How I Implemented the Back-To-Back Process in a Configure to Order Environment

7/30/2019 How I Implemented the Back-To-Back Process in a Configure to Order Environment

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How I implemented the Back-to-Back process in a Configure To Order

environment [ID 572644.1]

Modified19-JAN-2009 Type HOWTO Status PUBLISHED

Goal

This document has been authored by an Oracle customer, and has not been subject to an

independent technical review.

Submitted by: Krishnan SundaresanTitle: Principal Consultant

Company: Fujitsu Consulting, Inc.

This article delineates the setups and process steps for implementing the Back-to-Back

(B2B) process for configured Assemble To Order (ATO) items, that Id utilized in mywork, with different clients.

Business Scenario

In Industrial Manufacturing, Id witnessed organizations procure a fully assembled

configured ATO item, from a vendor, based on the business necessities. Typical reasons

include, but not limited to, the vendors economies of scale, technological edge,organizational core competence et al. And Id employed the standard B2B process in

Order Management to model such a scenario.

Note: This document deals with the purchase of the configured item assembly. Scenarios

that involve purchase of individual components involve different setups and have not

been dealt with.

Process Overview

In the standard B2B process, the end customers requirements are created as a Sales

Order (SO) in Order Management and a Purchase Requisition and Purchase Order (PO)are created to transmit them to the vendor. The material is received from the vendor in

the organizations warehouse and shipped to the customer, possibly with other items.

When such procured items are configured ATO items, additional application setups are

required so the procurement/fulfillment processes are synchronized.

Solution

Application Setups

At a high level, Id set up the applications as outlined below:


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Define the ATO Model as a Buy item in the Item Master (item attributes Make

or Buy Buy; Purchasable Yes and Purchased Yes; Build in WIP - Yes)

Define the List Prices, Buyers for the Model, Classes and the various Options, in

the Item Master

Set the Based on Rollup flag for the ATO Model to Yes, in Costing

Assign the item costs for the various Options of the ATO Model, in Costing (ifStandard Costing is being followed)

Create a new line type and assign the appropriate configuration workflows in

Order Management (for the same line type and item types ATO Model,

Configured Item and Standard, assign the respective seeded workflows)

Set up the BOM parameters, for the inventory organization

Set the profile options BOM: Match to Existing Configuration to Yes, BOM:

Configuration Item Type to ATO Item and BOM: Configuration Item

Delimiter to * (the values set here may be modified to accommodate the specificsof the clients business)

Set the profile options BOM: CTO Buy Cost Type to CTO, BOM: CTO

Perform List Price and Purchase Price Rollup to Yes and BOM: CTO PerformCost Rollup to Yes (this is to ensure that the * item has the correct rolled upList Price, of the components, for Purchasing and the cost)

Define Sourcing Rule in Purchasing that assigns the vendor (Type Buy from;

Allocation % 100; rank 1; these may be modified)

Assign the dynamically created ATO item (that represents the configuration;

typically items with delimiter * or -) to the Assignment Set with the Sourcing

Rule defined above (detailed below in the Process Steps section)

Add the ATO Model, Option Classes and Options to a Price List

Define the various rules that govern the configuration in Configurator Developer

(by importing the ATO Model), User Interface and publish it to Order

Management.

Process Steps

I followed the process steps, as detailed below to execute the B2B process.

Navigation: Order Management Super User > Orders. Returns > Sales Orders

1. Enter SO header details like Customer, Price List, Warehouse, Payment Terms, Freight

terms etc.

2. Enter the ATO Model on the SO line. Select the Line Type that has the workflow for

ATO Model.3. Invoke Configurator by clicking the Configurator button. The various Option Classes

and the Options get displayed. Select the desired Options. The rules defined inConfigurator Developer would come into play to ensure appropriate selection of the

Options and to drive any additional components, as a result of a selection.

4. Book the Sales Order.

5. Submit the concurrent request AutoCreate Configuration Items by providing the

Sales Order number as parameter. Ensure that a new item has been created and entered in


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the Sales Order. This * item represents the particular configuration for the Options

selected in step 3. The status of the line is BOM and Routing Created.

Navigation: Purchasing Super User > Supply Base > Assign Sourcing Rule

6. Query the Assignment Set set in the profile option MRP: Default Sourcing Assignment

Set

7. Choose the Item-Organization combination, and enter the organization, the * item

and the Sourcing Rule.

Note: Assigning a category to the ATO Model and assigning the category to the

Assignment Set by choosing the Category-Organization combination, could avert Steps

6 & 7. The * item, being a derivative of the ATO Model, inherits the categories assigned

to the ATO Model.

8. Submit the concurrent request AutoCreate Purchase Requisitions by providing the

Sales Order Number as parameter. This loads the po_requisitions_interface_all table in

Purchasing.


9. Query the Sales Order. The line status of the * item is POReq-Requested.

10. Submit the concurrent request Requisition Import with the parameters Import

Source as CTO and Initiate Approval after Reqimport as Yes.11. Query the Sales Order. The line status of the * item is POReq-Created. Open up theSupply to Order workbench to check the Purchase Requisition Number. From the

Shipping tab, see that the line has been reserved. This reservation is against the Purchase

Requisition (future supply).

Navigation: Purchasing Super User > AutoCreate

12. Query the Purchase Requisition and create the Purchase Order, by clickingAutomatic. Approve the PO.


13. Query the Sales Order. The line status of the * item is PO Created. From the Supply

to Order Workbench, check the PO number. The reservation is now against the PO.

Navigation: Purchasing Super User > Receiving


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14. Receive the PO. Depending on the Receipt Routing, it may be a two-step process of

receive and deliver.


15. Query the Sales Order. The line status of the * item is PO Received. The reservationis now against the on hand inventory and the line is ready to be pick released

Navigation: Order Management Super User > Shipping > Transactions

16. Query the Sales Order and from Actions> Launch Pick Release

17. Once the line is pick released, ship confirm the delivery

18. Submit the concurrent request Workflow Background process with the parameters

Process Deferred as Yes and Process Timeout as No.19. Query the Sales Order to ensure that the lines are Closed.

Navigation: Receivables Manager > Interfaces > Autoinvoice

20. Submit the request Autoinvoice Master Program, to generate the Customer Invoice.

Points to Note

As seen above, the process has integration touch points with various applications. Ive

gleaned the following points based on the scenarios Id encountered in the past.

The * item is the one that gets purchased and shipped. The Purchase Requisition

and the Purchase Order would have just one line (* item). Id utilized a PO

attachment to capture the component details that can be transmitted to the vendor.

The ATO Model and the Options are the items that our customer gets invoiced

for. The * item does not get invoiced.

From the above, the material transactions (in Inventory) would be for the * item

while the financial transactions (in Accounts Receivable) would be for the Model

and Options.

The * item would have the rolled up cost of the Options selected, during

configuration and would have entries for Cost Types CTO and Frozen. Thepurchase price on the requisition and the PO would be the rolled up purchasing

list prices of the Options. If we had a different PO currency, it would be converted

automatically.

The ATO Model may be serial-controlled and Install Base trackable. The * item is

the one for which serial number(s) may be assigned and tracked in Install Base

and not the components.


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The ATO Model may be serviceable. During SO entry, to prevent the service

from getting attached to the components, the profile option OM: Cascade Service

needs to be set to No. In pre-11.5.10 versions, the components need to be non-serviceable.

How I Implemented the Back-To-Back Process in a Configure to Order Environment

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