Shop Floor Control - Installation

Overview

The Installation section of this manual is included to provide you with the information needed to successfully convert from your existing system to the AddonSoftware Shop Floor Control module. The care taken in planning the installation will have a large influence on the total benefits obtained from it. Generally, the installation and setup of the software should be managed by your AddonSoftware dealer.

The installation process involves five major steps:

If more than one company will be using the Shop Floor Control module, it will be necessary to perform steps four and five separately for each company. Up to 98 companies may use the Shop Floor Control module concurrently. There are no separate sets of data files for each company. Each company’s information, though stored in the same set of data files, is completely segregated from the others in the way that the data is stored in the files.

If the installation process seems like a lot of work, remember that it must only be done once.

The installation checklists in this section are important. Use them to help ensure that all the steps required for a successful installation are covered.

Installing Other AddonSoftware Modules

The AddonSoftware Inventory Control module must be installed before the Shop Floor Control module, though it need not be fully functional before the Shop Floor Control installation process begins. However, certain installation steps in Inventory Control must be completed before installation of some of the other AddonSoftware modules can be started.

Once the finished goods part numbers have been entered in Inventory Control, the Order/Invoice Processing module can be installed. After the raw materials part numbers have been entered in Inventory Control, the Purchase Order Processing module can be installed.

Although the Bill of Materials module is not required for installation of Shop Floor Control, it is strongly recommended for most installations. The Bill of Materials module can be installed any time before or after the installation of the Shop Floor Control module.

The Payroll module also, if it is to be used, can be installed any time before or after the installation of Shop Floor Control.

Gathering the Information

Much of the information required to install the Shop Floor Control module can be gathered before the delivery of the computer. This includes the Shop Floor Control module parameters that form the foundation of how the system will function.

All information should first be gathered before attempting to enter anything into the system. Follow the order shown here for best results.

Shop Floor Control Installation Checklist

____    Shop Floor Control Parameters
____    General Ledger Accounts
____    Work Order Types
____    Employee Numbers and Names (if the AddonSoftware Payroll module is not installed)
____    Operation Codes (if the AddonSoftware Bill of Materials module is not installed)
____    Shop Floor Calendars
____    Open Work Order Information

Shop Floor Control Parameters

The Shop Floor Control parameters allow tailoring of the module to the specific needs of a business. Each parameter must be set so that it best matches the way the company operates. This requires a careful study of each task. A separate set of parameters is defined for each company.

Some options presented here can be changed after the module is operating, but many should not. Be sure to check with your AddonSoftware dealer if any changes need to be made after the module is in use.

Use the Shop Floor Control Application Parameters form to collect the parameter information. This form provides a record of how the module was established and should be kept for future reference.

Interface Options tab

>In the Bill of Materials Interface Enabled? field...

Mark this checkbox to interface the Shop Floor Control and Bill of Materials modules. It is highly recommended that the two modules are installed and interfaced. Doing so has benefits such as speeding work order entry by allowing pre-defined Bills to be used rather than keying in the details for each work order.

>In the Ord Proc Interface Enabled? field...

If the checkbox for this parameter is marked, order and sequence numbers will be requested during input of non-stock A special type of work order that describes the manufacture of an item that is not normally stocked as a part number. Non-stocks can describe a custom manufacturing job or any job where a standard bill of material is not followed. Or, items that are needed from subcontracts or purchase requisitions that are part of the manufacturing of a product. work orders, and the actual costs will be carried forward to the order. If unmarked, this interface functionality will not be available The quantity of materials available for use in production or sales. Available is calculated by subtracting Committed from On Hand.. In most cases, if the Order Processing module is installed, this parameter should be set.

>In the Purch Ord Interface Enabled? field...

If the checkbox for this parameter is marked, Work Order numbers will be requested in Purchase Order Entry for subcontract items. In most cases, if the Purchase Order module is installed, this parameter should be set.

>In the Payroll Interface Enabled? field...

This parameter allows information to pass between the AddonSoftware Shop Floor and Payroll modules. If the checkbox for this parameter is marked, and the Shop Floor Parameter, Use Std or Actual PR, is set to actual, the actual employee labor rates in the Payroll module will be available for work order costing. This will allow the option of posting labor transactions and calculation of overhead Overhead reflects charges that are not attributable to a specific job. Overhead will include charges such as rent, utilities, and depreciation and those costs are allocated to jobs by an hourly rate. (for job shop applications) at actual payroll rates, rather than a standard shop rate. This is only true if the Use Std or Actual PR flag is set to 'actual'. If the Use Std or Actual PR parameter is set to 'standard', the direct rate The dollars per hour for labor that a particular operation costs. is sent back to the payroll system.

>Post to General Ledger

Payroll tab

>In the Use Std or Actual PR fIeld...

This option will be enabled only if the Payroll module is installed and interfaced, as labor rates must be standard if there is no payroll interface. If this parameter is set to 'Std' (Standard), the standard labor rate in the Shop Floor or Bill of Materials operation codes will be used to calculate work order costs. If it is set to Actual, each employee’s actual pay rate from the Payroll module will be used to calculate work order costs. The Actual option will very rarely be selected.

>In the Use Time Clock In Entry? field...

This option will be enabled only if Time Sheet Entry Sequence is set to ‘D’ or ‘E’. If Time Sheet Entry Sequence is set to ‘W’, Time Clock Entry will default to unmarked--meaning do not use time clock entry.

Labor time is entered using a number of hours (i.e., 4.25) or as start and stop times from a time clock (i.e., 8:00 to 12:15). Mark the checkbox for this parameter if either time clock entry or number of hours will be allowed. Leave the checkbox unmarked if labor time will always be entered using a number of hours.

>Default Overhead Rate

>Time Sheet Entry Sequence

Labor hours for work order costing may be entered into the system in one of three ways: daily time sheets (D), weekly time sheets (E), or work order travelers (W).

Values  tab

>In the Max Nbr of Op Codes per WO field...

The AddonSoftware Shop Floor Control module allows you to determine the number of Work Order Operations Codes printed on detailed reports and displayed on the screen using certain inquiries. Typically, this parameter is set to 99. The Shop Floor Control Module will consolidate Operation Code detail lines when they exceed the parameter limit.

>In the Print Costs on Traveler A document that travels with a job throughout the shop floor. Typically, a the traveler reflects all processes and comments about how to manufacture the job, materials, and subcontracts.? field...

Travelers may be printed with or without costs displayed.

>In the Current Period field...

The current fiscal period of the Shop Floor Control module, which may or may not be the same period as any other installed modules.

>In the Current Year fIeld...

The current fiscal year of the Shop Floor Control module, which may or may not be the same year as any other installed modules.

Labels tab

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>In the Number of Labels Across field...

This field is currently not implemented. It is available for your AddonSoftware dealer to use in customizations.

>In the Vertical Lines Per Label field...

This field is currently not implemented. It is available for your AddonSoftware dealer to use in customizations.

>In the Horizontal Chars Per Label field...

This field is currently not implemented. It is available for your AddonSoftware dealer to use in customizations.

Masks

In AddonSoftware by Barista, masks are entered and maintained using the Input/Display Masks task, available on the Barista Administration’s Maintenance menu. The Shop Floor Control module expects mask definitions for Percent (%), Amount (A), Cost (C), Hours (H), ID (I), Rate (R), and Units (U).

General Ledger Accounts

Certain general ledger account numbers will be required for the proper functioning of the Shop Floor Control module. If the General Ledger module is in operation, some or all of the necessary account numbers may already exist. Your company’s accounting department can tell you what general ledger accounts exist on your system, and they should be informed that the installation of the Shop Floor Control module will affect certain accounts.

The Company Setup section of the AddonSoftware Administrator manual contains a Chart of Accounts form that may be used to collect the necessary general ledger account information. Instructions for creating these accounts, by using the Account Maintenance task, are also included in the Company Setup section.

Assets

>Inventory Accounts

An inventory account is credited when material is issued to a work order and debited when the work order is closed. When the Accounts Receivable and Inventory Control modules were installed, accounts were established for each type of inventory that was to be tracked in the general ledger. Category ‘I’ (Inventory Item) work orders will be closed to one of these accounts. However, an account such as “Custom Inventory” that will be debited when a category ‘N’ (Non-Stock Item) work order is closed is also required.

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>Work in Process Account

The Work in Process The value of the inventory on the shop floor. Work in Process is also used to generally describe the inventory that has some value added to it in the form of labor, but that is not complete. AddonSoftware only considers items to be Work in Process while a work order is open and not complete. account will be debited when material is issued or labor is updated to a work order and credited when the work order is closed. Each work order type may use a different work in process account.

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Expenses

>Other Recurring Expense

When a recurring (category ‘R’) work order is closed, a recurring expense account or a capital account will be debited. Refer to the Work Order Types section, for an explanation of recurring work orders.

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>Direct Labor

This account is sometimes called Direct Labor Applied to Inventory or Allocated Labor, will be credited when a timesheet is updated to a work order.

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>Overhead Labor

This account is sometimes called Overhead Applied to Inventory or Allocated Overhead, will be credited when a timesheet is updated to a work order.

>Purchases

When a purchase order for a subcontracted item is received into inventory, Purchases will be credited and Work in Process will be debited. When the invoice is received from the vendor, Purchases will be debited and Accounts Payable credited. Since the Purchases account is primarily a clearing account, its balance should be zero when all vendor invoices for the period have been entered.

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>Direct Labor Variance

Required only if standard costing is being used. Also called Efficiency Variance, this account is debited with the amount of direct labor variance to standard when the work order is closed.

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>Overhead Variance

Required only if standard costing is being used. Also called Overhead Efficiency Variance or Overhead Volume Variance, this account is debited with the amount of overhead variance to standard when the work order is closed.

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>Materials Variance

Required only if standard costing is being used. This account is debited with the amount of materials variance to standard when the work order is closed.

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>Subcontracts Variance

Required only if standard costing is being used. This account is debited with the amount of subcontract variance to standard when the work order is closed.

Work Order Types

Work order Type Codes allow for the definition of different classes of work orders. Classes may be grouped by department, type of inventory, location, or any other grouping that helps make it possible to organize work orders meaningfully.

Each work order type is categorized as either inventory, non-stock, or recurring, and its accounting implications are established. It may be useful to create multiple work order types for work orders of the same category and close process in order to be able to group certain sets of work orders. (Many Shop Floor Control reports may be selected and sorted by work order type.)

Use the Work Order Type Codes form to collect the work order types information. This form provides a record of how the system was established and should be kept for future reference.

>Work Order Type Code

Although any type code numbering system can be used, it may be useful to group similar work order types together. For example, work order type codes 01 through 30 may be reserved for work orders that are being built for inventory, codes 31 through 60 for non-stock, and 61 through 99 for recurring work orders. Each of these three types might be further broken down by product line or other features. Both alphabetic and numeric characters can be used in the type code.

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>Description

Each work order type should be given a brief description.

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Work Order Category

The category selected will affect the use of the Close to Account entry (see below). Three work order categories are available:

>Inventory Item (‘I’)

Work Orders using this category is for stocked, manufactured items that are contained in the Inventory Master File, and that probably has a bill of material describing their manufacture. Although category ‘I’ work orders may be used if the AddonSoftware Bill of Materials module is not interfaced, in this situation the entire bill of material must be input each time a category ‘I’ work order is entered.

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>Non-Stock Item (‘N’)

This category of Work Orders are for the manufacture of a custom item or any item that is not contained in the Inventory Master File. A category ‘N’ work order may be an order to build an item that is very nearly the same as a standard, stocked item except for a few modifications; or it may be a completely custom project unlike any existing bill of material. A category ‘N’ work order is generally created as a result of a specific customer order or a Request for a Quotation and may be entered for the purpose of preparing a cost estimate or quote. Normally a customer and sales order number will be associated with a category ‘N’ work order.

If the Shop Floor Control module will be used to prepare cost estimates and quotes, a special category ‘N’ work order type may be established that will be used exclusively for quotations. Such a work order can be changed (as long as transactions have not been made against it) to a production work order type if the quotation is accepted by the customer and the order placed.

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>Recurring/Permanent (‘R’)

Work Orders defined with this category are for maintenance, repair, or capital project activities. After being closed and all costs expensed at month-end, these Work Orders will be reopened for the following month for as long as the project is valid. Recurring Work Orders are typically closed to shop expense or capital accounts. A separate category ‘R’ work order type must be defined for each expense account required.

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Close at Standard or Actual?

The option to close inventory category work orders at actual costs (A) is rarely used and is not available if the Inventory Costing Method Inventory Parameter is set to Standard Costing. It may be needed if FIFO costing, average costing, or replacement cost is being used.

Non-Stock and Recurring work orders are not affected by this parameter, and will generally be closed at actual costs. Setting a category to close at actual costs, disables the four variance general ledger accounts.

When a work order is closed at actual costs, Work in Process is credited and the Close to Account is debited for the total value of the work order. When a work order is closed at standard costs, Work in Process is still credited with the total value of the work order, and the Close to Account is debited with the standard cost The sum of the materials, operations, and subcontracts, together with their costs, that make up the standard cost for an item. only. The difference between actual and standard is applied to the variance accounts.

G/L Accounts

>Work in Process Account

The Work in Process general ledger account will be credited when the work order is closed.

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>Close to Account

For category ‘I’ work orders, this account is not used because the account to which the work order is to be closed is determined by the part number. Category ‘N’ work orders should be closed to Inventory (or a special inventory sub-account called Custom Inventory). This account will be debited when a category ‘N’ work order is closed and credited when the item is sold. Category ‘R’ work orders may be closed to a recurring expense account or a capital account.

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>Direct Labor Account

The direct labor account is sometimes called Direct Labor Applied to Inventory or Allocated Labor, and it should always carry a credit balance. When a timesheet is updated to a work order, this account will be credited with the actual hours of shop time applied to the work order at shop rates or the assigned labor rate.

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>Overhead Labor Account

The overhead labor account is sometimes called Overhead Applied to Inventory or Allocated Overhead. When a timesheet is updated to a work order, this account will be credited with the actual hours of shop time applied to the work order at the standard labor overhead rate.

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>Purchase to  Account

When a purchase order for a subcontracted item is received into inventory, Purchases will be credited and Work in Process will be debited. When the invoice is received from the vendor, Purchases will be debited and Accounts Payable credited. Since the Purchases account is primarily a clearing account, its balance should be zero when all vendor invoices for the period have been entered.

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>Direct Labor Variance

Also called Efficiency Variance. This account is debited with the amount of direct labor variance to standard costing labor when the work order is closed.

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>Overhead Variance

Also called Overhead Efficiency Variance or Overhead Volume Variance. This account is debited with the amount of overhead variance to standard costing when the work order is closed.

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>Materials Variance

This account is debited with the amount of materials variance to standard when the work order is closed.

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>Subcontracts Variance

This account is debited with the amount of subcontract variance to standard when the work order is closed.

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Operation Codes

The Shop Floor Control module uses an operation codes file during the work order entry process. If the AddonSoftware Bill of Materials module is installed and interfaced, the Shop Floor Control module will make use of the Bill of Materials Operation Codes file. If Bill of Materials is not installed and interfaced, an operation codes file must be created.

Use the Operation Codes form at the end of this section to collect the operation codes information. This form provides a record of how the system was established and should be kept for future reference.

Op Code

It may be desirable to group the operation codes by the department, work area, process, etc.

Description

Each operation code should be given a brief description.

Direct Rate

The standard hourly direct labor rate to be used in costing this operation.

Pieces Per Hour

The standard number of pieces that can be completed in one hour.

Overhead Factor

The standard overhead factor that is to be used in costing this operation, entered as a factor of the labor rate. For example, if the overhead rate is 1½ times the direct labor rate of the operation, use an overhead factor of 1.5.

Queue Time

The average amount of time, entered in hundredths of an hour, that an item waits in line before being worked on at this operation. Used for scheduling operations.

Setup Time

The average amount of time, entered in hundredths of an hour, that it takes to set up an operation for a new item being produced.

Move Time

The amount of time, entered in hundredths of an hour, needed to transport an item from the current operation to the next. Used for scheduling operations.

Employee Numbers and Names

The Shop Floor Control module uses an employee file in its timesheet data collection process. If AddonSoftware Payroll is installed and interfaced, the Shop Floor Control module will make use of the Payroll Employee Master File. If the AddonSoftware Payroll is not installed or interfaced, an employee file must be created.

Use the Shop Floor Control Employee form at the end of this section to collect the employee information. This form provides a record of how the system was established and should be kept for future reference.

Employee No

The employee number. Be sure that the format matches the format established in the ID mask for SF (Shop Floor) as entered via the Barista Administration’s Input/Display Masks maintenance task.

Last Name

The employee’s last name. Up to 16 characters will be allowed.

First Name

The employee’s first name. Up to 14 characters will be allowed.

Alt Seq

An alphabetic code, usually the employee’s last name, that will be used in the alphabetic lookup. Up to 10 characters will be allowed.

Setting Up Shop Floor Calendars

Shop Floor Scheduling is based on calendars that are set up for each operation. In the shop floor calendar, you will identify the available hours for each operation, days off, and overtime days. Operations can be defined as a work center A group of like machines or processes that have similar capabilities. Work centers are scheduled together., a machine, or an actual operation, depending upon your volume and ability to handle detail. Your dealer should assist you in determining the correct number of operations for your facility.

Once the operations have been established, the calendar can be set up. If several persons will be working an eight-hour shift, the available hours should reflect the total. If an employee works in more than one operation, an estimate should be made as to the average time spent at each work center.

The Shop Floor Calendar will be the basis for the Load Balance How evenly the workload is distributed between work centers. The Load Balance Inquiry compares available hours to scheduled hours. Inquiry display, which graphically displays the hours assigned to a work center compared to the hours available. It will also be the benchmark used in determining the Bottleneck An operation that is scheduled for more labor hours than that resource has the capacity to complete. A resource that has demand that exceeds capacity is considered to be a bottleneck. Analysis Report. The available hours are also displayed on the Dispatch A document that lists all jobs to be worked on for the day, week or some period of time. AddonSoftware provides a dispatch inquiry as well as a report. Report.

A calendar can be established and then copied to other calendars. One calendar must be established before any automatic scheduling can be performed. While adjustments can be made at a later date, be sure to generate calendars far enough into the future to allow for the maximum lead time within the shop. If conditions should vary on the shop floor, adjustments can be made to the calendar. A batch rescheduling function will recalculate schedules based on the adjusted calendar.

Use the Shop Floor Calendar form at the end of this chapter to gather available hours for each operation for at least three months.

Converting the Open Work Orders

A company that is installing the AddonSoftware Shop Floor Control module probably will have several work orders already open and in existence. There are several ways these work orders can be converted to the new system.

It may seem simplest to allow the existing work orders to remain under the old system until they are all closed and to open all new work orders on the new system. This method should be used with great caution, though, since in practice it can cause confusion about which jobs are, or are not, on the system at any time.

The recommended method of converting the open work ordersis to determine the value that is already in each job, either by performing a physical inventory of work in process or by using the value for each job that is recorded in the job files of another computerized work order system. If the current system supports a type of recurring work order A type of work order that automatically closes and expenses itself each month by using the Close Recurring Work Orders processing tasks. Those tasks close and reopen this type of work order for additional transaction processing. Recurring work orders are convenient for tracking indirect labor expense., the conversion should be planned for fiscal month-end when the recurring work orders will be closed. It is strongly recommended that you keep a record of how the system was established for future reference.

Refer to the Operations section of this manual for further information about using each task described.

1. Perform Work Order Entry for each open work order.

   After determining which work orders are open and collecting the Open Work Order Conversion information for each work order, enter the information from the completed forms into the Shop Floor Control module with the Work Order Entry task.

   Determine the value of each open work order. As described previously, perform a physical inventory of work in process to determine the value of each work order, or use the value for each job that is recorded in the job files or another computerized work order system. Write this information on the Conversion Data Entry form that was completed in step one.

2. Enter the existing balances of the open work orders.
   Use the Work Order Conversion task in Shop Floor Control Utilities to enter the conversion data entry information, showing the amount of labor, material, and subcontracted work that is already in the jobs. Information about the data requirements of this task appears in the Operations section of this manual.

3. Balance the open work orders.
   Run the Work Order Conversion Register in Shop Floor Control Utilities to verify that all the conversion data has been correctly entered. Return to the Work Order Entry and Work Order Conversion Data Entry tasks to make any needed corrections, and verify that the work order information that has been entered balances to the totals. The Work Order Conversion Register should also balance to the general ledger Work in Process Account. Repeat steps three and four as needed until all work order totals balance.

4. Update the Work Order Conversion Register.

   When the Work Order Conversion Register is in balance, perform the update to move the data to the permanent files.

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Begin Live Operation

If the instructions in this section have been followed carefully, the Shop Floor Control module is ready for use. Continue with the Flow of Processing to learn how to use the software in daily operations.

Installation/Training Schedule

	Target	Completed	Signature
Pre-Installation Review:	___-___-___	___-___-___	__________________________________________
Information Review:	___-___-___	___-___-___	__________________________________________
Conversion Training:	___-___-___	___-___-___	__________________________________________
Conversion Review:	___-___-___	___-___-___	__________________________________________
Daily Processing Training:	___-___-___	___-___-___	__________________________________________
Period-End Training:	___-___-___	___-___-___	__________________________________________
Installation Complete A finished job. By contrast, work order can be partially closed. That is, a portion of the production is closed, but some still remains to be processed.:	___-___-___	___-___-___	__________________________________________

Application Parameters

Interface Options

Bill of Materials Interface Enabled?	_________ (Y/N)
Ord Proc (Order Processing) Interface Enabled?	_________ (Y/N)
Purch Ord (Purchase Order) Interface Enabled?	_________ (Y/N)
Payroll Interface Enabled?	_________ (Y/N)
Post to General Ledger?	_________ (Y/N)

Payroll

Use Std or Actual PR	_________ (Std/Actual)
Use Time Clock Entry	_________ (Y/N)
Default Overhead Rate	_________ (?????)
Time Sheet Entry Sequence	_________ (E/D/W)

Values

Max Nbr of Op Codes per WO	______________________ (1-99, but usually 99)
Print Costs On Traveler?	_________ (Y/N)
Current Period	_________ (MM)
Current Year	_________ (CCYY)

Labels

Number of Labels Across	_________
Vertical Lines Per Label	_________
Horizontal Chars Per Label	_________

Operation Code

Operation Code	_ _ _ (3 characters)
Description	_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _  (20 characters)
Direct Rate	__________________
Pieces Per Hour	__________________
Overhead Factor	__________________
Queue Time	__________________
Setup Time	__________________
Move Time	__________________

Employee Maintenance

Employee No	_ _ _ _ _ _ _ _ _ (1-9 characters)
Last Name	_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _  (16 max)
First Name	_ _ _ _ _ _ _ _ _ _ _ _ _ _  (14 max)
Alt Seq	_ _ _ _ _ _ _ _ _ _ (10 max)

Work Order Type Codes

Work Order Type	_ _   (2 characters)
Description	________________________________________
Word Order Category	________(I/N/R)
Close At Standard or Actual	__________(S/A)

G/L Accounts(Use valid general ledger account numbers)

Work In Process Account	____________________
Close To Account	____________________
Direct Labor Account	____________________
Overhead Labor Account	____________________
Purchase To Account	____________________

Dir Labor Variance Account	____________________
Ovhd Labor Variance Acct	____________________
Material Variance Account	____________________
Subcontract Variance Acct	____________________

Create Shop Floor Calendar

Operation Code	__________
Last Date Scheduled	__________ (Display only)
First Scheduled Date	__________
Number of Weeks	__________
Hours	__________
Days to Omit	__________