See also:
You will find a general description of how to manage lists in MONITOR in the chapter Managing Lists in the System under General in the MONITOR Basics guide.
Why Use This Procedure?
Under the Create tab in this procedure you can load a list used to calculate and analyze the volume value of different parts. This is usually performed for the entire line of goods or part register.
In order to estimate the volume value of parts, you must first have registered an Annual volume and a price to base the calculations on for the parts.
If you use annual volume with current daily pace and you have configured the setting Show Annual Budget/Volume and EOQ with Current Daily Pace?, under Requirements Planning under the Inventory tab in the Settings procedure, you can select if the annual volume shall be loaded from the annual value registered for the part or from the current pace (daily pace).
You can estimate the volume value for Purchase parts (P-parts), Manufactured parts (M-parts) and Stocked parts (S-parts). However, the volume value is usually calculated based on the standard price. That price is also selected by default.
You register prices and annual volumes for parts in the Update Part procedure in the Inventory module.
The standard price for your own manufactured parts (M-parts or S-parts) is calculated and saved in the Pre-Calculation or Pre-Calculation Selection procedures. The standard price for purchased parts is usually configured as the purchase price + purchasing costs.
You can calculate annual volumes for parts in the Estimate Annual Volume procedure based on different alternatives such as a sales forecast or the order backlog. The new estimated annual volume can be saved for the parts in that procedure as well.
ABC Codes
Parts with different volume values are classified using "ABC codes". You configure all the ABC codes that will be used in the system in the ABC Codes procedure in the Global Settings module. You can manually register ABC codes for parts in the Update Part or the Part List procedure, but in this procedure the ABC codes are calculated and suggested based on the parts' volume value.
The purpose of the ABC codes is to capture as large a volume value as possible with as few parts as possible. Before running you can enter limit values for the different classifications here.
For example, the parts of the ABC code that applies for high value parts should represent 80% of the volume value, 10% of another ABC code represents parts with a little lower value, 5% of a third, 3% of a fourth and 2% of a fifth ABC code. Another way of calculation is to use the option Distribute limit.
During calculation, the program will strive to classify the parts with these volume values or limits as close as possible to these limits. At the same time, the program will suggest the right ABC codes for the parts, based on their current volume value.
This way you can easily identify the parts that represent the largest share or portion of the volume value. Those are the parts that either have a high value, or a large annual volume, or a combination of both these characteristics.
You can choose to distribute the ABC codes using different methods during the volume value calculation and analysis. You can also perform a clean-cut volume value calculation of the parts without any distribution, but the most usual method is to select either a distribution of the volume value in %, or of part quantity in % or distribution based on limit.
When calculating the volume value, the selected distribution is considered a "should be" value. The result of the distribution that the program has calculated in the list should be considered an "is" value.
What Update Options Exist for this Procedure?
In this procedure you calculate and update ABC codes for the selected parts.
Work Flow
You should also read the instruction of the work flow during volume value analysis .
Window Functions
Use Calculate under the Display List tab to start the calculation of a new distribution of the volume value. This alternative is only available if you have selected a distribution alternative under the ABC code calculation heading under the Create tab. A box will appear in which you enter the distribution. When you click OK in that box, the calculation will take place immediately and you will see the results in the list.
Read more about the other Window functions under Window Functions in the MONITOR Basics guide.