SME’s are considered to be the back-bone of the UK economy and recent statistics indicate they account for 47% of revenue to the UK economy. Of that, according to the Economic and Social Research council,, 11% is contributed by Manufacturing in the UK which has in fact showed a steady increase over the last 20 years.
Whilst the trend over the last 20 years has been for manufacturing SME’s in the UK to deploy MRP to support increased productivity, many business are still relying on a mix of Excel spreadsheets, Word documents, hand written job cards and manual timesheets.
This article provides a lay persons overview of how an MRP will automate processes, save time, improve accuracy and support your business.
How Does Sage 50 Manufacturing Work?
Sage Manufacturing is an optional program that would be used alongside Sage 50 Accounts. It is used by companies who manufacture their own products and assists in the process. Just like Accounts, Manufacturing has some setup that is required to have the program function.
There is an area to enter a product code, description and other information like how much the item costs to purchase from suppliers as well as stock level information. On the suppliers tab, you can also enter suppliers from who you can purchase the product from as well as how much it costs to buy from them.
The operations register will also need to be setup ahead of creating any bill of materials. The operations register is a list of what things need to happen in order for a company to make their products, for example drilling or cutting. As shown below, there is a tab that relates to how long an operation will take as well as how much it produces.
Bill of Materials in Sage 50 Manufacturing
Once products and operations have been created, the next area to consider would be the Bill of Materials (BoM). This is where you add products that you will be manufacturing yourself. When creating a new BoM, there are several tabs relating to what is needed to make the product (components) as well as what operations need to be performed to create the item, as shown below.
Once a BoM has been created for a product, you are then able to either manually create a works order for that product or have Manufacturing automatically do this for you through the planning module. The planning module has two areas that are very commonly used, the Master Production Schedule (MPS) and Material Resource Planning (MRP).
Planning – MPS and MRP in Sage 50 Manufacturing
When MPS is run, it scans through the orders within Sage Accounts and reads demand levels from your existing orders. Users have the option of selecting what date to have MPS scan up to as well as what information it should look for (sales orders/estimates/make to stock etc.) It will then add these to the MPS list within Manufacturing, so users are easily able to see what customers have ordered.
MRP is then run which reads demand taken from MPS and makes recommendations on what should be done to satisfy this demand. When MRP is run there are several settings that users can choose from to customise the MRP run to their liking. Users can specify lead times, where they want to read demand from and can also only run MRP for a given range of products. An example of a standard ‘Run MRP’ window is included below.
One of the most useful things MRP can do is aggregate demand. This means that when making recommendations, if MRP knows that you have an order for product code OAK due in 7 days and another due in 11 days, it will include both orders in just one recommendation. For example, if the order due in 7 days was for 15 OAK and the order due in 11 days was for 10 OAK, MRP would recommend that you make 25 OAK so that you are able to satisfy both orders. MRP is also able to make recommendations that products are ordered in order to satisfy the reorder levels that would be set within product information. An example of what the MRP recommendations list looks like is included below.
Once MRP has recommendations in this list, a user must highlight any recommendation that they want to action and then press the action button towards the top of the window. This will then automatically perform the action that MRP recommended.
Work Orders in Sage 50 Manufacturing
The last of the main areas within Manufacturing is the Orders module, this is where works orders are created and completed. Works orders can be entered manually or be created automatically when actioning MRP recommendations. To create a works order manually a user would need to select new at the top of the screen and then decide if this is a one-off works order or a batch works order. Both types of works order are similar but one-off works orders usually have more detail and information as they are less standard than batch works orders. The window to create a batch works order looks like the below.
Completing a works order removes the components from stock and adds the finished product to stock.
Operation Times in Sage 50 Manufacturing
Operation Times is an optional add-on for use with Sage 50 Job Controller or Sage 50 Manufacturing Controller. It is not supported for use with Sage 50 Bill of Materials or Sage 50 Batch Controller. It allows you to collate data regarding times and costs for employees in relation to Works Orders. It can be used with a barcode scanner to simplify the process of shop floor data collection.
Qi also offers Qi Operation Times which extends the notion of bar code scanning on the shop floor to include:
Employee Tracking for Sage 50 Manufacturing
Employees are set up within Sage Manufacturing and the Works Order Tracking System uses this information to track which Employees book in and out of operations. Employees can only be booked on to one operation at any one time but will be able to work on multiple Works Orders.
Security settings will identify users who only have permission to book on or off jobs and display a single booking on/booking off screen without any further menu options.
Booking On/Booking Off Machines with Sage 50 Manufacturing
To book on or book off an operation the user will first scan his User ID bar code. This could be a printed sheet posted next to each workstation or a badge worn by the employee.
The employee will then scan the bar code on the Sage Manufacturing Job Sheet. The system will check at this point to see if this operation is already open for this user, if not then the Booking In details will be shown on the screen. These will include the relevant Works Order Number, Operation and Operation Description and total quantity required for the operation. The user will then be able to either scan another job sheet or click OK to save the on screen details and begin work or Cancel to clear the screen.
The screen will allow the user to scan job sheets from multiple Works Orders; each time a subsequent Job Sheet is scanned the system will check that the Operation type is the same as those already scanned – if a different operation type is scanned this will be rejected.
The system will allow any number of users to book on to the same operation and will include validity checks against all users to ensure that the maximum quantity required cannot be exceeded when completing the operation.
Booking On will also allow operations to be scanned out of sequence, however these operations cannot be booked off as completed until the previous operation has completed the relevant quantity.
Once every operation has been scanned and the user has selected the “OK” button, the date and time are recorded against these operations to be used during the booking off process and the employee can begin the work.
Thought for the Day
This is an example of statistical improvements our customers have experienced.
Timely delivery of manufactured goods to its customers (increased by 17%). Optimal use of manufacturing resources (equipment downtime reduced 14%). Decrease in capital cost due to decreased inventory levels and optimal use of production resources.
Credit: Mr Gary Page ‘Sage 50 Accounts and Manufacturing Functionality Walkthrough’ November 2019. Please contact Qi for a copy of the full document or to discuss MRP deployment and support.