3 Sales ...................................................................................................................................................... 8
3.1 Process .......................................................................................................................................................... 8
3.1.1 Selection process .................................................................................................................................. 8
3.1.2 Transaction process .............................................................................................................................. 9
3.2 Master data ................................................................................................................................................ 10
3.2.1 Customer master data ........................................................................................................................ 10
3.2.2 Material master data .......................................................................................................................... 10
3.2.3 Condition master data ........................................................................................................................ 11
3.2.4 Output ................................................................................................................................................. 11
4 Production planning process ................................................................................................................ 12
4.1 Overview............................................................................................................................................. 12
4.1.1 Forecast consumption ........................................................................................................................ 12
4.1.2 Independent demand versus dependent demand ............................................................................. 12
4.2 Forecast accuracy ............................................................................................................................... 12
4.3 Tuning of processes with ERP ............................................................................................................. 12
4.3.1 MPS: master production planning or master scheduling.................................................................... 12
4.3.2 Back-to-back order management ....................................................................................................... 13
4.3.3 ROP (re-order point) ........................................................................................................................... 13
4.3.4 Kanban ................................................................................................................................................ 13
1
,5 Purchase process ................................................................................................................................. 14
5.1 The process ......................................................................................................................................... 14
5.1.1 Steps ................................................................................................................................................... 14
5.1.2 Special situations: returns, backorders and late deliveries ................................................................ 17
5.2 Master data ................................................................................................................................................ 17
5.2.1 Vendor master data ............................................................................................................................ 17
5.2.2 Material master data .......................................................................................................................... 18
5.2.3 Purchasing information record ........................................................................................................... 18
6 Production process .............................................................................................................................. 19
6.1 Overview production process...................................................................................................................... 19
6.1.2 Step 1: release production order ........................................................................................................ 19
6.1.3 Step 2: preparation ............................................................................................................................. 19
6.1.4 Step 3: stage and setup....................................................................................................................... 19
6.1.5 Step 4: produce ................................................................................................................................... 20
6.1.6 Step 5: complete ................................................................................................................................. 21
6.2 Master data ................................................................................................................................................ 22
6.2.1 Routing ................................................................................................................................................ 22
6.2.2 Work ................................................................................................................................................... 22
6.2.3 Product group ..................................................................................................................................... 22
2
, 1 Introduction
1.1 Definition
Companies that do not innovate anymore and do not improve their processes, will not
survive.
Example: film reels used to have a good market, but the digital cameras became
obsolete. New portable media have become the standard.
1.2 Process
1.2.1 Most widely used processes
Sales process: interaction with the customer
- Objective: to dissipate orders from customers and deliver and invoice them
- To earn money
Purchase process: focuses on the suppliers
- Determine what you need
- Select the right supplier
Planning department: what, how much and when goods need to be bought and produced
- Having a sufficient inventory to supply customers in time
- Planning process
Warehouses: to store goods, with an in- and outbound.
- Receiving company orders
- Delivering customer orders
Production process: transforms raw materials into semi-finished and finished products,
ready to deliver to the customer.
Human resources: having the right people at the right place
- HR-department that recruits and retains people
- Also training and development
1.2.2 Transaction follows selection
Selection process: where we select the counter party, place, time, location, price, … with
which we will execute the transaction.
Transaction process: executing the transaction.
- Selection process can be considered as a preparation for the transaction process
- OLTP: online transaction processing tool
o After several years and thousands of transactions, a company has a lot of data
(big data)
o The company wished to analyse these data and find new opportunities
- OLAP: online analytical processing tool
o Tool to analyse big data of a company.
o Example: data warehouse
3
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