Manufacturing using ERPNext

By John Clarke October 4, 2017 ERP No comments yet

Manufacturing using ERPNext

ERPNext features for manufacturing include:

  • Efficiency: Items, Suppliers, Production Orders, etc. are managed within one controlled system. Fix a problem once and it’s fixed everywhere.
  • Transparent: A visible, trusted, change management process and chain of truth.
  • Scalable: Readily scales with users, items, suppliers and orders, and adapts as your processes change over time.

In this tutorial we will illustrate ERPNext support for manufacturing using the fictitious Swift Construction Company’s development of their Aircraft Wireless as a product example.

Goals

The goals of this tutorial are to:

  • Manufacture a sub-assembly with auto-issued child (input) items.

Manufacturing Cycle

The general manufacturing cycle in ERPNext is:


  • Enter a Production Order (also known as a Work Order), a directive to the manufacturing shop floor by the Production Planner to produce a certain quantity of a certain Item. The Production Order also helps directs the material requirements (Stock Entry) for the Item to be produced from its Bill of Materials.

    The Production Order is generated from the Production Planning Tool based on Sales Orders. You can also create a direct Production Order by:

    Manufacturing > Documents > Production Order > New

  • Enter a Production Order to manufacture an item according to its Bill of Materials (BOM).
  • Receive the finished manufactured items (the output from the work order) into stock. Input items listed on the Bill of Materials to auto-issue input items will be transacted to the work order at this time.
  • Issue any additional input items used in the manufacturing process to the Production Order.
  • Close the Production Order.

For this example we will manufacture 10 units of item 20000001-00, a custom electrical coil. The assembly tree is shown below. I covered how to configure an item as Manufactured, and how to create a BOM, in the Product Lifecycle Management using webERP tutorial.

20000001-00,"IND,830UH,AIRCRAFT WIRELESS"
|-- 90000001-00,"WIRE,MAGNET,38AWG,POLY"
|-- 90000002-00,"MAG,FERRITE ROD,1/4IN X 4IN,MATL=61"
\-- 90000003-00,"TAPE,ELECTRICAL,3/4"",BLUE,VINYL"

The manual process that will be followed is:

  • Manufacturing scheduler creates a Production Order that is assigned to a team to assemble and produce.
  • Assembly technician prints work order and kits required input materials from stock room. The technician initials each input item quantity as removed from stock.
  • Technician completes finished coils.
  • Technician initials Production Order as complete and returns to scheduler.
  • Scheduler receives the output items into the Production Order, which also causes the input items to be transferred from stock.
  • Scheduler closes Production Order.

TODO add swim-lane diagram(s).

TODO describe the accompanying parallel paperwork process.

Setup

If you have been following my previous tutorials,  there should be no further setup required. However, if not, it may be helpful tog review building a BOM in Product Lifecycle Management using webERP, and purchasing items in Purchasing Using webERP.

Create Work Order

A work order essentially converts the list of raw material required to manufacture an item (the Bill of Materials, or BOM) into one or more outputs. The work order can be printed and used to kit the necessary raw materials, and also used as a traveller for the Work in Process (WIP).

  • Create a new work order.
  • Enter optional Reference and Remark. TODO explain why
  • Search & select output item 20000001-00. Update.
  • Enter Qty 10 and comment for output 20000001-00. Update.

The work order can be printed and signed as record of kitting, and also as a record of additional input items to enter before closing the work order. A printed copy of the work order often travels with the WIP as identification (e.g. a traveler for a tote of material). Labels can also be printed for later attaching to the manufactured items. 

Main > Manufacturing > Transactions > Work Order Entry

If you search for work orders you will see that the new work work is in the system.

The  work order status shows demand for the raw materials needed to manufacture the inductor, which indicates they have not been issued.

You will also see that there is qty 10 of 20000001-00 on order from its item screen.

Receive Output Goods

When the output items have been manufactured they are received against the work order. For simplicity I will assume the manufacturing process was flawless, with no waste and all the manufactured items meet spec (see the manufacturing and test procedure filed in the Knowledge Base).  

Items listed on the BOM as auto-issue will issue to the work order at this time.

Process Manufactured Items Received

Close Work Order

Close the work order after all raw material has been issued to the work order and all manufactured items have been received against the work order. Review the work order costing,

Main > Manufacturing > Transactions > Select a Work Order > Select > Costing

and close the work order.

Summary 

This completes the overview of manufacturing using ERPNext. 

References

For further reading refer to https://erpnext.org/docs/user/manual/en/manufacturing/production-order


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