Hi All,

Has anyone dealt with vendor managed inventory in Maximo?  We have many inventory items that will be managed by the vendor on a weekly basis (restocking) and we'll receive a monthly invoice for items consumed.  The issue we're seeing at the moment is that many of the items appear on Job Plans / Work Orders.  When these are approved, Maximo will either reserve inventory (stocked), or raise POs (non-stocked).  We don't want this situation, and don't want to generate any financial transactions based on items consumed.

I would be interested to understand how others may have addressed this issue.


Regards,
Scott Taylor

------------------------------
Scott Taylor
Specialist Business Systems
Port Waratah Coal Services
------------------------------

#AustralianIBMMaximoUserGroup-NSWandACT

Hi Scott,

Interesting use case. Can you please share more details on this story. I am posting few queries which can help you giving some insights on the use case.

1. How invoices of items consumed will be processed? Is it through Maximo? If yes, whether they will be charged against Work Orders?
2. How inventory requirements against work orders are sent to vendor? Do you use Maximo references?
3. If your answers to above 1 and 2, why do we define material requirements in Job Plans and Work Orders? What is the business case?
4. Does Maximo send any financial transactions to any financial systems (Or ERP/ Financial applications)?

More details on the use case can help us to understand better and deliberate on options available. 

As I understood, Maximo does not have a direct function to support this case.

Best regards

V V Seshan

------------------------------
Venkataseshan Venkatasubramanian
------------------------------

Hi V V,

The items are currently managed as stocked items in our warehouse, eg a specific oil filter for one of our motors.  When the Job Plan is used to create the work order to replace the part, Maximo will create the reservation and the storesperson picks it ready for use.  When the quantity remaining in the warehouse is below the reorder quantity, Maximo will raise a PO to replenish the stock.

In future the vendor will make weekly visits to replenish any used items.  We do not need to supply any information in regards to this.  We do not want to generate purchase orders, invoices, etc, but we do want some items on Job Plans so the tradesperson goes out with the correct items for the job.  Not all items will be consumed this way as our tradespeople will come into the storeroom to obtain whatever consumables the required from the VMI for their jobs, whether or not it is on a work order.  This could include bolts, nuts, washers, glue, etc - all small value items.

Yes, we currently have all financial transaction going back to our ERP system.  Under a VMI scenario, we do not want any financial transactions going back to our ERP system for these VMI items.  We will receive a monthly invoice for all replenished VMI items which we will cover via the normal PO / Invoice processing mechanism.  The vendor's invoice will supply the quantity of each item used during the month.


Regards,
Scott Taylor

------------------------------
Scott Taylor
Specialist Business Systems
Port Waratah Coal Services
------------------------------

Original Message:
Sent: Mon May 31, 2021 01:44 AM
From: Venkataseshan Venkatasubramanian
Subject: Vendor managed inventory

Hi Scott,

Interesting use case. Can you please share more details on this story. I am posting few queries which can help you giving some insights on the use case.

1. How invoices of items consumed will be processed? Is it through Maximo? If yes, whether they will be charged against Work Orders?
2. How inventory requirements against work orders are sent to vendor? Do you use Maximo references?
3. If your answers to above 1 and 2, why do we define material requirements in Job Plans and Work Orders? What is the business case?
4. Does Maximo send any financial transactions to any financial systems (Or ERP/ Financial applications)?

More details on the use case can help us to understand better and deliberate on options available. 

As I understood, Maximo does not have a direct function to support this case.

Best regards

V V Seshan

------------------------------
Venkataseshan Venkatasubramanian
------------------------------

Hi Scott,

As I understood, you may have them added to WORK ORDER but you don't want to create a re-order (auto or manual) for both inventory and direct issue requirements. I could see some possible options as below:

1. In Inventory record of this item, mark REORDER="N" under Reorder tab so that this item will not be considered for re-order process. I believe it should work for both direct and inventory re-order processes (both manual or auto reorder processes). Please check this option.
2. In above case for inventory orders, work order requirements will create reservations but re-order will not happen on these VMI items. In such case if you don't want to have reservations against the storeroom, you can create an escalation to delete all reservations against VMI items which will clear against these items.

Please try these options and let us know if any of these helps or otherwise as well.

Best regards

V V Seshan

Solution Architect
TCS IAM

------------------------------
Venkataseshan Venkatasubramanian
------------------------------

Original Message:
Sent: Mon May 31, 2021 02:14 AM
From: Scott Taylor
Subject: Vendor managed inventory

Hi V V,

The items are currently managed as stocked items in our warehouse, eg a specific oil filter for one of our motors.  When the Job Plan is used to create the work order to replace the part, Maximo will create the reservation and the storesperson picks it ready for use.  When the quantity remaining in the warehouse is below the reorder quantity, Maximo will raise a PO to replenish the stock.

In future the vendor will make weekly visits to replenish any used items.  We do not need to supply any information in regards to this.  We do not want to generate purchase orders, invoices, etc, but we do want some items on Job Plans so the tradesperson goes out with the correct items for the job.  Not all items will be consumed this way as our tradespeople will come into the storeroom to obtain whatever consumables the required from the VMI for their jobs, whether or not it is on a work order.  This could include bolts, nuts, washers, glue, etc - all small value items.

Yes, we currently have all financial transaction going back to our ERP system.  Under a VMI scenario, we do not want any financial transactions going back to our ERP system for these VMI items.  We will receive a monthly invoice for all replenished VMI items which we will cover via the normal PO / Invoice processing mechanism.  The vendor's invoice will supply the quantity of each item used during the month.


Regards,
Scott Taylor

------------------------------
Scott Taylor
Specialist Business Systems
Port Waratah Coal Services
------------------------------


Original Message:
Sent: Mon May 31, 2021 01:44 AM
From: Venkataseshan Venkatasubramanian
Subject: Vendor managed inventory

Hi Scott,

Interesting use case. Can you please share more details on this story. I am posting few queries which can help you giving some insights on the use case.

1. How invoices of items consumed will be processed? Is it through Maximo? If yes, whether they will be charged against Work Orders?
2. How inventory requirements against work orders are sent to vendor? Do you use Maximo references?
3. If your answers to above 1 and 2, why do we define material requirements in Job Plans and Work Orders? What is the business case?
4. Does Maximo send any financial transactions to any financial systems (Or ERP/ Financial applications)?

More details on the use case can help us to understand better and deliberate on options available. 

As I understood, Maximo does not have a direct function to support this case.

Best regards

V V Seshan

------------------------------
Venkataseshan Venkatasubramanian

Hi, Scott,

I'd suggest to turn off reorder (as V V has suggested) but still maintain the reservation and actual inventory transactions onto workorder.  This would enable you do some vendor performance evaluation and risk analysis on critical items.  Naturally, you don't have to share this information with vendor unless you choose to.  Either attribute restrictions in conjunction with Security Groups or a cloned Inventory Application would do neatly.

And out of curiosity, would Consignment functionality in Maximo work for your Vendor Managed Items?

Regards

Vera 

------------------------------
Vera Tong
Maximo Consultant
Independent
12066695786
------------------------------

Original Message:
Sent: Mon May 31, 2021 02:14 AM
From: Scott Taylor
Subject: Vendor managed inventory

Hi V V,

The items are currently managed as stocked items in our warehouse, eg a specific oil filter for one of our motors.  When the Job Plan is used to create the work order to replace the part, Maximo will create the reservation and the storesperson picks it ready for use.  When the quantity remaining in the warehouse is below the reorder quantity, Maximo will raise a PO to replenish the stock.

In future the vendor will make weekly visits to replenish any used items.  We do not need to supply any information in regards to this.  We do not want to generate purchase orders, invoices, etc, but we do want some items on Job Plans so the tradesperson goes out with the correct items for the job.  Not all items will be consumed this way as our tradespeople will come into the storeroom to obtain whatever consumables the required from the VMI for their jobs, whether or not it is on a work order.  This could include bolts, nuts, washers, glue, etc - all small value items.

Yes, we currently have all financial transaction going back to our ERP system.  Under a VMI scenario, we do not want any financial transactions going back to our ERP system for these VMI items.  We will receive a monthly invoice for all replenished VMI items which we will cover via the normal PO / Invoice processing mechanism.  The vendor's invoice will supply the quantity of each item used during the month.


Regards,
Scott Taylor

------------------------------
Scott Taylor
Specialist Business Systems
Port Waratah Coal Services
------------------------------


Original Message:
Sent: Mon May 31, 2021 01:44 AM
From: Venkataseshan Venkatasubramanian
Subject: Vendor managed inventory

Hi Scott,

Interesting use case. Can you please share more details on this story. I am posting few queries which can help you giving some insights on the use case.

1. How invoices of items consumed will be processed? Is it through Maximo? If yes, whether they will be charged against Work Orders?
2. How inventory requirements against work orders are sent to vendor? Do you use Maximo references?
3. If your answers to above 1 and 2, why do we define material requirements in Job Plans and Work Orders? What is the business case?
4. Does Maximo send any financial transactions to any financial systems (Or ERP/ Financial applications)?

More details on the use case can help us to understand better and deliberate on options available. 

As I understood, Maximo does not have a direct function to support this case.

Best regards

V V Seshan

------------------------------
Venkataseshan Venkatasubramanian

Hi Vera,

I fear that if we maintain the reservations and inventory side of things, then I will need to continue the processes to replenish the stock, otherwise I will end up with work orders with a status of WMATL?  We don't actually want to manage inventory levels as the vendor will do this for us without PO / receipts.

I was considering the Consignment functionality but think I would still need to replenish items reserved and issued to work orders?  And it would also generate the GL transactions we don't want to post to our financial system (although we could probably identify these and remove them).

With V V's solution we could remove the reservations, but I'm not sure what impact that will have on the picking process for the storeman, nor what this does to the work order (work order with issued items ready for execution?) - something I will need to test.

Thank you for your input so far.


Regards,
Scott Taylor

------------------------------
Scott Taylor
Specialist Business Systems
Port Waratah Coal Services
------------------------------

Original Message:
Sent: Mon May 31, 2021 01:44 AM
From: Venkataseshan Venkatasubramanian
Subject: Vendor managed inventory

Hi Scott,

Interesting use case. Can you please share more details on this story. I am posting few queries which can help you giving some insights on the use case.

1. How invoices of items consumed will be processed? Is it through Maximo? If yes, whether they will be charged against Work Orders?
2. How inventory requirements against work orders are sent to vendor? Do you use Maximo references?
3. If your answers to above 1 and 2, why do we define material requirements in Job Plans and Work Orders? What is the business case?
4. Does Maximo send any financial transactions to any financial systems (Or ERP/ Financial applications)?

More details on the use case can help us to understand better and deliberate on options available. 

As I understood, Maximo does not have a direct function to support this case.

Best regards

V V Seshan

------------------------------
Venkataseshan Venkatasubramanian
------------------------------

Hi, Scott,

You could turn off the WMATL feature in Organisation Application in Maximo, and you might want to make sure your Maximo allows negative current balance (a configuration checkbox in Organisation Application), so that you wouldn't need to manage inventory stock.  But please be cautious if you do change these settings in Organisation Application as they are global, I'd suggest to put counter measurements in to safeguard the data and process for non-vendor management items.

In relation to integration with ERP, I assume Maximo posts outbound data to ERP?  If so, you might be able to set up rules to skip these vendor management items, so it would remove one layer of complexity.

There are also usability benefits keeping the reservations,  "select reserved items" would be handy, especially when it comes to mobility, wouldn't it?

Cheers

Vera

------------------------------
Vera Tong
Maximo Consultant
Independent
12066695786
------------------------------

Original Message:
Sent: Tue June 01, 2021 02:07 AM
From: Scott Taylor
Subject: Vendor managed inventory

Hi Vera,

I fear that if we maintain the reservations and inventory side of things, then I will need to continue the processes to replenish the stock, otherwise I will end up with work orders with a status of WMATL?  We don't actually want to manage inventory levels as the vendor will do this for us without PO / receipts.

I was considering the Consignment functionality but think I would still need to replenish items reserved and issued to work orders?  And it would also generate the GL transactions we don't want to post to our financial system (although we could probably identify these and remove them).

With V V's solution we could remove the reservations, but I'm not sure what impact that will have on the picking process for the storeman, nor what this does to the work order (work order with issued items ready for execution?) - something I will need to test.

Thank you for your input so far.


Regards,
Scott Taylor

------------------------------
Scott Taylor
Specialist Business Systems
Port Waratah Coal Services
------------------------------


Original Message:
Sent: Mon May 31, 2021 01:44 AM
From: Venkataseshan Venkatasubramanian
Subject: Vendor managed inventory

Hi Scott,

Interesting use case. Can you please share more details on this story. I am posting few queries which can help you giving some insights on the use case.

1. How invoices of items consumed will be processed? Is it through Maximo? If yes, whether they will be charged against Work Orders?
2. How inventory requirements against work orders are sent to vendor? Do you use Maximo references?
3. If your answers to above 1 and 2, why do we define material requirements in Job Plans and Work Orders? What is the business case?
4. Does Maximo send any financial transactions to any financial systems (Or ERP/ Financial applications)?

More details on the use case can help us to understand better and deliberate on options available. 

As I understood, Maximo does not have a direct function to support this case.

Best regards

V V Seshan

------------------------------
Venkataseshan Venkatasubramanian

The most immediate thing is that the vendor-managed items should be consignment stock and that the reorder flag be turned off as well. 

Here's the thing that has some level of concern.  You have said that the vendor sends you the invoice each month, but how are you validating that those items have been consumed?  With consignment stock, Maximo can generate an invoice based on consumption, frequency (i,e, monthly), or manually (i.e. when you want to be bothered).

------------------------------
===============================
Craig Kokay,
Lead Senior Maximo/IoT Consultant
ISW
Sydney, NSW, Australia
Ph: 0411-682-040
=================================
#IBMChampion2021
------------------------------

Original Message:
Sent: Mon May 31, 2021 01:44 AM
From: Venkataseshan Venkatasubramanian
Subject: Vendor managed inventory

Hi Scott,

Interesting use case. Can you please share more details on this story. I am posting few queries which can help you giving some insights on the use case.

1. How invoices of items consumed will be processed? Is it through Maximo? If yes, whether they will be charged against Work Orders?
2. How inventory requirements against work orders are sent to vendor? Do you use Maximo references?
3. If your answers to above 1 and 2, why do we define material requirements in Job Plans and Work Orders? What is the business case?
4. Does Maximo send any financial transactions to any financial systems (Or ERP/ Financial applications)?

More details on the use case can help us to understand better and deliberate on options available. 

As I understood, Maximo does not have a direct function to support this case.

Best regards

V V Seshan

------------------------------
Venkataseshan Venkatasubramanian
------------------------------