The document discusses the benefits of a new centralized inventory system in Oracle R12 for companies that do both process and discrete manufacturing. It allows such hybrid manufacturers to operate with a single item master and inventory system. This unified system reduces redundant data and maintenance while improving inventory visibility and supply chain integration. It also enables process manufacturers to engage in available-to-promise checking while respecting quality processes through new inventory status attributes.

1. R12 Readiness Business Case Process Manufacturing Presented by Anil Srinivas Vaddadi ( [email_address] [email_address] anil.lets.do.it@gmail.com)

2. Agenda Benefits Business Case Business Scenario Concept Elaboration 1 2 3 4 Centralized Inventory

3. Concepts Overview Entities in Process Inventory Entities in Discrete Inventory Centralized Oracle Inventory Variable Ingredients, Co-products, Potency, shelf-life Makes “Stuff” UOM are Material Specific grades Components, End Item, ECN’s Makes “THINGS” UOM are Each & Piece Serial Numbers

4. Change in Process Manufacturing One Inventory Module will support both Process and Discrete manufacturing. OPM Inventory Order Management Procurement ASCP OPM Product Dev. Oracle Inventory Discrete Inventory OPM Production OPM Costing OPM Quality WIP & BOM Quality Costing

5. Agenda Setup, Migration and Processes Benefits Business Case Business Scenario Concept Elaboration 1 2 3 4

6. Common Inventory Setups GMI Profiles All GMI profiles are obsolete Replaced by profiles or flags in Oracle Inventory GMI Profile Replaced by Oracle Inventory GMI: Allow Negative Inventory Flag on inventory organization parameters GMI: Retain Shipped Lot Status Flag on inventory organization parameters GMI: RMA Lot Restriction Receiving Option set up in Purchasing Define inventory organizations Migrate existing data Verify and enter Oracle Inventory setup Set key profile options SETUP

7. Common Inventory Setups Inventory Org S.O.B Legal Entity Locator Subinventory O.U. Master Org OPM Warehouse Locator Plant or Lab OPM Organizations OPM Company Define inventory organizations Migrate existing data Verify and enter Oracle Inventory setup Set key profile options SETUP

8. Allows you to convert warehouses to sub-inventories Navigation: OPM System Administration Form: Convergence Migration Setup Common Inventory Setups Define inventory organizations Migrate existing data Verify and enter Oracle Inventory setup Set key profile options SETUP

9. Common Inventory Setups Track and price items in two units of measure Set Process Manufacturing attributes by Organization Define inventory organizations Migrate existing data Verify and enter Oracle Inventory setup Set key profile options SETUP Items Lots Picking Rules Lots specific conversion Material Status Child Lots

10. Common Inventory Setups Establish lot control for an item Define inventory organizations Migrate existing data Verify and enter Oracle Inventory setup Set key profile options SETUP Items Lots Picking Rules Lots specific conversion Material Status Child Lots

11. Common Inventory Setups Child lot designation replaces sub-lots Items Lots Picking Rules Lots specific conversion Material Status Child Lots Define inventory organizations Migrate existing data Verify and enter Oracle Inventory setup Set key profile options SETUP

12. Common Inventory Setups Other flags control use of inventory Status prevents these transactions Items Lots Picking Rules Lots specific conversion Material Status Child Lots Define inventory organizations Migrate existing data Verify and enter Oracle Inventory setup Set key profile options SETUP

13. Common Inventory Setups Additional restrictions for Process Items Lots Picking Rules Lots specific conversion Material Status Child Lots Define inventory organizations Migrate existing data Verify and enter Oracle Inventory setup Set key profile options SETUP

14. Common Inventory Setups Define inventory organizations Migrate existing data Verify and enter Oracle Inventory setup Set key profile options SETUP View history of UOM changes Items Lots Picking Rules Lots specific conversion Material Status Child Lots

15. Process Flow The stock manipulations are done during a sales order, purchase order or batch creation or during a supply chain planning. Below are the processes that have incorporated the changes to reflect the centralized inventory concept. Reserve Reserve inventory for an order or batch Transact Miscellaneous transactions Move Orders Grade and status changes Query Material Workbench Inquiry Lot Genealogy Perform other inventory functions WMS: Manage your warehouse MSCA: Implement mobile applications Automated process Sales orders, Purchase orders Production Batches PROCESS Run Supply Chain Planning Reserve Inventory Transact Inventory Query and manage material Perform other inventory functions Manage warehouse User mobile applications

16. Process Flow Track and price items in two units of measure Automated process Sales orders, Purchase orders Production Batches PROCESS Run Supply Chain Planning Reserve Inventory Transact Inventory Query and manage material Perform other inventory functions Manage warehouse User mobile applications

17. Process Flow Status: Statuses can be changed bases on the transaction types and other attributes. Grades : Specific grades of raw materials are ordered from an approved list of vendors and the lots they receive are usually stable Automated process Sales orders, Purchase orders Production Batches PROCESS Run Supply Chain Planning Reserve Inventory Transact Inventory Query and manage material Perform other inventory functions Manage warehouse User mobile applications

18. Process Flow Automated process Sales orders, Purchase orders Production Batches PROCESS Run Supply Chain Planning Reserve Inventory Transact Inventory Query and manage material Perform other inventory functions Manage warehouse User mobile applications

19. Process Flow Perform other inventory functions Maintain accurate real-time information Physical inventory Cycle counting Manage inventory levels Automated replenishment Kanban management Transfers between facilities Automated process Sales orders, Purchase orders Production Batches PROCESS Run Supply Chain Planning Reserve Inventory Transact Inventory Query and manage material Perform other inventory functions Manage warehouse User mobile applications

20. Process Flow RTVs Orders Transfers RMAs Purchases Transfers Tailorable Rules & Workflow Process Global Visibility RF Support Directed Putaway Inspect Receive Ship Pack Directed Pick Cost Assemble WIP Issues Transfer Count Move Label Seamless Integration Replenish Automated process Manage Warehouse Sales orders, Purchase orders Production Batches PROCESS Run Supply Chain Planning Reserve Inventory Transact Inventory Query and manage material Perform other inventory functions Manage warehouse User mobile applications Planning Manufacturing Fulfillment Purchasing

21. Process Flow Application / Data Base RF Base Station SQL Net Telnet Over TCP/IP RF Device LAN or WAN Built-in RF Middleware Moves, Issues, Returns, Reservations, … Issues, Returns, Backflush, Completions… Misc. Transactions, Transfers, Counts,.. Pick, Confirm, Ship, Confirm, Print, … Direct, Std, Inspect, Cross-Dock, Print,.. Mobile Process Mfg Process Operations Mobile Inventory Mobile Shipping Mobile Receiving Built-in Mobile User Interface Mobile Transaction Server Automated process Sales orders, Purchase orders Production Batches PROCESS Run Supply Chain Planning Reserve Inventory Transact Inventory Query and manage material Perform other inventory functions Manage warehouse User mobile applications

22. Agenda Business case study Benefits Business Case Business Scenario Concept Elaboration 1 2 3 4

23. Business Case scenario Hybrid manufacturers can operate with just one item master and inventory system Scenario: Consider an aluminum manufacturer that needs process industry functionality to cast aluminum. However, once the aluminum is produced it becomes a discrete product. Grind Digest Calcinine Process Inventory Iron, Silicon, titanium (Ingredients) equals Aluminum Machined into variety Of products Process Manufacturing Discrete Manufacturing Pipes, Tubes, Panels, Auto equipment Discrete Inventory

24. Business Case scenario In Release 12 , Discrete and Process attributes are now contained in one item definition, and the inventory system now supports process requirements, on hand balances of inventory can now be managed and viewed centrally. To help support this, the new solution has features like dual units of measure, sub-lot control, hold, and netting logic Grind Digest Calcinine Process Inventory Discrete Inventory Iron, Silicon, titanium (Ingredients) equals Aluminum Machined into variety Of products Pipes, Tubes, Panels, Auto equipment Process Manufacturing Discrete Manufacturing

25. Agenda Benefits Benefits Business Case Business Scenario Concept Elaboration 1 2 3 4

26. Benefits Reduce … Redundant data and maintenance Increase … Inventory visibility Improve … Supply chain integration Process … Process manufacturers now can engage in Available to Promise (ATP) Keeping in mind the quality process, as Inventory in this status is on reserve. The new solution provides for better status attributes surrounding holds, and it prohibits a warehouse location that has been discovered to have erroneous inventory balances (an incorrect net inventory calculation) from being included in the Supply Chain Planning application’s available to promise calculations.

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