Back-to-Back Sales Order Cycle In Order Management

Overview of the B2B process:

1. Customer orders items (OM).
2. Purchase those items from the supplier (PO) and receive them into the warehouse.
3. Ship those items to the customer (OM).

The B2B process automates the creation of a supply order (PO) when a sales order is booked. The supply order is hard pegged (hard-reservation) to the sales order that it is supplying so that once the PO is received, the items are not inadvertently taken by another order or demand. Where the sales order line is within the process, can be visible  at all times so that customer service inquiries can be answered. This process is used for items that are not typically stocked nor manufactured. In an environment where lead times are often only a matter of 24 hours, the B2B process improves efficiency of the three steps above, by closely linking the Sales Order and the Purchase Order together.

Also called the supply-to-order process.

DETAILS

Setup Steps

1. Create a B2B item.

Go to Inventory > Items > Master Items and define the item as follows :
Enter item name and description.
- From Tools > Copy From, apply the Purchased Item template.
- In the Order Management tab, check the Assemble to Order flag (ATO).
- In the Purchasing tab, enter a value in the List Price field.
- In the Work in Process tab, make sure the Build in WIP flag is checked.
- In the General Planning tab, set the Make or Buy flag to Buy.
Save, and assign to Organization M1.

B2B item must be created at item validation org.
Same item in same item validation org cannot be both  stock item and a B2B item.

Note the ATO item attribute is checked as the B2B process utilizes the ATO process of the workflow. However, the item is not manufactured in WIP, and instead is a 'Buy' item that is replenished by a supply order in PO. Hence the item may also be called an ATO Buy item. 

2. Sourcing rules can be set up in PO to default sourcing information such as the supplier from which the item is purchased. For simplicity, sourcing rules are not setup for this testflow. 

3. Assign the item to the price list. 

4. Make sure the following periods are open for this testflow.

Inventory Period
Inventory > Accounting Close Cycle > Inventory Accounting Periods
Select the organization (this testflow uses M1).

Purchasing Period
Purchasing  > Setup > Financials > Accounting > Control Purchasing Periods

GL Period
Purchasing > Setup > Financials > Account > GL Period

Testflow Steps

User : OPERATIONS/WELCOME (needed for the steps in PO)
Responsibility : Order Management Super User, Vision Operations (USA)

1. Go to OM > Orders, Returns > Sales Orders. 

   Create a sales order with Order Type Mixed and enter the B2B item in the lines for any quantity. 
   Book the order. Note down the Order Number. 

2. The line status will move to Supply Eligible (flow_status_code SUPPLY_ELIGIBLE). 

   Place cursor on the line and go to Actions > Progress Order > Select Create Supply Order - Eligible to progress the workflow of the line. 

3. The line status will now show PO-ReqRequested (flow_status_code PO_REQ_REQUESTED). 

    OM has inserted a record in the PO requisitions interface table. 
    To check the record from SQLPLUS  run a query such as :

SELECT *
  FROM po_requisitions_interface_all
 WHERE     interface_source_line_id = &order_line_id
       AND interface_source_code = 'CTO';

R12 Note : While testing this step a Vision Instance the order line might get progressed to "Production Open" even though this item is not to be produced this in WIP.

If this happens, go to Purchasing > Supply Base > Sourcing Rules, and end-date the sourcing rule "M-M1" which is saying "Make At" M1 with allocation of 100%. This sourcing rule will interfer with the B2B testflow. After end-dating this sourcing rule, enter a new order line and it will progress to status "External Req Requested" as expected.

4. Go to Purchasing > Reports > Run and run the concurrent program Requisition Import with the Import Source parameter = CTO. Leave the other parameters as default. The concurrent program can also be run from OM > Orders, Returns > Requisition Import. 

    Go to View > Requests and verify that the Requisition Import has completed successfully.
5. The line status of the sales order line will now show PO-ReqCreated (flow_status_code PO_REQ_CREATED).

From the sales order line, go to Tools > Scheduling > Reservation Details > 'Supply' tab. Verify that the order line is reserved against the requisition. Note down the requisition number seen in this window. 

6. Go to Purchasing > Requisitions > Requisition Summary.

   In the Find Requisitions window, enter requisition number found in the previous step and click on Find.
   Verify that the status is Approved.

7. Go to Purchasing > Autocreate.

    From Edit > Clear > Record, clear any query criteria that may be defaulted.
    Enter requisition number and click Find.
    Check the checkbox to the left of the line, and click on Automatic.
    Enter the Supplier and Supplier site such as the following and click on Create.

Supplier : Advanced Network Devices
Supplier Site : FRESNO

8. The Purchase Order form will automatically open with the PO that got created.

     Click on the Approve button.
     Click on the OK button in the Approval Documents window to approve the PO.
     Note down the PO number, and verify that the status is Approved.

9. The line status of the sales order line will now show PO-Created (flow_status_code PO_CREATED).

10. From the sales order line, go to Tools > Scheduling > Reservation Details > 'Supply' tab. Verify that the order line is reserved against the PO.

11. Go to Purchasing > Receiving > Receipts.

    Enter  Purchase Order number and click on Find.
    In the Receipts window, check the checkbox to the left of the line and enter :

Destination Type : Inventory
Subinventory : FGI

    Save the receipt.

12. Go to Purchasing > Receiving > Receiving Transactions Summary.

     Enter the Purchase Order number and click on Find.
     Click on the Transactions button.
     Verify a Receive and Delivery transaction. This means that the B2B item has been received into Inventory.

13. The line status of the sales order line will now show Awaiting Shipping (flow_status_code = AWAITING_SHIPPING).

     On the sales order line, Tools > Scheduling > Reservation Details will now show that the item is reserved against Inventory in Subinventory = FGI.
     The line can now be  pick released, shipped and invoiced to the customer.

This completes the testflow steps for B2B.


Useful Queries

Checking the data in the PO requisitions interface table:

select * from po_requisitions_interface_all

where interface_source_line_id = &order_line_id

and interface_source_code = 'CTO';