Min Max Planning

PURPOSE

This document is meant to assist in the successful completion of the Min-Max

Planning Report 

SCOPE & APPLICATION

The intended use of this document is for the casual user beginning to use

the Min-Max Planning feature of Oracle Inventory.

MIN MAX PLANNING & REPORT

Min-Max planning is a type of order point replenishment system where the

minimum is the order point, and the maximum is the "order up to" inventory

level. The order quantity is variable and is the result of maximum minus

available and on-order inventory. An order is recommended when the sum

of the available and the on-order inventory is at or below the minimum.

Oracle Inventory enables you to perform min-max planning at two levels:

A. Organization

B. Subinventory

To perform organization-level min-max planning for an item, you must specify

organization-level minimum and maximum quantities. To perform subinventory-level

min-max planning for an item, you must specify subinventory-level min and max

quantities.

Requisitions may be generated to request stock for items for which the on-hand

quantity plus the on-order quantity is less than the min-max minimum amount.

Requisition can be stocked from another internal organization or from an outside

supplier, based on item sourcing rules you define at the item-subinventory,

subinventory, item or organization level.

You can define a default item source at the organization, subinventory, or item

levels. Oracle Inventory uses the information from the lowest level to determine the

source from which to requisition the item. The ascending hierarchy is 1) Item

in a subinventory, 2) Source in a subinventory, 3) Item in an organization,

and 4) Source in an organization.

TIMING OF ORDERS

Order when the following is true:

(on-hand quantity - demand) + (quantity on-order) < minimum quantity

QUANTITY ON ORDER

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 received in you organization.

QUANTITY OF ORDERS

Order quantity = (Maximum Qty) - [(on-hand quantity) + (quantity on order)]

PROFILE OPTION

Navigate as System Administrator: Profile`System place cursor in the Profile field

and type in 'INV:MIN%'.

You can specify a system-level min-max reorder approval status.  INV:MIN-MAX REORDER

APPROVAL. This option allows you to create requisitions as either approved or unapproved

when you run the Min-Max report.

ORGANIZATION LEVEL PLANNING.

When you min-max plan at the organization level you can optionally include open sales orders

and work in process component requirements as demand in the min-max planning calculation.

Inventory balances, purchase orders and WIP jobs are considered sources of supply.

Purchase requisitions for buy items and WIP unreleased jobs for make items for the

replenishment quantities can be optionally created. These in turn become purchase orders or

internal orders and the unreleased jobs become jobs for the required items.

Set Up.

Min-max planning begins by properly setting the min-max item attributes.

Navigation: Items-->Master Items or Organization Items.

Choose the Inventory Attribute Group.

     Inventory Item: This attribute must be checked for items which are stockable

     and transactable and for min-max planned items which are built in Work In Process.

     Stockable:  Check this box if you are checking the Inventory Item attribute.

     The Transactable attribute will also be check as this attribute is dependent

     upon the Stockable attribute.

Choose the Costing Attribute Group.

     Costing enabled: This attribute allows item cost reporting and tracking of the

     value for this item.

     Inventory Asset Value: This attribute indicates if this item is maintained as an asset

     in inventory. (Turning this option off indicates an expense item.)

Choose the Purchasing Attribute Group.

     Purchased: Indicates whether to purchase and receive an item. This option will allow

     Purchase Requisitions to be generated for items sourced from Suppliers.

     Purchasable: Indicated whether an item can be placed on a purchase order. This

     attribute can only be set when the Purchased attribute is on.

Choose the General Planning Attribute Group.

     Inventory Planning Method: Set to Min-Max

     Min-Max Minimum Quantity: Enter the user defined quantity minimum for min-max planning.

     When min-max planning is used the Min-Max Planning Report will suggest a new order when

     quantity drops to this minimum.

     Min-Max Maximum Quantity: Enter the user defined quantity maximum for min-max planning.

     When min-max planning is used the Min-Max Planning Report will suggest a new order that 

     brings on-hand quantity up to this maximum.

     Minimum Order Quantity (Optional): Enter the minimum order quantity or repetitive rate.

     This defines an order quantity below which it is unprofitable to build or buy the item.

     Maximum Order Quantity (Optional): Enter the maximum order quantity or repetitive rate.

     This defines an order quantity above which there is insufficient capacity to build or store

     the item.

     Source Type :

     A. Inventory - Fills requisition requests by creating internal requisitions that become

     internal sales orders, to pull stock from existing inventory.

     B. Supplier - Fills requisition requests by creating purchase requisitions that become

     purchase orders, procuring the item from a supplier.

     Source Organization: This attribute is controlled at the Organization Level Only. Enter

     the organization from which an internal requisition draws the item. This applies only when

     Inventory is the Source Type.

     Source Subinventory: This attribute is controlled at the Organization Level Only. Enter

     the subinventory within the source organization from which an internal requisition draws

     the item. This applies only when Inventory is the Source Type and only when there is a

     Source Organization entered.

     Make or Buy: Select the option that applies to items with Inventory Item set to "yes". 

     The Purchasable attribute must be set to "yes" to create purchase requisitions and purchase orders. 

     Fixed Lot Multiplier (Optional): Enter the fixed lot multiple quantity or repetitive rate to

     further control order quantity.

Note:   Safety Stock Method : MUST be set to "Non-MRP Planned".

Choose Work in Process Attribute Group.

     Build in WIP: Check this attribute if it is a "Make" item as well as an Inventory Item, and to

     have Min-Max generate unreleased jobs. Repetitive plans cannot be generated for repetitive items;

     you have the option of generating requisitions, unplanned jobs or a report only at the Organization

     level.

SUBINVENTORY LEVEL MIN-MAX PLANNING

Oracle Inventory takes into consideration inventory balances, purchase orders, internal order supply and

optionally, sales order demand for a single subinventory only. Rather than using item attributes for planning,

Oracle Inventory used values and parameters set at the item/subinventory level. The following values can be

established using either the Define Subinventory/Item Information form or the Define Item/Subinventory

Information form:

Planning Region

     Min-Max Minimum Quantity

     Min-Max Maximum Quantity

     Planning Method set to Min-Max Planning

Order Modifier Region

     Fixed Lot Multiple (Optional)

     Maximum Order Quantity (Optional)

     Minimum Order Quantity (Optional)

Sourcing Region

     Item Sourcing Details :

     Sourcing type (Vendor or Inventory)

     Sourcing Organization (if type is Inventory)

     Sourcing Subinventory (if type is Inventory - optional)

Setup-->Organizations-->Subinventories. Query a Subinventory and then click on Item/Subinventory button on

the bottom of the form.

Alternative way to access this: Items--> Master (Organization) Items then either query an item or define a

new item and click on "Special" Item/Subinventories.

MIN-MAX PLANNING REPORT CALCULATIONS.

In addition to the planning level option (organization or subinventory), Oracle Inventory offers the option to Net

Demand when calculating availability. You also specify a Demand Cutoff Date and a Supply Cutoff Date.

Net Demand = "Yes" to any of the Net Demand Report Options

Nettable Quantity On-hand is either the sum of the quantities on hand for the item across all nettable Subinventories

within the organization or the nettable quantity in the subinventory specified (depending on the planning level).

Non-nettable quantities may be optionally included.

7 Total Available = Nettable Quantity On-Hand + On-order  -  Open Demand where:

Nettable Quantity On-hand is the sum of the quantities on hand for the item across all nettable Subinventories within

the organization or the nettable quantity in the subinventory specified (depending on the planning level).

Non-nettable quantities may be optionally included.

On Order is the sum of open purchase orders, requisitions, internal orders, work in process jobs  and shipments scheduled

for receipt prior to or on the Supply Cutoff date. If using the Subinventory planning level, orders referencing other

subinventories, or with no subinventory referenced, are not included.

Open Demand is the sum of open sales orders, reserved or unreserved, scheduled to ship prior to or on the Demand Cutoff Date

and WIP component demand scheduled for issue on or before the Demand Cutoff Date. If using the subinventory planning level,

sales order demand referencing other subinventories, or with no subinventory referenced, are not included.

7 If Total Available < Minimum Quantity then Min-Max Planning Report will suggest a new order where:

Minimum Quantity is the value for the Min-Max Minimum Quantity item attribute. Or, at the Subinventory planning level minimum

quantity is the value for the Min-Max Quantity set at the item/subinventory level.

7 Order Quantity = Maximum Quantity - Total Available, adjusted for order quantity modifiers:

Oracle Inventory revises the order quantity if necessary for the quantity to be a multiple of the fixed lot size multiplier.

The order quantity must be greater than or equal to the minimum quantity, or the

quantity will be revised upward to the minimum.

The order quantity must be less than or equal to the maximum quantity or the quantity will be revised downward to the maximum.

Net Demand = "No" to the Net Demand Report Options:

7 Total Available = Nettable Quantity On-Hand + On-Order (note that Open Demand is not considered here) where:

Nettable Quantity On-hand is the sum of the quantities on hand for the item across

all nettable Subinventories within the organization

or the nettable quantity in the subinventory specified (depending on the planning

level). Non-nettable quantities may be optionally included.

On Order is the sum of open purchase orders, requisitions, internal orders, work

in process jobs  and shipments scheduled for receipt prior

to or on the Supply Cutoff date. If using the Subinventory planning level, orders

referencing other subinventories, or with no subinventory

referenced, are not included.

7 If Total Available < Minimum Quantity then Min-Max Planning Report will suggest a new order where:

Minimum Quantity is the value for the Min-Max Minimum Quantity item attribute. Or,

at the Subinventory planning level minimum quantity is

the value for the Min-Max Quantity set at the item/subinventory level.

7 Order Quantity = Maximum Quantity - Total Available, adjusted for order quantity modifiers:

Oracle Inventory revises the order quantity if necessary for the quantity to be a multiple of the fixed lot size multiplier.

The order quantity must be greater than or equal to the minimum quantity, or the

quantity will be revised upward to the minimum.

The order quantity must be less than or equal to the maximum quantity or the quantity will be revised downward to the maximum.

GENERATING REQUISITIONS

Requisitions can be optionally generated when the Min-Max Report is run. A location

must be specified to serve as the default delivery

location on the requisitions. In addition, the Restock parameter must be set to "Yes".

Oracle Inventory creates purchase requisitions

when the attribute Source Type is set to Supplier, and creates requisitions for Internal

Orders when the attribute Source Type is set to Inventory.

The Source Organization attribute is used to determine the organization from which the internal requisition sources the item.

Once the report is generated, a row can be found for each item generating a requisition

in the PO_REQUISITIONS_INTERFACE table.

At this point Oracle Inventory has completed the Min-Max process once rows are found in this table. 

A requisition or purchase order number is not generated until the Requisition Import process is run from Oracle Purchasing.

Change responsibilities to an Oracle Purchasing responsibility with enough rights

to run the Import Process. Navigate to Reports-->Run,

place cursor in the Name field and choose 'Requisition Import' from the list of values.

In the field Import Source there will be a choice

of INV in the list of values indicating that there are requisitions to be imported

from Inventory. Import these requisitions and

process as any ordinary requisition.

REQUESTING THE MIN-MAX REPORT IN ORACLE INVENTORY

1. Navigate to Reports-->Planning and choose Min-Max Planning from the list of values in the Name field.

2. The parameters window will appear.

3.  Indicate whether the planning level is set for the entire organization or a specific

subinventory. If you select Subinventory,

enter the name of the subinventory. At the Subinventory level, the report cannot

generate jobs and does not consider Work in Process

jobs as supply or Work in Process components as demand.

4. Indicate the type of item to include on the report. The choices are Items Under Minimum Quantity, Items Over Maximum

Quantity, or All Min-Max Planned Items.

5. Enter the sort criteria for the report. Choices are: Inventory item, Category, Planner or Buyer. If you choose Category,

enter the category set.

6. Enter the demand cutoff date. The report includes demand on or before this date. If you do not check Net Demand this date

is for display purposes only.

7. Enter the demand cutoff date offset to supplement the demand cutoff date by any specified number of days. This is optional

and will default to zero.

8. Enter the supply cutoff date. The calculation includes open supply orders on or before this date.

9. Enter the supply cutoff date offset to supplement the supply cutoff date by any specified number of days. This is optional

and will default to zero.

10. Indicate whether to create requisitions by setting the Restock to "Yes". If the Planning Level is set to Organization,

the report generates requisitions or jobs according to the item's Make/Buy flag. If the Planning Level is set to Subinventory

the report generates only requisitions.

11. For Repetitive Item is used only is conjunction with Organization Planning Level, choose one of the following options:

Create Requisitions, Create Discrete Jobs, Report Only.

12. Enter the Default Delivery location.

13. Indicate whether to net unreserved orders.

14. indicate whether to net reserved orders.

15. Indicate whether to net WIP demand - this cannot be set to "Yes" if Planning Level is set to Subinventory.

16. Indicate whether to include PO supply.

17. Indicate whether to include supply residing in Oracle Inventory interfaces.

18. Indicate whether to include subinventories set to non-nettable.

19. Display Format - choose one of the following:

Display all information.                        Report displays all columns

Don't display supply/demand details.            Does not display Min Order Qty, Max Order Qty or Multiple Order Qty columns.

Don't display order constraints                 Does not display On-Hand qty column.

20.  Indicate whether to display item information.

OTHER

The Oracle Inventory Min-Max Planning Report short name is INVISMMX.rdf. It also has a corresponding INVISMMX.pll file

which is a library of linked programs (ie. do_restock) called when the report is run. It important that the .pll file

be the correct version for the .rdf file being run. For information on the latest versions please contact Oracle Support

Services.

SUMMARY

The Oracle Inventory Min-Max Planning Report is used to show planning information for items at either the Organization or

Subinventory level. You can specify a variety of selection criteria and parameters and the report can also generate

purchase or internal requisitions for Buy items or Work In Process unreleased jobs for Make items.