Integrating Manufacturing With Sage 300

Out of the box, Sage 300 Inventory Control provides a basic assembly (backflush) option.  This includes the ability to create a simple bill of materials, and when necessary, create an “assembly” which will take the components required to reduce inventory, and produce finished goods which will be received into inventory. With this method, all of this happens the instant an assembly is processed.

Sage Assembly BOM Screen:

For businesses where this assembly method makes sense, this option works very well.  However, for more complex manufacturing requirements, this will not provide all the options necessary.  For example, Sage assemblies can’t address the following:

• Production Areas
• Work Centers
• Employee and subcontract resources
• Overhead
• Operations
• Estimated versus actual costing

In addition, an assembly/backflush solution is not a true work order solution.  As a result, with assemblies you cannot create work in process (WIP) for manufacturing processes that are not immediate and where there is also a need to keep track of raw material being used and finished goods produced during the manufacturing process.

I started working with Sage 300 almost 25 years ago, and for several years, I was not satisfied with the 3^rd party manufacturing solutions that were available for Sage 300.   This was a big disappointment to me since I came from a manufacturing background.  The biggest reason was because these solutions were not truly integrated.  Meaning they did not work within the Sage 300 UI, and they required that certain aspects of the manufacturing process were maintained in a separate system and only introduced to Sage once they were a finished goods.  This created a nightmare for reconciling data and transactions between Sage and other 3^rd party solutions.

Then several years ago, an innovative company called AutoSimply came up with a fully integrated manufacturing solution for Sage 300.  Once I learned about this option I was immediately interested and researched this solution.  I was extremely impressed and knew this was finally a manufacturing solution I could support.

Without going into too much detail (this article would be to long if I did!), below are some of the most important features:

User Interface/Integration:

One of the most important features is that this product works completely within the Sage UI.  Not only that, it fully integrates with the General Ledger, Inventory Control, Order Entry, and Purchase Order modules.

Hierarchy:

Another benefit is the ability to create a completely customizable hierarchy in your manufacturing module.  This includes the ability to setup an unlimited number of the following settings:

• Production Area – (i.e. Northwest facility, Chicago Plant, etc.)
  • Work Center – Specific areas where certain work can be done within the production area
    • Operations – ”What” work is being done within a work center
      • Resources – “Who” is doing the work in that operation. Resources  can also be sub contractors and overhead.
      • Tools – a separate setup to define specific tools being used and tool costs associated within that operation.

Once you have created your hierarchy, the bill of materials allows you to then leverage all of the required information for routing.  In addition, any required raw materials can be added since this module links directly to your Sage inventory control items.  Below are screenshots of a manufacturing Bills of Material (BOM):

Fig 1: General Tab

Fig 2: Operations Tab

Fig 3: Components Tab

Fig 4: Instructions Tab

Assembly Methods:

The manufacturing module supports the following assembly methods:

• Backflush
• Single MO
• Batch MO’s
• KanBan

Furthermore, you can create manufacturing orders (MO’s) to stock, to order, or both

Integration:

The below screen is a good example showing how this module integrates in real time to your inventory, purchase orders, and sales orders.  You will note that when creating a manufacturing order (MO), you can see exactly what activity and balances exist within the rest of your Sage modules that will affect your manufacturing activity.  From the below query screen you can also automate the creation of MO’s and purchase requisitions:

General Ledger Integration:

The GL setup for manufacturing allows you to setup Work in Progress (WIP) accounts as well as the optional absorption accounts for Labor, Overhead, and subcontract costs assigned to the build.

Updates to MO versus BOM:

Another great feature is that after converting a BOM to an MO, you can then make changes/replacements to components, quantities, operations, and resources in the MO as needed.

Keeping track of costs in real time:

Every MO maintains actual costs for materials issued, along with non material costs for that MO.  Allowing the user to determine actual versus estimated production costs at the MO level:

Resource Costs:

You can also breakout your estimated and actual time in the following categories:

• Setup time
• Run time
• Clean up time
• Wait time

Assigning Material:

When material is assigned to a build, you can set the following parameters:

• What operation that material is being used for
• Type – Direct or Packaging
• Default source inventory location
• Scrap percentage
• Required quantity
• Quantity per run (based on batch size)
• Additional comments/reference for each detail Ine

Partial issuance/partial receipts:

You do not have to have all the materials available to issue and start a manufacturing order.  You can issue only the materials available and issue additional materials when available.

Linking manufacturing orders to sales orders/purchase orders:

When creating MO’s against a sales order, you can assign the sales order(s) to that MO to maintain a link:

Similar to Sales Orders, you can also link Purchase Order lines to your MO:

Estimated Costing:

You can determine what method you want to use to estimate costing.  Options include Standard Cost, average cost, last cost (material costs plus additional costs), or most recent cost (material not including additional costs).  If using standard costs, you can breakout all of the standard costs by cost type:

Workflow:

Due to the various methods that the manufacturing module offers for producing MO’s, you have several options when it comes to how you setup your company when going from BOM’s to completed MO/Finished Goods.  Below is a sample basic diagram of the most common method used:

Industry Applications:

We have successfully applied this solution to a large number of clients in many different industries.  Below is a partial list of industries:

• Electronics
• Engineering
• Food Services
• Agriculture
• Automotive
• Casting and molding
• Machine shops
• Process (continuous and batch)
• Chemical
• Beverage

Supporting Modules:

It is important to note that the Manufacturing module is only the “core” product within a suite of products that AutoSimply offers.  Depending on the organization, the below products can also be added to support the manufacturing process:

• MRP – A fully integrated material resource planning module that allows users to set min/max, lead time, purchase/manufacture/subcontract, network locations, and assign buyers by product
• Quality Control – allows users to setup QC requirements as well as required results by item
• Shop Floor Control – Allows line workers to record their time and completed quantity at the workcenter/operation/resource level
• Barcode Scanning – will support any MFG or inventory control action within Sage 300
• Lot/Serial Tracking – for clients that require lot or serial tracking within Sage 300

Summary:

The purpose of this review is to give a company a good baseline when considering manufacturing options that integrate within your Sage 300 ERP.  If you have any questions or wish for us to provide a detail review and demonstration of this product, please contact us and we would be happy to assist!