Copyright © 2006, Oracle. All rights reserved. Release 12 Field Readiness Workshop Chargeable Subcontracting

Copyright © 2006, Oracle. All rights reserved.

Release 12 Field Readiness Workshop

Chargeable Subcontracting

Copyright © 2006, Oracle. All rights reserved.2

Purpose:This document provides an overview of features and enhancements included in Release 12. It is intended solely to help you assess the business benefits of upgrading to Release 12.

Disclaimer:This document in any form, software or printed matter, contains proprietary information that is the exclusive property of Oracle. Your access to and use of this confidential material is subject to the terms and conditions of your Oracle Software License and Service Agreement, which has been executed and with which you agree to comply. This document and information contained herein may not be disclosed, copied, reproduced or distributed to anyone outside Oracle without prior written consent of Oracle. This document is not part of your license agreement nor can it be incorporated into any contractual agreement with Oracle or its subsidiaries or affiliates. This document is for informational purposes only and is intended solely to assist you in planning for the implementation and upgrade of the product features described. It is not a commitment to deliver any material, code, or functionality, and should not be relied upon in making purchasing decisions. The development, release, and timing of any features or functionality described in this document remains at the sole discretion of Oracle. Due to the nature of the product architecture, it may not be possible to safely include all features described in this document without risking significant destabilization of the code.



Functional Deep Dive


Functional Deep Dive Agenda

• Product Review – Business Needs

• Demonstration

• Implementation Considerations

• Customization and Extensibility Options

• Integration Considerations

• Upgrade Considerations

• Global Considerations

• Lessons Learned

• Wrap Up/Q&A


Review Business Needs – Market Drivers

• What are the new features for this product?– Chargeable Subcontracting Solution with Planning and

execution capabilities has been introduced

• What is the market driver or customer need that caused Oracle to create this functionality?– Chargeable subcontracting is a common business practice in

Japan, and is also being adopted by companies in Korea and Taiwan. This is top Priority requirement in Japan and gives oracle big advantage in the market place.

• What’s in it for the customer – what are the benefits that correlate directly with the customer pain points or market drivers?– Effectively Manage the outsourcing process by eliminating the

difficulties in planning, tracking of the components and also with the simplified financial settlement by AP/AR Netting


Place Order fo

r Outsourced Assembly A

MP added value = $5

RMS: Raw Material Supplier

OEM : Original Equipment Manufacturer

MP: Manufacturing Partner

1 Ea

B

A

C

2 Ea

Ship Components @ B-$4, C

-$6

B C

Place

Order

for

B&C

Pay to MP $5 [$19 – (2*$4 + 1*$6)]OEM

RMSMP

Bu

y @

B -

$2, C

-$3

B C

Buy Ass

embly

A @

$ 1

9 (in

cludin

g $14

)

A

MP doesn’t pay for the Components

Chargeable Subcontracting - Business Process


Chargeable Subcontracting – Summary

Planning IntegrationPlan component supply and demand in both the OEM

and the Manufacturing Partner

Workbench Online visibility of extended supply chain

AllocationsTrack Component allocations to subcontracting orders

and corresponding shipments for effective material control

Consumption AdjustmentsRecord and adjust over/under consumption of

components at the Manufacturing partner

AP/AR Netting Streamline Payments to Manufacturing partners

Change managementSupport Subcontracting order changes for greater

supply chain agility

Feature Business Value


Chargeable subcontracting

Demonstration


Demonstration – Scenario(s)

• Scenario 1: Assembly with Synchronized components– Order execution– Financial Settlement

• Scenario 2: Assembly with pre positioned & synchronized components– Order execution


OEM (Standard Cost Org)

MP (Zero Cost Organization)

Replenishment SO Item : C, QTY:10Ea Customer : MP

Replenishment SO Item : B , QTY:20Ea Customer: MP

Discrete Job Assembly : A QTY :10Ea

Interlock

Receive

Subcontracting Order Assembly : A , 10Ea Supplier : MP

ASCP

AP Invoice AR Invoice

AP/AR NettingPay to MP

$

SHIP

SHIP

Auto receive Components

Receive

Receive

No Manual Transactions in MP Org

Replenishment PO Item : C, QTY:10Ea Supplier : OEM

Replenishment PO Item : B, QTY:20Ea Supplier : OEM

B

A

C

1 Ea2 EaB&C are Synchronized Components

Process Receiving Transactions

Complete

Misc Issue A

Demonstration – Scenario1Assembly with synchronized components


OEM (Standard Cost Org)

MP (Zero Cost Organization)

Discrete Job Assembly : A QTY :10Ea

Replenishment SO Item : B , QTY:100Ea Customer: MP

Interlock

Receive

Subcontracting Order Assembly : A , 10Ea Supplier : MP

ASCP

AP Invoice AR Invoice

AP/AR NettingPay to MP

$

SHIP

SHIP

Auto receive Components

Receive

Receive

No Manual Transactions in MP Org

Replenishment PO Item : B, QTY:100Ea Supplier : OEM

B

A

C

1 Ea2 EaB is Prepositioned C is Synchronized

Replenishment SO Item : C, QTY:10Ea Customer : MP

Replenishment PO Item : C, QTY:10Ea Supplier : OEM

ASCP

Misc Issue A


Complete

Demonstration – Scenario 2Assembly with pre positioned & synchronized components


Demonstration


Demonstration Scenario(s) Summary

Manage outsourcing Process• Allow OEMs to efficiently manage outsourcing Process with better

planning and execution

Process Visibility • Workbench provides clear visibility into each stage of the subcontracting

Process execution Purchase order Change Management• Supports change management of the subcontracting order for greater

supply chain agility

Inventory Visibility at MP site• OEM has better visibility of Component on hand inventory at

Manufacturing partner site

Simplified financial settlement• Payments to the Manufacturing partners are simplified with automatic

netting of AP and AR invoices


Implementation Considerations – Setup Tasks

SETUP

Define Shipping Networks

Define Accounting Setup

Define Assemblies and Components

Define OEM and MP Organizations

Enable Chargeable Subcontracting

Profiles

Define Customers and Suppliers

Define Price Lists


Implementation ConsiderationsFunctional Dependencies

• Chargeable subcontracting is dependent on the following modules– Oracle Inventory– Oracle ASCP – Oracle Bill of Material– Oracle Work in Process– Oracle Order Management– Oracle Purchasing– Oracle Payables– Oracle Receivables– Oracle Shipping* Chargeable subcontracting works without ASCP. ASCP is needed only for Planning

the components


Customization and Extensibility Options

• None


Integration Considerations

• Chargeable subcontracting integration with other planning products where ASCP is not deployed


Upgrade Considerations

• None


Global Considerations

• Chargeable subcontracting is enabled only for Japan, Korea and Taiwan


Lessons Learned from Field Testing

• Dropship Final assembly from Manufacturing partner to Customer

• Dropship Assembly from one manufacturing partner to another


Wrap Up/ Q&A



Technical Deep Dive


Technical Deep Dive Agenda

• Data Model Changes / Database Relationships

• Workbench

• Concurrent Requests

• Reports

• Performance Considerations

• Wrap Up/Q&A


Data Model and Database Relationship ChangesPhysical Data Model

JMF_SUBCONTRACT_ORDERS

PK SUBCONTRACT_PO_SHIPMENT_ID

SUBCONTRACT_PO_HEADER_IDSUBCONTRACT_PO_LINE_IDTASK_IDPROJECT_IDOEM_ORGANIZATION_IDTP_ORGANIZATION_ID....

JMF_SHIKYU_COMPONENTS

PK SUBCONTRACT_PO_SHIPMENT_IDPK SHIKYU_COMPONENT_ID

OEM_ORGANIZATION_IDSHIKYU_COMPONENT_PRICEUOMCURRENCY

JMF_SHIKYU_REPLENISHMENTS

PK REPLENISHMENT_SO_LINE_ID

REPLENISHMENT_SO_HEADER_IDREPLENISHMENT_PO_HEADER_IDREPLENISHMENT_PO_LINE_IDREPLENISHMENT_PO_SHIPMENT_IDALLOCATED_QUANTITY....

JMF_SHIKYU_ADJUSTMENTS

PK ADJUSTMENT_ID

SUBCONTRACT_PO_SHIPMENT_IDSHIKYU_COMPONENT_IDADJUSTMENTREASON....

PO_LINE_LOCATIONS_ALL

PK LINE_LOCATION_ID

PO_HEADER_IDPO_LINE_IDPO_RELEASE_ID...

JMF_SHIKYU_ALLOCATIONS

PK SUBCONTRACT_PO_SHIPMENT_IDPK SHIKYU_COMPONENT_IDPK REPLENISHMENT_SO_LINE_ID

DELIVERY_DETAIL_IDALLOCATED_QUANTITYUOM


Table Descriptions

Name Description

JMF_SUBCONTRACT_ORDERS Stores the subcontracting orders information.

JMF_SHIKYU_COMPONENTS Stores the components required for the outsourced assembly item.

JMF_SHIKYU_REPLENISHMENTS Stores the replenishment sales orders information.

JMF_SHIKYU_ALLOCATIONS Stores the allocations created between the replenishment sales orders and the subcontracting order shipments

JMF_SHIKYU_ADJUSTMENTS Stores adjustment data to be processed by the consumption adjustment concurrent program.


OA Framework Pages

Chargeable Subcontracting Workbench is a new user interface added for this feature. The workbench allows the users to

• Track the component shipments and allocations to the subcontracting order

• Track the estimated component consumption by outsource assembly, and adjust for over / under consumption at the MP site

Please refer to Technical TOI for the HTML page file name details and descriptions


Concurrent Requests

The following new batch programs are created for this feature

Name Description

Interlock Manager Main program to load the subcontract orders , create the WIP job, create replenishment orders and to create the allocations.

Reconciliation Manager Program to reconcile changes made to the subcontracting order

Auto Receive Components Program to automatically receive the components into the MP organization


Program to process the outsourced assembly receipts and corrections


Reports

The following new reports are created for this feature

Name Description

Subcontracting Order Report

Report to print the subcontracting orders, along with their component requirements and allocation information.

Confirmation Report Report to print the estimated component on-hand quantities at the manufacturing partner site

Cost Update Analysis Report

Report to print the estimated impact of any proposed standard cost changes to the outsourced assembly or the subcontracting components.


Performance Considerations

Consideration for Interlock concurrent program

• The optional User Parameters Batch Size and Maximum Number of Workers can be used to facilitate better performance by allowing parallel processing.

• By default, the Maximum Number of Workers would be 1 and the Batch Size would be set equal to the number of new Subcontracting Orders that have not yet been loaded.



Hands-on Experience


Hands-on Experience

• Objective(s) of Hands-on Experience

• Login Details/ Environment Information

• Limitations/ Known Issues

• Rules of Engagements

• Other


Wrap Up/ Q&A


Thank You

Thank You


Wrap Up/ Q&A


Thank You

Thank You

Documents

Copyright © 2006, Oracle. All rights reserved. Release 12 Field Readiness Workshop Chargeable Subcontracting