Category: Manufacturing

Forecasting 101 – How to Forecast Manufacturing in a High Customization Environment in D365.

Forecasting can seem impossible when manufacturing in an environment with a high volume of custom products. Multiple SKUs are used, and the components used in those SKUs are highly variable. So, what should be done?

If you are already using MRP in D365, one way is to follow these four steps.

1.     Calculate the ave. forecast by SKU. – Calculate the ave. number of custom assemblies by SKUs you produce each month.

2.     Calculate the attachment rate per component per SKU. – Calculate the ave. percentage you attach a given component to that SKU.

–         For example, if you build SKU X 10 times a month, how many times does that build contain each component?

–         If a component is included in each build that component would be 100%. If it is only 7 times out of 10 that would be 70%.

3. Setup Item Allocation Keys—In D365, Set up Item Allocation Keys for each SKU. Add all components and assign the Attachment rates.

4.     Add a Demand Lines Forecast for each SKU Item Allocation Key.

Questions/Comments? Feel free to reach out.

Bill of Materials 101: Manufacturing BOM vs Planning BOM

Bill of Materials (BOM) are an important part of any manufacturing process. Bills of Materials contain all the parts (including assemblies and sub-assemblies), raw materials, and components to manufacture a product. Keeping these lists correct ensures accuracy in the production process, and provide supporting (procurement, planning, etc.) functions critical information.

While Bills of Materials can be used in various applications, two of the most common types are Manufacturing and Planning. Both types contain parts, raw materials, and components but have different structures and uses.

Manufacturing Bills of Material (BOM) –

Contents: Manufacturing BOM’s contain all the parts (including assemblies and sub-assemblies), raw materials and components to manufacture a product.

Structure: They are structured to reflect the actual manufacturing process on the production floor.

Use: Used to manufacture products.

Planning Bills of Materials (BOM) –

Contents: Planning BOM’s contain all the parts raw materials and components to manufacture a product. They generally don’t include the manufacturing structures (assemblies and sub-assemblies).

Structure: They are structured to reflect the material forecasting process.

Use: Used for Material Requirements Planning.

Questions? Feel free to reach out.