Discrete Manufacturing: Project  Manufacturing

What is Project  Manufacturing?

 

Project  Manufacturing is when a project needs to be set up to track labor tasks (not assembly related) and to manage the manufacturing of an assembly that consists of parts and sub-assemblies according to the specific requirements of a specific customer/sales order. Such an assembly can not be used again for sales orders from other customers. Such a production order may last months or years.

The components and sub-assemblies need to be designed, engineered, configured and manufactured.

Example:

A discrete manufacturer which manufactures a custom large boat. A trade exhibit manufacturer has to design, engineer, manufacture a trade booth. Many labor tasks have to be done besides making the booth. Therefore a project is set up to track all those tasks and to make/manufacture the actual booth. The booth parts will then be packed, loaded onto a truck, transported to the exhibition, unloaded there, unpacked and installed.

Integration with Project Accounting for Job Costing

When you schedule a production run, you need to schedule people, tasks, assign tasks to people, schedule machines, tools and material. This becomes a serious project. The Acumatica Project Accounting enables you to do all this, and enables you to make a project estimate, and track actual costs against the estimate. 

The following infographic illustrates this. More details for the infographic can be seen here.

In the new version 2019R1 of Acumatica, the project accounting module/workspace enables you to specify project quotes consisting of a project estimate to do a certain set of manufacturing tasks and use  a certain list of items/parts. Once this quote is approved, the project quote can be converted to a project. In addition this project can become a work/production order in a manufacturing environment where the Acumatica Manufacturing Edition is installed. 

The video (20 mins, 2/2019) below illustrates the creation of a project quote, which then becomes a project in a manufacturing environment, and then becomes a work/production order. You can click here to see the full screen. 

What does that mean for the manufacturing management and the inventory management?

 

This means that normally a project will be set up consisting of :

  • Labor (design, blueprint, engineering, assembly, installation, ..)

  • Components/parts that are not part of the manufacturing but part of the installation

  • Assembly to be manufactured/assembled consisting of:

    • Components/parts

    • Sub assemblies

 

For the assembly to be manufactured in the project, which requires a specific production order having specific assembly and for each sub-assembly, a specific BIll Of Material (BOM) will be created, and a production order will be planned. A sub-assembly may have to be manufactured. You can see in the video ( 11 mins, May 2020, at min 6.42) below that there is a specific production order number and BOM number for a specific assembly.

There is no Materials Requirements planning since there is no forecasting possible since there is no sales history avalable for that specific assembly.

Actually the MTO manufacturing method is being used.

 

Regarding inventory management, the determination of the ReOrder Point (ROP) and the Order Quantity can not be done based on the history of sales orders and plain forecasts since exact same sales orders don't exist. Neither do forecasts exist . The determination will be done based on insights of new sales orders that use some common components, current stock and purchase orders in transit. The inventory is just-in-time inventory. Components and maybe sub-assemblies will be made just-in-time.

References: http://www.softwareshortlist.com/erp/articles/erp-applications/make-to-order-vs-make-to-stock-implications-for-your-erp-system/

The Challenges with Project Manufacturing

The two main drawbacks of Project  Manufacturing management type are timeliness and cost of customization.

What solution does Acumatica have to manage Project Manufacturing?

The Acumatica Manufacturing Edition handles the Bill of Material, the creation of a production order from the assembly item in the project, and management of the actual production run. During the creation of the production order, the current stock of that assembly item is displayed.

The video (12 mins, 5/2020) below describes how a manufacturer of trade exhibition booths can use the Acumatica Project Accounting and the Acumatica Manufacturing management application to manage the manufacturing of trade exhibition booths.  Both are fully integrated, and use the same database.

Click here to see the video full screen

Project Manufacturing using the Estimator to create a BOM

The video above assumed that a BOM was already created for the finished good (injection molding machine). The video (30 mins, 11/2020) below shows you how the Estimator of the Acumatica Advanced Manufacturing Management application can be used to create a BOM.

Sorry the quality of the video is not the greatest but, it does show the flow of the project manufacturing process. This flow is easy to follow in the Acumatica ERP as shown in the video/webinar below. The PPT slides used in the video/webinar are given below.

We will try to give you a better video.

Click here to learn more about the Estimator. Once there scroll down to the Estimator section.

Product Life Cycle Management (PLM)

The Product Life Cycle management ISV application of Arena Solutions will enable you to manage the product conception, design, engineering, testing, general production and marketing. Click here to see more details.

BIll Of Material and Production Order Planning and Management

Click here to learn more about the BOM and production order creation and management.

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