Projects:Referenced Inventory/Functional Specification
The functionality behind the Reference number is also known as the SSCC: Serial Shipping Container Code. While the SSCC is mainly focussed on logistical identification and handling in distribution between business partners (For instance, the SSCC# is present in EDI / ASN), the functionality of the Reference Number is a bit wider as it is also used for logistical identification and handling within a warehouse.
Referenced Inventory is the functionality that identifies one or multiple storage details (Stock records) by using a "Reference Number". The Reference Number can have two distinct uses:
- Shared References: Multiple Storage Details can share the same Reference Number and scanning the Reference will identify the list of Storage Details. In this case the scanned 'object' can be a roll-cage, box or pallet with a variety of products and quantities for further distribution.
- Unique References: Each Storage Detail (optionally) has a reference number, and this reference number is not re-used in other storage details. Scanning it would point to only one Storage Detail and uniquely identify it. In this case, the purpose of the Reference# is to uniquely identify a Storage Detail in a Warehouse to facilitate identification and movements. The Reference number can be used as method for Catch Weight, when product has a Base Unit of Measure in weight but specific storage details can have different weight.
The Reference number is typically system-generated, just by taking the last issued number and adding one.
Reference Number vs Serial Number
The Reference number is functionally different fom a Serial Number in the sense that a reference number only exists during the life-time inside the warehouse: It has no value outside the warehouse and a specific Storage Detail in a distribution chain could very well have different Reference Numbers when it was in different warehouses. In contrast, a serial number or lot/batch number identifies the stock during its complete life-time, regardless if it just was manufactured, already distributed and awaiting a customer or sold and perhaps requested a repair or service. Reference numbers and serial/lot number can co-exist as they serve different purposes.
A good way to see the dynamics of referenced inventory is when we recognize this as a typical complexity in the process business. Where its counterpart, the discrete business deals with discrete products and distribution.
As used in: Discrete products, Distribution and Multi-Product references
An additional use of the Reference# is to identify an object that consists of multiple products, typically a roll-cage, box or pallet that has been created as result of a picking process and is to travel as complete object to the next stage, either customer shipping or production. The process for that is to constitute a new reference and add the single objects to it. In that process, the single object will adopt the Reference# of the newly constituted object (pallet). See below an example of a multi-product pallet that share the same reference number.
|CHEESE OLD AMSTERDAM||SHIPDOCK-X||ABC||66778899||51,99024|
Note that the total weight per lot is the sum of the individual single objects (cheeses).
As used in: Catch Weight, Process Industry
Referenced Inventory is typical for the process manufacturing industry:
- For processed products, the BaseUM of any material should be a so-called fundamental unit. Let’s take mass (KG, in the metric system) for timber (or cheese).
- Then they also can have one or more alternate UM and each of these has a UoM-conversion to the BaseUM:
- Unit – for inventory and sales purposes -> 1 unit = 2,5 KG
- (note that each product has different sizes or base-material and as such different UoM-conversions).
- Pack (a packed multiple of unit) -> 1 pack = 10 kg (4 units)
- Pallet – for warehousing purposes -> 1 pallet = 500 KG (200 units or 50 packs)
Now we know for fact that each unit is not exactly 2,5 KG: If we would show enough decimals (and have proper measuring equipment), we would eventually see a digit different than 0. Consequently, a pack or pallet is also not exactly 10 or 500 KG... The business-question here is: "How relevant is this and do we want-or-need to record this in our system?"
- For products where the base material is a commodity* (both cheap and not regulated) it is advisable -unless other business parameters decide otherways- to treat these conversions as typical or standard conversion deviations and not register the individually procuded units in inventory. Obviously there will be deviations, but for a prpoer inventory accounting these could be controlled by a frequent inventory count in both raw materials and finished goods.
- When the base material is not cheap or it is regulated by law (f.i. we produce gold bars or medicine…) then there is a desire or requirement to register each individual processed unit in inventory, and with that the -slight but important- difference in BaseUM (weight in our example). This is not a UoM-conversion issue but an inventory issue! And so in this case we would mark the inventory record with a unique REFERENCE number that identifies that specific gold bar.
See below an example of REFERENCED inventory of three GOLD BARs from the same batch (XYZ) but each have a slightly different weight. When we scan the REFERENCE 12345678, we know that we are transacting that specific gold bar, that is stored in SAFE-1 and has Lotnumber XYZ and weighs 1,00391 KG.
And here an example of NOT-REFERENCED inventory of 4000 KG of timber of 20*80*4 cm.
From the perspective of the finance dept. there is 4000 KG of timber. From the perspective of the warehouse, there are 8 pallets. And from the perspective of the sales dept. there are either 1600 units or 400 packs. These are just different visualizations where all visualizations -obviously- accumulate to the same quantity, measured in BUM.
The Reference number is a new (optional) column in the Storage detail and the Storage Detail can be identified quickly by this reference number.
The Advanced Warehouse Operations module Front-End must be enhanced to recognize a scan of the Reference number and allow to generate multiple tasks in the case of a Shared Reference number.
The Routing should receive a flag that allows to blank-out a Reference number just before the Goods transaction takes place.