What? Gold in Visual ERP? You betcha.
Have you ever wondered if transactions are being processed properly in Visual? Especially, inventory transactions. There can be so many of these with lots of different people involved. With that volume of transactions there is definitely a possibility for problems. If you want to get a comfort level, have a look for negative inventory. It is like a goldmine because in there are all the different things that are going on incorrectly in your database.
Just think of the things that could have gone wrong:
- It could be a part has been substituted on the floor but no one told Visual. This is where I have to say “Visual is an ERP System, not an ESP system. It cannot read your mind.”
- You are not receiving things timely. Did the paperwork get lost? Is the paperwork sitting on the receiver’s dock but hasn’t been received yet? Or has the paperwork been sent to the office to be processed instead of being done at receiving.
- You’re shipping an order that hasn’t really physically shipped. But you say, I need the paperwork. You may want to consider the picklist instead.
- We’re shipping the parts in Visual, but we haven’t received the work orders in Visual yet. Again, this could be an opportunity for a process improvement. Can the parts be received on the floor as soon as they come off the line? Could they be bar-coded to make it even more efficient?
- How about a physical inventory count? The count was entered incorrectly or just plain counted wrong.
- Or then there is the fat finger. Or the trigger-happy finger. The latter, is always fun. I remember a case where a user entered 7 into the quantity field on their bar-code system. This was a lot of years ago and response times were not as good as today. So, they clicked on the 7, again and again. On top of that the parts were set to auto-issue. The 7,777,777 for each part on the work order were issued. That was a bit of a mess.
- We could even enter the incorrect Part ID on a customer order.
But these really are not negative. I really don’t like to think in negative terms. These are opportunities for improvement to make your Visual even better. There are lots of reports to help you with your inventory accuracy. How about:
- The Work Order Requirement – Unissued Materials Report. This will show you by work order where not enough materials have been issued. Pick a date range to focus your efforts.
- Comparative Material Usage Report. Select for All closed work order and pick a date range. I like to modify this report to streamline it a bit. Remove the page breaks, get rid of extra blank lines.
- Review your RMA’s. What are the reasons for returns? Wrong part shipped?
- Inventory Transactions – by filtering on adjustment only. Each time there is an adjustment, you should as why?
So, you might ask, why is this important? Many times, I hear “we just do an adjust in or out to fix. Inventory is then accurate.” As an accountant, that makes me cringe. Adjustments don’t end up on the cost of the product. Accurate costs are necessary to assess the profitability of parts and customers. It will help guide the company on where to focus the future direction of the business.
So, negative inventory is full of little gems to teach you, or to help you identify places where you need to improve your process and ultimately improve the profitability for the company. Hey, if the company makes more money, they might just pay more. So, it is good for everyone.