Logan Consulting

Unlocking the Secrets

of WIPNadia Truxell

Loga

n C o

nsul

ting

Introduction – Nadia Truxell• Operations/Materials Manager – Scherdel Sales & Technology

Automotive Supplier of Springs and StampingsImplemented QAD

• Project Manager – Logan ConsultingQAD Implementations and Business Process ConsultingAutomotiveFood & BeverageConsumer GoodsIndustrial Products

Loga

n C o

nsul

ting

Unlocking the Secrets of WIP

What is WIP and how can it help you?

Data Structure for Optimizing Information through Adv Rep Production Reporting

Pitfalls – Common Errors to Avoid and How to Recognize and Fix them when they happen.

Loga

n C o

nsul

ting

The Basics… WIP

• Work in Process

Material that has been partially processed but not yet transformed into its final state and not normally usable as is. The status of WIP material is usually described by its current routing operation location

Loga

n C o

nsul

ting

How Can WIP Help You?

• Provide visibility of cost of material that currently being processed

• Provide better control of material in process as it moves through the production process

• Provide visibility of material being processed by a subcontractor at an external supplier location

Loga

n C o

nsul

ting

How Can WIP Help You?• As material moves throughout the manufacturing process it

becomes work in process (WIP)• Picks up cost as it moves through operations• Consumes materials and labor

Loga

n C o

nsul

ting

How Can WIP Help You?

Why some companies don’t use WIP functionality:

• No business requirement to track at operational level

• Lack of understanding of software functionality

• Pain from incorrect transactions

• Limited resources for accurate and timely data collection

Loga

n C o

nsul

ting

How Can WIP Help You?

Why some companies should use WIP functionality:

• Multiple steps throughout the manufacturing process where it is necessary to track costs at the operational level.

• Desire to increase visibility and control of material as it moves through the process

• Ability to scrap and reject material by operation

• Subcontract operations exist in the manufacturing process

Loga

n C o

nsul

ting

Data Structure

• Department

• Work Center/Machine

• Routing

Loga

n C o

nsul

ting

Data Structure

Routing Example - NO Visibility to WIP

Loga

n C o

nsul

ting

Data Structure

• Routing Example – Multi Operations

Loga

n C o

nsul

ting

Data Structure

• Department

Loga

n C o

nsul

ting

Data Structure

• Work Center

Loga

n C o

nsul

ting

Data Structure

• Routing

Loga

n C o

nsul

ting

Data Structure

• Routing Example – Multi Operations

Loga

n C o

nsul

ting

Data Structure

• Routing Subcontract

Loga

n C o

nsul

ting

Data Structure

• Routing Subcontract

Loga

n C o

nsul

ting

Data Structure

• Operation

• Work Center/Machine

• Milestone

• Subcontract

Loga

n C o

nsul

ting

Tracking WIP - Transactions• Backflush

• Move

• Scrap

• Reject

• Rework

• Adjust

Loga

n C o

nsul

ting

Tracking WIP - Transactions• Backflush

Loga

n C o

nsul

ting

Tracking WIP - Transactions• Backflush

Loga

n C o

nsul

ting

Tracking WIP - TransactionsBackflush Transaction moves reported quantity through the

manufacturing process between milestone operations.

Loga

n C o

nsul

ting

Tracking WIP - TransactionsMove Transaction

Loga

n C o

nsul

ting

Tracking WIP - TransactionsMove Transaction

Use Move Transaction to transfer a quantity from the input queue of a manufacturing operation to the output queue of the following operation, or if there is no following operation, to finished material inventory

Loga

n C o

nsul

ting

Tracking WIP - TransactionsScrap Transaction

Loga

n C o

nsul

ting

Tracking WIP - TransactionsUse Scrap Transaction to remove quantities from either the input,

output, or reject queues of a manufacturing operation.

Loga

n C o

nsul

ting

Tracking WIP - TransactionsReject Transaction

Reject previously backflushed units from an operation's output queue to the same operation's reject queue or to the reject queue of any preceding operation

Reject units from an operation's input queue and record the reject at the previous operation

Loga

n C o

nsul

ting

Tracking WIP - TransactionsReject Transaction

Loga

n C o

nsul

ting

Tracking WIP - TransactionsReject Analysis Report

Loga

n C o

nsul

ting

Tracking WIP - TransactionsRework Transaction

Use Rework Transaction to transfer item quantities from the reject queue of one manufacturing operation to one of the following:

The output queue of the operation at which you are reporting (reporting operation)

The output or input queue of any operation subsequent to the reporting operation

Loga

n C o

nsul

ting

Tracking WIP - TransactionsRework Transaction

Loga

n C o

nsul

ting

Tracking WIP - Transactions

Loga

n C o

nsul

ting

Tracking WIP - Transactions

Loga

n C o

nsul

ting

Tracking WIP - Transactions

Loga

n C o

nsul

ting

Tracking WIP - TransactionsWIP Adjust Transaction

Loga

n C o

nsul

ting

Tracking WIP - TransactionsWIP Adjustment Analysis Report

Loga

n C o

nsul

ting

Tracking WIP - TransactionsSubcontract Shipping

Moves material into inventory location of the Subcontract Supplier Code

PO Receipt moves material into next operation in Routing

WIP Item Number can be assigned to material while it is in the Subcontract Routing operation

Components

Loga

n C o

nsul

ting

Tracking WIP - ReportsRouting Detail Browse (Custom)

Loga

n C o

nsul

ting

Tracking WIP - ReportsOp_Hist Detail Browse (Custom)

Loga

n C o

nsul

ting

Tracking WIP - ReportsWIP Status Report

Loga

n C o

nsul

ting

Tracking WIP - ReportsWIP Valuation Report

Loga

n C o

nsul

ting

Tracking WIP - Reports

Loga

n C o

nsul

ting

Tracking WIP - Reports

Loga

n C o

nsul

ting

Common PitfallsIssue: Move Next Op = No Quantity stays in the output queue of the last operation Fix: Use Move Transaction to push the quantity through

Issue: Incorrect Quantity ReportedFix: Reverse incorrect quantity and report correct quantity at the

appropriate operation using backflush transaction

Issue: Wip Status Report shows incorrect quantities at operationsFix: Cycle count Work Center inventory and use Scrap

Transaction and/or Move transaction to adjust.

Loga

n C o

nsul

ting

Common PitfallsIssue: Backflush transacted at non-milestone operationFix: Reverse the transaction and redo at the correct operation

Issue: Previous operation negative when backflushing a later operation.

Fix: Count work center inventory to ensure correct. Ensure backflush transaction was completed for previous milestone operation.

Loga

n C o

nsul

ting

Common PitfallsIssue: Backflush transacted at non-milestone operationFix: Reverse the transaction and redo at the correct operation

Issue: Previous operation negative when backflushing a later operation.

Fix: Count work center inventory to ensure correct. Ensure backflush transaction was completed for previous milestone operation.

Loga

n C o

nsul

ting

Common PitfallsIssue: Backflush transacted at non-milestone operationFix: Reverse the transaction and redo at the correct operation

Issue: Previous operation negative when backflushing a later operation.

Fix: Count work center inventory to ensure correct. Ensure backflush transaction was completed for previous milestone operation.

When ALL ELSE FAILS – use the WIP Adjust Transaction

Loga

n C o

nsul

ting

Common PitfallsAccuracy of information requires commitment and discipline

throughout the organization.

Loga

n C o

nsul

ting

Questions?

Loga

n C o

nsul

ting

Thank You

Nadia Truxell

ntruxell@logan-consulting.com

Loga

n C o

nsul

ting