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Maintaining multiple units of measurement

Dear All,

We are into steel pipe manufacturing industry, where multiple units of measurement are used at various processes. The whole process is described as below:

1. Raw material is always measured in KGs and GR is also done in KG.

2. A pipe can be measured in three units:

a) KG or MT (Metric Tonnes)

b) Numbers

c) Meters

But all these units may or may not available at all the stages. In other words,

- When pipe is produced, then at production shop-floor, only the number of pieces are counted. Length and Weight are variable factors. As length is decided by customer for the same material code. Weight is also not fixed as thickness of the Raw material keeps on varying. And it is impossible to weigh the pipes during production because of process & shop-floor challenges. So, during production stage, only number of piece is a known factor. E.g. 100 pipes are produced and appx. weight is 10 MT with total length as 600 Meters.

Note: Weight and Length are appx. figures.

- When pipe is being sold to customer, it can be sold in any unit i.e. either in Meters or in Numbers or in KG. And at the time of selling only, material is being weighed at weigh bridge.

Case 1: When sales unit is numbers:

Suppose sales qty is 100 Numbers which is perfect as per production. But at weight bridge, the weight of these 100 pipes comes out to be as 10.2 MT. Now the problem is as per system conversion, weight is only 10 MT. So showing only 10 MT in Invoice or delivery output will be inaccurate as it does not match with Weigh bridge measurement.

Case 2: When sales unit is MT:

As per system, stock produced is only 10 MT, how can we sell 10.2 MT? From where should we bring this extra .2 MT? Sales cycle will stop. And suppose if weigh bridge weight is 9.8 MT, then system will always show .2 MT stock in system which is not present physically.

Case 3: When sales unit is Meters:

As per system, already produced length is 600 meters, but at the time of selling, if actual total length comes out to be 603 meters, then again problem of bringing extra stock. And if actual total length comes out to be 597 meters, then a surplus stock will be seen in system.

Note: Batch management is required, and batch numbers are generated in a mass in a single day.

Solutions visited:

A) Physical Inventory (PI) does not seem to be a solution, as

- it also posts the accounting document which is questionable if done on regular basis

- doing PI for batches will be very much tedious job

B) Batch specific unit of measure is also creating problems at shop floor and also while processing the batches in PP & SD modules.

Aim: To be able to track inventory at least in Numbers and MT accurately.

Thanks & Regards,

Vishal

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  • Best Answer
    Posted on Sep 09, 2013 at 09:28 AM

    Hi Vishal,

    Already we have mapped almost similar scenario in cable industry.

    You have to use Batch management- "Batch specific unit of measure" functionality and variant configuration.

    Create characteristic - production length, length tolerance%(+), length tolerance%(-).

    no. of pc, no %(+), no %(-)

    Assign required characteristic in batch class and variant class.

    Case 1: When sales unit is numbers:

    In Batch specific unit of measure functionality you can receive only single unit batch for 100 numbers. But whenever you assign no%(+) and no%(-) in variant class with dependency you can receive single unit batch with tolerance.

    Case 2: When sales unit is MT:

    If you use positive, negetive tolerance characteristics you will be able to receive eg-10.2 MT in place of 10 MT. So billing can be done for as per positive, negetive received quantity.

    Case 3: When sales unit is Meters:

    This is a common scenario for this type of manufacturing unit. Take help from SD/FICO consultant consultant how they can bill for extra length.

    Thanks,

    Biplob

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    • Hi Vishal,

      If you use "Batch specific unit of measure" in material master, during goods receive you will received that material as "Single unit batch(SUB)" . Now tolerance is giving to allow to receive more or less length over single unit batch. I think you need to do some development and test it in your system.

      Thanks,

      Biplob

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