benefits of automotive

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Oracle Warehouse Management

Benefits of OWM for Automotive

An Oracle Topical Essay

June 2002


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Oracle Warehouse Management

Benefits of OWM for Automotive

BENEFITS OF OWM FOR AUTOMOTIVE

Oracle has a well-integrated applications solution to address the unique needs of the automotive sector. The special

requirements of automotive focus on demand management, production and shipment sequencing, and material control.

Oracle Release Management and components of Oracles manufacturing suite address demand management and

production sequencing requirements. Oracle Inventory traditionally handled the material control component.

However, several features critical for efficient material management, including mobile device integration, integrated

label printing, and efficient shipping processes, were not supported by standard Oracle Inventory functionality. Thesefunctional gaps were typically addressed by customization and integration with third party software providers, leading

to expensive and difficult to maintain implementations.

Oracle Warehouse Management, a component of the Oracle e-Business Suite, addresses many of these requirements

with standard, out-of-the-box functionality. OWM is tightly integrated with Oracle Inventory and the rest of the e-

Business Suite, using the same data model implementation of OWM is just the incremental setup required to utilize

the new features.

This document describes the features of OWM that are of particular interest to Tier 1 and Tier 2 automotive suppliers,

as well as any integration points to other components of the e-Business Suite that are enhanced with OWM. The key

areas include mobile support, label printing, manufacturing integration, and simplified shipping processes. In order to

provide a complete picture, other areas such as inbound processes and replenishment will also be covered.

Integrated Mobile Support

First, however, the key enabling technology and the benefits it can provide will be described. All transactions are

managed through a fully connected mobile device with an integrated barcode scanner. All data is immediately

validated by the system, preventing invalid items or nonexistent locators from being entered, for instance.

In addition, transactions can also be processed online in real time, so that the system always accurately reflects current

inventory positions and warehouse conditions. Data accuracy is greatly improved by the use of barcode scanners,

rather than manually keyed data, and data identifiers help ensure that the right data is scanned in the right field.

Combined with license plate support, which allows multiple serials, lots, or even items, to be grouped in a single

container and moved together with a single scan, transactions on the mobile device greatly improve inventoryaccuracy, transaction speed, and enable real time data availability.

All transactions are supported on the mobile devices, while management functions are typically performed on the

desktop.

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Inbound

OWM supports receiving all documents that can be received on the desktop application, including purchase orders,

internal requisitions, and RMAs. Receipt via advanced shipping notices (ASN) are also supported, and all receipt

routings standard, inspection, and direct are supported.

Receipt

The receiver scans or enters the purchase order number or ASN. The operator then enters a new license plate number(LPN) for the pallet, which can be used to streamline movement transactions. Alternatively, the LPN may already

have been generated by the supplier and provided on the ASN. Next, either the supplier item number, or the

organizations own item number, is scanned, and the quantity is entered. Finally, any additional information that must

be recorded, such as carrier, pack slip, or bill of lading number, can be scanned and captured.

Labels

At this point, several labels can be printed, including a label identifying the LPN and the contents, or labels for just the

LPN, or just the contents. The weight and volume of the pallet can also be printed on these labels. Different label

formats can be printed based on characteristics such as the item or item category, supplier or purchase order type, or

any number of additional attributes.

Putaway

The system will suggest a locator, based on locator capacity (weight and volume) in comparison to that of the load.

The system can also base the suggestion on item category, so different types of components are segmented in the

warehouse for easier control. Additional preferences, such as avoiding commingling of items, or minimizing

fragmentation if multiple pallets of the same item are received, can also be honored.

Dedicated item locators may also be setup along the manufacturing line for frequently used or standard components. If

any dedicated locators are empty, the putaway logic can be built so that an operator picking up the pallet for putaway

can be directed to replenish those dedicated locators before putting the remaining quantity away to storage.

To confirm each putaway, the receiver scans the LPN, the item, the quantity, and the destination subinventory and

locator.

Replenishment

Most common components are pulled from the manufacturing line directly into the assembly, either at the operation

move or at the assembly completion. These components are stocked along the manufacturing line near where they will

be needed, and they may be stocked at multiple locations if used in multiple lines. As these components are

consumed, they must be replenished.

Task Based Replenishment

OWM builds on the min/max replenishment process available with Oracle Inventory. A schedulable concurrent

request generates replenishments for all locators that have less than the minimum level for its dedicated component.

With Oracle Inventory, these replenishment requests are fulfilled by material from a particular subinventory, and must

be transacted on the desktop. However, with OWM, tasks are generated for these replenishment requests, and any

material available in the warehouse can be selected based on any number of user-definable rules.

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Tasks

Several features are inherent in a task, including restricting the task to those operators with the requisite skill set and

equipment available to perform the task. In addition, if the material required for the task is too heavy or large to be

done in a single movement, the task will be split into smaller sub-tasks. Tasks are sequenced based on the warehouse

layout, so that operators follow an efficient path on the floor. Any exception an operator comes across when

performing a task is documented for the warehouse manager, and can kick off a corrective action via Oracle

Workflow. Finally, operator progress and efficiency can be viewed on the desktop Warehouse Controlboard.

Picking Rules

The best material from the best locations will be selected for use in replenishment activities. Criteria that may be

important for a warehouse might include stock rotation (pick oldest material first), warehouse cleanup (pick near-

empty locators first), or warehouse efficiency (pick full LPNs only). Any combination of these, or other criteria can be

used; the picking rules are just as flexible as the putaway rules. These criteria are defined in the OWM Rules Engine.

Putaway to Manufacturing Line

As described in the inbound section, material received from an ASN, purchase order, or interorganization transfer can

be putaway directly to the dedicated locations along the manufacturing line. This can be done based on several

decision criteria. For instance, the line can be replenished only if the entire pallet can fit along the line, or only if theline is below its minimum level, or it can be replenished whenever the location on the manufacturing line has available

capacity. All of these criteria, and many more, can be defined using the OWM Rules Engine.

Manufacturing Integration

OWM is tightly integrated with various components of manufacturing. Picking tasks can be generated for discrete jobs

and flow schedules. Completions directly into an LPN can be performed from a discrete job, flow schedule, or

workorderless completion, and then utilize the same putaway rules described for inbound. Finally, labels can be

printed for flow schedules when they are started, for use as job travelers, or for customer compliant labeling.

Picking for Manufacturing

Commonly used components will likely be defined as assembly or operation pull and replenished to the manufacturing

line as documented above. However, more expensive or more massive components may be supplied to the

manufacturing line as needed, so that only a few components are available in advance. This can be ensured via

Component Pick Release, which creates tasks for all components on a discrete job or flow schedule. Other

components that may be more efficiently supplied by the min-max processes described earlier can be optionally

excluded from the Component Pick Release process, so that a combination of supply methods can be utilized.

Component Pick Release

Component Pick Release is the process by which tasks are created for components on a discrete job or flow schedule.

The user can select a single job or schedule, or a range of jobs and schedules, based on material requirement date,

assembly, or sales order, on the desktop form. Once the selection criteria are completely specified, an online processallocates the material and dispatches tasks directly to qualified operators.

The operator confirms the task by scanning the LPN, or if loose, the item, quantity, subinventory and locator of the

source material, and then dropping the material directly to the job or schedule. The mobile interface indicates the

department and operation, as well, to assist the operator in finding the right location to drop off the material.

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Component pick release also maintains additional features of tasks described earlier, such as rules-based allocation and

rules-based material selection.

Labeling

Labels indicating the job or schedule for which the material has been picked, as well as details about the material

including many flexfields, can be printed for material requirements that are fulfilled with tasks.

LPN Completions

As completed assemblies flow off the assembly line, they can be completed directly into LPNs. These LPNs can then

be putaway to particular staging lanes based on the outbound loads that are being built. Multiple serials of a single

assembly can be completed into a single LPN. Multiple assemblies can be completed into a single LPN as well, so that

heterogeneous loads such as a front / rear axle combination can be built in a single step from manufacturing.

Generating LPNs for Completion

LPNs for use in completion can be generated on the fly, generated in advance, or pre-packed in advance. All three

options allow labels, such as LPN labels and content labels to be printed, but the methods differ in the timing at which

the label can be produced, and how much information will be included in the label.

For instance, if the LPNs are pre-generated, then a pallet ready for completion can be labeled in advance and the

operator need only scan the LPN label. Content labels could only be printed after the completion transaction, however.

If, however, the LPNs are pre-packed, then the system knows the item and quantity that will be completed into the

LPN in advance of the actual completion, and thus can print a label with all details prior to the completion. Pre-

packing also automatically associates a container item to an LPN, which is included in the outbound ASN. Container

items can also be associated at a later point, either as a separate transaction, or as part of the Direct Ship outbound

process.

Rules Based Putaway

After the LPN has been built from completed jobs or schedules, the LPN can be putaway. The putaway process can be

integrated with the completion so that the same operator that performed the completion must also perform the putaway,or the process can be separated into its two components, so that a different operator may perform the putaway. The

putaway triggers the OWM Rules Engine to select the best destination storage locator or staging lane, though the

operator can always override the system suggestion.

Serialized Assemblies

Many automotive assemblies are serialized, often with a supplier-provided serial number. The serial number is

associated with the assembly at the time of completion. Using LPN-based completions, any additional attributes of the

serial can be captured in flexfields. In addition, if the assembly required any assembly pull serialized components, that

serial data is captured as well. The component to assembly serial relationships, or serial genealogy, is maintained in

the system so that any later quality issues can be traced back to the component serials.

Additional serial numbers that must also be maintained with an assembly, such as the VIN or OEM chassis number,

can be associated with the assembly and included in labels by using flexfields.

Kitting via Workorderless Completions

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LPN-based workorderless completion is a powerful feature for building aftermarket kits. This combines the standard

features of supplying material to a job, backflushing all components into the kit, with the features of directed putaway,

so that the completed kit can be directed to a storage location where other similar kits are kept. Note that because of

the power of the OWM Rules Engine, this location need not be fixed, but rather, can differ as the collection of

components and assemblies varies. Or the Rules Engine can build on any dedicated item-locator assignments that have

already been setup or that are desired.

Flow Labeling

Labels can be printed at the beginning of a flow schedule, or at any later point during a flow schedule. Whenever a

label is printed, the OWM Rules Engine is used to determine the correct label format to use based on any number of

attributes such as the item, the customer associated to the flow schedule, ship to address, or any related flexfields. This

can be used to provide a traveler document with the assembly, or a customer compliant label, or perhaps even both.

If the assemblies are built out of sequence, but then later staged in sequence, the sequence number can be populated in

a flexfield and then printed on the label for use by a material handler as staging instructions. Note that, of course, this

would require that a schedule have no more than one sequence number so that the assembly could be uniquely

identified with the sequence number, and thus, probably just one assembly / serial number per schedule.

In addition, if material must be placed in a particular position when it is completed into an LPN, the positioning datacan be populated on a flexfield and then printed on the labels. The flexfield data could also control which label format

would be printed, so that for instance, different label formats were printed for items on the bottom of the pallet and

items on the top of the pallet.

Outbound

Typically, automotive suppliers are assembling finished goods for a specific customer ship schedule; there is no

allocation process by which material is selected and picked for each customer. Pick Release, a required concurrent

process with Oracle Inventory, creates move orders, allocates and reserves material, creates deliveries, and prepares

the order line to be staged. These steps are unnecessary for automotive suppliers and only complicate the shipping

process. With OWM, the entire pick release process can be bypassed with a feature called Direct Ship.

Container Management

All LPNs can be associated with container items. A container item identifies the type of container, such as pallet,

crate, or box, used for the LPN, and can also have a weight and volume. By associating container items with LPNs,

the system can include the tare weight of the container when calculating the LPN weight.

A container item can be associated automatically with an LPN when LPNs are prepacked prior to WIP completion or

pregenerated by a desktop concurrent request. The LPNs can also be associated with container items on the fly on the

mobile device, either as a separate transaction, or as part of the Direct Ship process.

Container item details are included in the outbound ASN, so that the customer receiving the LPNs knows the type of

container to expect from the supplier.

Direct Ship

With Direct Ship, an operator simply scans the LPN about to be shipped, enters the sales order that it is being shipped

for, and optionally enters any additional data such as the container item, freight costs, or the delivery method. This

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single transaction completes the shipping transaction for a sales order line, avoiding the system and operational

overhead of pick release.

Direct Ship is particularly powerful when used in combination with LPN-based completions. Finished assemblies are

completed into the LPNs that will be shipped. Manual consolidate, split, pack, and unpack transactions are supported

to build any packaging configurations that are required by the customer. Then, once the shipment is ready, the entire

outbound process can be triggered by just a few scans. After decrementing inventory and issuing the LPNs, outbound

ASNs are generated, the delivery is updated, and the order line is closed.

ENABLING TECHNOLOGIES

Several technologies new with Oracle Warehouse Management enable all these business processes to work together

seamlessly, with maximum flexibility, and all without customization. These components are the mobile server, which

provides support for mobile transactions, the Rules Engine, and integrated labeling support. Key components of these

three areas are described below, with an emphasis on those features relevant to an automotive customer.

Mobile Support

All the transactions described above are supported on mobile handheld RF devices with integrated barcode scanners.

Other supported transactions include miscellaneous / alias receipts and issues, subinventory transfers, organization

transfers, material status update, LPN update, cost group update, kanban replenishments, label reprint requests, and

directed picking and putaway. Manufacturing and Oracle Quality inspection plans are also supported on the mobile

device. For complete documentation on all supported transactions, refer to the Oracle WMS Users Guide and the

Oracle MSCA Users Guide.

Oracle has a large list of supported / certified devices, including all major models from LXE, Intermec and Symbol,

and can work with vendors to certify additional devices as necessary. Any barcode symbology supported by the

mobile device is supported by Oracle, in that the device translates the barcode into plaintext for the application.

Integrated security and customizable menus are standard features on the mobile, as they are on the desktop

applications. Additional features are discussed below.

Transaction Processing

The devices are connected via online connections directly to the application and database so that all material

movements can be recorded immediately, and any material inquiry reflects the most recent data. Alternatively, just as

on the desktop, the processing mode for the mobile devices can be set for immediate concurrent processing or

background processing if the transaction volume is too large for online processing.

Field Validation and Dynamic Page Construction

Regardless of transaction processing mode, all mobile forms perform field level validation. This means that, as on the

desktop, a user is immediately notified if, for instance, an invalid item number or a non-existent locator is entered.

Furthermore, the mobile pages are built as the transaction progresses, displaying only fields that are applicable to the

current transaction. For instance, the serial number field is only displayed if an item is serial controlled, and the lotnumber field is only displayed if the item is lot controlled.

This field validation and dynamic page construction greatly simplifies the mobile transactions and helps increase data

accuracy.

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Data Identifiers

Operators may not always get the correct barcode for each scan, or the sequence in which the barcodes are available

for scanning may differ from the sequence in which the mobile device expects them to be scanned. Data identifiers

handle this out-of-order scanning. A data identifier is a prefix appended to the front of barcodes that is automatically

removed before the data is passed to the application. The prefix identifies the type of barcode that is being scanned, so

that, for instance, if the device expects the item to be supplied, but instead the locator is scanned, the locator is placed

on the correct field.

Rules Engine

The Oracle Rules Engine provides a repository for customer restrictions and business policies. It is implemented

directly from standard Oracle forms; no code needs to be written. The entire system is built using lists-of-values.

Security features are built-in to prevent modification of objects currently in use.

Once the Rules Engine is set up, the end users never see its complexity. Customer requirements and organization

policies are not visible to the operator, only the end results. This simplifies the decision making process for operators,

providing optimal answers and eliminating mistakes.

The Rules Engine has five rule types: picking, putaway, task type assignment, cost group assignment, and label format

assignment.

Picking

Directed picking makes material allocations and directs operators to pick material from specific locators. Some

common examples of picking rules are to ensure stock rotation, to deplete a location in order to free up additional

warehouse space, or to minimize the number of full LPNs that will be used. Assuming that Direct Ship will be used,

directed picking will be applicable for allocating material for replenishment tasks, and allocating material for push

material requirements on jobs with Component Pick Release.

Putaway

Directed putaway directs operators to put newly received or completed material into the most appropriate locators.

Some common processes that the rules are capable of modeling include minimizing item fragmentation, requiring nolot comingling in a locator, directing hazardous materials to a corresponding hazardous storage location, or placing

seasonal items in a subinventory dependent on time of year. Other putaway possibilities include basing the location on

inspection results, the type of purchase order, or item category.

Putaways, to intelligent locations suggested by the Rules Engine, can also be performed for any items anywhere within

the warehouse.

Task Type Assignment

Task type assignment captures the skill sets and equipment required for a warehouse task so that work is only assigned

to appropriate users. Operators can sign onto a mobile RF device, optionally specifying the equipment available to

them. Tasks are assigned to operators based on the operators skill set, equipment requirements and capacity, or thesubinventory the task occurs in. For instance, hazardous tasks can be assigned only to personnel with the appropriate

training, while putaways to the top racks can be limited to operators who have signed on with a high-reach forklift.

Label Format Assignment

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Compliant labeling is becoming increasingly important, but also increasingly difficult as different customers or carriers

require different label formats. The Rules Engine can remove this complexity from the operators by selecting the

appropriate label format, and label type, based on customer, customer ship to address, item category, or transportation

method. Labels that include different data, barcode symbologies, or have different layout can be generated for each

item, container, or as otherwise necessary.

Additionally, odd sized items may require different label types, or some order types may require weather-resistant

labels, for example. The Rules Engine can also generate labels for use inside the warehouse. Upon receiving lot-controlled items, for instance, the appropriate lot stickers will be printed automatically. The Rules Engine is capable of

modeling all this logic.

Cost Group Assignment

Cost groups capture the material valuation accounts necessary for tracking inventory value. For instance, different

accounts could be set up for refurbished, consigned, and company-owned inventory. Previously, cost groups were

associated with the subinventory in which material was stored. With WMS, cost groups are now associated directly

with the on-hand material.

When material is received into the warehouse the owning cost group must be determined. The material handler

should not make cost group decisions on the warehouse floor. The Rules Engine automates this decision, removingcomplexity from the floor while still providing material valuation accounts tracking.

Label Printing

With OWM, labels can be automatically printed as part of business process flows. Label types are assigned to

business flows. For instance, an LPN Summary label and a Material label may be assigned to the purchase order

receipt business flow. The Rules Engine then determines the correct label format to use based on any rules that you

have defined.

OWM creates an XML file with the correct information, including which label format to use based on any rules that

have been set up. OWM relies on a third party package, such as Loftware, Accelio, or Formscape, to build the

formatted label from the XML file, and then to send the printing request to the label printer. A complete list of all the

supported label types for each business flow can be found in the WMS Users Guide, and implementation details can be

found in the WMS Implementation Guide.

The following label types are supported:

Flow Contents

Serial

LPN

LPN Content

LPN Summary

Location

Shipping

Shipping Contents

WIP Contents

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CONCLUSION

The key enabling technologies of integrated mobile support, label printing, and the Rules Engine, combined with

targeted automotive features like Direct Ship and LPN-based completions make Oracle Warehouse Management an

integral part of an automotive solution. With Oracle Release Management and Oracle Manufacturing, the e-Business

Suite is uniquely positioned to meet many of the automotive requirements out of the box.

Additional Information

All of the features mentioned in this guide are described in much greater detail in the OWM Users Guide and

Implementation Guide, available from metalink. In addition, topical essays are available on the internal OWM TOI

site for all of these features at www-apps.us.oracle.com/wms/toi.

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June 2002

Author: David Wertheimer

Copyright Oracle Corporation 2002

All Rights Reserved Printed in the U.S.A.

This document is provided for informational purposes

only and the information herein is subject to change

without notice. Please report any errors herein to

Oracle Corporation. Oracle Corporation does not

provide any warranties covering and specifically

disclaims any liability in connection with this document.

Oracle is a registered trademark.

Oracle Corporation

World Headquarters

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Redwood Shores, CA 94065

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Worldwide Inquiries:

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Copyright Oracle Corporation 2002

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