Backflushing
By Dave Piasecki
Bewilderment,
fear, and sometimes repulsion are reactions you may receive when you suggest
backflushing materials in a production reporting system.
I recall a reaction I received when informing the new director of
operations at a manufacturing plant on the details of shop-floor reporting being
used which included backflushing. The
reaction can best be described as one you would expect from someone experiencing
his first visit to a proctologist. These
reactions are usually due to confusion as to what exactly backflushing is, how
it works, and when to use it.
So
what is backflushing? If you ask
someone involved with engineering or maintenance they’ll likely describe it as
reversing the flow of materials (generally liquids) to flush contaminants from
some type of filtering device. Water
treatment plants are a good example where water is filtered through sand to
remove impurities; periodically they will reverse the flow through the sand to
force the contaminants to the surface where they can be removed.
If you try to make a correlation between this process and the process for
backflushing materials in inventory management you will find that there are
absolutely no similarities, hence the confusion.
Backflushing is simply an inappropriate and misleading term used to
describe a method for issuing materials to production orders at the point that
production of a specific operation is completed.
To make things clearer, for a portion of this article I will refer to backflushing as postproduction issuing. I will also use the term preproduction issuing to describe the method(s) for issuing material most people are familiar with. It’s important to discuss the similarities in the programs used to execute postproduction issuing and preproduction issuing to demonstrate that the two methods are essentially small variations of a single process.
The
standard flow.
When
you create a production order you will usually enter some very basic information
such as item number, requested quantity, and requested date (in most MRP systems
this information is automatically entered when you convert a planned order).
This information (known as the production order header) is then used to
create the materials list (also called parts list or pick list) and the
routing
for this specific production order. The
materials list is created by multiplying the quantity required from the order
header by the quantity per of each component on the bill of materials which
results in a detailed materials list showing each component, the quantity per,
and the total quantity required to produce the requested quantity of the
finished item.
When
it comes time to start production there are several methods used to accumulate
the materials required for production. One
method is to simply use the materials list and pick all of the materials and
transport them to the production area. You
then use a program designed to issue the components to a specific production order. This program will generally require you to enter the
production order number to bring up the materials list.
You can then accept the entire materials list as a single transaction and
the program will issue the quantity on each detail line to the production order
reducing on-hand balances by that quantity. If the materials list did not specify the locations the
materials were to be picked from, you would have to enter that detail information
before completing the transaction. The
program will probably also have an option to increase or decrease the entire
materials list at the header level by changing the quantity required of the
finished item; all detail lines will then recalculate based on this quantity.
You would also have options to change quantities on individual detail
lines or only issue individual detail lines.
If this is starting to sound like I’m talking about your specific software it’s because this is very standard functionality and most programmers will refrain from getting too creative in these areas. While this is the most common method for accumulating the required materials and issuing them there are quite a few variations. You may have some materials that are stocked at the machine; these are referred to as point-of-use materials. You may have the person that picked the materials also go ahead and issue the point-of-use materials even though they haven’t actually picked them or you may have the operator issue these during production. You may also have situations where the amount of materials required to complete the entire production order is too large to stage at the machine all at once and smaller quantities are picked and issued as production requires. In this type of issuing you may use the previously described program, selecting individual lines and specifying quantity picked on each trip, or you may use a separate program where you enter the component item number, the quantity, and the production order number to directly issue individual transactions to the specific production order. This type of transaction program and process will likely be highly prone to errors unless used with an automatic data collection system such as those using bar codes.
Backflushing
In
postproduction issuing (backflushing) you are not issuing the materials until
production is posted (reported) against the operation. The materials may be
accumulated through whatever means are most efficient for your operation.
Once the operation is completed, the operator will use a program to post
the production against the operation. The
operator will generally enter the production order number, operation, quantity
good, scrap quantity, and labor and machine information.
The production reporting program will then bring up the issuing program
(essentially the same program as in the preproduction issuing) using the sum of
the good and scrap quantity to recalculate the materials required.
You generally then issue all the materials as one transaction just as
you would have in the preproduction issue.
You would also have options to change individual item quantities and add
individual scrap quantities to detail lines.
Another option commonly used in postproduction issuing is to have the
issuing program work in the background without the operator ever seeing it
(blind backflushing).
Now
you can see that the difference between preproduction issuing and postproduction
issuing is essentially just the timing of the transactions and a little
transaction automation. So where is it advantageous to use backflushing?
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In
operations where scrap is common in the finished item and you continue to
produce until you have a good quantity equal to the ordered quantity, you
will find postproduction issuing will simplify the issuing process since you
won’t know how many you will run until you have completed production. |
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When
you use point-of-use materials, postproduction issuing simplifies the issuing
process and makes it easier to perform counts on the point-of-use materials.
If you were to preproduction issue these materials you would need to
rectify the system counts with any orders that had quantities issued but not
yet consumed, however, if you postproduction issue you should have a
system-to-actual-count match after each production posting. |
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In
very long production runs (days or weeks) where preproduction posting takes
the materials out of the on-hand inventory balance days or weeks before they
are being used and puts the dollar value into a WIP account.
Anyone that has tried to rectify WIP accounts will tell you that the
less you have in the WIP account and the quicker things come out of the WIP
account the better off you are. It’s
far easier to track inventory than WIP.
You also may have situations where you don’t have enough of the raw
materials for the entire production run, however, more will be arriving during
the run (JIT/kanban); preproduction posting would force inventory of the raw
materials negative. It’s
important to note that I am assuming that if you are doing long production
runs that you are posting quantities produced periodically (each shift or
each day) rather than waiting until the entire run is complete. |
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When
you are using bulk materials such as bar stock, roll stock, sheet goods, and
dry goods or liquids in bulk containers, where the exact quantity cannot be
picked. For example, if you need
1000 linear feet of material that comes in bulk rolls of 300 linear feet, preproduction issuing of 1000 even though the material handler delivered
1200 causes a confusing inventory situation, and issuing the entire 1200
would require you to reverse issue 200 when you return the remainder. |
Examples:
For
a simplified example of an operation where postproduction issuing would make
sense I’ll create a fictitious company that makes prepackaged food products
for vending machines. This company called The Taste Like Cardboard Snack
Company has set up a production work cell for their sandwich assembly that
makes several combinations of sandwiches on white or wheat bread, with ham,
turkey, or beef, American or Swiss cheese, and mustard or mayonnaise.
This gives you about a hundred separate finished combinations and they
will generally run about 30 production orders per shift.
The final step in the assembly is to run the sandwich through an
automated heat-seal packaging machine which, despite their best efforts, manages
to trash about one percent of the sandwiches run through it. Since they are a
make-to-order manufacturer with no tolerances allowed they must produce the
exact number of good sandwiches as ordered.
Since
they are dealing with very few components (only nine) to make up all of these
combinations it would make sense to treat these components as point-of-use
materials especially since they are stored in bulk form.
Trying to pick and segregate exact quantities of mustard, mayonnaise,
meat, cheese, and bread for each production order would be inefficient (and
probably messy). Due to the scrap problem you really don’t know how many
sandwiches you will need to make to get the correct quantity, so preproduction
issuing would force you to go back and enter additional transactions for the
scrap materials. While it may be possible to use digital scales for the meat and
cheese, flow meters for the mayonnaise and mustard, and a counter for the bread
to try to automatically capture exact quantities used per production order, it
just isn’t a cost-effective option and having the production operators
manually track actual usage will likely prove to be an accuracy nightmare.
The best option here is to use blind postproduction posting.
All the operator needs to do is enter the good quantity and the scrap
quantity and let the system calculate the rest.
A
real-world example of postproduction posting I had recently encountered was for
a manufacturer of paperboard packaging materials.
One of the families of products produced were round lids that consisted
of a custom printed insert, rim base material, rim label material, and adhesive. The inserts were stocked on pallets of anywhere from 20,000
to 200,000 depending on size, the rim base material and rim label material were
on bulk rolls, and the adhesive came in bulk containers. The forming of the lids was a single operation on a single
machine. This forming operation was highly prone to scrap and they were a
make-to-order operation that required a specific good quantity be produced.
Production runs could go from several hours to several days and would be
grouped so that multiple orders using the same rim base material and rim label
material were run consecutively.
All
of the raw materials are stored in random location storage in the warehouse.
Material handlers would deliver rim base material, rim label material,
adhesive, and inserts as needed to keep the machine running.
Material handlers would enter location transfer transactions to move the
materials from the storage locations to a specific machine location set up for
the lid forming machine. When the
production operator finished an order or when the shift ended, the operator would
post quantity good and quantity scrapped, the backflush program would then
calculate material requirements and issue them from the machine location.
By using machine locations for the backflushing we essentially isolated the storage locations from the production reporting system and were able to maintain cycle counting in the storage areas. By the way, did I mention that this was a 24/7 operation? This also gave the benefit of very quickly catching production reporting errors just by monitoring the inventory at the machine locations.
Tips
on implementing postproduction issuing (backflushing).
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Backflushing
is performed by operation, in the bill of material you will have to link the
component to the specific operation and set the backflushing flag.
You may also have to set backflushing flags on the specific operation
in the routing, the program used for production posting, and at the
machine/cost center level. The
details of each system may vary so read the documentation for your specific
software. |
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You
may also find backflush flags on the item master; if so, this is likely used
only as a default in setting up bills of material.
Changing this to backflush will probably not change any existing
bills previously created. |
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Changing
an item on a bill of material to backflush will likely not change the item
on the materials lists on any existing production orders previously created.
You will probably have to change these manually or delete and
recreate the orders. |
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Backflushing
is generally not a global setting, which means you can chose specific bills
of materials to backflush and even specific items within a bill of material.
For example, you could backflush only point-of-use items and perform
preproduction issuing on other items within the same production order. |
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Bill
of materials often have options for entering scrap percentages.
Note that this scrap information is usually only used for materials
planning purposes and will probably not have any effect on the backflush
quantities, however, you should test to see how your system handles this. |
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I
highly recommend setting up machine locations and backflushing from these
locations rather than backflushing from specific storage locations (this is
often set up at the machine/cost center level, however, it may be set up on
the item master, bill of material, or routing).
Items stored in specific locations should be transferred to the
machine location when picked for production. |
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You
may need to set up some alternative picking documents.
Creating a report that consolidates all materials required at a
specific operation for all production orders expected to be ran during that
shift gives you the efficiency of batch picking.
Point-of-use items can be treated similar to the way you would
replenish forward picking locations in a distribution operation. |
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If
you are using lot tracking of components you may not be able to perform
blind backflushing, you will probably need to enter lot information in the
detail of the issuing program. |
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Need
I mention that accurate bill of materials and routings are critical. |
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Thoroughly
test your system. Verify the effects on inventory accounts, on hand balances,
allocations, and locations. |
I
have only discussed backflushing materials, however, some systems may also allow
you to backflush labor. Backflushing
labor is simply using the quantity produced information and the standard labor,
machine, and set up hours in the routing to calculate labor and machine time to
apply against the production order.
Backflushing
is not an ideology; it’s not something you should be for or against.
It’s simply a method for issuing materials that works well when applied
correctly and works poorly when applied incorrectly. Operations not using point-of-use materials, bulk materials,
or those where production scrap does not force an increase in run quantities
will find no benefit to backflushing. Contract
manufacturers and engineer-to-order manufacturers may find system setup too
extensive or bill of material accuracy inadequate to support backflushing.
Operations that have or can easily put in place automated data collection
systems to accurately issue exact quantities to production orders will also have
little need to consider backflushing.
Dave Piasecki is owner/operator of Inventory Operations Consulting LLC, a consulting firm providing services related to inventory management, material handling, and warehouse operations to manufacturers and distributors in Southeast Wisconsin. He has over 15 years experience in warehousing and inventory management and can be reached through his website (http://www.inventoryops.com), where he maintains additional relevant information and links
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