Tuesday, November 22, 2011

Sourcing Rule in Oracle Purchasing

Sourcing rules determine the movement of materials between organizations in a global enterprise; these organizations include the suppliers and the materials include those items made at the manufacturing organizations.
Sourcing rule can be global (available to all organizations) or local (available to the only organization in which it is defined)
Replenishment source can be:
1) An inter-organization transfer (Transfer From)
2) The replenished organization that manufactures the item (Make At)
3) An external supplier (Buy From)
Make at:
This option specifies that you will make any items associated with the rule at the receiving organization.
Buy From:
This option specifies that you will buy any items associated with the rule from supplier. You must enter appropriate supplier and site (optional).
Transfer from:
This option specifies a diff organization within the enterprise as the source of the items. Using this option you will identify the source organization. You must have already defined the shipping network between source and receiving organization.
Ship method
Ship Method determines the Intransit time and shipping cost which planning will use in its calculations.
Allocation and Rank in Sourcing rule
You can rank the sources of supply named in the rules and bills, giving one priority over another when the planning process generates recommendations. You can also assign sourcing percentages to these sources, allowing you to allocate a portion of the total orders to each source. You cannot apply sourcing rules and bills of distribution (make them Planning Active) until the sum of the allocation percentages equals 100.
Once you have defined your sourcing rules and bills of distribution, you must assign them to particular items and/or organizations.
Each Sourcing rule can be assigned to:
A single item (across all organizations)
An item in a specific organization
All items in a specific organization
A category of items
A category of items in an organization
All items in all organizations (globally)
Here, I’ll discuss how to create sourcing rule and assigning it to an item.
1) Verify Profile Options
Navigate to System Administrator à Profile à Personal Profile
Verify the following Profile Options
MRP:Default Sourcing Assignment Set: Supplier Scheduling
PO: Automatic Document Sourcing: Yes
PO: Allow Auto-generate Sourcing Rules: CREATE AND UPDATE
PO: Allow Autocreation of Oracle Sourcing Documents: Yes
2) Create a Item in Inventory with Purchasing Item Template

3) Create Sourcing Rule
Navigate to Purchasing à Supply Base à Sourcing Rules
Enter the Name, Effective Date
Select All Orgs
Select Type as Buy From
Enter Supplier Name, Allocation % and Rank
Save

4) Assigning Sourcing Rule
Navigate to Supply Base à Assign Sourcing Rule
Go to Menu à View à Find
Choose Supplier Scheduling from the list of values.
Add a new line with the item created and Assign the Sourcing Rule to the Item

5) Verify Sourcing Rule
Now, Navigate to Requisitions à Requisitions
Verify that the Sourcing Rule is defaulted on creation of the requisition for that particular item.

Enjoy Learning Oracle Apps J

6 comments:

  1. i want the steps of sourcing rule of making same item with differnt supplier and should take the current supplier

    ReplyDelete
  2. I WANT TO CREATE A SOURCING RULE WITH AUTOMATION OF CREATING SAME ITEM WITH DIFFERENT SUPPLIER AND THE ITEM SHOULD ITSELF CREATE SOURCING RULE AND AUTOMATION

    ReplyDelete
  3. Hi Shankar,
    Sorry for this late reply.
    In the second screen shot, I've highlighted the Allocation % and Rank.
    If you want to buy the same item from two suppliers, mention the allocation % as 50% for both the suppliers and rank as 1 and 2 based on which supplier you wanted to be selected first and second.
    Hope this answers your question

    ReplyDelete
  4. Thank you for your time. It helped.

    ReplyDelete
  5. The requirement is,the PR should be created and approved automatically,when Work Order is released.

    where to set the sourcing rule for this.Is there any per-defined rule.so that we can enable the rule.

    Please let me know.

    ReplyDelete
  6. Hi Pavithra,

    Thank you very much for the blog.It is very helpful.

    Actually i have an issue.In the second screenshot say there are two suppliers with allocation as 50% for both and rank as 1 and 2 how can we re rank the two suppliers?say i want the second supplier to move ahead of the first supplier in the hierarchy.How can i test this scenario?

    Kindly advise.

    Cheers
    Siva Charan

    ReplyDelete