R12.x Defining Inventory Organizations
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Objectives
After completing this lesson, you should be able to:
• Understand the structure of an inventory organization.
• Understand the multi-organization structure in Oracle
Applications.
• Understand how to use the organization reports.
• Understand how to set up the organization profile options.
• Understand organization implementation considerations.
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Inventory Organizations
Distribution Center
Company
Warehouse
An inventory organization is a facility where you store and transact items. Before you can use Oracle
Inventory, you must define one or more inventory organizations. Inventory organizations represent
distinct entities in your enterprise and can be one of the following:
A physical entity such as a manufacturing facility, warehouse, or distribution center.
A logical entity such as an item master organization, which you use to define items.
An inventory organization may have the following attributes:
An inventory organization can have its own location, ledger, costing method, workday calendar, and
items.
An inventory organization can share one or more of these characteristics with other organizations.
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Inventory Organization Structure
Subinventories are
unique physical or logical
separations of material
inventory, such as raw
material inventory,
finished goods inventory,
or defective goods
inventory.
Organization
Subinventories
You use locators to
identify physical areas
where you store
inventory items.
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You can set up an inventory
organization without subinventories;
however, you cannot transact items
in that inventory organization until it
has at least one subinventory.
Locators
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Quiz
An inventory organization where you store and transact items
can have only one subinventory:
a. True
b. False
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Sample Inventory Organization
Receiving
sub
Raw materials
sub
Manufacturing
sub
Inbound
Finished goods
sub
Defective
goods
sub
Inspection
sub
Shipping sub
Outbound
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Outbound
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Multi-Organization Structure
What is multi-organization structure?
• Applications and database enhancement
• Enables you to consolidate your operations under one
installation of Oracle Applications on a single global
instance
• Enables you to keep transaction data secure by line of
business
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Setting Up Locations
Define information describing
the physical locations of
employees and
organizations.
Locations are shared between
Oracle Inventory, Oracle
Purchasing, and Oracle
Human Resource
Management Systems.
Locations flagged as global
locations are available to all
business groups. You can
associate each organization
with only one location;
however, you can associate
more than one organization
with the same location.
Physical locations are defined
in Oracle Human Resource
Management Systems.
Physical location
Employees
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Organizations
Defining Organizations
Ledger
each inventory organization
to an operating unit. Each
operating unit is associated
to a legal entity and a
primary ledger
Operating unit
Inventory
Organization A
Subinventory
Locator
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organization classifications
are inventory organization,
legal company, and HR
organization.
Subinventory
Locator
Locator
Inventory
Organization B
Subinventory Subinventory
Locator
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Locator
Quiz
Locations define information about the physical locations of
employees and organizations:
a. True
b. False
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Inventory Parameters
The Inventory Parameters tab enables you to:
• Set up organization information
• Enable related, optional Oracle Applications
Oracle Enterprise
Asset Management
Oracle Process
Execution
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Oracle Warehouse
Management
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Costing Parameters
‫פרמטרים תמחיריים‬
Which costing method is the organization going to use?
• Standard
• Average
• LIFO (last-in-first-out)
• FIFO (first-in-first-out)
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Revision, Lot, Serial, and License Plate Number
(LPN) Parameters
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Revision parameters
Lot parameters
Revision A
Lot 403B
Serial parameters
LPN parameters
Item AS5222
Serial #5847329
LPN101
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ATP, Pick, Item-Sourcing Parameters
The ATP, Pick, Item-Sourcing Parameters tab enables you to:
• Set the available to promise (ATP) default rule for the
organization
• Set the picking defaults for the organization
• Set the item-sourcing defaults for the organization
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Interorganization Parameters
The Inter-Org Information tab enables you to determine the
parameters the organization uses when it transfers material
between organizations.
M1 Seattle
manufacturing
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M2 Boston
manufacturing
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Other Account Parameters
You use the Other account parameters tab enables you to set
up receiving account information, profit and loss account
information, and other additional accounts.
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Warehouse Management Parameters
If you have Oracle Warehouse Management installed you can
enter organization parameters that apply only to Oracle
Warehouse Management.
Oracle Warehouse
Management
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What Is a Subinventory?
Finished goods
Raw materials
Defective items
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What Is a Subinventory?
Storage Subinventory
• Mandatory
• Tracking of goods is
possible
• Material reflects in onhand quantity
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Receiving Subinventory
• Optional
• Tracking of goods is
possible
• Does not reflect in on
hand quantity
• Available if receipt is
made through use of
Oracle Warehouse
Management and Oracle
Mobile Supply Chain
Applications
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Defining Subinventories
Subinventory
• Physical or logical separation of material
• You must define at least one subinventory for each
organization
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Locator Control
In coordination with locator settings at the
subinventory and item level, you must first
specify locator controls at the Organization
level
Row
None: Inventory transactions within this organization do not require
locator information.
Prespecified only at item level: Inventory transactions within this
organization require a valid, predefined locator for each item.
Dynamic entry allowed: Inventory transactions within this
organization require a locator for each item. You can choose a
valid, predefined locator, or define a locator dynamically at the
time of transaction.
Determined at subinventory level: Inventory transactions use locator
control information you define at the subinventory level.
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Rack
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Bin
Dynamic and Static Locators
Dynamic Locators
• Generate during a
transaction as needed
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Static Locators
• Predetermined
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Quiz
Locators may represent the following entities in warehouses:
a. Organizations
b. Aisles
c. Rows
d. Shifts
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Subinventory-Locator Relationship
With locator control
Without locator control
Subinventory: BULK
Subinventory: FROZEN
The possible locator
control types are:
•None
•Prespecified
•Dynamic entry
•Item Level
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Locator Flexfield Structure
M1 Seattle
M2 Boston
Locator flexfield structure is common
across all organizations (sub inventories)
but names should be different
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Row 1A
Row 1A
Rack 1A
Rack 1A
Bin 1A
Bin 1A
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Interorganization Shipping Networks
moves material to
an intermediary
Intransit shipment
Shipping methods
Shipping organization
GL accounts to use in transit
Material ownership during transfers
Planning transfer
lead-times
Direct organization
Transfer charges
Destination organization
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Destination organization
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Shipping Method
Shipping methods are the
way you ship material
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Additional Setup Steps
Employees
Employees who perform
cycle and physical
inventory counts.
Planners
Freight carriers
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Quiz
When you set up a shipping network, you must select a transfer
type. Select the valid transfer type(s):
a. Intransit
b. Docking
c. Direct
d. COD
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Additional Organizational Setups
Organization access
This controls
access to
organizations
based on the user
responsibility
assigned to a user
by the system
administrator.
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Material shortages
trigger shortage alerts and
notifications
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Copying Inventory Organizations
Copy organization
M1 Seattle
manufacturing
M2 Boston
manufacturing
1. This model organization must be a transactional
organization and not an item master organization.
2. You can copy only organizations within the same
operating unit.
3. The system creates the new organizations under
the same business group to which the model
organization belongs, and assigns the new
organizations to the same operating unit, legal
entity, and ledger as the model organization.
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Additional Organizational Setups
You can choose to copy
the following
information from the
model organization:
•
•
•
•
Organization definition
Shipping networks
Hierarchy assignments
Bills of material and bills of
material parameters
• Departments, resources, and
routings
• Item information
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When you copy a
model organization
the system
automatically copies
the following
information:
•
•
•
•
Subinventories
Locators
Work in Process parameters
Work in Process accounting
classes
• Planning parameters
• Shipping parameters
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Organization Hierarchy
Organization hierarchies
enable you to group
together organizations and
perform operations across
all organizations within a
hierarchy
M2 Boston
manufacturing
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M1 Seattle
manufacturing
M3 Dallas
manufacturing
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M6 Phoenix
manufacturing
Inventory Reporting
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Organization Reports
Report
Description
Item-Subinventory Report
Lists items assigned to subinventories.
Locator Quantities Report
Shows inventory item quantities stored in specific
locators.
Subinventory Quantities
Report
Shows inventory item quantities by subinventory.
Freight Carrier Listing
Lists the freight carrier codes for the current
organization.
Inter-organization Shipping
Information Listing
Lists the shipping networks for the current
organization.
Locator Listing
Lists the locators for the current organization.
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Organization Reports
Report
Description
Organization Parameters Listing Lists the organization parameters for the current
organization.
Subinventory Listing
Lists the subinventories for the current
organization.
Organization Hierarchy
Exceptions Report
Displays all organizations belong to a legal entity
that are not assigned to an organization
hierarchy.
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Profile Options
Profile Option
Description
INV: Inter-Organization
Currency Conversion
Indicates the currency conversion for interorganization transfers between organizations using
different currencies. Available values are: Corporate,
Spot, or User.
TP: INV Inter-Organization
Transfer form
Indicates the processing control of inter-organization
transfers in the Inter-Organization Transfer window.
Available values are: Background processing
(periodically), Concurrent processing (in parallel), or
On-line processing (Default, immediately).
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Additional
Implementation Considerations
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Additional Implementation Considerations
Products and features
Do you need to set up additional products or features?
1. Need to determine if
organization is a process or
a discrete organization
Oracle Process
Execution
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Oracle Enterprise
Asset Management
Oracle Warehouse
Management
Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
Implementation Considerations
Subinventories
• Is it necessary to differentiate between receiving and
storage subinventories in your warehouse?
• Do you need to link your receipts to a receiving location?
• Do you need to track material without it appearing in onhand quantity?
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Implementation Considerations
Locator control
• Do you need to implement locator control?
• Do you need to need to implement locator control for the
organization, for individual subinventories, or at the item
level?
• Should locator control be predefined, just-in-time, or both?
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Implementation Considerations
Organization access
• Should all responsibilities have access to the organization?
• Which responsibilities should have access to the
organization?
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Implementation Considerations
Shipping networks
• Do you need to ship material between organizations?
• Do you need to track inventory between transfers?
• How do you want to ship material between organizations?
• Do you ship material to Japan, Korea, or Taiwan?
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Implementation Considerations
Shipping networks
• Who owns the material until receipt the shipping
organization or the receiving organization?
• Which receipt routing do you use standard, direct, or
inspection required?
• Is an internal order required for each shipment?
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Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
Summary
In this lesson, you should have learned how to:
• Understand the structure of an inventory organization.
• Understand the multi-organization structure in Oracle
applications.
• Understand how to use the organization reports.
• Understand how to set up the organization profile options.
• Understand organization implementation considerations.
1 - 45
Copyright © 2010, Oracle and/or its affiliates. All rights reserved.