In an ETO environment, when a sales order is released to manufacturing, visibility to that order is essential to organize parts and assemblies with like operations into efficient batches. Further, the work orders for the lower level subassemblies driven by the Top level ETO require some trackability back to a sales order or a parent work order. Several challenges arise when attempting to render a 360 degree view of where an ETO is at in the production process.To efficiently plan the for the movement of all these parts and assemblies related to a specific order through all work stations in an organized fashion is critical to the success of shop floor planning.

1. Managing and Tracking Configure-to-Order
Manufacturing with Oracle Applications
Jason Bletz
New Generation Consultants
Overview
In a Configured-to-Order (CTO) environment, the requirements to fill customer orders are not known
until the sales order is booked. While some common components from inventory are used to satisfy
the requirements of multiple configurations, most of the purchased items and subassemblies are
either bought or built specifcally for the configured order. Such variations in products can include
size, color/coatings and other accessories. These variations impact downstream activities including
special operations, outside processing and whether the product is assembled and shipped or first
shipped and then assembled onsite or at other satellite locations. Controlling the CTO order as it
moves from Order Entry into Manufacturing and finally into shipping in a configure-to-order
environment can be a logistical challenge for any organization. Companies need visibility to
determine when to release the order, where the subassembly components are in the process, how to
track job specific purchase orders, report on product variablility, how to control and account for
changes to the order and how to cost related jobs when the order line is modified or canceled.
Further complicating the process are complex nested BOMs that generate large numbers of work
orders and purchase orders related to the assemblies and sub-assemblies that comprise the CTO
product.
New Generation Consultants (NewGen) provided several solutions to satisfy the business
requirements of the CTO manufacturer referenced in this paper, however the scope of this paper is
to discuss the Oracle tools and strategies implemented to satisfy the management and control of
CTO orders through the manufacturing process. Additional solutions surrounding shipment and
delivery of the product, configure to quote, configurator rules, and servicing of installed product can
be found in other White Papers in the NewGen library.
Industry Methodologies
Project Manufacturing provides management tools that measure and control large projects in a
project oriented environment. Capabilities of Project Manufacturing systems include project level
task breakdown, project level estimation, project level revenue and cost reporting, planning and
pegging by project as well as project billing by milestone. While these capabilities support several
configure-to-order manufacturers, the caveat with project manufacturing systems is the ongoing
management and support of each project required by the organization. This is especially true for
organizations that have a high volume of customer orders and configurations.
Discrete and Flow Manaufacturing do an excellent job for build-to-stock environments. The final
products are planned and built against forecasts of standard items. Shop floor operations are
Managing and Tracking CTO Manufacturing with Oracle Applications Page 1

2. centered around products that are manufactured, assembled and released to inventory. The orders
are completed by picking items, newly created or already in inventory, and shipping them.
Statement of Problem
While some ERP systems can manage project level manufacturing (low volume and high
variability/configurations) and others can manage discrete manufacturing (High Volume and Low
Variability/configurations), very few can support organizations that deal with high volume and high
variability. If the organizations employ project manufacturing methodolgies they are required to set-
up and manage a project for every distinct configuration being ordered. If they employ discrete
manufacturing methodologies, visibility of sales order/project specific information throughout this
process is not available as the emphasis of discrete manufacturing is on organizing parts and
assemblies into efficient discrete batches thereby eliminating project specific tagging and tracking.
Concerns revolving around work-in-process (WIP) management and work-in-process tracking for
high volume CTO manufacturers include:
 Difficulty in identifying which work orders, other than the top level assemblies, are associated
to what sales order demand.
 Excessive number of transactions in WIP to manage and track the associated work orders.
 Difficulty in identifying which work orders are associated to other work orders (which
subassemblies are tied to which final assemblies).
 Excessive number of work orders taxes the ability of staff to efficiently process.
 Inability to generate usable standard reports for Shop Floor paperwork without the need to
alter the shop floor flow.
 Uniqueness of each CTO product being ordered may cause a proliferation of part numbers.
 Creating new work orders or updating existing work orders is often required for customer-
driven change orders. It is difficult to tie them to the current production schedule and parent
demand.
 Identifying when to release final assembly orders once all child assemblies are complete.
Concerns revolving around changes to orders include:
 Changes to the configured item often requires canceling the order line as identifying and
making changes to the associated work orders is difficult.
 Difficulty in tracking down all work orders associated with a change order.
 Difficulty in capturing the associated costs related to the change.
 Overall management of work order changes.
CTO Company Profile
 Mature manufacturing organization, operating since 1889.
 Configure-to-Order manufacturer.
 High degree of configuration of product
 Multiple configurators and order entry systems needed to be centralized.
 CAD and other design applications required integration to the order entry process.
Managing and Tracking CTO Manufacturing with Oracle Applications Page 2

3. Solution Requirements
For its client, New Generation determined that any solution had to conform to specific business and
technology requirements.
Business:
 Streamline sales order to WIP flow. Using three distinct Configurator tools to configure the
product and generate sales orders, the solution needed to capture multiple inputs of demand
and communicate these requirements to the shop floor in one unified format.
 Minimize change to the production floor – Radically changing the floor operations to fit
the system was not in the client’s best interest. Any solution needed to be transparent to the
floor.
 Maintaining Delivery Commitments – Current commitments to the customers could not be
impacted. Meeting promised delivery dates is essential to maintaining customer relations.
 Maintaining flexibility in product configurability - Client’s sales and reputation is partly
driven by its ability to offer its customers a highly configurable product. Additionally, flexibility
is provided to alter the product design up to shipment of finished product. Reducing this
capability to fit the out-of-the-box system functionality was not an option.
 Leveraging current investment – Significant investment had been made in Oracle ERP.
Any solution would need to leverage the current ERP without requiring the need for
investment in additional software applications.
System:
 Reduction in WIP tracking needs – Reduce complexity for manufacturing team to plan and
manage scheduling.
 Maintaining compliance – Any solution must not void any support for E-Business Suite
(EBS) by Oracle.
 Feasibility – Technical and functional capability within a tight budget and timeline. Solution
must fit within the framework of Oracle EBS.
 Reduction in manual work arounds – The solution needed to reduce overall complexity
and allow users to work within the system to manage the process.
 Usability – The solution must match the order-to-cash process flow and leverage current
system design and modules.
Solution Components Implemented
Oracle E-Business Suite
 Oracle Order to Cash (OM, Advanced Pricing, Shipping)
 Oracle Financials (AR, AP, General Ledger, Project Costing)
 Oracle Configurator
 Oracle Purchasing
 Oracle Advanced Supply Chain Planning
 Oracle Data Hubs
 Oracle Discrete Manufacturing (Bills of Material, Production Scheduling, Work in Process,
Costing)
Managing and Tracking CTO Manufacturing with Oracle Applications Page 3

4. Solution
The focus of this solution was to capture and streamline CTO Order demand from Oracle Order
Management (OM) and release it directly into WIP regardless from which configurator system the
demand originated. By utilizing Oracle’s workflow capabilities, a Seiban numbering strategy and a
custom WIP dispatching form, NewGen was able to create discrete jobs in the WIP module for the
top level assemblies and any make-to-order components specified at any level in the BOM. All jobs
were linked to their respective sales order line, CAD drawing ID and parent work orders (where
applicable). The custom form provided a 360 degree view of all jobs that were associated with a
sales order or drawing ID. From this form they are able to manage all work orders and their release
statuses. Finally, custom shop floor documents were used to communicate all work instructions to
the shop floor. These documents included routing sheets, indented bills of material, as well as a
document that grouped different items with like operations so the machine operators could batch
disparate jobs across the same resources. These shop floor documents were designed to match
legacy format and, therefore, eliminated the need to alter product flow through the shop floor
workstations.
Solution Components
Custom Workflow - Standardization of post-order flow for Configured items
The Make-to-Order Workflow provides features needed to satisfy the following basic business
needs:
 Control the approval step so as to prevent orders from being released until configuration and
manually/automated BOM adjustments are complete.
 Reference number can be associated to order configuration and subassemblies
 Work Orders can be associated with the sales order.
 All Make-To-Order Items (Configured Top level items, MTO subassemblies) can be released
directly to WIP (bypass MRP).
 Work Orders can be associated with each other (Parent Child Relationship).
 Release critical time constrained purchase components to Purchasing.
------------------------------------
Activities included in the workflow include:
 Require an Approval prior to the job being released from the sales order to WIP
 Call the lead time rollup concurrent program
 Perform a wait function in the line flow prior to release in WIP (Ship Date – (Lead Time + X
days))
 Revert to prior activities (prior to release to WIP)
 Automatic Generation of Work in Process Jobs for make-to-order items (includes Configured
items as well as make-to-order items)
 Link the WIP Job to a specific sales order
 Link the WIP Job to a specific File Number (CAD drawing ID)
 Link WIP Jobs to related Jobs (Parent/Child relationship)
Managing and Tracking CTO Manufacturing with Oracle Applications Page 4

5. Managing and Tracking CTO Manufacturing with Oracle Applications Page 5

6. Job Tagging
One of the key requirements of the solution was to provide visibility of all entities linked to a specific
sales order line. While the unique numbering of the star assembly can track final assembly level
work orders to the sales order line, it does not provide any visibility to the components below. Job
specific entities such as purchase orders and subassembly work orders could not be tied to the
parent assembly or the sales order line. A Seiban number strategy was implemented to
automatically generate unique numbers and link all these make-to-order/buy- to-order components
to the sales order line. Seiban numbers provide project-like tracking capabilities without the
overhead of opening, maintaining, costing, and closing each distinct project.
Through the use of Seiban numbering NewGen was able to achieve the following:
 Link all entities associated with a specific CTO order
 Provide real time status tracking of all WIP jobs and purchase orders tied to a specific sales
order line
 Track and Manage inventory by Seiban and Sales Order
 Use Advanced Supply Chain Planning to plan at the Seiban level
 Respond to Change Orders through Planning
 Provide, when needed, project level costing
Custom Dispatch Screen
– Search Form
To provide control around retrieving and managing information, an Oracle form was created to
enable searching of WIP jobs based on specific client search criteria. This form was designed to
provide flexibility in that it allows for searching using various inputs:
 Sales Order - By Sales Order Number. A value entered here will limit the search to just
those jobs associated with a sales order number
 File ID and Fan Group– Unique composite (Seiban Number) identifier that ties the sales
order line item with WIP jobs as well as CAD drawings and all other associated documents.
A value entered here will limit the search to just those jobs associated with a specific Fan
design.
 WIP Status – The status of the WIP jobs (released, unreleased, complete, etc.). For
example, display all jobs that are unreleased for a specific sales order.
 Parent Job – The Parent job is a Job that is dependent on the completion of subassembly
(lower BOM) jobs.
 Department and Resource – Lists jobs specific to a department or resource. A value
entered here will show all the jobs that are scheduled for that specific resource. This can be
used in conjunction with other fields to make it sales order specific or not.
 Due Dates - To be used in conjunction with a department search and resource search. This
will be used to identify the jobs within the date range (not sales order specific).
 Item Type – This will limit the search to a specific Item Type. This would be used in
conjunction with the other fields, for example, show all piece parts for order 100000.
 Job Number – This would be used to list a specific job and view all associated information
including parent work order, sales order, Seiban, etc.
Managing and Tracking CTO Manufacturing with Oracle Applications Page 6

7. – Results of the Query
The searched information returned is organized in a logical/manageable manner and presented in a
working form to facilitate greater control over the process.
Using the form, Users can elect to mange the work orders in several ways:
 Review - Review the status of all WIP jobs associated with an order line
 Release –
o Release like items in batch mode for ERQ
o Release individual work orders or nested (items with like resource requirements)
work orders
 Schedule - Schedule work orders by department
 Review and act upon - Review and act upon configuration dependencies, dependent work
orders, etc
 Job Linking and De-Linking - Job Linking and De-Linking for manual job additions and job
removals for change orders
 Print Documents – Print the associated shop floor documents
 Print Nested Documents – Group items with like resource requirements into a master job
sheet
Managing and Tracking CTO Manufacturing with Oracle Applications Page 7

8. <Sample Screen Shot of all WIP jobs specific to a final assembly>
– Buttons/Actions:
Several buttons and activities are available to ease the maintenance activities for the work orders
and better coordinate downstream activities related work orders associated with a sales order line.
Button Action Example
Select All Select all items returned by the search Can be used to select all jobs
and perform a batch action
Release Release all selected work orders This will update the job to
(Dispatch) to the floor “released” and allow for charges
Cancel Cancel the selected work order(s) This will update the job status to
“cancel”
Update This will open the standard Oracle Changes can be made to the job
Discrete Job form via the standard Discrete job
form
Print Print the Shop floor documents for Depending on the item, this will
Documents associated work stations print specific shop floor
documents
Print Nested This will group all items associated with Nested documents will be used
Documents a configuration and/or resource, and to decrease the need for one
group all the jobs onto one job sheet. document per work order
Managing and Tracking CTO Manufacturing with Oracle Applications Page 8

9. Custom Reports
Print Documents
Shop floor documents for associated work stations
To better match the flow of production on the shop floor, Newgen’s client required several types of
shop floor documents for their Fan Jobs and associated work orders. For make-to- order product a
shop floor packet is created for the master work order. This packet includes all the jobs required to
make the end assembly. These include piece part work orders (a routing sheet for each piece part),
Subassembly work orders (1 for each make to order component on a bill of material), and a Master
Assembly work order. Because the manufacturing of the individual work orders occurs in tandem,
the work order packet is dispersed through the shop floor with each job sheet following a specific
routing. After the completion of each job the individual sheets are reunited with the master assembly
sheet using the unique Seiban as a reference.
Print Nested Documents
Group all items associated with a configuration and resource and group all the jobs onto one job sheet.
The Nested documents report content is driven by the WIP Dispatcher. The form allows the
dispatcher to perform searches based on department and resource. The user will identify parts with
similar resource and routing requirements, select those jobs, and then create a nested document list.
This nested listing contains all the work order numbers due to run in that department or on a
resource for a given period of time.
Summary
Through a combination of Oracle workflow technology and Oracle forms and reports, NewGen was
able to leverage the information within the Oracle E-Business Suite and provide a complete tracking
and dispatching solution that matched the physical process of configuring and releasing work to the
manufacturing floor. The solution also provided a companywide view of all the tasks and related
statuses of WIP-related information associated with a CTO order line. Additionally, the flexibility of
linking new work orders associated with the sales order line for change orders answered the
challenges of accurately costing all work for each custom/configured to order item.
Before Solution After Solution
The client was unable to finally approve BOM All configured-to-order lines require an
changes prior to the work being released to approval step for final BOM modification
the floor resulting in an accurate snapshot of make-to-
order jobs.
Managing and Tracking CTO Manufacturing with Oracle Applications Page 9

10. Before Solution After Solution
CTO work orders were interfaced to WIP Custom workflow contains a “wait activity” to
immediately after order progression prevent generation of work order until due date
minus lead time expires.
Critical Purchase-Order components would not Critical purchase components are released
generate requisitions until scheduled MRP directly to purchasing as a requisition
completed providing advanced notice for expediting
Work orders generated for lower level make- Work orders are generated directly from the
to-order components would be generated from sales order line
MRP
No visibility of relationship between work Lower level work orders generated from the
orders. Lower level work orders generated via sales order line are linked to the sales order
MRP and released to WIP were not linked to and Seiban
the sales order line or Seiban
Visibility of work orders related to the sales Dispatch screen displays all work orders
order line and the Seiban was limited associated with a sale order line or a Seiban.
This visibility allows for tracking and
management at an aggregate level (Top level).
Tracking and managing manually created Jobs can be linked or de-linked from a sales
rework jobs for a sales order line was difficult order line or Seiban. This allows for tracking
and time consuming and costing of all WIP for a sales order line.
Client was not able to tie work orders to a Seiban is passed to every work order allowing
Seiban and was unable to reference CAD for quick and easy reference to the CAD
drawings drawings
Difficulty with scheduling resources for a WIP dispatch screen displays all resource
particular sales order requirements for a specific sales order line so
the jobs can be released to the floor in tandem
Shop Floor paperwork was printed for Shop floor paperwork represents the physical
individual jobs and had limited reference to flow of work on the shop floor. All documents
final assemblies and Seiban reference the final assembly, sales order line,
and Seiban. Additionally, nesting capabilities
allowed scheduling sheets to be deployed to
individual workstations.
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11. Before Solution After Solution
No Advanced Supply Chain Planning Seiban level planning allows planner to see all
capabilities available at the Project Level. All planned activities for purchase orders and
suggested requirements were not linked work orders for a specific sales order line.
together.
Client was not able to respond to order line Seiban level planning picks up changes in
configuration changes in a timely and accurate sales order line demand and makes
manner. All related work orders and purchase appropriate suggestions to create, cancel or
orders had to be tracked manually modify existing entities tagged with same
Seiban identifier.
Managing and Tracking CTO Manufacturing with Oracle Applications Page 11

12. About the Author:
Jason Bletz is Practice Director for Oracle Applications at multi-national (USA and India) Platinum
partner New Generation Consultants, Inc. (www.newgenusa.com) in Chicago, Illinois. He has 15+
years experience in Manufacturing and Distribution Industries and 13+ years experience in IT. Jason
has assisted many companies with the implementation of business strategies including lean, agile
and ETO manufacturing, logistics and supply chain management, change management and process
engineering. As an accomplished Oracle Implementer and Project Manager, Jason provides expert
advice enabling clients to get optimal value from their investment in Oracle solutions.
Jason’s industry experience covers small to medium-sized businesses as well as large multinational
organizations across many sectors including Manufacturing and Distribution, Services, Healthcare,
Bio-Tech, Utilities and Public Sector. He has extensive Functional and Solution Design experience
with several Oracle Tools including eBusiness Suite, Hyperion and Oracle Business Intelligence.
Jason is responsible for leading growth and development of New Generation Consultants’ clients with
a key focus on managing strategic ERP initiatives to accelerate these objectives.
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