators or you can
manually fill in the details. You can edit these details prior to transaction.

Chapter 9 - Page 68
Move Order Allocating
Allocating Move Orders

Allocating is the process in Oracle Inventory that uses picking rules and item transaction
defaults to suggest move order line details to fulfill a move order line. The line details are the
inventory transactions that must be fulfilled to complete the move order allocation. You can
consider the allocating process as a sourcing process. Allocating occurs when you click the
Allocate button in the Transact Move Orders window.
Suggesting Sources
Oracle Inventory uses the picking rules you set up at the organization or organization-item
level to suggest source locators, revisions, and lots to source the material in order to fulfill a
move order allocation.
Suggesting a Destination
The picking rules only suggest source locations. If the destination subinventory is locator-
controlled and no locator is specified on the move order line, Oracle Inventory generates a
suggestion based on the item subinventory locator default you set up for move orders. You can
set up a default locator for each item that you want to move around the warehouse on a move
order. This is not the same default type that you would use for receiving or shipping.

Chapter 9 - Page 69
You have two choices in transacting the move orders to transfer the material to the destination
location:
• Automatic Pick Confirmation: The move order is transacted instantly after the order is
allocated without any further human intervention. On-hand inquiries will show the
material in staging. You can then perform ship confirmation.
• Manual Pick Confirmation: You can confirm the pick of the move order allocation. You
can also update any picking details such as the source locations, lots or serials and to
report shortages or inventory inaccuracies and allow the system to generate more pick
suggestions. Reporting inventory inaccuracies enables you to request a cycle count in the
inventory area where the material was not found if so desired.
Oracle Shipping
Oracle Shipping provides two choices for when and how you can fill in the line details. These
choices are made by setting up an organization parameter but can be overridden at pick release.
• Auto allocate - the allocating process is done at pick release instantly after the move
order is created. No more human intervention is needed and the pick slip can be printed
automatically.
• Pick release only creates move orders but does not fill in the line details. You must
navigate to the move order form after pick release and click on the Allocate button. This
option allows warehouse managers to determine when to release the pick to the floor and
might be a better solution for implementations running a global order entry with
distributed warehouse management and/or shipping. In these cases, orders can be
released to regional warehouses from the central order management location in advance
and individual warehouses can schedule picks closer to actual ship time.

Chapter 9 - Page 70
Generate Move Orders
Generating Move Order Requisitions

You use the Move Orders window to create move order requisitions by specifying item,
quantity, source, destination, locations, and other order information.
For each move order, an order number is required. A number is defaulted for you if you leave
the field without entering a value.
In the Default region, you can set up values that default to the lines. Default fields are not
required. You can set up a default transaction type of either Subinventory Transfer or Move
Order Issue. A Move Order Issue is the same as an account issue. You can specify the Move
Order Issue for accounts and account aliases. You can define a default source subinventory,
destination subinventory or account, for Move Order Issues, as well as the requested delivery
date (date required) for the material.
The lines are the actual material requests for the move order. In the Item tabbed region, you
can specify the item, revision, and quantity, and you can update the delivery date for that item.
A move order requisition manually requests subinventory transfers or Move Order Issues.
These requests can optionally go through an approval process before they become move orders
that are ready to be sourced and transacted. The approval process does not include dollar
amount constraints.

Chapter 9 - Page 71
Defining Project and Task Information
If the organization is a project manufacturing-enabled organization, you specify the project and
task in the Project and Task tabbed region.
Defining Source Information
You use the Source tabbed region to specify the subinventory from which to draw the material.
This field defaults from the header-level default block but can be overridden if necessary. You
can also specify the locator, lot, and serial numbers if known to use for the transactions. Only
the subinventory field is required. If you do not know from where the items should come, the
On Hand button takes you to an on-hand inquiry window for that item to locate the material
within your organization.
Defining Destination Information
You use the Destination tabbed region to specify the subinventory or account for Move Order
Issues that the material should be delivered. This field defaults from the header-level default
block but can be overridden if necessary. You can also specify the destination locator for
subinventory transfer move orders if known.
Defining Control Information
You use the Control tabbed region to request a subinventory transfer or Move Order Issue at
the line level by selecting a transaction type. This field defaults from the header-level default
block but can be overridden if necessary. You can optionally specify a reason and reference
code on the inventory transactions.
Transactions > Overview of Move Orders
.. / Generating Move Order Requisitions
../ Generating Replenishment Move Orders

Chapter 9 - Page 72
Item Allocation
Allocating Items
Reservation
A reservation is a line in the inventory reservations table. In the reservation table, supply, such
as on-hand inventory, is matched with a demand source such as a sales order. A reservation is
used to earmark your inventory for a particular use.
Pending Transaction
A pending transaction is a transaction that Oracle Inventory expects to occur shortly, but
confirmation of the transaction has not yet been recorded. This is a material pick that has not
yet been completed. Move order line details are an example of the pending transaction. A pick
slip may have already been printed, but the picker has not yet indicated that they have
deposited the material in the destination location.
Neither reserved material nor a pending transaction quantity is included in any availability
calculation for the source location.
You should not allocate a move order line too soon in the business process, because the
allocating process for a move order creates pending transactions and removes that quantity
from an availability picture. Allocating should not be done until you are ready to print the pick
slip and move the material.

Chapter 9 - Page 73
Transact Move Orders
Transacting Move Order Lines

Use the Transact Move Order Line Allocations window to view, allocate, transact move order
allocations, view the move order line details, and transact move order allocations. Transacting
move orders will post all movement activity immediately for the selected move order line and
its related details.
Transact
Once the lines have been allocated, you can commit all of the transactions for a single move
order line by selecting the lines you want to transact and clicking the Transact button. You can
save and exit the move order line details without transacting if you need to print a pick slip
report. This enables you to transact each detail line before or after picking the material.
(Help) Oracle Manufacturing Applications > Oracle Inventory >Transactions > Overview of
Move Orders > Transacting Move Orders

Chapter 9 - Page 74
Guided Demonstration Overview: Transacting Move orders

Chapter 9 - Page 75
Guided Demonstration - Transacting Move Orders
Create an Item
1. (N) Items >Master Items.
2. Create an Item using the following information:

− Item: CM11445
− Description: Mother Board
3. (M) Tools > Copy from.
4. Enter Finished Good in the template field.
5. Choose Apply.
6. Choose Done.
7. (T) Inventory.
8. Use the following information to enable the Locator Control attribute:

9. (M) File > Save.
10. (M) Tools > Organization Assignment.
11. Enable item CM11445 in the following organizations:

− M1 Seattle
− M2 Boston
Receive the Item
14. (N) Transactions > Miscellaneous Transaction

− Type: Miscellaneous Receipt
16. Choose Transaction Lines
17. Use the following information to complete a miscellaneous receipt:

Chapter 9 - Page 76
− Item: CM11445
− Locator: 1.2.1
− Quantity: 500
Generate Move Order
20. (N) Move Orders > Move Orders
21. Use the following information to generate a move order:

− Number: 001
− Description: Mother Board Move Order
− Transaction Type: Move Order Transfer
− Source Subinventory: FGI
− Destination Subinventory: Stores
− Item: CM11445
− Quantity: 200
22. Choose Approve.
Transact Move Orders
24. (N) Move Orders > Transact Move Orders.
25. Find move order 001.
26. Choose View / Update Allocations.
27. Use the following information to update the move order:

− Source Subinventory Locator: 1.2.1
− Destination Subinventory Locator: 1.1.2
28. Choose Transact.

Chapter 9 - Page 77
Practice Overview: Transacting Move orders

Chapter 9 - Page 78
Practice - Transacting Move Orders
Overview
In this practice you will generate and transact move orders.
Assumptions
• You are skilled in Oracle navigation
• You completed the Define Items practice
• You completed the Locator controls practice
• You completed the define subinventory practice
Tasks
Create an Item
Create an item using the following information.

− Name: ##-1234
− Template: Purchased Item
− Organizations: M1, M2
Receive your item
Create a miscellaneous receipt for 500 pieces of your item and receive them into at least two
locators of your ##FGI subinventory.
Create a Move Order
Create a move order for your item and move 10 pieces from the ##FGI subinventory to the FGI
subinventory using the following information:
− Number: ##-1
− Description: Team ## Move order
− Item: ##-1234
Transact Move Order
Verify your move order, and make changes such as locator control. When complete transact your
move order.

Chapter 9 - Page 79
Verify the Results
Verify your transaction was processed.

Chapter 9 - Page 80
Solution – Transacting Move Orders
Create an Item
1. Navigate to the Master Item window.
• (N) Item > Master Items
2. Define an item using the following information:

− Name: ##-1234
− Description: Move Order Item
3. Apply the Purchased Item template
• (M) Tools > Copy From.
• Select the Purchased Item Template from the LOV.
• Select Apply.
• Select Done.

Chapter 9 - Page 81
4. Enable Inventory Control.
• (T) Inventory
5. Save your work.
6. Assign your item to organizations M1 and M2.
• (M) Tools > Organization Assignment.
• Enable item in M1 Seattle and M2 Boston.

Chapter 9 - Page 82
Receive Your Item
8. Receive 500 pieces of your item into stock.
• (N) Transactions > Miscellaneous Transaction

− Type: Miscellaneous Receipt
− Account: Miscellaneous (From LOV)
• Select Transaction Lines.
• Enter the following information in the subsequent fields:

− Item: ##-1234
− Locator: ##.1.1
− Quantity 250
− Item: ##-1234
− Locator: ##.1.2

Chapter 9 - Page 83
− Quantity 250
Create a Move Order
10. Navigate to the Move Order window.
• (N) Move Orders > Move Orders
11. Define a Move Order Using the following Information:

− Number: ##-1
− Description: Team ## move order
− Source Subinventory: ##FGI
− Item: ##-1234
− Quantity: 10

Chapter 9 - Page 84
12. (T) Destination.

Chapter 9 - Page 85
• Choose Approve.
Transact Move Order
14. Navigate to the Transact Move Orders window.
• (N) Move Orders > Transact Move Orders
15. Find your move order.
• Numbers: ##-1
• Choose Find.

Chapter 9 - Page 86
16. Update your Move Order.
• Select View/Update Allocations
• Verify/Update the following:

− Locator: ##.1.1
− To Subinventory: FGI
− To Locator: 1.2.1
− Quantity: 10

Chapter 9 - Page 87
17. Choose Transact.
Verify the Results
19. View the results to verify the transaction processed.
• (N) On-hand, Availability > On-hand Quantity

− Locator: 1.2.1
− Item: ##-1234

Chapter 9 - Page 88
• Select Find.

Chapter 9 - Page 89

Chapter 9 - Page 90
Agenda

Chapter 9 - Page 91
Transactions Using a Mobile Device
Transactions Using a Mobile Device

You can perform inventory transactions using a mobile device. You can perform the following
transactions:
• Miscellaneous Receipt
• Alias Receipt
• Inventory Issues
• Subinventory Transfers
• Move Orders
• Organization Transfers
• PO
• RMA
• Intransit Shipment
• Receipts
• Sales Orders

Chapter 9 - Page 92
• Internal Order Shipments
• Cycle Count
• Physical Inventory Entries

Chapter 9 - Page 93
Guided Demonstration Overview: Mobile Transactions

Chapter 9 - Page 94
Guided Demonstration - Mobile Application Inter-organization
Transfer
1. Enter telnet esxxxx.oracle.com 7070 in the Windows Run dialog box, where xxxx is the
instance number.
2. Select Default from the Device List.
3. Enter your user name and password. Note that the responsibility, “Materials & Mfg” must
be assigned to your user name.
4. If there is more than one responsibility assigned to your user name, select Materials & Mfg
from the Responsibilities list.
5. Select Inventory from the Materials & Mfg menu.
6. Select Transfers.
7. Select Org Transfer.
8. Enter M1 as the Org code.
9. Enter M2 as the To Org.
10. Enter Intransit Shipment as the transaction type.
11. Enter 001 as the shipment number.
12. Enter AS18947 as the item to ship.
13. Enter FGI as the from subinventory
14. Enter 5 as the quantity to transfer.
15. Select Done.

Chapter 9 - Page 95
Practice Overview: Mobile Transactions

Chapter 9 - Page 96
Practice - Mobile Transactions
Overview
In this lab you will transfer items from one organization to another.
Assumptions
Tasks
Interorganization Transfers Using the Mobile Interface
Use the Mobile interface to conduct an interorganization transfer using the following
information:
− From Organization: M1 Seattle
− To Organization: M2 Boston
− Item: your choice
− Quantity: 5

Chapter 9 - Page 97
Solution – Mobile Transactions
Interorganization Transfers Using the Mobile Interface
Responsibility = Materials & Mfg
1. Start the Telnet session.

− Windows Start menu > Run
− Enter telnet esxxxx.oracle.com 7070 in the Run dialog box, where xxxx is the
instance number.
3. Enter your user name and password. Note that “Materials & Mfg” responsibility must be
assigned to your user name.

Chapter 9 - Page 98
4. If more than one responsibility had been assigned to your user name, then select Materials &
Mfg from the list.
5. Select Inventory from the Materials & Mfg Menu.

Chapter 9 - Page 99
6. Select Transfers from the Inventory Menu.
7. Select Org Transfer from the Transfers Menu.

Chapter 9 - Page 100
8. Enter your item to transfer using the following information:
− Org Code: M1
− To Org: M2
− Trx Type: Intransit Shipment
− Shipment Number: ##
− Item: Your Choice
− From Sub: ##FGI
− Quantity: 1
− To Sub: Stores

9. Select Done
Note: Use the down arrow to advance to Done.
10. Select Logout

Agenda

Managing Shipments
Managing Shipments (Oracle Purchasing)

You can review and update intransit shipments between inventory organizations.
• Shipment Visibility: You can access all incoming and outgoing shipments associated
with the current organization.
• Shipment Header: You can update information pertaining to the shipment header such as
Ship-to Location and Number of Containers. If you change the Expected Receipt Date,
Oracle Purchasing updates Shipment Supply to reflect the new due date.
• Shipment Lines: You can update information pertaining to the shipment lines such as
Expected Receipt Date, Receipt Routing, Packing Slip, and Note to Receiver. The receipt
routing that you specify in Maintain Shipments overrides routings specified at the item,
organization, or system levels.
Receiving > Managing Shipments

Agenda

Summary

11i Replenishment Concepts
Chapter 10

Chapter 10 - Page 1

Chapter 10 - Page 2
Objectives

Chapter 10 - Page 3
Agenda

Chapter 10 - Page 4
Overview
Course Overview
This module provides an overview of Oracle Inventory forecasting and replenishment methods.
(Help) Oracle Inventory > Inventory Planning and Replenishment > Overview of Inventory Planning
and Replenishment > Forecasting.

Chapter 10 - Page 5
Overview of Inventory Planning
Overview of Oracle Inventory

Inventory planning involves answering two questions:
• When should you place a new order?
• How much should you order?
Using the Oracle Inventory application, you can set up the following types of inventory
replenishment plans:
• Min-max planning
• Reorder-point planning
• Kanban replenishment planning
• Replenishment counting (for non-quantity tracked subinventories)
After you select the replenishment method that you want to use, Oracle Inventory concurrent
programs populate the requisition interface.
Oracle Inventory planning interfaces with Oracle Purchasing, and indirectly with Oracle Order
Management.

Chapter 10 - Page 6
Order Planning
Replenishment Considerations
Before you replenish your inventory, you should consider the following:
• Order time
• Order size
• Planning method
When to Order
Typically, you should order when the on-hand quantity plus incoming supply minus demand is
less than the specified minimum inventory level. On-hand quantity refers to what you currently
have in stock. Supply represents on-hand stock plus inventory coming into the organization.
Demand represents the need for a particular item.

Chapter 10 - Page 7
How Much to Order
How Much to Order

Ideally, you should order a quantity that balances the cost of placing an order with the cost of
managing inventory while covering expected demand. After you determine the amount to
order, you can create a requisition to replenish inventory from another organization or a
supplier. Note: Suppliers may have minimum order quantities.

Chapter 10 - Page 8
Replenishment Process for Intra-Org Supply Sources

Chapter 10 - Page 9
Replenishment Process for Supplier Supply Sources

Replenishment Process for Inter-Org Supply Sources

Replenishment Process for Product Supply Sources

Agenda

Overview of Oracle Inventory Forecasting
Inventory Planning and Forecasting

Forecasts generated by Oracle Inventory are based on historical transaction activity only. When
creating a forecast, you can select the type of transactions that you want to use. You can also
specify how far into the future that you want to forecast demand.
After you complete a forecast, you can use it to determine reorder-point planning. You can also
load forecasts into the master schedule, which is a component of the Oracle Material
Requirements Planning (MRP) application.
Note: You can manually create forecasts using Oracle Inventory or Oracle MRP. There are no
constraints for manually created forecasts. So, manually created forecasts can be based on
transaction activity other than historical data.

Forecast Types
Forecast Types
Forecast generation uses mathematical algorithms to calculate a prediction of future demand.
You can calculate estimated future demand for items using historical data and focus or
statistical forecasting techniques. You can create multiple forecasts and group complementing
forecasts into forecast sets. Oracle Inventory supports the following forecast types:
• Focus
• Statistical
Focus forecasting enables you to simulate various methods of calculating demand so that you
can select the best forecasting model. Statistical forecasting enables you to use detailed history
and applies weighted factors to exponentially smooth the data. Statistical forecasting also
enables you to apply exponentially weighted trend and seasonality factors to predict demand.
You typically use Focus forecasting to produce single period forecasts, whereas you can use
Statistical forecasting to forecast any number of periods into the future.

Agenda

Oracle Inventory Replenishment Methods
Oracle Inventory Replenishment Methods

With Oracle Inventory, you can set up specific replenishment methods to help you decide the
size, timing, and amount to order. Oracle Inventory supports the following replenishment
methods:
• Reorder-Point-planning
• Min-Max planning
• Kanban replenishment
• Replenishment counting
For more information see: (Help) Inventory Planning and Replenishment > Overview of
Planning and Replenishment.

Replenishment Methods Levels
Oracle Inventory Replenishment Methods (continued)

Based on the replenishment method that you select, you can perform replenishment planning at
the organization or subinventory level. The table in the slide summarizes the levels at which
you can perform a specific replenishment method.
Note that Kanban is done at the locator level. Also Periodic Automatic Replenishment which is
a type of Replenishment Counting is also done at the locator level.

Safety Stock
Safety Stock
Safety Stock is a base level of inventory from which Oracle inventory performs planning. In
other words, the item is planned as if the safety stock quantity for the period is the zero
inventory balance of the item. This ensures that the safety stock quantity remains in inventory
to cover any fluctuations in demand.

Economic Order Quantity
Economic Order Quantity

The economic order quantity (EOQ) is a type of fixed order quantity that determines the
amount of an item to be purchased or manufactured at one time. The intent is to minimize the
combined costs of acquiring and managing inventory.

Overview of Reorder-Point Planning
Reorder-Point Planning Overview

As shown in the graphic, with reorder-point planning, you order a quantity when the quantity
falls to a predetermined reorder-point. Ideally it is best to reorder at some point before
inventory levels fall into the safety zone. Safety stock typically provides a buffer from which to
fill orders between reorder-points. At the end of the lead time, the onhand quantity should
equal the safety stock.
The essential feature of reorder-point planning is that it projects what the stock level will be—
based on forecast demand and no visibility of sales orders—at the end of the item's lead time.
This projection is then used to decide whether or not the reorder-point has been reached.
The reorder-point is calculated by adding expected demand during lead time to safety stock.
You perform reorder-point planning for the entire organization. You can use reorder-point
planning for items under independent demand. That is, demand for items (or materials) that are
independent of the demand for other items (or materials). When you define an item, you can
specify reorder-point planning as the inventory planning method.
For more information see: (Help) Oracle Inventory > Inventory Planning and Replenishment >
Overview of Reorder Point Planning.

Overview of Min-max Planning
Min-max Planning Overview

Min-max planning is a method of inventory planning that determines how much to order based
on user-defined minimum and maximum inventory levels. In contrast to reorder-point
planning, min-max planning is not based on demand projections and does not consider lead
time. With Oracle Inventory, you can perform min-max planning at the both the organization
and the subinventory levels. To perform organization-level min-max planning for an item, you
must specify organization-level minimum and maximum quantities. Min-max planning is
typically used to control low value inventory items that do not need great control. To perform
subinventory-level min-max planning for an item, you must specify subinventory-level
minimum and maximum quantities.
Overview of Min-Max Planning.

Overview of Kanban Replenishment
Kanban Replenishment
Kanban is a means of supporting pull-based replenishment in manufacturing systems. A
kanban system is a self-regulating pull system that leads to shorter lead times and reduced
inventory. Kanban systems are typically applied to items with relatively constant demand and
medium-to-high production volume.
Kanbans represent replenishment signals that are manual and highly visible, such as a color-
code card that moves with the material, a light that goes on when replenishment is required, or
an empty bin that is moved to the supply location to trigger replenishment.
Kanban systems typically provide support for external devices, such as bar code readers to read
kanban cards and trigger a replenishment signal.
Kanban System Features
Kanban systems include the following characteristics:
• Close cooperation between the users and the supply channel
• Short re-supply lead times
• Relatively small quantities reordered at a time
• Relative frequent ordering

Overview of Kanban Replenishment.

Overview of Replenishment Counting
Replenishment Counting
Replenishment counting enables you to perform counts for non-tracked subinventories and
then direct Oracle Inventory to check these counts against the minimum quantities that you
specified.
A non-tracked subinventory is an expense subinventory for which Oracle Inventory does not
maintain on-hand quantity information. When you move valued material to a non-tracked
subinventory, Oracle Inventory automatically charges the appropriate expense account and
discards that quantity. Non-tracked subinventories typically store items of low value, such as
office stationery. You can also use replenishment counting if you do your own planning. In this
case you may order either a specific quantity or the maximum quantity specified in the Min-
Max values. Non-tracked subinventories might include hospital storerooms, where there is no
opportunity to record accurate and timely issue-transaction information.
Overview of Replenishment Counting.

Overview of PAR Counting
Periodic Automatic Replenishment (PAR) Counting

PAR counting is replenishment counting done at the locator level in a subinventory.

Agenda

Mobile Replenishment Count Overview
Mobile Device Replenishment Count

Oracle Mobile Materials Management provides windows to perform mobile replenishments.

Agenda

Summary

11i Replenishment
Fundamentals
Chapter 11
11i Replenishment Fundamentals

Chapter 11 - Page 1

Chapter 11 - Page 2
Objectives

Chapter 11 - Page 3
Agenda

Chapter 11 - Page 4
Overview

Chapter 11 - Page 5
Agenda

Chapter 11 - Page 6
Focus Forecasting
Describing Focus Forecasting Methods

Focus forecasting simulates five forecast methods to determine the best forecasting model to
use. An example of each focus forecast method is shown in this slide and on the following
pages. Each method generates a forecast for the current period based on demand from
previous periods.
Note: If not using daily time buckets, focus forecast methods 1 and 4 require at least one year
of historical data. When you use daily time buckets, a week is used instead of a year in
calculating Models 1 and 4. Fifty-two week years are presumed in yearly calculations with
weekly time buckets. This means that the same week last year is taken to be the week fifty-two
weeks before the current week.

Chapter 11 - Page 7
Focus-Forecasting (continued)

Chapter 11 - Page 8
Focus-Forecasting (continued)

Chapter 11 - Page 9
Using Focus Forecasting
Determining the Best Forecast Method

The system uses the absolute percentage error (APE) to determine the best forecasting method
to use. The APE is the difference between the actual demand and the forecast associated with
the actual demand. You calculate the APE using actual and forecast demand. Oracle
Inventory selects the model with the smallest APE to calculate the current period forecast.
The following formula determines the APE:
APE = ( |actual demand - forecast demand| ) / actual demand
Note: Focus forecasting provides a one-period forecast. If you request a focus forecast for
multiple periods, then Oracle Inventory uses the forecast of the first period for all of the
forecast periods in the request. If actual demand is available for the current period, then you
can recompile the focus forecast to update the forecast.

Focus Forecasting Example
Example of Focus Forecasting

To evaluate which forecasting model produced the best forecast, last period, the absolute
percentage error (APE) is calculated for the five forecasts. The forecast model with the
smallest APE is then chosen to calculate the forecast for the next period.
In this example, to determine the best forecast model to use, you would first calculate the
forecast and APE for March 2001 for each of the five focus forecasting methods. Then, to
forecast demand for April 2001, select the the focus forecast method that yielded the smallest
APE.
Forecast Model 4 represents the best model for March of 2001, because the APE associated
with this forecast is only 5 percent compared to the higher APEs for Models 1, 2, 3 and 5.
Note: This example shows the calculation for Method 4 only.
Forecast = actual demand in the same period last year × (actual demand in the previous period
this year / actual demand in the previous period before the same period last year)
Calculating the Forecast and APE for Model 4:
March 2001 = March 2000 × (February 2001 / February 2000)
= 250 × (255 / 210)

= 303.57142, rounded to 304
APE for model 4:
APE = (| actual demand - forecast demand |) / actual demand
= (|290 - 304|) / 290
= 0.05 or 5%
Calculating the Demand Forecast for April 2001:
Because 5% is the smallest error of the five models, you would select Model 4 to calculate the
April 2001 forecast.
April 2001 = April 2000 × (March 2001 / March 2000)
= 260 × (290 / 250)
= 301.6000 or 302
Note: Results have been rounded to the nearest whole number.

Statistical Forecasting

Exponential Smoothing Forecast (ESF)
Describing the Exponential Smoothing Forecast (ESF)

Exponential smoothing uses the forecast from the prior period and adds an adjustment to obtain
the forecast for the next period. With ESF, demand is forecast by averaging all of the past
periods of actual demand. This forecasting method weighs more recent data to give it greater
influence over the forecast results than older data.
You can calculate the current period forecast by using a weighted average of the most recent
and forecasted demand. The alpha factor, also called the smoothing constant, is multiplied by
the forecast error to determine the adjustment. You can specify an alpha factor between zero
and one. The larger the alpha factor, the less impact the older data has on the new forecast.
The current forecast is equal to the old forecast, plus a portion of the forecast error from the
previous period. You can use this method when trend or seasonality patterns do not exist.
Example of Exponential Smoothing Forecasting
This example shows the ESF calculations for a 9-step ahead forecast assuming an alpha (á)
value of 0.2, At-1 of 270, and ESFt-1 of 288.
So the forecast for period 9 for the assumed values of á, At-1, and ESFt-1 is:
ESFt = α × At-1 + (1 - α) × ESFt-1

ESF9 = 0.2 × A8 + (1 – 0.2) × ESF8
= 0.2 × 270 + 0.8 × 288
= 284.4
Note: ESF always lags behind the trend by at least one period.

Trend-Enhanced Forecast (TEF)
Describing the Trend-Enhanced Forecast (TEF)

For longer-range forecasts, you can use the trend-enhanced forecast to estimate the amount of
persistent change in basic demand from period to period.
TEF is based on the exponential smoothing factor (α), but also considers the trend (β).
Both the exponential smoothing and trend values closer to zero are weighted towards the past
trend and values closer to one are weighted more heavily towards the current trend.
Example of Trend-Enhanced Forecasting
This example shows the effect of adding the trend enhancement to the ESF calculation. With
the trend-enhanced forecast, you can reflect the current trend in a forecast. The trend-enhanced
forecast for period 9 is derived by performing the following calculations:
• Determining base value
• Updating the trend index
• Adding the two for the current period trend-enhanced forecast
This example shows the TEF calculations for a 9-step ahead forecast for the following assumed
values:
• α = 0.2

• β = 0.1
• A8 = 270
• TEF8 = 306
• B8 = 287
• R8 = 19
Determining the Base Value
Bt =α × At-1 + (1 – α) × TEFt-1
B9 = 0.2 × A8 + (1 – 0.2) × TEF8
= 0.2 × 270 + 0.8 × 306
= 298.8
Updating the Trend Index
Rt = β × (Bt - Bt-1) + (1 - β) × Rt-1
R9 = 0.1 × (B9 - B8) + (1 - 0.1) × R8
= 0.1 × (298.8 – 287) + 0.9 × 19
= 18.28
Adding the Base and Trend Index to determine the Period 9 Trend Forecast
Recall that the calculated base value was 298.8 and the trend index was 18.28.
TEFt = Bt + Rt
TEF9 = B9 + R9
= 298.8 + 18.28
= 317.08 = Period 9 Forecast

Season-Enhanced Forecast (SEF)
Describing the Season-Enhanced Forecast (SEF)

You can use seasonality indexes to indicate the degree of seasonal variation for a product. You
can specify a seasonality factor to estimate how much demand during the season will be above
or below the average demand for the product.
Values closer to zero give more weight to past seasonal indexes, and values closer to one one
give more weight to current seasonal indexes. This method produces a more consistent pattern
of seasonal demand from period to period over the course of the forecast.
You can use SEF to track changes in demand that result from annual promotions and expected
peaks in demand. For example, you might use SEF to track the demand of children’s clothing
purchases at the beginning of the school year versus the demand for children’s clothing at other
times of the year.
Example of Season-Enhanced Forecasting
With highly seasonal goods such as winter clothing and holiday cards you should take seasonal
demand variations into consideration. To do this, you must first enter seasonality indices for
each period indicating how much demand during the period is above or below average. A
seasonality index of 2 indicates that demand during this period is twice the average demand.
An index of 0.5 indicates that demand during this period is half the average demand. An index

of 1 means that the demand is average during this period. If the average seasonality index
entered is not equal to 1, then Oracle Inventory normalizes the indices so that the average
seasonality indices do equal 1.
The same kind of logic that is used for adjusting for trend in the TEF is used to adjust for the
seasonal variations. Demand is first deseasonalized by dividing by the seasonality index for
that period and then exponential smoothing is used to produce a new base value. The base
value is then multiplied by the seasonal index for the period being forecasted to produce the
season-enhanced forecast (SEF).
To determine seasonality index, you perform the following calculations:
• Adjust the last period’s seasonality index
• Calculate the forecast base value
• Multiply the forecast base value by the period seasonality index
This example assumes the following:
• α = 0.2
• γ = 0.3
• A8 = 270
• B8 = 238
• S7 = 1.15
Adjust The Last Period’s Seasonality Index
St = γ × (At / Bt) + (1 – γ ) × St-1
S8 = 0.3 × (A8 / B8) + (1 – 0.3 ) × S7
= 0.3 × (270 / 238) + 0.7 × 1.15
= 1.145
Calculate the Forecast Base Value
Bt = α × (At-1 / St-1) + (1 – α) × Bt-1
B9 = 0.2 × (A8 / S8) + (1 – 0.2) × B8
= 0.2 × (270 / 1.145) + 0.8 × 238
= 237.56157
Multiply the Forecast Base Value by the Period 8 Seasonality Index
SEFt = Bt × St-1
SEF9 = B9 × S8
= 237.56157 × 1.145
= 272.00799
Note: After determining period 9 results, you can calculate period 9’s seasonality index and
then forecast for period 10.

Trend- and Season-Enhanced Forecast (TSEF)
Describing the Trend- and Season-Enhanced Forecast (TSEF)

The Trend- and Season-Enhanced forecast combines the trend and seasonal methods to
incorporate both types of demand. With TSEF you specify a trend factor as well as a
seasonality index.
Example of Trend- and Season-Enhanced Forecasting
Despite the seasonal adjustments made in the SEF, a trend element may remain in the forecast
base, B. The TEF and the SEF can be combined to derive a trend- and season-enhanced
forecast (TSEF). The TSEF uses all three smoothing factors: alpha (α), beta (β ), and gamma (γ
).
As with the season-enhanced forecast, you calculate the new period 8 seasonality index as soon
as period 8 actual demand is determined.
To calculate the trend- and season-enhanced forecast for period 9, you perform the following
calculations:
• Calculate the period 8 seasonality index
• Calculate the period 9 base value
• Calculate the new trend factor

• Add the base and trend factors together and multiply by the seasonality factor to get the
period 9 trend- and season-enhanced forecast
For this example, assume the following values:
• Smoothing constant, α = 0.2
• Trend smoothing constant, β = 0.1
• Seasonality smoothing constant, γ = 0.3
• A8 = 270
• B8 = 255
• R8 = 10
• S7 = 1.15
Calculating the Period 8 Seasonality Index
St = γ × [At / (Bt + Rt)] + [(1 – γ ) × St-1]
S8 = 0.3 × [A8 / (B8 + R8)] + [(1 – 0.3 ) × S7]
= 0.3 × [270 / (255 + 10)] + (0.7 × 1.15)
= 1.11066
Calculating the Period 9 Base Value
Bt = α × (At-1 / St-1) + (1 – α) × (Bt-1 + Rt-1)
B9 = 0.2 × (A8 / S8) + (1 – 0.2) × (B8 + R8)
= 0.2 × (270 / 1.11066) + 0.8 × (255 + 10)
= 260.6197
Calculating the New Trend Factor
Rt = β × (Bt – Bt-1) + (1 – β) × Rt-1
R9 = 0.1 × (B9 – B8) + (1 – 0.1) × R8
= 0.1 × (260.6197 – 255) + 0.9 × 10
= 9.56197
Calculating the Period 9 Trend- and Season-Enhanced Forecast
TSEFt = (Bt + Rt) × St-1
TSEF9 = (B9 + R9) × S8
= (260.6197 + 9.56197) × 1.11066
= 300.07997

Forecast Setup and Maintenance
Accessing Forecast Help

For an overview about the forecast setup components, access the online help topic: Overview
of Forecasting.
(Help) Oracle Inventory > Inventory Planning and Replenishment > Forecasting. The
Overview of Forecasting topic appears.
Accessing Forecast Setup Help
You can find information on forecast rules in the Overview of Forecasting topic.
To access instructions on how to set up a forecast, scroll to the bottom of the Overview of
Forecasting topic and click the “Defining a Forecast” link. The Defining a Forecast topic
appears. Follow the instructions provided to set up a forecast.

Guided Demonstration Overview: Creating a Manual Forecast

Guided Demonstration - Creating a Manual Forecast
Creating a Forecast Set
1. (N) Planning > Forecasts > Sets
2. Enter the following the information to create a forecast set:

− Forecast Set: FG Set
− Description: Finished Goods forecast set
− Bucket Type: Weeks
− Forecast: FGI
− Description: Finished Goods forecast
3. (M) File > Save.
Setting Up Forecast Entries
5. (N) Planning > Forecasts > Entries
6. (M) View > Find
7. Select the FG Set forecast set.
8. Enter the following forecast entry information

− Item: AS18947
− Date: Today’s Date
− End Date: 1 week in advance.
− Current: 1000
− Item: AS18947
− Date: 1 week in advance
− End Date: 2 weeks in advance
− Current: 2000
− Item: AS18947
− Date: 2 weeks in advance
− End Date: 3 weeks in advance.
− Current: 3000
9. (M) File > Save.

Viewing Forecast Quantities
11. (N) Planning > Forecasts > View Entries
12. (M) View > Find.
13. Select the FG Set Forecast set.
14. Choose Bucketed

Practice Overview: Creating a Manual Forecast

Practice - Creating a Manual Forecast
Overview
In this lab you will create a manual forecast for one of your items.
Assumptions
• You completed the define items lab.
Tasks
Define a Forecast Set
Define a forecast set using the following information:

− Forecast Set Name: ##-FSET
− Description: Forecast Set for Team ##
− Bucket type: Weeks
− Forecast Name: ##-FNAME
− Forecast Description: Forecast Name for Team ##
Enter Forecast Entries
Define forecast entries using the following information:

− Forecast Item: ##-Item02
− Quantities: 3000, 4000, 2000, 2500, 2000, 4500
View Forecast Quantities
View the forecast quantities for your forecast.

Solution – Creating a Manual Forecast
Define a Forecast Set
1. Navigate to the Forecast Sets Window.
• (N) Planning > Forecasts > Sets
2. Define a forecast set using the following information:

− Name: ##-FSET
− Description: Forecast Set for Team ##
− Bucket type: Weeks
3. Enter the following information in the forecast field:

− Name: ##-FNAME
− Description: Forecast Name for Team ##
• (M) File > Save

Enter Forecast Entries
5. Navigate to the Forecast Entries window.
• (N) Planning > Forecasts > Entries
6. Open your forecast set
• (M) View > Find
• Select the ##-FSET forecast set
• Enter your ##-Item02 in the item field.
7. Enter the following quantities in progressive weeks for the next 6 weeks. Start with the first
date field, and use the LOV for each available date.
− 3000
− 4000
− 2000
− 2500
− 2000
− 4500

• (M) File > Save
View Forecast Quantities
9. Navigate to the Item Forecast Entries window.
• (N) Planning > Forecasts > View Entries
10. Open your forecast set
• (M) View > Find
• Select the ##-FSET forecast set that you created from the LOV.
11. Select Bucketed to view your forecast quantities.
12. Close window.

Agenda

Uses of Reorder-point Planning
Uses of Reorder-point Planning

• You can perform reorder-point planning for the entire organization.
• You can use reorder-point planning for items under independent demand.
• You can specify reorder-point planning as the inventory planning method when you
define an item.
• You can use reorder-point planning for items that you do not need to control very tightly
and that are not very expensive to carry in inventory.
• You can use reorder-point planning to decide when to order new quantity before using
safety stock.

Reorder-point Planning: Safety Stock
Reorder-Point Planning
Recall from Replenishment Concepts that with reorder-point planning, you order a quantity
when the quantity falls to a predetermined reorder point as shown in the above graphic.
Reorder-point planning uses the following pieces of information:
• Safety stock
• Replenishment lead time
• Item demand
• Order cost
• Carrying cost
Safety Stock:
Safety stock is the quantity of an item that you plan to have in inventory to protect against
fluctuations in supply and demand. You can manually enter safety stock quantities or Oracle
Inventory can calculate a safety stock level based on an existing forecast for an item.

Reorder-Point Planning: Lead Time
Reorder-Point Planning (continued)

Replenishment Lead Time
Replenishment lead time is the total time between recognizing the need to reorder and the
receipt of items. Order processing lead times include the following components:
• Preprocessing lead time
• Processing lead time
• Postproccessing lead time
Oracle Inventory calculates reorder point planning lead time by adding all the three
components.
Item Demand
The reorder point planning routine uses the average demand during the replenishment lead
time. Oracle Inventory uses forecast information to calculate average demand.
Timing of Reorders
You should reorder when the following is true:
(quantity on hand + quantity on order) < reorder point
where the reorder point = safety stock + [(lead time) × (average demand during lead time)]

Reorder-Point Planning: Reorder Quantity
Reorder-Point Planning (continued)

Quantity of Reorders
The reorder quantity is equal to the Economic Order Quantity (EOQ). The EOQ is the quantity
that minimizes the total cost of ordering and storing inventory. Use the following formula to
determine the EOQ:
EOQ = SQRT {[2 × (annual demand) × (order cost)] / (annual carrying costs)}
Oracle Inventory calculates the EOQ by using annual demand from the forecast that you
provide when you perform reorder-point planning. The system also uses the order and annual
carrying costs that you specify when you define items.
You can constrain the reorder quantity by specifying the following information for each item:
• Fixed-lot multiplier
• Minimum order quantity
• Maximum order quantity
Quantity on Order

Quantity on order represents supply that you have not yet received. The quantity on order is the
sum of the purchase order, requisition (internal and supplier), and in-transit quantities owned
by the organization.

Reorder-Point Planning Steps

Entering Item Planning Attributes

Entering General Planning Attributes for Reorder-point Planning
Organization Items: General Planning Tabbed Region

Navigation Path
Inventory Responsibility
(N) Items > Organization Items > (T) General Planning
Carrying Cost Percent
Oracle Inventory uses the carrying cost percent information to calculate the EOQ for the item.
The annual carrying cost represents your internal cost to stock one of that item per year.
Carrying cost = (carrying cost percent) × (standard unit cost)
Order Cost
Oracle Inventory uses the order cost to calculate the EOQ for the item. The order cost
represents the fixed cost of placing an order for any quantity of the item.
Fixed-lot Size Multiplier
Oracle Inventory orders a quantity that is a multiple of the fixed-lot size multiplier.
Minimum-Order Quantity
Oracle Inventory orders a quantity that is at least as large as the minimum-order quantity.

Maximum-Order Quantity
Oracle Inventory orders a quantity that is less than or equal to the maximum-order quantity.

Entering Lead Times
Organization Items: Lead Times Tabbed Region

Navigation Path
(N) Items > Organization Items > (T) Lead Times
Lead Times
You can specify the following lead times:
• Preprocessing lead time: Represents the number of days required to place a purchase or
manufacturing order.
• Processing lead time: Represents the number of days required to procure or manufacture
the item.
• Postprocessing lead time: Represents the number of days required to deliver a purchased
item from the initial supplier receipt of the purchase order.

Entering Safety Stocks
Entering Safety Stock

You can enter a user-defined quantity as the safety stock or have the system calculate the
safety stock. To enter user-defined quantities, use the Enter Item Safety Stocks window.
If you want Oracle Inventory to calculate safety stock, using the Mean Absolute Deviation
method, you must submit a concurrent request through the Reload Safety Stock window.
Navigation Path for Enter Item Safety Stocks Window
(N) Planning > Safety Stocks
Navigation Path for Reload Safety Stock Window
(N) Planning > Safety Stock Update
Stock Calculation Methods
User-defined quantity method: You can enter safety stock quantities and the date for which
each quantity is effective. You can update safety stock quantities that you previously entered
or that Oracle Inventory calculated for you.

User-defined percentage method: To use the user-defined percentage method, you must use the
Reload Safety Stock window and specify the following information for the item:
• A forecast
• A safety stock percent
- Oracle Inventory uses the following equation to calculate safety stock quantities:
Safety stock = (safety stock percent) × (forecast demand).
Mean Absolute Deviation Method: To calculate safety stock using this method, you submit a
concurrent request using the Reload Safety Stock window. In this window, you must specify
the following information:
• A forecast
• A service level percent
- The service level percent represents the probability that you can fill an order from
available inventory. If you enter a high service level, then Oracle Inventory
calculates relatively larger safety stock quantities. Oracle Inventory calculates
safety stock quantity by using the following equation: safety stock = Z × 1.25 ×
(mean absolute deviation) where Z is the appropriate value from a table of standard
normal distribution corresponding to the service level. The mean absolute deviation
is a measure of how the forecast demand deviates form the actual demand.

Performing Reorder-point Planning
Providing a Forecast
The reorder-point planning program uses information from the forecast to calculate the
Economic Order Quantity (EOQ) and the reorder-point quantity. The following equations show
each of these calculations:
• EOQ = SQRT {[2 × (annual demand) × (order cost)] / (annual carrying costs)}
• Reorder point = safety stock + [(lead time) × (average demand)]
Providing On-Order Quantity Information
Oracle uses on-order quantity information to determine when to reorder an item. You should
reorder when the following is true:
(quantity on hand + quantity on-order) < reorder point
Oracle uses the following sources to calculate on-order quantities:
• Purchase orders
• Requisitions (internal and supplier)
• In-transit shipments owned by the organization
Oracle Inventory uses purchase orders, requisitions, and in-transit shipments that are scheduled
to be delivered before the supply cutoff date.

Viewing Planning Information
You can view planning information before creating replenishment orders. If you want to create
replenishment orders automatically, then you must request requisitions.
Creating Requisitions
Oracle creates requisitions for all items that meet the following condition:
(quantity on hand + quantity on order) < reorder point
Oracle creates either purchase requisitions (if the source is a supplier) or internal requisitions
(if the source is an Inventory Organization). The reorder quantity is the EOQ constrained by
the following attributes:
• Fixed-lot size multiplier
Reorder Submission
You can submit the planning process for all items under reorder-point planning or submit the
planning process for just those items that are below their reorder-point quantities.

Guided Demonstration: Reorder Point Planning

Guided Demonstration - Reorder Point Planning
3. (T) General Planning.
4. Change the Inventory Planning Method to Reorder Point.
5. Change the Minimum Order Quantity to 35.
6. Change the Order Cost to 45.
7. Change the Carrying Cost % to 12.
8. (T) Lead Times.
9. Change the Processing lead time to 5.
10. Save and Close Window.
11. (N) > Planning > Reorder Point Planning.
12. Select Items Under Reorder Point as the Item Selection.
13. Enter Demand and Supply cut off dates.
14. Select a Forecast from the list of values.
15. Submit your request.

Agenda

Uses of Min-max Planning

Min-max Planning
Min-Max Planning
Recall that Min-max planning is a method of determining when and how much to order based
on user-defined minimum and maximum inventory levels.
Note: To perform organization-level Min-max planning for an item, you must specify
organization-level minimum and maximum quantities.
Deciding When to Order with Min-max Planning
You should order when the following is true:
(on-hand quantity – demand) + (quantity on order) < minimum quantity
Quantity on order is the sum of purchase order quantities, requisition quantities, and intransit
shipments. It also includes WIP jobs as supply at the organization level. Quantity on order
represents supplies that you have not yet received in your organization.

Min-max Planning: When to Order?

Min-max Planning: How Much to Order?
Note:
You can constrain the order quantity by specifying the following order modifiers for an item:
• Fixed-lot multiplier

Min-max Planning Steps

Item Planning Attributes

Min-max Planning Setup Procedure

Selecting a Planning Level

Entering Planning Attributes
Entering Item Planning Attributes

After you select a planning level, either Organization or Subinventory, you enter the
appropriate planning attributes.

Submitting the Min-max Planning Requests
Submitting the Min-max Planning Requests

In addition to setting up planning attributes, min-max planning involves submitting a
concurrent process that generates the Min-max planning report. You can also perform
exception reporting with the Min-max planning reporting feature. When you submit the Min-
max planning request, you must specify a number of parameters including parameters that
address the following:
• Nettable subinventories
• Demand quantities
• On-order quantity information
• Requisitions and WIP unrealized jobs
• Exception reporting
You can submit the planning process for all items under min-max planning. You can also
submit the planning process for just those items under their minimum quantities and submit the
planning process for just those items over the maximum quantities.
Using Nettable Subinventories

Oracle Inventory enables you to use on-hand quantities that exist in either nettable or non-
nettable subinventories, or both.
Displaying Demand Quantity
Oracle Inventory displays the sum of all unfulfilled demand created before the cutoff date. The
system calculates demand quantity by using information from the following sources:
• Sales orders
• Internal orders
You can include WIP job component requirements as a source of demand as well. You can net
unfulfilled demand against on-hand quantity and also include inventory reservations in netting
on-hand quantity against demand.
Viewing Planning Information
You can view planning information before creating replenishment orders. To automatically
create replenishment orders, you must request requisitions.
Creating Requisitions and WIP Unrealized Jobs
If you request a restock, Oracle Inventory creates requisitions and WIP unreleased jobs for all
items that meet the following condition:
(on-hand quantity) + (quantity on order) < minimum quantity
Oracle Inventory creates purchase requisitions (if the source is a supplier) and internal
requisitions (if the source is an Inventory Organization) for all Buy items, and WIP unreleased
jobs for all Make items. The order quantity is constrained by the following attributes:
• Fixed-lot size multiplier
Navigation Path
Inventory Responsibility (N) Reports > Planning

Guided Demonstration Overview: Min-max Planning

Guided Demonstration - Min-max Planning
Setting Up Min-max Planning for an Item.
2. Find Item AS54888
3. (T) General Planning
4. Change the Inventory Planning Method to Min-Max.
5. (M) File > Save.
6. (M) Tools > Item Subinventories.
7. (M) File > New
8. Enter FGI as the subinventory.
9. Select the Min-Max Planning Check box.
10. Enter 300 as the Minimum Qty.
11. Enter 900 as the Maximum Qty.
Running the Min-max Planning Report.
14. (N) Planning > Min-Max Planning
15. Enter the following planning information.

− Planning Level: Subinventory
16. Choose OK.
17. Choose Submit.
Viewing the Min-Max Planning Report
18. (N) Requests.
19. Find your request.

20. Choose View Output.
21. (M) File > Close.

Practice Overview: Min-max Planning

Practice - Performing Min-max Planning
Overview
In this lab you will perform min-max planning for an item.
Assumptions
• You completed the define items lab.
Tasks
Enable Min-max Planning for Item
Enter Min-max planning for ##-Item03 and restrict to your ##FGI subinventory.
Use the following minimum and maximum quantities:

− Minimum quantity: 300
− Maximum quantity: 900
Request a Min-max Planning Report
Request a min-max planning report for your item and subinventory using the following
information:
− Planning level: Subinventory
View Min-max Planning Report
View your min-max planning report.

Solution – Performing Min-max Planning
Enable Min-max Planning for Item
1. Navigate to the Organization Items window and find your ##-Item03 item.
• (N) Items > Organization Items
2. Find your ##-Item03 item.
3. (T) General Planning

− Inventory planning Method: Min-Max
4. (M) File > Save
5. (M) Tools > Item Subinventories
6. Enter the minimum and maximum quantities for the item/subinventory combination as
follows:
− Name: ##FGI
− Minimum Quantity: 300
− Maximum Quantity: 900

• (M) File > Save
Request a Min-max Planning Report
8. Navigate to the Min-Max Planning window.
• (N) Planning > Min-Max Planning
9. Enter the following information in the Parameters window:

− Planning Level: Subinventory
− Subinventory: ##-FGI

10. Choose OK.
11. Choose Submit.

View Min-max Planning Report
12. (N) Requests
13. Select My Completed Requests

14. Select Find.
15. Select your request.

16. Select View Output.
17. (M) File > Close.

Agenda

Uses of Replenishment Counting
Uses of Replenishment Counting

Recall that replenishment counting is a method of ordering items for subinventories. You can
perform counts for the non-tracked subinventories and then have Oracle Inventory check these
counts against the minimum quantities that you have specified. Oracle Inventory creates
requisitions that are based on the sourcing options that you specify for each item.

Replenishment Planning Steps
The following are the steps involved in performing a replenishment count:

1. Specify the requisition approval status using the profile options.
2. Use the Subinventories window to create the subinventories for which you want to
perform replenishment counts.
3. Assign items to the subinventories using the Item Subinventories window.
4. Define sourcing information for the subinventories. You can define sourcing information
at various levels, for example you can define sourcing information at the item-
subinventory level or at the subinventory level.
5. Enter the replenishment count header information using the Replenishment Count
Headers window.
6. Enter the replenishment counts using the Replenishment Count Lines window.
7. Process and report the count information for the system to generate requisitions based on
the sourcing information. For example, if sourcing is from another subinventory then the
system automatically generates a move order.
Note
Use the INV: Replenishment Count Requisition Approval profile option to specify the

requisition approval status.
Use the INV: Replenishment Count Line Failure profile option to specify whether the
system should stop or continue processing in case a replenishment count fails.

Subinventories Window
Subinventories Window
Inventory Responsibility (N) Setup > Organizations > Subinventories (B) New.

Item Subinventories Window
Specifying Min-max Planning

To enter replenishment counts for an item, you must specify subinventory-level min-max
planning for the item.
Entering Subinventory-Level Min-Max Minimum and Maximum Quantities
You can use the Min-max method to replenish subinventories. In one replenishment count
entry method, you can order the min-max maximum quantity.
In another replenishment count entry method designed only for non-tracked subinventories,
you can enter an on-hand quantity, after which Oracle Inventory performs min-max
calculations.
Navigation Path
Inventory Responsibility (N) Setup > Organizations > Subinventories (B) Item/Subinventory.

Item Subinventories: Order Modifier Tab
Entering Order Modifiers

Fixed-Lot-Size Multiplier
When you perform replenishment counting, Oracle Inventory calculates order quantities that
are multiples of the fixed-lot-size multiplier.
Minimum Order Quantity
When you perform replenishment counting, Oracle Inventory calculates order quantities that
are greater than the minimum order quantity.
Maximum Order Quantity
When you perform subinventory replenishment, Oracle Inventory calculates order quantities
that are less than the maximum order quantity.
Navigation Path
Inventory Responsibility (N) Setup > Organizations > Subinventories > (T) Order Modifiers.

Replenishment Count Headers
Entering Replenishment Count Header Information

In the Replenishment Count Headers window, you enter a name and subinventory for which
you want to perform replenishment counting.
Navigation Path
Use the following navigation path to access the Replenishment Count Headers window:
Inventory Responsibility (N) Counting > Replenishments Counts > Counts (B) New.

Replenishment Count Lines
Entering Replenishment Count Lines

You must enter replenishment count header information to enter replenishment count lines for
items that are associated with the subinventory that you specify.
For any count type, the reorder quantities are constrained by fixed-lot-size multiple quantities,
maximum order quantities, and minimum order quantities. Oracle Inventory uses the sourcing
options defined for that item and subinventory combination.
On-Hand Quantity
This method is only for non-tracked subinventories. The item for which you select this method
must be a min-max planned item. You can count the contents of the subinventory and then
enter the on-hand quantity. Oracle Inventory uses the quantity that you enter to perform min-
max comparisons and to generate requisitions.
Order Maximum
The item for which you select this method must be a min-max planned item. Oracle Inventory
generates a requisition for the min-max maximum quantity specific to that item and
subinventory combination. You cannot enter a quantity if you select this option.
Order Quantity

The item for which you select this method can be planned using any replenishment planning
method. With the Order Quantity count type, Oracle Inventory generates a requisition for the
quantity that you enter.
Navigation Path
Use the following navigation path to access the Replenishment Count Lines window:
Inventory Responsibility(N) Counting > Replenishment Counts > Counts (B) Lines.

Processing Replenishment Counts
Entering Counts Using External Devices

You can use external data collection devices, such as bar code readers to enter replenishment
counts. You can run the replenishment validator and processor after entering counts directly
into the replenishment open interface.
Replenishment Validator and Processor
The replenishment validator reads the count records that exist in the interface table. The
interface table stores the counts that you enter with an external device. Oracle Inventory
validates the items, subinventories, and counts, and then writes the records to the count tables.
The replenishment count processor performs the calculations that are necessary to determine
whether Oracle Inventory should create requisitions. Oracle Inventory creates internal or
purchase requisitions according to each item’s default sourcing options. Run the replenishment
validator program before submitting the replenishment processor.
Purging Replenishment Counts
If you want to purge replenishment counts, use the Purge Replenishment Counts window.
Navigation Paths
Inventory Responsibility(N) Counting > Replenishment Counts > Process Interface.

Inventory Responsibility (N) Counting > Replenishment Counts > Purge.

Practice Overview: Performing a Replenishment Count Using
Forms

Practice - Performing a Replenishment Count Using Forms
Overview
In this practice you will perform a replenishment count using forms. The following are the steps
in this practice:
• Defining item-subinventory relationship and sourcing information
• Entering the replenishment count header information
• Entering the replenishment count using forms
• Processing the count information using forms
Assumptions
• You completed the practice on creating subinventories.
• You completed the practice on defining items.
• The quantity of ##-Item02 in your ##RM subinventory is at least 100.
Tasks
Define Item-Subinventory Relationship and Sourcing Information
Define item-subinventory relationship and sourcing information for the following:

− Subinventory: ##LV
− Item: ##-Item02
− Min-Max Planning: Yes
− Minimum Quantity: 10
− Maximum Quantity: 50
Also define sourcing information in such a way that ##-Item02 for ##LV is replenished from the
subinventory ##RM.
Enter Replenishment Count Header Information
Create a replenishment count header for forms using the following information:

− Name: ##RC1
Enter Replenishment Count Using Forms
Enter the replenishment count for ##RC1 using the following information:
− Item: ##-Item02
− Count Type: Onhand Quantity
− Count: 5
Process the Count Information Using Forms
Process the count entered for ##RC1 using the forms.
Answer the following question after you complete the lab.
What is the reorder quantity for ##RC1?

Solution - Performing a Replenishment Count Using Forms
Define Item-Subinventory Relationship and Sourcing Information
1. Change Organization to M1 Seattle.
• Choose Seattle Manufacturing
• Select OK
2. Verify the on-hand quantity of ##-Item02 in ##RM Subinventory.
• (N) On-hand, Availability > On-hand Quantity

− Subinventory: ##RM
− Item / Revision: ##-Item02
3. (B) Find.

4. Navigate to the Subinventories window
5. Select the ##LV subinventory from the list.
6. Select Item/Subinventory
7. Define the item-subinventory relationship using the following information:
• (T) Planning
− Item: ##-Item02
− Min-Max Planning: Yes
− Min Qty: 10
− Max Qty: 50
• (T) Sourcing
− Type: Subinventory
− Subinventory: ##RM

8. (M) File > Save.
9. Navigate to the Replenishment Count Headers window.
• (N) Counting > Replenishment Counts > Counts
10. Select New.
11. Create a new replenishment count header using the following information:
− Name: ##RC1
− Count Using Mobile: No

12.
Enter Replenishment Count Using Forms
13. Select Default Items.
14. Enter the following information:

− Count Type: Onhand Quantity
− Quantity: 5

15.
Process the Count Information Using Forms
17. Return to the Replenishment Count Headers window.
18. Select Process and Report. The replenishment request number is displayed.
19. View the details of the Replenishment Count Report by querying for the request number in
the Requests window.
Note: As the item ##-Item02 for the subinventory ##LV is sourced from another
subinventory ##RM, the application automatically creates a move order after you process
the count. However, to complete this transaction you must transact this move order using the
Transact Move Orders window.
20. What is the reorder quantity for ##RC1? The reorder quantity is 45 (maximum quantity –
onhand quantity).

Practice Overview: Performing a Replenishment Count Using the
Mobile Application

Practice - Performing a Replenishment Count Using the Mobile
Application
Overview
In this practice you will perform a replenishment count using the mobile application. The
following are the steps in this practice:
• Entering the replenishment count header information using forms
• Entering the replenishment count using the mobile application
• Processing the count information using the mobile application
Assumptions
• You completed the practice on performing a replenishment count using forms.
Tasks
Create a replenishment count header using the following information:

− Name: ##RC2
− Subinventory: ##-LV
− Count Using Mobile: Yes
Enter Replenishment Count Lines
Enter the replenishment count line information for ##RC2 using the forms:
− Item: ##-Item02
− Count Type: Order Quantity
Enter Replenishment Count Using the Mobile Application
Enter the replenishment count for ##RC2 in the mobile application using the following
information:

− Replenishment Count: ##RC2
− Item: ##-Item02
− Order Quantity: 30
Process the Count Information Using the Mobile Application
Process the count entered for ##RC2 using the mobile application.
Answer the following question after you complete the lab.
Can you enter the count in the Replenishment Count Lines window for ##RC2? Why?

Solution - Performing a Replenishment Count Using the Mobile
Application
1. Navigate to the Replenishment Count Headers window.
• (N) Counting > Replenishment Counts > Counts
2. Select New.
3. Create a new replenishment count header using the following information:

− Name: ##RC2
− Count Using Mobile: Yes
Enter Replenishment Count Lines
4. Select Default Items.
5. Enter the following information:

− Count Type: Order Quantity

6. (M) File > Save.
Enter Replenishment Count Using the Mobile Application

instance number.

10. If more than one responsibility had been assigned to your user name, select Materials & Mfg
from the list.

12. Select Counting from the Inventory menu.

13. Select Repl Count from the Counting menu.
14. Enter the following information when prompted.
Note: The mobile application screen is case sensitive.

− Organization Code: M1
− Replenishment Count Name: ##RC2
15. Select Count to enter the order quantity.

16. Enter 30 as the order quantity and select Save/Next.
Note: As ##-Item02 is the only item associated with 00-LV subinventory, the item name is
automatically displayed and you are prompted to enter just the count quantity. If there are
more than one item associated with the subinventory, then you also need to enter the item.
You can enter the count quantity for all items that have been associated with the
subinventory. You can enter the count quantity for these items even if you have not included
them in the Replenishment Count Header.
17. Press Ctrl+B to view the Message Page.


Process the Count Information Using the Mobile Application
18. Select Process and Report to process the count information that you entered.
19. Press Ctrl+B to view the Message Page. The request number is displayed. You can view the
details of the Replenishment Count Report by querying for the request number in the
Requests window.

20. Select Logout to exit the mobile application.
21. Can you enter the count in the Replenishment Count Lines window for ##RC2? Why? No,
you cannot enter the count in the Replenishment Count Lines for ##RC2. This is because
you would have selected the Count Using Mobile check box in the Replenishment Count
Headers window, you can enter the count only using the mobile application.

Processing PAR Counts
PAR Counts
Periodic Automated Replenishment (PAR) counting is a replenishment method that enables
you to perform replenishment count at a locator level. For example, in Oracle Inventory you
can model a hospital storeroom as a subinventory and the shelves and trolleys in the storeroom
as locators. You can define PAR levels for each item stored in these locators. You can
replenish these items every time they go below the PAR level.
In general, the steps for PAR are the same as that of replenishment counting. For a list of these
steps, see Replenishment Planning Steps earlier in this lesson. The following steps are specific
to PAR:
• Enable PAR level planning for the subinventories.
• Define locators for the subinventories.
• Enter the PAR level when you define the item subinventory relationship.
Note:
If you have enabled PAR level planning for a subinventory, you cannot perform min-max
planning for that subinventory. The PAR level acts as both the minimum and maximum
quantity levels for subinventories that have PAR level planning enabled.

Reorder Quantity For PAR Count
PAR Count Reorder Quantity

The reorder quantity when you process a PAR count depends on the following factors:
• PAR Level
• Quantity
• Count Type
The table in the slide explains how the reorder quantity differs based on these factors. The
system generates the appropriate replenishment document based on the item sourcing for the
subinventory. For example, if sourcing is from another organization, the system automatically
generates an internal order.
If you choose on-hand quantity as the count type, then the quantity denotes the on-hand
quantity available in the locator. The system compares this quantity that you enter with the
PAR level to calculate the reorder quantity. This option is only for non-tracked subinventories.
If you choose order PAR then the reorder quantity is same as the PAR level. This is similar to
the order maximum option available when you perform a replenishment count. You cannot
enter the quantity if you choose order par.

Choose order quantity to generate a replenishment requisition for the quantity that you want to
order. In this case, the quantity denotes the order quantity.
Note:
If you have not specified the PAR level, then you can only choose order quantity as the count
type.

Agenda

Kanban Cards
Kanban Replenishment
Recall that a kanban system is a self-regulating pull system that leads to shorter lead times and
reduced inventory. Kanban systems are typically applied to items with relatively constant
demand and medium-to-high production volume.

Kanban Planned Items
Kanban Planned Items

To define a kanban planned item, you must set the Release Time Fence attribute in the
MPS/MRP Planning attribute group to the Kanban Item (Do Not Release) option in the Master
Items window. Use the following navigation path to access the MPS/MRP Planning attribute.
You can define pull sequences only for kanban planned items.
Navigation Path
Inventory Responsibility (N) Items > Master Items > (T) MPS/MRP Planning.
Defining Pull Sequence Sources
For every kanban planned item, you must define a pull sequence, which is a series of kanban
locations that model the replenishment network on the shop floor. For example, a kanban
location can be a subinventory locator. The replenishment source for a kanban location can be
another kanban location, a production line, or an external source. You can use locators even if
locator control is turned off at the organization and item levels.
Kanbans can be sourced from an external supplier or an internal organization. A supplier-
source-type kanban triggers a purchase request to the supplier, while an inter-org- source-type
kanban results in an inter-organization transfer.
Navigation Path

Inventory Responsibility(N) Kanban > Pull Sequences > (T) Source.

Kanban Cards
Kanban Cards
Kanban cards are created for an item, subinventory, and locator (optional). They are uniquely
identified by a kanban number. For cards generated from a kanban pull sequence, the number
is automatically generated. For manually defined cards, both replenishable and
nonreplenishable, you can enter an unused kanban number or let the system create the number.
You cannot override the quantity for generated cards, but you can add additional cards or
delete existing cards from the pull sequence to control the inventory in the replenishment
chain.
A supply source defaults from the sourcing rules if a sourcing rule is available for the item and
kanban location. Only the primary supplier, based on the split percentage and ranking, is used.
You can manually override the quantity and supply source on a pull sequence only before the
cards are printed. Changes to the pull sequence are not reflected until the old cards are deleted
and new ones are created. Updates to the sourcing rules apply only to cards created after the
update.
Kanban Card Status
Kanban cards are generated with a default card status of Active. When you define a card
manually,you can initially give it either Active or Hold status.You can terminate use of a card

by changing the card status to Canceled, but you cannot reverse this change. Only canceled
cards can be deleted.
Navigation Path
Inventory Responsibility(N) Kanban > Pull Sequences (T) Kanban.

Kanban Supply Status
Kanban Supply Status

You can set all of the supply status codes manually. You can also set all of the supply statuses
automatically except for In-Transit. All cards are generated with a status of New. You can
switch this status to Empty to trigger a kanban replenishment signal. During initial setup, you
can switch the status to Full if you are starting out with a full bin. When you are defining a card
manually, you create a card with at status of Empty, Full or New.

Kanban Replenishment Sources
Kanban Sources of Replenishment

You can create kanban cards with the following source types:
• Inter-Org- Replenished by another organization.
• Intra-Org- Replenished from another subinventory in the same organization.
• Production- Replenished by a production line.
• Supplier- Replenished by an external supplier.
• Flow Schedules- Replenished by flow.
• User Defined- You can define a replenishment source.

Kanban Card Printing
Kanban Card Printing

You can print kanban cards for a replenishment plan or a replenishment chain when you
generate the cards. You can also print cards individually if the card information is complete.
You can print duplicate cards only if the original is lost or voided. You are given a warning
message when you print duplicate cards.

Guided Demonstration Overview: Generating Kanban Cards

Guided Demonstration - Kanban
Create Kanban Pull Sequence
1. (N) Kanban > Pull Sequences.
2. Choose New.
3. Enter the following information to create the pull sequence.

− Item: AS18947
− Source Type: Supplier
− Supplier: Advanced Network Devices
− Supplier Site: Santa Clara
4. (T) Kanban
− Calculate: Number of Cards
− Size: 10
− Number of Cards: 10
− Minimum Order Qty: 20
5. (M) File > Save
6. Choose Generate Cards
7. Choose Cards
8. Select the first card.
9. Choose Replenish
10. Select the second card.
11. Choose Replenish
12. (N) File > Save
13. (N) File > Close Form.

Practice Overview: Generating Kanban Cards

Practice - Generating Kanban Cards
Overview
In this lab you will learn how to generate Kanban Cards.
Assumptions
• You have completed the defining Subinventories Lab
• You have completed the Defining Items Lab.
Tasks
Setting up a Kanban Pull Sequence
Set up a Kanban pull sequence using the following information:

− Item ##-Item03
− Locator:
− Size: 10
− Cards: 10
− Minimum Order Quantity: 20
Generate Kanban Cards
Generate Kanban cards for the pull sequence you created.
Replenish Kanban Cards
Replenish your Kanban cards.

Solution – Generating Kanban Cards
Setting up a Kanban Pull Sequence
1. Navigate to the Pull Sequences window.
• (N) Kanban > Pull Sequences > (B) New.
2. Use the following information to define a new pull sequence:

− Item: ##-Item03
− Locator: Row ##, Rack 1, Bin 1
• (T) Kanban
− Size: 10
− Number of Cards: 10

− Minimum Order Quantity: 20
3. (M) File > Save
Generate Kanban Cards
4. Choose Generate Cards
5. Choose Yes to print Kanban cards.
6. Verify your Kanban cards printed.
• (M) View > Requests
• Select All My Requests
• Choose Find

Replenish Kanban Cards
7. Navigate to the Kanban Cards Summary window.
• Choose Cards or (N) Kanban > Kanban Cards.
8. Replenish Kanban cards.
• Select the first Kanban card in the list, and choose Replenish.
• Verify the supply status changed to Wait.
• Select the second Kanban card in the list and choose replenish.
• Verify the supply status is Empty.

9. (N) File > Save.
10. (N) File > Close Form.

Agenda

Available to Promise
Available to Promise
Available to Promise (ATP) represents the quantity available for sale at any given period. The
basic formula for ATP is ATP quantity = on-hand quantity + supply - demand – shortage.
Oracle Inventory enables you to define different rules that govern what is considered supply
and demand.

ATP Rules and ATP Checks

Uses of ATP in Oracle Inventory
Uses of ATP in Inventory

• You can view the earliest available data for a specific quantity of an item or a group of
items and the available quantity of an item for a specific date.
• You can view the supply, demand, and ATP item quantities for the periods that fall
between the current date and the end of the ATP horizon.

Steps for Checking ATP
Checking ATP
Note: Oracle Inventory displays the organization-level default ATP rule whenever you perform
ATP queries in your organization.

ATP Rules Setup Steps
Defining an ATP Rule

Navigation Path
Inventory Responsibility (N) Setup > Rules > Available to Promise
You can use the following equation to calculate the ATP quantity for each supply period.
Period ATP = (period supply) – (period demand)

Defining Computation Options
ATP Computation Options

When you define ATP rules, you must specify computation options. Computation options
govern how to calculate the ATP quantity in each period. You can use computation options
individually or in combination.
Backward Consumption of Shortage
You can calculate ATP information by using the surplus quantity of an item from prior ATP
periods to cover a period shortage. If the period ATP is negative, you can go backward through
the supply periods, one at a time, and subtract the shortage from the available quantity. You
can keep going backward until the shortage disappears or you run out of periods.
Forward Consumption of Shortage
You can calculate ATP information by using a surplus quantity of an item from future ATP
periods to cover an earlier period shortage. If the period ATP is negative, then you can go
forward through the supply periods, one at a time, and subtract the shortage from the available
quantity. You can keep going forward until the shortage disappears or you run out of periods.

Defining Computation Options
Determining ATP using Accumulation Options

You can use the Accumulate Available option to calculate ATP by carrying over the available
quantity of an item from one ATP period to the next.
Note: This option assumes backward consumption of shortage.
Entering an Accumulation Window
Accumulation window is the number of days by which to limit the accumulation of available
supply. The accumulation window is measured in workdays based on the organization calendar
and exception set.
The accumulation window option prevents the commitment of near-term supply to orders that
have requirement dates far into the future. The accumulation window applies to only the
following two computation options:
• Accumulate Available
• Backward Consumption

Specifying Supply and Demand Time Fences

A time fence is the total lead time required to purchase or manufacture an item. You can
define item time fence options to provide timing information for the ATP calculation.
The ATP calculation algorithm uses the following time fences:
Past-due-supply time fence
Past-due-demand time fence
Infinite-supply time fence
Entering Past Due Supply and Demand Days
Past-Due-Supply Days
The ATP process does not consider any supply scheduled before the past-due-supply time
fence date. The ATP process considers all supply from the beginning of the past-due-supply
time fence date to the current date as supply for the current date.
Past-due-supply time fence date = (current date) – (past-due-supply days)
Past-Due-Demand Days

The ATP process does not consider any demand scheduled before the past-due-demand time
fence date. The ATP process considers all demand from the beginning of the past-due-demand
time fence date to the current date as demand for the current date.
Past-due-demand time fence = (current date) – (past-due-demand days)

Selecting an Infinite-Supply Option

The infinite-supply time fence date is the end of the ATP horizon. Oracle Inventory does not
consider supply sources scheduled on or after this date in ATP calculations. The infinite-
supply option represents the total time beyond which the ATP process assumes that infinite
supply is available to cover any scheduled demand.
You can select one of the following infinite-supply options:
• Cumulative manufacturing lead time: The manufacturing lead time of an assembly plus
the largest adjusted cumulative manufacturing lead time of its components.
• Cumulative total lead time: The total lead time of an assembly plus the largest adjusted
cumulative total lead time of its components.
• Total lead time: The sum of the preprocessing, processing, and postprocessing lead times
of an item.
• User-defined time fence: A lead time that you specify for the item.

Specifying a Supply Period

Oracle Inventory designates a period as beginning on a scheduled supply date and ending on
the day before the next scheduled supply date. A supply period can cover several days or be a
minimum of one day.
If supply occurs on a nonworkday, the ATP calculation considers that supply as belonging to
the next workday. If multiple supply events occur on the same day, the ATP process considers
the total supply.

Specifying Demand Sources
ATP Demand
ATP demand is the sum of all demand quantities in the supply period. If demand occurs on a
nonworkday, the ATP calculation considers that demand as belonging to the previous workday.
ATP by Demand Class Check Box
If you select the ATP by Demand Class check box, the ATP calculation considers only supply
and demand for a particular demand class. The demand class feature enables you to forecast,
plan, and promise based on subdivisions of your demand. For example, a demand class might
represent a large customer or a group of related customers.
If you select ATP by Demand Class, Oracle Inventory considers only the following sources of
supply:
• Discrete MPS
• Repetitive MPS
• Discrete WIP
• Repetitive WIP
• Nonstandard WIP
Including User-defined Demand Sources

In addition to Oracle’s predefined sources, you can use your own demand sources. To use your
own demand sources, you must populate the user-defined demand interface table with your
external demand information.

Specifying Supply Sources
Using the Available On-Hand Quantity as the Supply Source

You can choose to include available on-hand quantity as a source of supply. However, you
should not typically use available on-hand quantity as supply in make-to-order and assemble-
to-order environments.
Including User-Defined Supply as a Supply Source
In addition to Oracle’s predefined supply sources, you can use your own supply source.
However, you must populate the user-defined supply interface table with your external supply
information.

Setting Up Item and Bills for ATP Checking

ATP Checking
Enabling ATP Checking When Placing a Demand

If you enable the Check ATP attribute, the item must pass an ATP test before you can place a
demand for it in Oracle Order Management. When you place a demand for the item in Oracle
Order Management, the ATP process checks to see if there is sufficient quantity.
If you decide not to enable the Check ATP attribute, then you can place a demand for the item
even if there is not sufficient stock to satisfy the demand. You should not enable the Check
ATP attribute for items that are noncritical, rarely out of stock, on a short manufacturing cycle,
or replenishable on short notice.
Specifying an Item ATP Rule
Oracle Inventory uses the ATP rule that you assigned to check ATP when you place a demand
for the item in Oracle Order Management. If you do not specify an ATP rule for the item, the
ATP process uses the organization-level default ATP rule that you enter in the Organization
Parameters window.

ATP Checking
Selecting the ATP Components Attribute

If you enable the ATP Components attribute for an assembly, you can place a demand for the
assembly only if all of the components with the enabled Check ATP attribute at the bill-
component level pass the ATP check. If you enable the Check ATP attribute for the assembly,
then the assembly must also pass the ATP check before you can place a demand for it.

ATP Checking
Setting the Check ATP attribute at the Bill Level

Use the following navigation path to access the Bills of Material window:
Navigate to the Oracle Bills of Material application, (N) Bills > Bills.
If an item is a component in a bill of material, you can change the value of the Check ATP
attribute, at the bill-component level, to something other than what you set at the master-item
level.
If you had enabled the Check ATP attribute when you defined the item, you can decide
whether to enable or disable the component Check ATP attribute.
If you had not enabled the Check ATP attribute when you defined the item, Oracle Inventory
does not enable the bill component Check ATP attribute.
This enables you to set up items that require passing ATP checks when ordered directly, but
that do not require passing ATP checks when they are components of an assembly.
Use the following navigation path to access the Check ATP attribute in Oracle Inventory:
(N) Items > Organization Items > (T) Order Management.

Viewing ATP Criteria
Viewing ATP Information for Individual Items

When you set up ATP criteria, you must specify the following information:
• Required quantity
• Required date
Oracle Inventory then displays the following ATP results:
• Earliest date on which the required quantity will be available
• ATP quantity for the required date
Viewing ATP Information for a Group of Items
Oracle Inventory returns the date when all of the items in the group will be available. You can
view the ATP result and supply and demand detail for each item by navigating to the ATP by
Period and Supply/Demand Detail windows respectively.
Viewing ATP Information for a Demand Class
You can view ATP information for individual items and groups of items that belong to a
particular demand class.

Agenda

Planning and Forecasting Profile Options
Planning and Forecasting Profile Options

Minmax Reorder Approval
Indicates the status of requisitions created by the Minmax Planning Report. Inventory
predefines a value of Pre-approved for this profile for all levels upon installation. If you choose
Incomplete, you can optionally load requisitions as unapproved and use the document approval
functionality in Oracle Purchasing.
Enter Replenishment Count Form
Indicates processing control in the Enter Replenishment count window. The available values
are as follows:
• Background processing: Upon commit, control returns immediately to you, allowing you
to continue working. The replenishment count transactions are executed on a periodic
basis.
• Concurrent processing: Upon commit, Oracle Inventory spawns the concurrent process
and returns control immediately to you, allowing you continue working. Displays the
concurrent request number representing the concurrent process executing the
replenishment.
Replenishment Count Line Failure

Indicates the action taken when a failure is detected while processing a replenishment count
line. Inventory predefines a value of Continue processing for this profile for all levels upon
installation.
• Continue processing- Other (successful) lines for the replenishment header are processed
to requisition lines.
• Halt processing- Do not process other (successful) lines for the replenishment header.
Replenishment Count Requisition Approval
Indicates the status of subinventory replenishment requisitions created by the replenishment
processor. Available values are:
• Pre-approved- Requisitions created by the replenishment processor are approved.
• Incomplete – Requisitions created by the replenishment processor have not been
submitted for approval.
• Approval Required- Requisitions created by the replenishment processor are currently not
approved.
Inventory predefines a value of Incomplete for this profile. If you choose Approval Required,
you can optionally load subinventory replenishment requisitions as unapproved and use the
document approval functionality in Purchasing.

Setting Up the Min-Max System Profile Value
Entering Min-Max Approval Status

When you run the Min-max report, the INV: Minmax Reorder Approval profile option enables
you to create requisitions as either approved or unapproved.
How to Enter a Min-Max Approval Status
To enter a min-max requisition approval status, navigate to the System Profiles window to
enter a personal or system profile value to specify a min-max reorder approval status.
Navigation Path
Inventory Responsibility (N) Setup > Profiles > Personal.
The Personal Profile Values window appears.
(M) View > Find.
A Find window appears. Enter “%Minmax%” in the find window to locate the Minmax
Reorder Approval profile option.
Note: If you do not have access to system-level profile values, ask your system administrator
for assistance in setting up the system-level Minmax Reorder Approval profile option.

Subinventory Setup Windows

Agenda

Min-Max Order Type and Order Source
Min-Max Order Type and Order Source

An item can be a “make” item or a “buy” item. This characteristic of an item and the source
type that you specify for the item determine the type of replenishment order created for that
item. For organization level min-max planning, you can specify the source type in the “General
Planning” tab of the Organization Item window.
For subinventory level min-max planning, you can specify the source type in the Sourcing tab
of the Item Subinventories window. If this is left blank, the report checks to see if a source
type is specified either at the Subinventory level, the Organization Item level, or in the
Organization Parameters window.
If the item is a Buy item and the source type is set to “Inventory,” min-max creates
requisitions. If the source type is “Supplier,” it creates purchase orders, and if the source type is
“Subinventory,” it creates move orders. Note that source type “Subinventory” is not valid for
organization level planning (it is not a valid option on the Organization Parameters window; if
used on the Organization Item window for an item that is planned at the organization level, it
will not restock the item). Items must also be transactable in order for min-max to create
purchase orders, requisitions or move orders (“Transactable” check box on Inventory tab of
Organization Item window checked).

Purchasable Item Considerations
The following conditions must be satisfied before min-max can insert records into the PO
interface table:
• For requisitions (source type Inventory), internal orders must be enabled for the item.
That is, the Internal Orders Enabled check box in the Order Management tab of the
Organization Item window must be selected.
• For purchase orders (source type Supplier), the item is purchasable. That is, the
Purchasable check box in Purchasing tab must be selected.
• An Inventory AP Accrual account is defined for the organization.
• An Invoice Price Variance account is defined for the organization.
• For Min-Max Report to create Purchase / Internal requisitions successfully, Encumbrance
Account SHOULD BE specified at Item or Org level, if the 'Use Requisition
Encumbrance' check box is selected in the Financial Options window under
Encumbrance tab. For subinventory level planning, Encumbrance Account SHOULD BE
specified at the item-subinventory, subinventory, organization-item or organization level.
For organization level planning, min-max will only look at the organization-item or
organization level to find the encumbrance account. If the 'Use Requisition Encumbrance'
check box is not selected, it is optional to specify Encumbrance Account in the
Organization Items window or Organization Parameters window.
• A charge account is defined. If the Inventory Asset Value check box in the Costing tab of
Organization Item window is checked, then the material account is used. For organization
level planning, the material account is specified in the Valuation Accounts section of the
Costing Information tab of the Organization Parameters window. For subinventory level
planning, the material account is specified in the Subinventories window. If the
Inventory Asset Value check box is not selected, the expense account is used for
organization level planning. The expense account is defined on the Purchasing tab of the
Organization Item window, or in the Valuation Accounts section of the Costing
Information tab of the Organization Parameters window; for subinventory level planning,
Oracle Inventory checks the expense account defined at the subinventory level before
looking at the org-item or org level expense account.
Additional considerations for Creation of WIP Jobs
For “make” items, min-max inserts a record into the WIP interface table
wip_job_schedule_interface for creating a WIP Job or Schedule for manufacturing this item.
WIP work orders cannot be generated for subinventory level min-max planning – if a Make
item is min-max planned at the subinventory level, the report flips the flag and treats it as a
Buy item instead. Also, the item must have the Build in WIP and Pick components enabled.
Make Item Considerations
The following considerations should be considered when using min-max on make type items.
• Discrete MPS
• Set the item type to Make.
• Make certain that under the general planning tab the sourcing is set to null and cleared
out.
• Make certain to run the min-max planning with restock = yes. Whether or not WIP
demand and supply are included in the calculations is specified in the report parameters.

• It is possible to verify that an entry has been made into the table
WIP_JOB_SCHEDULES_INTERFACE.
• Run the associated Mass load Concurrent Program (WIP > Discrete > Import Jobs and
Schedules) to ensure that the WIP interface tables have been picked up and processed.

Replenishment Method Selection
Replenishment Method Selection

Consider the following information when determining the replenishment method to use:
• Supply sources
• Document created during replenishment
• Demand Sources – Although not listed in the table, demand sources might include the
following:
- Sales orders
- Forecasts

Agenda

Summary


11i Inventory Accuracy
Concepts
Chapter 12
11i Inventory Accuracy Concepts

Chapter 12 - Page 1

Chapter 12 - Page 2
Objectives

Chapter 12 - Page 3
Agenda

Chapter 12 - Page 4
Overview of Inventory Accuracy
Overview
Oracle Inventory has features that enable you to control and improve the accuracy of your
inventory records:
• ABC Analysis
• Cycle Counting
• Physical Inventory

Chapter 12 - Page 5
Agenda

Chapter 12 - Page 6
ABC Analysis Overview
ABC Analysis
ABC Analysis is the classification of a group of items in decreasing order of annual dollar
volume or other criteria. This array is then usually split into three classes A, B, and C.
• A Group- The A group usually represents 10% to 20% by number of items and 50%-70%
by projected dollar volume.
• B Group- The B group usually represents about 20% of the number of items and about 20%
of the dollar volume.
• C Group- The C group contains 60%-70% of the number of items and represents about
10%-30% of the dollar volume.

Chapter 12 - Page 7
Agenda

Chapter 12 - Page 8
Cycle Counting Overview
Cycle Counting
With cycle counting, inventory is counted on a cyclic schedule rather than once a year. A cycle
inventory count is usually taken on regular defined basis. Most effective cycle counting
systems require the counting of a certain number of items every workday with each item
counted at a prescribed frequency. You can use cycle counting along with ABC analysis to
count items of greater importance more frequently than those of less importance. Cycle
counting supports scheduled counting based on value or counting by location, and can be set
up at the organization level or the subinventory level.
Benefits of Cycle Counting
Cycle counting enables you to keep inventory records accurate by correcting errors between
the system on-hand (perpetual) and actual on-hand (physical) quantities. Cycle counting can
also be a valuable tool to help identify patterns in the errors found. Analysis of these patterns
can suggest and help to prioritize improvements in training, tools, and processes. Over a period
of time these improvements may increase the average level of inventory record accuracy.

Chapter 12 - Page 9
Agenda

Physical Inventory Overview
Physical Inventory
A physical inventory is a periodic reconciliation of system on-hand balances with physical
counts in inventory. You can perform physical inventories whenever you choose to verify the
accuracy of your system on-hand quantities. You can perform a physical inventory for an entire
organization or for particular subinventories within an organization. Physical inventories are
usually performed once every six months or once a year depending on the organization
requirements.

Why Perform Physical Inventories?

Agenda

Mobile Inventory Accuracy Overview
Mobile Device Inventory Accuracy

Oracle Mobile Materials Management provides windows to perform cycle counting and
complete physical inventory functions.

Agenda

Summary

11i Inventory Accuracy
Fundamentals
Chapter 13
11i Inventory Accuracy Fundamentals

Chapter 13 - Page 1

Chapter 13 - Page 2
Objectives

Chapter 13 - Page 3
Agenda

Chapter 13 - Page 4
Defining an ABC Analysis

Chapter 13 - Page 5
Define and Run an ABC Compilation
Explaining ABC Compilation

An ABC Compile is a ranking of your items based upon selected criteria. You can define and
compile an ABC analysis for your entire organization or for a specific subinventory within
your organization.
You choose the compilation criterion, the scope of your analysis, the cost type to use in
determining item values and any additional information that may be conditionally necessary
based on your compilation criterion.

Chapter 13 - Page 6
ABC Compilation Criteria
Explaining ABC Compilation Criteria

For each distinct compile, you can choose one criterion (such as current on-hand value or MRP
demand usage value) to value and rank each item included in the ABC compile. The criterion
that you choose defines what the rank of a particular item will be in the ABC Compile.
For example, if you use current on-hand quantity as your compile criterion, then item X with
an on-hand quantity of 10 units is of higher rank than item Y with a quantity of 5 units. If you
use current on-hand value as the criterion and if item X has a cost of $10 per unit and item Y
has a cost of $25 per unit, then item Y has a higher value than item X since Oracle Inventory
compares $100 ($10x10 units) to $125 ($25x5 units).
Explaining ABC Compilation Criteria Options
Current On-Hand Quantity
• Use the current on-hand quantity of inventory. Assign the sequence number by descending
quantity.
Current-On-Hand Value
• Use the current on-hand quantity of inventory multiplied by the cost for the cost type.
Assign the sequence number by descending value.

Chapter 13 - Page 7
Historical Usage Value
• Use the historical usage value (transaction history). This is the transaction quantities times
the unit cost of the transactions for the time period you specify. Assign the sequence
number by descending value.
Historical Usage Quantity
• Use the historical usage quantity (transaction history) for the time period you specify.
Assign the sequence number by descending quantity.
Historical Number of Transactions
• Use the historical number of transactions (transaction history) for the time period you
specify. Assign the sequence number by descending number of transactions.
Forecasted Usage Value
• Use the forecasted usage value based on the forecast quantity calculated and the cost type
you specify. Assign the sequence number by descending value.
Forecasted Usage Quantity
• Use the forecasted usage quantity. Assign the sequence number by descending quantity.
Previous Cycle Count Adjustment Quantity
• Oracle Inventory sums the quantity of all cycle count adjustments that have occurred since
the last ABC compile date. Assign the sequence number by descending quantity.
Previous Cycle Count Adjustment Value
• Oracle Inventory sums the value of all cycle count adjustments that have occurred since the
last ABC compile date. Assign the sequence number by descending value.
MRP Demand Usage Quantity
• Oracle Inventory sums the MRP gross requirements for the MRP plan you specify. Assign
the sequence number by descending quantity.
MRP Demand Usage Value
• Oracle Inventory sums the MRP gross requirements for the MRP plan you specify, then
multiplies each by the item cost type you choose in the ABC compile form. Assign the
sequence number by descending value.
MPS Demand Usage Quantity
• Oracle Inventory sums the MPS gross requirements for the MPS schedule you specify.
Assign the sequence number by descending quantity.
MPS Demand Usage Value
• Oracle Inventory sums the MPS gross requirements for the MPS schedule you specify, then
DRP Demand Usage Quantity
• Oracle Inventory sums the DRP gross requirements for the DRP plan you specify. Assign
the sequence number by descending quantity.
DRP Demand Usage Value
• Oracle Inventory sums the DRP gross requirements for the DRP plan you specify, then

Chapter 13 - Page 8
Agenda

Chapter 13 - Page 9
ABC Valuation Scope
ABC Valuation Scope

You can select a valuation scope for determining the ranking of items. You can do an ABC
compile across individual subinventories or across an organization. If you choose to restrict
ABC compile to items within a particular subinventory, you have the option of valuing your
items across all subinventories in the organization or by the individual subinventory.

Agenda

Defining ABC Groups
Defining ABC Groups

ABC assignment groups link a particular ABC compile with a valid set of ABC classes. This
allows you to selectively reduce or increase the number of ABC classes you want to use in
your item assignments for a particular ABC compile.
Oracle Inventory uses these groups when you automatically assign your items to ABC classes.
It ensures that you divide your items into the exact number of groupings you specified in the
ABC group.
You must also assign a sequence number to each class associated with the ABC group. The
class with the lowest sequence number is assumed to have the highest rank and will have
higher rank items assigned to that class than the next higher sequence number.
You may update an assignment group to add new classes, however you cannot delete a class. If
you need to delete a class, you must create a new assignment group with only the desired
classes.

Defining ABC Classes
Defining ABC Classes

You use ABC Classes to identify the value groupings to which your items belong. You can
define these classes using your own terminology. For example you might define classes High,
Medium, Low, and later assign your items of highest rank to high, those of lower rank to
Medium, and those of the lowest rank to low. You must assign an ABC class to at least one
ABC group.
You can use ABC classes to group items for a cycle count where you count “A” items more
frequently than “B” items. When you use ABC classes in this way, you perform an ABC
analysis and assign items to classes based on analysis results.

ABC Item Assignments
When you define ABC assignments you specify the cutoff point for each ABC class. Each
ABC class must have at least one item assigned to it and all items in the ABC compile must be
assigned to an ABC class. You can use any of the following fields to determine the cutoff
points:
• Seq: You can enter the sequence number from the ABC Descending Value Report for the
last item to be included in each ABC class. Oracle Inventory automatically calculates this
value if you choose to assign classes by another method. Oracle Inventory displays the last
sequence number as the default of the last class.
• Inventory Value: You can enter the cumulative value from the ABC Descending Value
Report for the last item to include in each ABC class. Oracle Inventory automatically
calculates the maximum value. This maximum value is restricted to the total inventory
value compiled and is displayed in the Total Compile Value field. Oracle Inventory
displays the total inventory value as the default for the last class.
ABC Item Assignments Note
% Items: You can enter the percent of number of items compiled from the ABC Descending
Value Report to include in each class. Oracle Inventory automatically calculates this value if
you choose to assign classes by another method.

% Value: You can enter the percent of total compile value from the ABC Descending Value
Report to include in each class. Oracle Inventory automatically calculates this value if you
choose to assign classes by another method.
It is possible to have several items in the ABC compile with zero value. If any item with zero
value is in a class other than the last class, you may only assign items using the sequence
number or item percent.
For the Inventory Value, % Item, and % Value fields, if the value entered does not exactly
match any item, Oracle Inventory chooses the first item with a value greater than the value
entered. For example, if you choose 20% to be A items, inventory calculates which items
comprise 20% and will include the next item if a partial is in the calculation. If 20% = the first
10 items in your compile, plus part of the 11th item, then items 1-11 are A items.
If you are not satisfied with the class into which an item falls as a result of the automatic ABC
assignment process, you can change it. For example, you compile your ABC analysis based on
historical usage value. A new item in your inventory is ranked low because it has little
transaction history. However, you know that for the future this item should really be ranked
higher. Use the Update ABC Assignments form to reclassify this item.
Whenever you recompile an ABC analysis or change the method by which you assign your
ABC classifications, you lose any changes you might have made to your item assignments. All
items are reclassified based on their new ranks in the ABC Descending Value Report and the
method you choose to determine cutoff points.

Guided Demonstration Overview: Compiling an ABC Analysis

Guided Demonstration - ABC Analysis
Creating an ABC Compile
1. (N) ABC Codes > ABC Compiles.
2. Choose New.
3. Enter Finished Goods as the compile name.
4. Enter Finished Goods Analysis as the description.
5. Choose subinventory as the content scope.
6. Choose subinventory as the valuation scope.
7. Select the FGI subinventory.
8. Select Current on hand quantity as the compile criterion.
9. Choose Compile.
Note: Note the concurrent request number.
10. Choose Yes to print the compile results.
Note: Note the concurrent request number.
11. Choose Close Form
Creating ABC Classes
12. (N) ABC Codes > ABC Classes.
13. (M) File > New.
14. Create three ABC Classes using the following information.

− Class Name: Finished Goods A
− Description: Finished Goods Class A
− Class Name: Finished Goods B

− Description: Finished Goods Class B
−
− Class Name: Finished Goods C
− Description: Finished Goods Class C

ABC Assignment Groups
17. (N) ABC Codes > ABC Assignment Groups.
18. (M) File > New.
19. Enter Finished Goods ABC as the Group Name.
20. Enter Finished Goods as the compile name.
21. Choose Group Classes.
22. Choose the following ABC Classes.

− Finished Goods A
− Finished Goods B
− Finished Goods C
24. Choose Assign Items.
25. Enter the following percentage values.

− A items: 50%
− B items 80%
− C items populates automatically
26. (M) File > Save and Proceed.
Note: Note the Concurrent request number.

Practice Overview: Compiling an ABC Analysis

Practice - Compiling an ABC Analysis
Overview
In this practice you will compile an ABC analysis.
Assumptions
Tasks
Receive Items
Receive 20 items of your choice in to your ##FGI subinventory. You can use part numbers from
other teams as well as system items that begin with AS, CM, or SB. Be sure to receive different
quantities of each item ranging from 5-100.
Note: Receive at least one system item. These items are associated with standard costs.
Compile an ABC analysis
1. Compile an ABC Analysis using the following information:

− Name: ##FGI ABC
− Description: ABC Complie for Team ##FGI
− Content and Valuation Scope: Subinventory
− Criterion: Current on hand quantity
− Cost Type: Frozen
Define ABC Classes
2. Define three ABC Classes using the following naming convention:

− Name: ##Class A
− Description: A items
− Name: ##Class B
− Description: B items
− Name: ##Class C
− Description: C items

Define an ABC Group
3. Define an ABC group using the following information

− Group Name: ##ABC Group
− Compile Name: ##FGI-ABC
Define an ABC Sequence
4. Define an ABC Sequence using the following information:
• Class Name
− ##Class A
− ##Class B
− ##Class C
Assign Item Valuation
5. Assign item valuation as follows:

− ##Class A: 50
− ##Class B: 80
− ##Class C: (system calculates)
Update ABC Codes
6. Change one item from a C item to an A item, and change one item from a C item to a B
item.

Solution – Compiling an ABC Analysis
Compile an ABC Analysis
1. Navigate to the ABC Compile window.
• (N) ABC Codes > ABC Compiles
• (M) File > New
2. Compile an ABC Analysis using the following information:

− Name: ##FGI-ABC
− Description: ABC Complie for Team ##FGI
− Content and Valuation Scope: Subinventory
− Criterion: Current on hand quantity
− Cost Type: Frozen
• Select Compile, and note your report request number. ___________________
• Select Yes to print results, and note your request number. _________________

Define ABC Classes
3. Navigate to the ABC Classes window.
• (N) ABC Codes > ABC Classes
• (M) File > New
4. Define three ABC Classes using the following naming conventions:

− Name: ##Class A
− Description: A items
− Name: ##Class B
− Description: B items
− Name: ##Class C
− Description: C items
Define an ABC Group
6. Navigate to the ABC Assignment Groups window.
• (N) ABC Codes > ABC Assignment Groups.


• (M) File > New.
7. Define an ABC group using the following information:

− Group Name: ##ABC Group
− Compile Name: ##FGI-ABC
Note: Make sure that ##ABC Group (the group that you created) is selected.
• Select Group Classes
Define an ABC Sequence
8. Define an ABC Sequence using the classes you created earlier.
• Class Name
− ##Class A
− ##Class B
− ##Class C

9. Save your work.
• (M) File > Save
Assign Item Valuation
10. Select Assign Items.
11. Enter the following percentages in the % Items field:

− ##Class A: 50
− ##Class B: 80
− ##Class C: (system calculates)

12. Select Assign.
Update ABC Codes
13. Review and update the ABC codes assigned to items in the ##FGI subinventory.
• Select ##ABC Group in the ABC Assignment Groups window.
• Select Update Items.

• Change one item from ##Class C to ##Class A.
• Change one item from ##Class B to ##Class C.

Agenda

Defining and Maintaining a Cycle Count

Agenda

Cycle Count Approval Tolerance
Cycle Count Approval Tolerance

A cycle count is a count of a subset of items, counted during the working day rather than after
freezing stock levels. When the actual count and the system’s on-hand quantity do not exactly
agree, the cycle count will be compared to an approval tolerance.

Approval Tolerances
Approval Tolerances
Oracle Inventory supports two types of cycle count approval tolerances, Quantity Variance
Tolerance and Adjustment Value Tolerance. For each type, you can specify a positive and a
negative limit which can differ from each other. When a particular cycle count entry results in
an adjustment that exceeds any one of these limits, you have a cycle count adjustment that
exceeds approval tolerances. Based on the approval option you choose when you define your
cycle count, this adjustment is either posted automatically or held for approval.
Quantity Variance Tolerance:
The Quantity Variance Tolerance is a user-defined limit for the difference between the actual
cycle count quantity and the system tracked on-hand quantity. You express positive and
negative quantity variance tolerances as percentages of the system on-hand quantity.
You enter these percentages when you define your:
• Cycle Count Header
• Cycle Count Classes
• Cycle Count Items

Oracle Inventory uses any percentages you define at the cycle count item level first. If you do
not have any defined for an item, it uses the tolerances defined for that item’s cycle count class.
If you do not have any defined for the class, it uses the tolerances at the cycle count header
level. If you have no tolerances defined for the header, Oracle Inventory assumes that there is
no limit to the approval tolerance.
Adjustment Value Tolerance:
The Adjustment Value Tolerance is a user-defined limit for the total value of a cycle count
adjustment.
• The adjustment value is calculated as:
adjusted value = (system on-hand qty – actual count qty) * current item cost
The Adjustment Value Tolerance is expressed as positive and negative amounts in your
functional currency. An adjustment value is out of tolerance if it falls outside of these amounts.
You enter these tolerances when you define your cycle count header and cycle count classes.
Oracle Inventory uses the values you define at the cycle count class level first. If you do not
have any defined for an item’s class, it uses the values at the cycle count header level. If you
have no tolerances defined for the header, Oracle Inventory assumes that there is no limit to the
approval tolerance.

Hit/Miss Tolerance
Hit/Miss Tolerance
The Hit/Miss Tolerance is a user-defined limit for the difference between the system tracked
on-hand quantity and the actual cycle count quantity. You express positive and negative
hit/miss tolerances as percentages of the system on-hand quantity. A count is considered a
“hit” if it is within these tolerances, and a “miss” if it is outside them.
The Hit/Miss Tolerance allows you to evaluate the actual accuracy of your inventory.
You enter Hit/Miss tolerance percentages when you define your cycle count header and when
you define your cycle count classes. Oracle Inventory uses the percentages you define at the
cycle count class level first. If you do not have any defined for an item’s class, it uses the
tolerances at the cycle count header level. If you have no tolerances defined for the header,
Oracle Inventory assumes that there is no limit to the Hit/Miss tolerance, and all variances are
therefore “hits” regardless of the size.
Inventory uses these tolerances to generate the Cycle Count Hit/Miss Analysis report which
will be covered later in this course.

Measurement Errors
Measurement Errors:
Negative and positive measurement errors are user-defined limits for the difference between
the cycle count quantity and the system tracked on-hand quantity. Measurement Error limits
are assigned by Item. Inventory does not make any adjustments to an item whose cycle count
quantity differs from the system tracked on-hand quantity by less than the measurement error.
Because of this, measurement errors may implicitly override any approval tolerances you
specify.
You specify measurement errors when you define or update an item at the Master Item or
Organizational Item level. Use measurement errors with extreme caution since they actually
prevent cycle count adjustments from taking place. You would typically use this feature on an
exception basis for items you cannot accurately count. For example, if you visually check the
level of bolts in a bin to estimate the quantity, or you use their weight to approximate the
quantity, you might want to allow for measurement errors. Therefore, if your system tracked
on-hand quantity for the bolts in that bin is within an acceptable range, you do not perform a
cycle count adjustment.

Cycle Count Items
Cycle Count Items

You must load items into your cycle count before you can schedule or count them. There are
two methods you can use to do this:
• Specify an existing ABC group from which to automatically load your items
• Manually enter, delete, or update the items you want included/excluded
When you specify an existing ABC group, Oracle Inventory automatically includes all items in
the ABC group you choose in your cycle count. Inventory also copies the ABC classes for that
ABC group into the current cycle count classes and maintains the same classifications for the
included items. You can change the classifications of your items for your cycle count
independent of the ABC classes.
Once you have generated your list of items to count from an ABC group, you can periodically
refresh the item list with new or reclassified items from a regenerated ABC group. Using the
Cycle Counts window, you can choose whether to automatically update class information for
existing items in the cycle count based on the new ABC assignments. You can also choose to
have any items that are no longer in the ABC group automatically deleted from the cycle count
list.

You manually enter, delete, or update the items you want included/excluded using the Cycle
Count Items window. You may want to use this window to load all your items for a cycle count
or to simply add items as they are defined in the system rather than recompiling your ABC
group and doing a complete reinitialization.

Agenda

Automatic Scheduling
Automatic Scheduling
In order for Oracle Inventory to perform automatic scheduling you must do the following:
• Set the Cycle Count Enabled item attribute to Yes for the items you want to include in the
cycle count.
• Enable automatic scheduling when you define your cycle count.
• Request the schedule using the Generate Automatic Schedule Requests window.
- Each time the auto scheduler runs, it schedules counts only for the schedule interval
you defined for the cycle count header. So if your schedule interval is weeks, Oracle
Inventory schedules all items that you need to be counted on all of the workdays in the
current week. If your schedule interval is days, then Oracle Inventory only schedules
those items that are due for counting on the current date.

Manual Scheduling
Manual Scheduling
You can request counts for specific subinventories, locators, and items, and set the count for
any inventory date. For example, you could enter a request to count item A wherever it can be
found in subinventory X. Or you could request to count all item quantities in subinventory Y,
locator B-100.
Since manually scheduled counts have no impact on automatically scheduled counts, you can
potentially count some items more frequently than you had initially planned.
Physical Location Scheduling
You can use this feature to execute location-based cycle counting. You first need to generate a
schedule for counting each subinventory and locator. You then need to enter the schedule
requests for each locator, specifying the schedule date.

Count Requests
Count Requests
This process takes the output of the automatic scheduler and your manual schedule entries and
generates a count request for each item number, revision, lot number, subinventory and locator
combination for which on-hand quantities exist. These count requests are ordered first by
subinventory and locator, then by item, revision, and lot. Oracle Inventory assigns a unique
sequence number to each count request that can be used for reporting, querying and rapid count
entry.
As the count requests are derived from the state of on-hand balances at the time the Generate
Cycle count Requests process is run, you should wait to run it until you are ready to count.
Note: When you schedule an item to be counted using manual scheduling, some schedule
requests may have overlapping count requirements. The count request generator does not
create duplicate count requests, but instead cross-references one count request back to each
associated schedule request.
Count Requests for Items with Zero Count
By default Oracle Inventory does not automatically generate requests to count items with an
on-hand quantity of zero. To include such items:

• Define all sourcing details and inventory controls for the item. For example, if an item is
under predefined locator control be sure it is assigned to a subinventory and locator.
• Select the Generate Zero Counts option when you define your cycle count.
The count request generation process automatically creates a count request. If a quantity is
found and counted, an adjustment is made.
At count entry, you may receive a warning message stating “Zero count, no adjustment
performed.” Oracle Inventory generates this warning if it cannot find all levels of inventory
control defined for the item. In this situation, enter the count but no adjustment is performed.
To make an adjustment and update the missing information, enter an unscheduled count using
either the Cycle Count Entries or Approve Adjustments window.

Entering Cycle Counts
Entering Cycle Counts

You can use the same window to enter counts of items requested through automatic or manual
cycle count scheduling.You can also enter unscheduled count entries, if they are allowed for
your cycle counts. You can use unscheduled counts to perform location based cycle counts.
You can also use a mobile device to enter cycle count quantities.
Oracle Inventory automatically queries all count requests for which you have not yet entered a
count. You can use flexible search criteria to specify the group of count requests for which you
want counts entered to speed up the count entry process. For example, you can specify a range
of count request sequences assigned to one person so they can be entered in the same order
they were printed on the count sheet.

Cycle Count Open Interface
Cycle Count Open Interface

You can import/export cycle count entries from external systems into Oracle Inventory using
the Cycle Count Entries Open Interface.
Export Cycle Count Request
This process enables you to export cycle count requests into external systems.
Update Cycle Count Open Interface
This process enables you to update cycle count entries.
Import Cycle Count Entries from Open Interface
This process enables you to import cycle count entries open interface records into the database.
Purge Cycle Count Entries Open Interface Data
This process enables you to purge all cycle count entries from the open interface.
Print Cycle Count Entries Open Interface Data
This process enables you to print cycle count entries open interface data.

Agenda

Count Adjustments and Approvals
Count Adjustments and Approvals

Once you enter and save your cycle counts, Oracle Inventory determines whether any
adjustments need to be made depending on the approval options and tolerances you set when
you define the cycle count.

Automatic Recounts
Automatic Recounts
If you turn on the Automatic Recount option when you define your cycle count, Oracle
Inventory automatically submits recount requests for items that are outside the limits of the
approval tolerances you specify. Oracle Inventory submits recounts as many times as
necessary, limited by the maximum automatic recounts you specify for the cycle count. After
you reach the maximum number of recounts, Oracle Inventory holds the count for approval.
Any count request with the Recount status automatically appears on the next cycle count
listing. You can manually request recounts when you are approving adjustments. This recount
request will be included in the next cycle count listing.

Approving Cycle Counts and Adjustments
Approving Cycle Counts Held for Approval

Employees with access to the Count Adjustment Approvals Summary window can query,
request the recount of, or approve cycle counts pending approval. You can query all counts or
only those pending approval. You can approve adjustments, recount an item in question, reject
the count or take no action until further investigation takes place.
Approving Cycle Count Adjustments
You use the Count Adjustment Approvals Summary window to approve cycle count
adjustments, to request/approve recounts, or to reject the adjustment. Oracle Inventory
determines which counts need approval by using the approval tolerances you entered while
defining your cycle count. You can use flexible search criteria to specify the cycle count
adjustments you want to review or approve.
Using the Count Adjustment Approvals Summary window, you can view a variety of current
item information to help determine whether to approve an adjustment. Select the information
from the following tabbed regions:
• Adjustment: View information for the count adjustment UOM, variance quantity, variance
value, variance percentage, and system quantity.

• Item Location: View information for subinventory and locator. You can also view the unit
of measure and adjustment quantity.
• Item Details: View information for a revision, lot number, and serial number. You can also
view the unit of measure and adjustment quantity.
• Reason, Reference: View or update the transaction reason and reference information. You
can also view the unit of measure and adjustment quantity.
• Count: View information for UOM, count quantity, counter, and count date.
• Count Status, Class: View information for the sequence number, count status, and cycle
count class.
• Approval: View information for date approved and approver.
Approval Actions and Adjustments Options
For items appearing in the Approval Actions, Adjustments region, you can approve, request a
recount, or reject cycle count entries that are pending approval. You can also approve or reject
any count for which a recount has already been requested. You can reject any cycle count
request that has not yet been counted. You can display count history information or open the
Count Adjustment Approvals window.
• Select Approved to approve the selected count entry and post the adjustment to the
transaction manager for processing.
• Select Rejected to reject the selected count record. An adjustment is not posted. No further
processing of this count entry takes place.
• Select Recount to process a recount request for the selected count request. An adjustment is
not posted.
• Select the Count History button to open the Count History window for the current item. For
the current item, this window displays count and variance information for the current, prior
and first counts.
• Select the Open button to open the Count Adjustment Approvals window for the current
line. This window is a combination block which you can use to view and enter approval
and adjustment information for the current line instead of using the Count Adjustment
Approvals Summary window.

Guided Demonstration Overview: Performing Cycle Counts

Guided Demonstration - Cycle Counting
1. (N) Counting > Cycle Counting > Cycle Counts.
2. Choose New.
3. Enter the following cycle count information.

− Name: FGI Cycle Count
− Description: Finished Goods Cycle Count
− Adjustment Account: Miscellaneous
− Late Days: 1
− Starting Sequence: 0
− Unscheduled Entries: Yes
− Display System Qty: Yes
4. Select Specific in the Count Subinventories alternative region.
5. Select the FGI subinventory from the drop down list.
6. (T) Serial and Schedule
7. Enter the following Serial and Schedule information:

− Auto Schedule: Yes
− Frequency: By period
8. (T) Adjustments and ABC
9. Enter the following approval tolerances:

− Qty Variance: 3
− Adjustment Value: 50
− Hit / Miss Analysis: 10
10. Enter the following ABC Information:

− Group: Group created during ABC analysis (Finished Goods ABC)
− Option: (Re)initialize
11. Choose Classes.
12. Enter the following ABC Class information:

− Class: Class A class created during ABC analysis (Finished Goods A)
− Count: 150
− Class: Class B class created during ABC analysis (Finished Goods B)
− Count: 100
− Class: Class C class created during ABC analysis (Finished Goods C)

− Count: 50
13. (M) File Save.
14. (M) Tools > Perform Full Cycle Count
15. Enter the cycle count name for the following parameters
− Generate automatic schedule recount
− Generate cycle count request
− Cycle count listing.
16. Choose Submit.
Entering Cycle Count Entries Using a Mobile Device
18. Select Inventory.
19. Select Counting
20. Select Cycle Count
21. Select Normal
22. Enter the following cycle count information:

− Org Code: M1
− Cycle count name: FGI Cycle Count
− Item: AS18947
− Quantity: Enter a number plus or minus the system quantity.
23. Select Done.
Cycle Count Entries and Approvals
24. (N) Counting > Cycle Counting > Cycle Count Entries
25. Enter FGI Cycle Count in the Cycle Count field.
26. Choose find.
27. At the question: “Find all open count requests?” choose Yes to view all open cycle count
items.
Note: Notice the item amount entered during the mobile counting demonstration does not
appear.
28. Choose Adjustments.

29. Enter the count quantities.
32. (N) Counting > Cycle Counting > Approve Counts
33. Enter FGI Cycle Count in the Cycle Count field.
34. Choose Find.
35. At the question: “Query count pending approval only?” choose No to view all cycle count
items.
Note: Notice the item quantity entered in the mobile counting demonstration appears in the
Count tabbed region.
36. Choose Approved to approve an item adjustment.
37. Select the Approver from the drop down list in the Approval tabbed region.
38. (M) File Save.
39. Choose OK.
40. Close the Approvals window.
41. Approve or reject the remaining items.

Practice Overview: Performing Cycle Counts

Practice - Performing a Cycle Count
Overview
In this practice you will perform a cycle count using the ABC compile group you created in a
previous lab.
Assumptions
• You completed the Compile an ABC Analysis practice.
• You completed the Define Items practice.
• You have at least 20 items in your ##FGI subinventory
Tasks
Define a Cycle Count Header
Define a cycle count header using the following information:

− Name: ##Cycle Count
− Description Team ##Cycle Count
− Late Days: 1
− Starting Sequence: ##
− Unscheduled entries Yes
− Display System qty: Yes
− Count Subinventories: Specific
− Frequency: By Period
− Approval Required: If out of Tolerance
− QTY 3%
− Adjust Value: 50
− Hit/Miss: 10%
− Group: ##ABC Group
− Class A: 150 counts per year

− Class B: 100 counts per year
− Class C: 50 counts per year
Perform a Cycle Count
Use the following parameters to perform a cycle count:

− Name: Generate Automatic Schedule
− Cycle Name: ##Cycle Count
− Name: Generate CycleCount Requests

− Name: Cycle Count Listing

Enter Cycle Count Entries
View the system quantities and enter quantities for the cycle count. Have some of the items out
of tolerance, and have at least one item match the system quantity.
Approve, Reject or Recount Cycle Count
Why are some of the items already approved? ________________________________________
Approve, Reject or recount all entries for your cycle count.

Solution – Performing a Cycle Count
Define a Cycle Count Header
1. Navigate to the Cycle Counts Window.
• (N) Counting > Cycle Counting > Cycle Counts
2. Select New.
3. Enter a new cycle count header using the following information:
• (T) Scope and Control

− Name: ##Cycle Count
− Description Team ##Cycle Count
− Late Days: 1
− Starting Sequence: ##
− Unscheduled entries Yes
− Display System qty: Yes
− Count Subinventories: Specific

• (T) Serial and Schedule
− Count: Not Allowed
− Frequency: By Period
• (T) Adjustments and ABC

− Approval Required: If out of Tolerance
− QTY 3%
− Adjust Value: 50
− Hit/Miss: 10%
− Group: ##ABC Group

• Select Classes
− ##Class A: 150 counts per year
− ##Class B: 100 counts per year
− ##Class C: 50 counts per year

4. (M) File > Save
Perform A Cycle Count
5. (M) Tools > Perform Full Cycle Count

6. Enter the following parameters
− Generate automatic schedule (Parameters field): ##Cycle Count
− Generate cycle count requests (Parameters field): ##Cycle Count

− Cycle Count Listing (Parameters field): ##Cycle Count
7. Select Submit
Note: Do not proceed until after your concurrent request completes.
Enter Cycle Count Entries
8. Navigate to the Cycle Count Entries window.
• (N) Counting > Cycle Counting > Cycle Count Entries
9. Enter ##Cycle Count in the Cycle Count name field, or select your cycle count from the list
of values.
10. Select Find to populate your items.

11. Choose Yes to see all open count requests.
12. (T) Adjustments
13. Enter Count quantities for your items. Enter a few quantities that are out of tolerance, a few
quantities within tolerance, and at least one that matches the system quantity.

• (M) File > Save
Approve, Reject or Recount Cycle Count
15. Navigate to the cycle count approvals window.
• (N) Counting > Cycle Counting > Approve Counts
16. Select your cycle count from the LOVs in the Cycle Count field.
17. Select Find to open your cycle count items.
18. Select No to view all items.

19. Why are some of the items already approved? They fall within set approval limits.
20. Approve, reject or recount your items.
• (M) File > Save

Practice Overview: Mobile Counting

Practice - Mobile Counting
Overview
Use the mobile device to perform a cycle count for your ##FGI subinventory.
Assumptions
• You have completed the ABC Analysis Lab.
• You have completed part one of the Cycle Counting lab.
Tasks
Entering Item Quantities Using the Mobile.
Enter cycle count quantities for an item.

Solution – Mobile Counting
Entering Item Quantities Using the Mobile

instance number.

4. If more than one responsibility had been assigned to your user name, select Materials & Mfg
from the list.

6. Select Counting from the Inventory Menu.
7. Select Cycle Count from the Counting Menu.

8. Select Normal from the Cycle Count menu.
9. Enter the following information when prompted.
Note: The mobile application screen is case sensitive.

− Org Code: M1
− Cycle Count Name: ##Cycle Count
− Sub: ##FGI
− Item: Enter an item in your ##FGI subinventory
− Qty: Enter a quantity

10. Select Done to apply your cycle count.
11. Select Logout to exit the Mobile.

Agenda

Summary


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11i Inventory Management

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Tyra Crockett, Yuvaraj Kandhaswamy

Technical Contributors and Reviewers

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• Working experience with Oracle Applications.

• There are no prerequisites for this course.

How This Course Is Organized

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Passwords DROP USER scott

Lowercase Syntax variables CREATE ROLE role

Typographic Conventions in Oracle Application Navigation Paths

This simplified path translates to the following:

2. (M) From the menu, select Query then Find.

3. (B) Click the Approve button.

(ST) = Sub Tab

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11i Inventory Management Fundamentals Table of Contents

The following help navigation path, for example—

(Help) General Ledger > Journals > Enter Journals

—represents the following sequence of actions:

2. Under the General Ledger entry, expand Journals.

3. Under Journals, select Enter Journals.

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