Order explosion and auto-replenishment

Auto-replenishment Production


Order Explosion

Asprova starts out by generating operations for orders whose output item is calculated as having LLC=0, stopping the order explosion operation by each low level, meaning at the circled positions in the process flow chart described in the page titled "Auto-replenishment production". Generated operations will be as follows.

[Operations]

Operation codeItemQuantityComments
01:20A10*20 of C are required as materials.
01:40B10*10 of B1 are required as materials.

Next, the net requirements will be calculated for the items of LLC=1as follows.

Net Requirements = Gross Requirements + Safety Stock - Theoretical Inventory

These net requirements will appear as shown in the table below. Also listed here is the number of orders to be auto-replenished, which is determined for each item from its net requirements and the fixed lot size specified in the item table.

Item codeGross requirementsSafety stockTheoretical inventoryNet requirementsProduction lot size MAX# of auto-replenished orders
B110578101

With this calculation completed, we can now generate the manufacturing orders and operations of LLC=1, based on the requirements of the items shown in the chart above. We start by generate the manufacturing orders for the items with LLC=1 (in this case the item B1), which will appear as shown below.

Order codeItem codeQuantityOrder type
M0000B110Manufacturing order

Now we generate operations for this auto-replenished manufacturing order.

[Operations]

Operation codeItemQuantityComments
M0000:40B110*50 of C are required as materials.

Next, we calculate the net requirements.

Item codeGross requirementsSafety stockTheoretical inventoryNet requirementsProduction lot size MAX# of auto-generated orders
C705867502


Orders to be Auto-replenished

Now, having completed processing of LLC=1, we are in the position to calculate the requirements for the items of LLC=2, in this case the item C. Since the production lot size UNIT is 10 and the production lot size MAX is 50 for the item C, there will be two auto-replenished orders with production quantity of 50 and 20, according to the net requirements.

Order codeItem codeQuantityOrder type
M0001C50Manufacturing order
M0002C20Manufacturing order

Now we generate operations for these manufacturing orders.

[Operations]

Operation codeItemQuantityComments
M0001:10C50*50 of D are required as materials.
M0002:10C20*20 of D are required as materials.

At this point, normally, we would go on to calculate requirements and generate manufacturing orders for items with LLC=3, but since there are no items with LLC=3, the computation ends.

The manufacturing orders and operations that are auto-replenished in this example can be summarized as below.

Order codeItem codeQuantityOrder type
M0000B110Manufacturing order
M0001C50Manufacturing order
M0002C20Manufacturing order

[Operations]

Operation codeItemQuantity
01:20A10
01:40B10
M0000:40B110
M0001:10C50
M0002:10C20

Calculation of the size of orders to be auto-replenished

The above example explains the "Normal" type of calculation, i.e. the default method of calculating the production lot size. However, depending on the setting of the calculation type, quantities of auto-generated orders will be calculated differently.

The process to determine the production lot size of auto-replenished orders is performed once for each low level code when orders are exploded.

Production lot size calculation method

Normal

Manufacturing orders will be generated for the net requirement using the production lot size MIN, MAX and UNIT. First, the orders will be generated using the production lot size MAX as much as possible, and then the quantity of the last generated order will be adjusted using the production lot size MIN and UNIT.

In the example above, the net requirement of the item C is 67. Since both the production lot size MIN and UNIT are 10, the quantities of auto-replenished orders will be 50 and 20.

Production lot size calculation method

Even

First, the net requirement is divided by the production lot size MAX.

If any surplus occurs as a result of the division, the number of orders to be required (1) will be the result of the division (2) plus 1. (If there is no surplus, the following process will not be performed.)

Divide the net requirement by the number of orders to be required. Calculate the production quantity (3) adjusting the quantities to satisfy the production lot size MIN and UNIT constraints.

Multiply the production quantity (3) by the number of orders to be required (1) minus 1. Subtract the calculation result from the net requirement.

Adjust the quantity resulted from the subtraction to satisfy the production lot size MIN and UNIT constraints (4).

Consequently, manufacturing orders as many as the number (1) with the production quantities being (3) plus one order with the adjusted production quantity (4) will be generated.

For example, if the calculation type "Even" is used in the above example, the calculation will be as follows:

First, if we divide 67 by the production lot size MAX 50, we get 1 and a surplus. Therefore, the number of orders to be required is 2.

Next, if we divide 67 by 2, we get 33. Since both the production lot size MIN and the production lot size UNIT are 10, the order quantity is adjusted to 40. This will be the base order quantity.

Then, we subtract 40 x 1 (2 (the number of orders required) minus 1) = 40 from 67. Adjusting by the production lot size MIN and UNIT, 30 is calculated.

Consequently, one manufacturing order with production quantity of 40 and another manufacturing order with production quantity of 30 will be generated.

Also, if we specify 5 as the production lot size UNIT in the example above, two orders with production quantity of 35 each will be generated.

*Note that, if there are any discrepancies between the production lot size MIN, MAX and UNIT (e.g. MAX < MIN), auto-replenished orders may not be created or pegged for that item.



Types of auto-replenished orders

By default, orders to be auto-replenished are specified as manufacturing orders. However, you can specify to auto-replenish other types of orders using the "Obtain method" property of an item object. Values you can select from the "Obtain method" property and types of orders to be auto-replenished are as follows:

Obtain methodType of auto-replenished orders
Not allowedDoes not auto-replenish.
ProduceManufacturing order
Prefer to produce Manufacturing order
PurchasePurchase order
Prefer to purchasePurchase order

When purchase orders are auto-replenished, quantities of the orders are calculated using the values specified in the purchase lot sizes MIN, MAX, and UNIT.

For auto-replenished orders, the property "Order class" will be "Replenishment order".


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