Walkthrough: Microsoft Dynamics GP 2010 MRP Move-Out Functionality


Symptoms


 

Business SCENARIO

Microsoft Dynamics GP 2010 has been implemented. The Move-Out functionality in Material Requirements Planning (MRP) will be used. Users need to understand how this functionality works--including the necessary setup.

 

This document will describe the following:

1. The setup required to use the MRP Move-Out functionality.

2. The concepts that contribute to the calculations used in creating Move-Out suggestions.

3. Sample scenarios to enhance understanding of those key concepts.

More Information


 

Background INFORMATION

Microsoft Dynamics GP 10 included MRP Move-Out functionality. In both Microsoft Dynamics GP 10 and Microsoft Dynamics GP 2010, the goal of the Move-Out is to avoid oversupply situations. Oversupply situations exist when the MRP Projected Available Balance (PAB) for an item/site exceeds the Order-Up-To Level defined at that item/site.

In Microsoft Dynamics GP 2010, additional functionality has been added to avoid situations where an existing supply order is suggested to be moved out, but then another supply order is suggested in its place.

 

Step by STEP

1.  Set up Microsoft Dynamics GP so that the Move-Out functionality is enabled. 

a. Move Out must be enabled at the item/site level. This is done by marking the appropriate checkbox in the Item Resource Planning window.

b. Move Out must be enabled for the entire company. This is done by marking the appropriate checkbox in the MRP Preference Defaults window.

c. The Order Point Quantity in the Item Resource Planning window is used to define the point at which MRP will suggest an order to replenish quantities. This field also serves as the lower limit for our desired on hand quantity at the item/site in question.

d. The Order-Up-To Level in the Item Resource Planning window is used to define the point at which the item/site is oversupplied. This field also serves as the upper limit for our desired on hand quantity at the item/site in question. For “lean” companies, the Order Point Quantity and Order-Up-To Level can have a very short range between the values—or they can be the same value.

e. The Move-Out Fence is a new field in the Item Resource Planning window. It should be entered in Days. The Move-Out Fence is a time period before “demand”, where that demand falls on or after an “oversupply period”, when supply orders will NOT be suggested to be moved. The Move-Out Fence is an optional field. If populated, it will help to limit the number of supply orders which are suggested to be moved out.

2.  Understand the concepts used in the Move-Out calculations.

a. Move-Out Fence date range: We apply the value in the Move-Out Fence field to determine a range of dates for the Move-Out Fence. Here are the calculations:

i. If there is demand on the same date as the oversupply, then the range is calculated as follows: The date on which a supply order results in oversupply - the Move-Out Fence days [inclusive of the oversupply date]. This date range constitutes the Move-Out Fence.

ii. If there is no demand on the same date as the oversupply, then the range is calculated as follows: Go ahead in time (toward the future) for the first date with demand. Use the first demand day after the oversupply [inclusive] - the Move-Out Fence days. This date range constitutes the Move-Out Fence.

b. Look-Back Period: A time period adjacent to an oversupply date during where supply orders may be moved out. The Look-Back Period consists of two dates which together make up a time period.

i. Look-Back Period Date 1:

1. The first (oldest) date in the Move-Out Fence - one day. This is date 1 of the Look-Back Period.

2. If the Move-Out Fence value is zero, then date 1 is calculated as follows:

o    If there is demand on the same date as the oversupply, then date 1 is that oversupply date.

o    If there is no demand on the same date as the oversupply, then date 1 is the first demand day after the oversupply.

ii. Look-Back Period Date 2: Go back in time (before the oversupply date) to the closest prior date with demand + one day. This is date 2 of the Look-Back Period.

iii. Convert Date 1 and 2 to a Range: Date 1 and 2 are evaluated. The older date value will become the start of the Look-Back Period. The newer date value will become the end of the Look-Back Period.

c. PAB Evaluation: If one or more supply orders can be found in the look-back period, then PAB will be evaluated as follows: Is (PAB on the oversupply date – total supply order quantity during the look-back period) >= (Order-Up-To Level + demand on the oversupply date)?

o    If the answer is NO, then the quantity on order in the look-back period is needed to meet some demand.

o    If the answer is YES, then the supply order(s) in the look-back period can be moved or canceled.

d. Order Point Evaluation: MRP will not suggest that a supply order be moved or canceled, if it would result in the PAB on the oversupply date falling below the Order Point Quantity.

e. Qualifying POs: POs must meet the following criteria to be considered for a move out or cancelation:

o    No SOP or MOP links

o    The status is New, Released, or Change Order

f. Qualifying MOs: MOs must meet the following criteria to be considered for a move out or cancelation:

o    No data collection records for the MO.

o    No pending Component Transaction Entry transactions for the MO.

o    No component quantities issued or backflushed for the MO.

o    No SOP or POP links.

o    The status is Quote/Estimate, Open, or Released.

3.  Practice calculating the Move-Out Fence and Look-Back Period

a. Use the values in the following chart for each of the sample scenarios below:

 

On Hand Quantity

10

Order Point Quantity

10

Order-Up-To Level

10

Move-Out Fence (in days)

5

b. Scenario 1: Here are the transactional documents to consider:

 

Order Type

Doc#

Demand

Supply

Due Date

PAB

Starting PAB

 

 

 

Starting PAB

10

PO

PO0001

 

5

10/1/09

15

SO

SO0097

5

 

10/1/09

10

PO

PO0002

 

15

10/4/09

25

PO

PO0003

 

20

10/4/09

45

SO

SO0098

15

 

10/4/09

30

PO

PO0004

 

20

10/5/09

50

SO

SO0100

40

 

10/8/09

10

 i. On which dates do we have an oversupply at the end of the day?

1. At the end of 10/4, the PAB is 30. This is 20 greater than the Order-Up-To Level of 10.

2. At the end of 10/5, the PAB is 50. This is 40 greater than the Order-Up-To Level of 10.

ii. Analysis of 10/4 Oversupply

1. Move-Out Fence: There is demand on the same day (10/4) as the oversupply. This is the end of the Move-Out Fence. Start with this day (inclusive) and subtract the Move-Out Fence days (5). The result is 9/30. The Move-Out Fence is from 9/30 to 10/4.

2. Look-Back Period Date 1: Start with the beginning of the Move-Out Fence and subtract one day. Date 1 is 9/29.

3. Look-Back Period Date 2: The closest prior date with demand is 10/1. The demand on this date is SO0097. We add one day to that date to get to 10/2.

4. Look-Back Period: The Look-Back Period is from 9/29 to 10/2.

5. Final Analysis: Most of the Look-Back Period is falling inside of the Move-Out Fence. Only orders falling on 9/29 would be eligible to be moved. There are no orders for this item which meet that requirement.

iii. Analysis of 10/5 Oversupply

1. Move-Out Fence: There is no demand on the same day (10/5) as the oversupply, so we look ahead to the next date that has demand. This is 10/8. Start with this date (inclusive) and subtract the Move-Out Fence days (5). The result is 10/4. The Move-Out Fence is from 10/4 to 10/8.

2. Look-Back Period Date 1: Start with the beginning of the Move-Out Fence (10/4) and subtract one day. Day 1 is 10/3.

3. Look-Back Period Date 2: The closest prior date with demand is 10/4. The demand on this date is SO0098. We add one day to that date to get to 10/5.

4. Look-Back Period: The Look-Back Period is 10/3 to 10/5.

5. Final Analysis: Most of the Look-Back Period is falling inside of the Move-Out Fence. Only orders falling on 10/3 would be eligible to move. There are no orders for this item which fall on that date.

c. Scenario 2: Here are the transactional documents to consider:

   

Order Type

Doc#

Demand

Supply

Due Date

PAB

Starting PAB

 

 

 

Starting PAB

10

PO

PO0001

 

20

10/1/09

30

PO

PO0002

 

20

10/5/09

50

SO

SO0100

40

 

10/9/09

10

i. On which dates do we have an oversupply at the end of the day?

1. At the end of 10/1, the PAB is 30. This is 20 greater than the Order-Up-To Level of 10.

2. At the end of 10/5, the PAB is 50. This is 40 greater than the Order-Up-To Level of 10.

ii. Analysis of 10/1 Oversupply

1. Move-Out Fence: There is no demand on the same day (10/1) as the oversupply, so we look ahead to the first future date with demand. This is 10/9. Start with this date (inclusive) and subtract the Move-Out Fence days (5). The result is 10/5. The Move-Out Fence is from 10/5 to 10/9.

2. Look-Back Period Date 1: Start with the beginning of the Move-Out Fence (10/5) and subtract one day. Date 1 is 10/4.

3. Look-Back Period Date 2: We look for the closest prior date with demand. We have no demand prior to the 10/1 oversupply. This means that the Look-Back Period will begin at the start of the MRP planning horizon.

4. Look-Back Period: The Look-Back Period is from the start of the MRP planning horizon until 10/4.

5. Final Analysis:  PO0001 that drove the oversupply on 10/1 would be eligible to be moved. It is within the Look-Back Period and outside of the Move-Out Fence. However, before PO0001 can be moved, it must also pass the PAB and Order Point evaluations, as well as the Qualifying PO status requirements.

iii. Analysis of 10/5 Oversupply

1. Move-Out Fence: There is no demand on the same day (10/5) as the oversupply, so we look ahead to the first future date with demand. This is 10/9. Start with this date (inclusive) and subtract the Move-Out Fence days (5). The result is 10/5. The Move-Out Fence is from 10/5 to 10/9.

2. Look-Back Period Date 1: Start with the beginning of the Move-Out Fence (10/5) and subtract one day. Date 1 is 10/4.

3. Look-Back Period Date 2: We look for the closest prior date with demand. We have no demand prior to the 10/5 oversupply. This means that the Look-Back Period will begin at the start of the MRP planning horizon.

4. Look-Back Period: The Look-Back Period is from the start of the MRP planning horizon until 10/4.

5. Final Analysis: PO0001 is eligible to be moved. It falls within the Look-Back Period and outside of the Move-Out Fence. PO0002 on 10/5 would not be eligible to be moved since it falls within the Move-Out Fence. Once again, PO0001 must pass the PAB and Order Point evaluations and Qualifying PO status requirements before it could be moved.