Define Basic Settings for Subcontracting

This document explains how you define the settings for subcontracted item.

Outcome

The parameters that control subcontracting item are defined.

The settings for subcontracting can be used to create a product structure in (PDS001), item in MMS001 and item/warehouse in MMS002.

The following files are updated:

Before you start

Follow these steps

Define purchase order type

Two purchase order type with order type category 70 for the subcontracting flow must be defined in 'Purchase Order Type. Open' (PPS095).

One for subcontracted operations which on the PPS095/F panel normally has 150 Material plan update= 2, update material plan but not balance.

Another for subcontracted items which on the PPS095/F panel normally has 150 Material plan update= 1, update both material plan and balance.

  1. Start 'PO Type. Open' (PPS095). Specify a PO type with purchase category 70=Subcontract.

  2. On the F panel, select 'Printout method item name and item description (120 and 121) specify how the item name and descriptions are printed on the purchase order document.

  3. The material plan update (150) field on the F panel controls whether or not the material plan and/or the balance id should be updated. The valid alternatives are:

    The 'Material update' field for subcontracted operations which on the PPS095/F panel must have 150 Material plan update= 2, update material plan but not balance

    The 'Material update' field for subcontracted items which on the PPS095/F panel must have 150 Material plan update= 1, update material plan and balance

  4. Select or specify the appropriate values on the F panel, based on your review of the 'Parameter to Set' table.

  5. Press Enter.

Define purchase settings

  1. Start 'Settings – Purchasing' (CRS780).

  2. On the E panel select Default order type – subcontracting.

    The Default order type - subcontract (07) field defines the requisition order type used for handling the issue of subcontracted materials. This order type is also used to create the dummy requisition order used to get the freight document. See chapter 2.1.3 for a description of the important settings on this order type.

  3. On the F panel select 'Default PO type – subcontracting operations and General Costing Model – subcontract'.

    The Default PO Type – subcontract operations (18) field specifies the purchase order type used in the subcontracting flow. This order type is used if no order type is set on the item/supplier combination in 'Supplier. Connect Item' (PPS040).

  4. On the F panel select General Costing Model – subcontract.

    The General Costing Model - subcontract (21) field specifies the ID of the purchase costing model used for the subcontracting operations. A special costing model can be used for the subcontracted operation in order to take care of costs related to the subcontracting, for example, freight costs, extra subcontracting add-ons, and so on.

    This model works together with the finished product's product costing model. In the product costing model, the D01 element contains the cost component for the subcontracted operation. By using the subcontract costing model, costs other than the actual cost for the work performed by the subcontractor can be considered, for example, freight costs. etc. The standard cost can be created from 'Product Costing. Calculate Selected Items' (PCS200) where the Calc Purch Items check box must be selected. The purchase price for the subcontracted operation is placed in an agreement (a general or a normal agreement).

  5. On the G panel select the parameter for 'Planning policy – subcontracting and repair' and check Create planned requisition orders – subcontracting.

    The subcontracted orders can be planned differently from normal orders. This is controlled from the Planning policy – subcontracted orders (32) parameter. The planning policy is used when the planned purchase order is created for the subcontracted order.

  6. Press Enter.

Settings for requisition/distribution type

  1. Start 'Req/Distr Order Type. Open' (CRS200).

  2. If Accumulate gross weight in order header (60) is activated, the gross weight for the total of the order lines is accumulated in the order header.

  3. If a dummy requisition should be created in order to get the freight documents, the Allow issue on non-stocked items (70) field must be set to 1.

  4. Reference text type (105) specifies the requested contents of the reference text field used as additional information in material plans and historical stock transactions. If values 03, 04 or 05 are chosen, the reference order number will be shown in the text field.

  5. Dispatch policy (255). The field indicates the dispatch policy design. A dispatch policy contains settings for how the dispatch should work, and is assigned to each order type. Dispatch policies are defined in (MWS010).

  6. Press Enter.

    For more information about how to manage RO/DO, allocation, and dispatch policy, see Internal Orders including Requisition and Distribution Orders.

Parameters to set

Program ID/ Panel

Field

The field indicates …

Settings for purchase order type category 70

(PPS095/F)

120 Print out method – item name

...the method for transferring the item name to the purchase order.

The valid alternatives are:

1 = Name is taken from the item/supplier file (PPS040). If there is no name, the field will be left blank.

2 = Name is taken from the item/supplier file. If there is no name, it will be taken from the item/language file (MMS030). If the name is still missing, it will be taken from the item file. A warning will be issued if the purchase order language differs from the local language.

3 = Name is taken from the item/supplier file. If there is no name, it will be taken from the item/language file (MMS030). If the name is still missing, it will be taken from the item file. No warning will be issued if the order purchase language differs from the local language.

4 = To be used only when creating inquiry from planned order. Name is taken from the planned order. If there is no name, the field will be left blank.

(PPS095/F)

121 Printout method – item description

...how the technical description of the purchase order's items is retrieved.

The valid alternatives are:

1 = Description is taken from the item/supplier file. If there is no description, the field will be left blank.

2 = Description is taken from the item/supplier file. If there is no description, it will be taken from the item/language file (MMS030). If the description is still missing, it will be taken from the item file. A warning will be issued if the purchase order language differs from the local language.

3 = Description is taken from the item/supplier file. If there is no description, it will be taken from the item/language file (MMS030). If the description is still missing, it will be taken from the item file. No warning will be issued if the order purchase language differs from the local language.

4 = Description is retrieved in the same way as in alternative 2, but is never printed on the purchase order.

5 = To be used only when creating inquiry from planned order. Description is taken from the planned order. If there is no description, the field will be left blank.

(PPS095/F)

150 Material plan update

…if the item's material plan should be updated.

The valid alternatives are:

0 = No.

1 = Yes, update both the material plan and balance.

2 = Yes, update the material plan but not balance.

Alternative 2 is used for orders (subcontracts for example) which should be displayed in the material plan without affecting the projected on-hand balance. It can also be used for direct goods deliveries. During order line entry, you may override the alternative specified here.

Note: Two purchase order type with order type category 70 for the subcontracting flow must be defined in 'Purchase Order Type. Open' (PPS095).

One for subcontracted operations which on the PPS095/F panel normally has 150 Material plan update= 2, update material plan but not balance

Another for subcontracted items which on the PPS095/F panel normally has 150 Material plan update= 1, update both material plan and balance

Purchase settings

(CRS780/E)

07 Default order type – subcontracting

…the requisition order type used in order to issue material when managing subcontracted orders.

Requisition order types are defined in (CRS200).

(CRS780/F)

18 Default PO type – subcontracting operations

…the PO type that is proposed when a planned PO for subcontracted operations is created and when no PO type has been specified for the operation in (PPS040). This is valid for manufacturing orders.

Note: This is a setting valid for subcontracted operations not subcontracted items.

(CRS780/F)

21 General Costing Model - subcontract

…the general costing model used for subcontracted orders. For example, you have added elements for setup price and extra transport fees to this costing model.

Costing models are defined in (PPS285).

(CRS780/G)

32 Planning policy – subcontracting and repair

…the planning policy used for subcontracted orders. The controlling parameters to be considered in (MMS037) are '022 Default status - planned orders when AM=A1' and '025 Default status - planned orders when AM=A2'.

In the planning policy, you define the rules for how planned orders are generated and how action and warning messages are to be applied, among other things.

Planning policies are defined in (MMS037).

(CRS780/G)

44 Create planned requisition order – subcontracting:

…that a planned requisition order is created when a planned PO for subcontracted items without a manufacturing order is created.

It is recommended that you select this field.

Settings for requisition/distribution type

Note: For more information about how to manage RO/DO, allocation, and dispatch policy, see Internal Orders including Requisition and Distribution Orders.

(CRS200/G)

105 Reference type text

…the requested contents of the reference text field which are used as additional information in material plans and historical stock transactions.

The valid alternatives are:

01 = From-To warehouse

02 = From-To location

03 = Reference order category, reference order number, line, job reference 1 positions 1-13

04 = Reference order category, reference order number, line, To location

05 = Reference order category, reference order number, line, marking positions 1-13.

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