Preparing to Implement PeopleSoft Inventory

This chapter discusses issues that you should consider before beginning the PeopleSoft Inventory implementation. This chapter discusses how to:

Define serial control and shipping serial control.
Define staged-date tracking.
Define the negative inventory option.
Set up location accounting.
Set up business unit and item options.
Define order fulfillment processing.
Use workflow in PeopleSoft Inventory.

Defining Serial Control and Shipping Serial Control

You can track serial numbers from the time that you receive an item or from the time that you ship an item from the business unit:

Serial control enables you to track an item as it moves from one material storage location to another.

This tracking method requires a serial ID for every material movement transaction involving the serial-controlled item. For example, the serial ID is required for putaway, cycle counts, and picking.
Shipping serial control enables you to track an item only after shipment.

If the item is returned, you have a shipping serial ID to identify it, but you do not have to track the serial ID throughout the entire inventory process.

There are several ways to assign shipping serial ID numbers before physically shipping an item:

On the Express Issue component, use the Serial ID page to assign ship serial ID or have the system automatically assign them.
On the Shipping/Issues - Ship Serial page or the Express Issue component's Serial ID page, you can assign shipping serial IDs to the order line and save the page, without marking the line as being shipped. The system can automatically assign the ship serial IDs using the Shipping/Issues component.
Through electronic data collection, you can assign shipping serial IDs after the item has been allocated using the Order Release process with a Create Allocation action (push picking plan) or after it has been picked using either online picking feedback or the inventory picking data collection transaction.
On the Inventory Front End Shipping EIP or the Inventory Shipping EIP, the system can automatically assign the ship serial IDs. Users can also manually assign ship serial IDs using the Location/Lot/Serial segment by leaving the storage location blank.
On the Shipping Notification EIP, users can manually assign ship serial IDs using the Lot/Ship Serial segment.
On the Material Picking Feedback page.
On the Fulfillment Workbench, you can assign ship serial IDs using the Pick Confirm, Front End Ship, and Ship actions. On the Location/Lot/Serial level enter serial IDs and leave the storage location blank. This indicates to the system to assign a ship serial ID instead of picking the serial ID. If you would like the ship serial IDs to be recorded with a specific lot ID, enter the lot along with the serial information. If you would like to pick the lot but not the serial ID, enter the lot on a separate Location/Lot/Serial entry with a storage location.

To use the Front End Shipping process page or the Shipping process page, you must have ship serials defined for the demand line before processing.

You cannot ship an order line that does not have the correct number of shipping serial IDs assigned for shipping serial-controlled items. For example, if the order line is for five units of a shipping serial-controlled item, but only three shipping serial IDs were assigned, an error message appears when you save either the Express Issues or Shipping/Issues component.

When you enter shipping serial IDs, you can assign them to particular lot IDs either manually or through electronic data collection transactions. When you generate shipping serial IDs automatically, you can specify a lot ID to assign to the entire batch of new shipping serial IDs. However, to generate 100 shipping serial IDs from two lots, you must generate the shipping serial IDs in two batches.

If you enter more than one lot ID, the system verifies whether the ratio of shipping serial numbers assigned is correct. For example, if 10 out of 25 items are picked from lot A and 15 items are picked from lot B, the system ensures that 10 shipping serial ID numbers are associated with lot A and 15 shipping serial ID numbers are associated with lot B. This verification occurs when you exit the Serial ID page and when you save the Express Issue page.

When shipping serial-controlled material is returned, you can specify the shipping serial ID number on the RMA Line (returned material authorizations line) page. This enables you to track which items were returned by shipping serial ID number.

See Also

Shipping Inventory

Defining Staged-Date Tracking

Staged-date tracking enables you to track all stocked items according to the date that they were put into inventory. You can select this option for your installation on the Installation Options - Inventory page, for an individual item at the setID level on the Define Item - Inventory: Tracking/Description page, or for a business unit/item combination on the Define Business Unit Item - Inventory: Shipping/Handling page.

If most of the PeopleSoft Inventory business units use staged-date tracking, select the option at the installation level and override it at the setID-item level or the business unit-item level as necessary. PeopleSoft Inventory always considers the business unit/item combination when processing.

If you enable staged-date tracking, the default staged date is the current date, and the Staged Date field appears on pages and prints on reports. (Depending upon how you set the business unit defaults, you may need to save or refresh a page before this field appears.) Because stock is differentiated and identified by the staged date, enter staged dates for all material movements in PeopleSoft Inventory.

If you do not use staged-date tracking, the system automatically enters the default date defined on the Installation Options - Inventory page as the staged date and hides the Staged Date field on all pages and reports.

If you run the Order Release process using the earliest staged date (FIFO) or latest staged date (LIFO) location by date sort options, you must use staged-date tracking so that the system can differentiate among the items in a location.

Note. Before processing any inventory transactions, determine whether you want to use staged-date tracking for your entire installation, for an item at the setID level, or for a business unit/item combination. Once you begin processing inventory, do not change this option.

Establishing Item Tracking and Lot-Control Attributes

Establishing Item Shipping and Handling Attributes

Defining the Negative Inventory Option

Whether due to a time lag between the movement of stock and the recording of transactions or because of data entry errors, the system quantities might be less than the physical quantities in a given material storage location. For example, suppose you put away stock and then pick it to fulfill a customer order before the putaway transaction has been recorded. Regardless of the quantity discrepancies, it’s critical to your organization to continue processing the transactions to keep the production schedules and customer shipments on track.

To help support fast-paced manufacturing and distribution environments, you can enable key transactions in PeopleSoft Inventory to drive quantity balances negative.

Allowing Negative Inventory and Displaying Warning Messages

If you enable negative inventory for a business unit (by selecting the Allow Negative Inventory option on the Inventory Definition - Business Unit Options page), you can indicate whether you want the system to display warning messages before accepting transactions that result in negative quantities. These warning messages are not available in background (COBOL and Structured Query Report [SQR]) processes.

Reviewing Transactions Affected by Negative Inventory

Transactions can drive these inventory available quantities negative:

Business unit/item quantities: the quantity available, quantity on hand, and quantity owned that are stored at the business unit and item level.

If stock is in work in process (WIP) material storage locations and there are negative quantities, the quantity reserved stored at the business unit and item level can potentially be negative.
Item-lot quantities: the quantity available and quantity on hand that are stored at the business unit, item ID, and lot ID level.
Storage location quantities: the on-hand and available quantities of the item at the material storage location level (including container ID, staged date, lot ID, serial ID, and unit of measure).

This table lists transactions that update these inventory quantities. The transactions marked Yes in the Allow Negative Qty (allow negative quantity) column can drive inventory balances negative.

Note. You cannot enter negative quantities for transactions using the negative inventory option. For example, you cannot enter −10 as a quantity for a putaway transaction.

Transaction Type	Area Affected	Type	Allow Negative Qty?
Putaway	Complete Putaway	COBOL	No
	Express Putaway	Page	No
Stock Fulfillment	Reserve Materials	Application Engine	No
	Allocate Lots	page
	Lot Allocations	COBOL	No
	Front-End Shipping	Application Engine	No
	Order Release	Application Engine	No
	Material Picking Feedback	Page	Yes
	EDC Inventory Picking	COBOL	Yes
	Shipping Requests	Application Engine	No
	Picking Confirmation	Application Engine	Yes
	Shipping/Issues	Component	Yes
	Deplete On Hand Qty	Application Engine	Yes
	Express Issue	Component	Yes
	Fulfillment Workbench	Component	Yes
	Shortage Workbench	Component	Yes
	Fulfillment Engine EIPs	Application Engine	Yes
Adjustments	Adjustments	Page	Yes
	EDC Adjustments	COBOL	Yes
Transfers	Transfers	Page	Yes
	EDC Transfers	COBOL	Yes
	Container Management	Page	Yes
Physical Accounting	Stock Quantity Update	Application Engine	Yes

Making Special Considerations by Functional Area

For most functional areas, the Allow Negative Inventory option enables you to enter a quantity greater than what is available in the material storage location, lot, or business unit. The following sections describe special processing when negative quantities exist:

Putaway and Express Putaway

If the owned quantity for an average cost item is negative before the putaway transaction, the average cost is set to the actual cost of the putaway (for example, inbound purchase order cost), and the net difference in total inventory value is written off.

The write-off amount is calculated like this:

write-off amount = total value of item after putaway − (total value of item before putaway + total value of putaway) = (new average cost * (original qty owned + putaway qty)) − ((old average cost * original qty owned) + (putaway cost * putaway qty))

Material Picking Feedback

Serial Control:

For serial-controlled items, you can make an over-allocation; that is, you can allocate more than the on-hand quantity. This means that a serial ID that was allocated to a specific demand line can be picked for another demand line with an over-allocation.

When you make an over-allocation, the system issues a warning that the serial ID has been over-allocated. Once the over-allocation has been picked and confirmed, the on-hand quantity is set to 0, which prevents the serial ID from being picked and confirmed again. If you later attempt to fill the original allocation, the system generates an error message and does not permit the transaction.

Storage Containers:

Within a given material storage location, you can pick and confirm to drive a container quantity negative as long as the same container ID does not exist in another material storage location with a positive or negative quantity.

Express Issue

Serial Control:

For serial-controlled items, you can issue quantity that has already been allocated. However, you cannot drive the quantity negative by issuing more than the on-hand quantity. If a serial ID is allocated to a demand line but issued for another using an express issue, the serial ID cannot be picked and confirmed for the original demand line.

For example, if a worker uses a previously allocated serial-controlled item to fill another demand, the system allows the transaction but warns that the serial ID has been over-allocated. If the worker trying to fill the original allocation attempts to confirm the serial ID after the issue has been recorded, the system generates an error message and does not permit the transaction.

Storage Containers:

You can ship all items in a storage container quickly by using the Choose Containers link on the Express Issue page. The system creates an order line for each item in the container. However, if any items in the container have a negative quantity balance, the system issues an error message indicating that the container cannot be shipped. To ship items that have a negative balance, ship at the item level rather than the container level.

Adjustments

If the available quantity for the item is negative, you can perform a decrease, scrap, or miscellaneous issue ad hoc adjustment to drive the quantity further negative.

You cannot drive quantity negative when adjusting the quantity of a serial-controlled item.

Transfers and Container Management

If a storage container has any item with a negative available quantity, you can transfer the storage container after accepting the system warning.

You can transfer items with negative quantity on hand after accepting the system warning.

Serial-controlled items must have a quantity balance of 1 to be transferred.

Because storage containers are considered empty only if the quantity is 0, you cannot rebuild a container in another location if it already exists with a non-zero quantity.

Counting Inventory

You can perform cycle counts for items that have negative available quantities, but if you enter a count quantity, it must be greater than or equal to 0.

Inventory counts the on-hand quantity at the material storage location level. When you enter a count quantity (on-hand quantity) that is less than the reserved quantity, the Stock Quantity Update process drives the available quantity negative.

Inventory Status

You cannot change the inventory status of a particular item in a material storage location in which the on-hand or available quantity is negative or some quantity is reserved.

You can change the status of inventory that has positive quantity, even if that change drives quantity at the business unit or lot level negative (as long as negative balances are allowed for the business unit).

Making Stock Quantity Adjustments and Transfers Within the Business Unit

Managing Inventory Status

Counting Inventory Stock

Picking Inventory

Receiving and Putting Away Stock

Reviewing and Resolving Negative Balances

If you enable transactions to drive quantities negative, you can use the Negative Balances page to locate items with negative available quantities. From this page you can transfer to other pages to:

Make ad hoc quantity adjustments (on the Adjustments page).
Set up counting events for negative balance locations on the Setup Counting Event - Count Options page. These options are used by the Event Creation process page.
View the complete transaction history of an item to help track down what transaction might have caused the negative balance on the Transaction History Inquiry page.

When you select worklist entries created by the Negative Inventory workflow for each item that has a negative balance at the business unit, lot, or receiver level, you automatically jump to the Negative Balances page.

You can also generate the Negative Balance report, which lists items (based on your criteria) with negative available quantities.

Setting Up Location Accounting

Location accounting is an accounting method that captures and records material movement within the warehouse, providing accounting visibility based on where the inventory resides.

You can designate certain storage areas as containing raw material, WIP, inspection, or finished goods by assigning the corresponding ChartFields to the storage area. All inventory locations in a storage area use that storage area's accounts. As each inventory movement occurs, the Accounting Line Creation process looks at the accounts associated with each storage area to determine which accounts to debit and credit. For example, when inventory is shipped to a customer, the system credits the storage area from which the inventory is shipped.

Note. To use location accounting, you must select the Location Accounting Required option on the Inventory Options page when you define the business unit, and you must establish ChartFields for each storage area on the Storage Area Accounting page before processing inventory transactions.

Defining Location Accounting

Setting Up Business Unit and Item Options

You can set up a variety of options in each of a business unit's functional areas (stock fulfillment, replenishment, putaway, and so on). The decisions that you make regarding many of these options are not easily reversed after you begin processing inventory transactions for the business unit. Keep this in mind when making the following decisions:

Define the business unit’s default material storage location configuration on the Inventory Options page.

Material storage locations comprise a storage area and up to four levels of storage-level detail. Once the storage level configuration is defined for the storage area, only its associated level of detail appears on pages. After inventory transactions have been processed, the storage level configuration cannot be modified without a data conversion effort.
Determine whether items that have a status of Restricted or Hold should be counted as part of the available quantity for the business unit.

If they should, select the Incl Non Open in Avail Qty (include non-open in available quantity) option on the Inventory Definition - Business Unit Options page when you establish the Inventory business unit.
Determine whether you want to make soft reservations in the business unit.

Soft reservations are not required to fulfill orders in PeopleSoft Inventory, but using them enables you to know whether you have enough quantity on hand to fulfill a specific order. Set up reservations (including the number of reservation lead days) on the Setup Fulfillment-Reservation page. You can override the business unit reservation settings for individual items using the Setup Item Fulfillment page. Do not change the number of reservation lead days once orders have been processed.
Decide whether you want to replenish using stock-level reorder points or ad hoc requisitions for backorders.

Specify ad hoc requisitions for backorders at the business unit level on the Setup Fulfillment page; you can override this setting for individual items using the Setup Item Fulfillment page. Define reorder point replenishment on the Setup Replenishment page.
Consider the standard unit of measure for an item before defining it on the Define Item - General: Common page.

To avoid quantity conversion rounding issues, we suggest that the smallest unit of measure be defined as the standard unit of measure for the item. Once an item has been processed by an inventory transaction, you cannot change its standard unit of measure.
Decide whether a unit of measure results in whole number quantity values or decimal number quantity values.

For example, if you want quantities with a unit of measure of EACH to be entered only as whole numbers, define this on the Units of Measure page.
Decide which material storage locations store non-owned stock.

PeopleSoft Inventory permits only non-owned and consigned items to be stored in locations defined as non-owned. Define a location as non-owned by selecting the Non-Owned option on the Material Storage Locations page.

Important! If you are integrating with PeopleSoft CRM FieldService, configure the business units and material storage locations to reflect the underlying assumptions of the integration design.

See Also

PeopleSoft CRM FieldService PeopleBook

Defining Order Fulfillment Processing

PeopleSoft provides a number of options for fulfilling the stock requests. This flexibility enables PeopleSoft Inventory to meet the fulfillment needs in a wide variety of inventory environments. Before beginning your implementation, you should determine what options to use for fulfillment and what options should not be used in the environment.

Using Workflow in PeopleSoft Inventory

PeopleSoft workflows are an integral part of PeopleSoft Inventory, whether you are reviewing backlog information, reviewing shipment information, notifying customers of shipment, or approving items.

Interunit Transfer Confirmation	This workflow creates an interunit transfer shipment confirmation in the form of an email to the destination business unit. The email is launched from either the Shipping/Issues - Order Summary page or the Express Issue page for interunit transfer orders.
Lot Expiration/Lot Retest	An Application Engine process checks for lots that have a retest date or a lot expiration date earlier than the current date and creates a worklist entry. When you select the worklist entry, the system transfers you to the Lot Control Information page, where you can update the lot’s status, retest date, and expiration date.
Negative Balances	An Application Engine process, named Notify Negative Inventory (IN_WFNEGINV) checks for negative balances and creates a worklist entry. This process can be found by navigating to PeopleTools, Application Engine, Request AE. When you select the worklist entry, the system transfers you to the Negative Balances Inquiry page, where you can view the negative balances and either generate a cycle count or adjust the quantities.
Shipment Shortage	An Application Engine process checks for shipments with a quantity shortage and generates an email notification to the role user, based upon the demand source of the order (PeopleSoft Order Management, PeopleSoft Purchasing, PeopleSoft Inventory, or PeopleSoft Planning).
Bar Code Transaction Errors	An Application Engine process checks for barcode transactions that have an error status and generates a worklist entry. When you select the worklist entry, the system transfers you to the Transaction Error page, where you can view and correct the errors.
Lot Allocation	When processing completed configured items from PeopleSoft Manufacturing, the Complete Putaway process (INPPPTWY) determines whether an order line is waiting to be lot allocated. The Complete Putaway process creates a worklist entry for order lines associated with the completed production ID. When you select the worklist entry, the system transfers you to the Allocate Lots page.
Fixed Bin Replenishment	This workflow enables you to stock transfers efficiently from the main warehouse or stockroom to fixed picking locations that need to be replenished.
Fixed Picking Replenishment	This workflow, which is activated by the picking plan, notifies warehouse personnel to transfer stock from inventory to the fixed picking locations to ensure enough stock is available to fulfill orders for shipment.

PeopleTools 8.46 PeopleBook: Workflow Technology