Article: Incremental Learning of Supply Chain Management Capabilities In The New Microsoft Dynamics AX and AX 2012 R3
The two major options currently available for using Dynamics AX can be labeled the “new Dynamics AX” and “Dynamics AX 2012 R3”, where both options share the same embedded conceptual models and business processes. The new Dynamics AX is now in public preview. Stated another way, the functionality within the new Dynamics AX is based on the proven business logic of AX 2012 R3, but there are some substantive differences.
Many AX professionals familiar with previous software versions need to learn the incrementally new functionality, which can be gleaned from the Microsoft documentation about “What’s New”. However, it is difficult to gauge the relative amount of functionality and incremental learning. For some, the starting point for incremental learning consists of the older version of AX 2012, while others may start from AX 2012 R3.
This article quantifies the incremental learning and the relative amount of change between these previous versions and the new Dynamics AX, and focuses on supply chain management topics for manufacturing and distribution. It starts with some metrics about the amount of incremental learning, and then provides a summarized description of changes in AX functionality. Previous articles reviewed the incremental SCM changes between AX 2009 and AX 2012 for discrete manufacturing and process manufacturing , and between AX 2012 and AX 2012 R2.
1. Metrics about the Amount of Incremental Learning
The amount of AX functionality and the associated incremental learning is difficult to measure. A helpful starting point involves a rough measure of the previous versus new functionality which indicates the proportionate amount of change. One rough measure can be based on a page count analysis of my new book. The heat map displayed in Figure 1 summarizes the book topics, and a yardstick portrayal of previous functionality in AX 2012 (shown in white) and the incrementally new functionality within the new Dynamics AX or AX 2012 R3 (shown in light grey). These two versions share the same business logic. The figure also identifies the incremental changes related to just the new Dynamics AX (shown in dark grey), such as the new workspace capabilities. The entire length of a yardstick represents a complete walkthrough of the topic so you get a proportionate sense of magnitude.
As you can see by the yardsticks within Figure 1, the older version of AX 2012 comprises the majority of functionality for every topic except the one for advanced warehouse management. The advanced approach to warehouse management was introduced in AX 2012 R3, whereas the basic approach has been available for a long time. The yardsticks about the two approaches to warehouse management reflect a page count of the companion book “Warehouse Management using AX 2012 R3“, and the length simply indicates a large number (rather than a proportionate page count).
Almost every topic had a relatively small degree of change stemming from AX 2012 R3. Most topics were also affected by changes in the new Dynamics AX, such as the use ofSCM-related workspaces described in a previous article.
In summary, the amount of incremental learning differs based on whether you need to understand the advanced approach to warehouse management. When using just the basic approach to warehouse management, the new capabilities in AX 2012 R3 and the new Dynamics AX represent a 5-10% change in overall functionality compared to AX 2012.
The advanced approach to warehouse management requires a significantly higher amount of incremental learning. A rough estimate of incremental learning would be 200+ pages based on a page count analysis of my companion book about warehouse management.
Several caveats apply to this heat map and the estimates of incremental learning. The topics reflect an SCM focus on manufacturing and distribution, and do not include topics related to retail, accounting and human resources. Other relevant topics are not included, such as lean manufacturing, projects, and service orders. With these limitations in mind, the analysis can still provide rough yardsticks of incremental learning.
2. Summarizing the Changes in AX Functionality
The previous section quantified the incremental learning and the proportionate amount of change between AX 2012 and the newer versions of AX 2012 R3 and the new Dynamics AX. The analysis focused on the SCM-related topics covered within my new book. This section summarizes some of the major changes for the SCM-related topics. It is not an exhaustive list, and a previous article already summarized the incremental changes related to workspaces. The book chapters provide an organizing focus for the explanation.
Fundamentals of Modeling Inventory Locations The item- and warehouse-specific policies that support use of the basic versus advanced approach to warehouse management represent the biggest change for modeling inventory locations.
An additional change within the new Dynamics AX affects the approach to intercompany trade when using an additional AX instance or a different ERP package. In these scenarios, you handle intercompany trade using the new Data Import/Export framework rather than the previous approach using the Application Integration Framework (AIF).
Definition of a Material Item Several changes in item definition stem from use of the Advanced WMS approach to warehouse management, starting with additional policies within the Storage Dimension Group assigned to items. Use of the Advanced WMS approach also impacts the essential data for an item, which requires two additional fields about a reservation hierarchy and unit sequence group. It impacts the item’s enterprise-level data about an NMFC code which provides information for the new bill of lading format. The values for four different item filter codes can be defined, and you assign the relevant value to an item to support Advanced WMS purposes such as directed put-away based on the item characteristic.
Bill of Material Information The BOM versions for manufactured items can be optionally maintained via product change cases.
As part of supporting the Advanced WMS approach, an additional option was introduced for defining the warehouse source of components in BOM/routing information so that raw material picking work can deliver components to a production input location.
Resources and Routings As part of supporting the Advanced WMS approach to production order picking and receiving, you can define a production input location for a resource group (or a resource) and a production output location.
Product Costing One change involved a new capability related to a costing version for planned costs, where the item cost records for purchased items can be automatically populated based on purchase prices within purchase trade agreements. These item cost records can then be used to calculate the planned costs for manufactured items.
A new Compare Item Prices report enables a comparison of costs within a selected costing version (1) to the pending costs in a specified costing version or (2) to the active costs as per an effective date. It can also calculate the net change in inventory value for a set of standard cost data.
Batch Number and Serial Number Tracking An additional option for serialized items supports the deferred assignment of serial numbers until sales order shipment. A new Item Trace inquiry provides more comprehensive information for batch (and serial) number tracking purposes, and it can identify the customers that received products containing a component with a bad batch.
Coverage Planning Data to Model SCM Decision Making A graphical analysis of related action messages termed the Action Graph was introduced, where you can apply the suggested action for a selected message. This capability was enhanced in the new Dynamics AX so that the Action Graph still displays reference information after applying the suggested action for an action message.
S&OP and Master Scheduling An additional option for forecast consumption logic supports demand forecasts for stocked components so that any demand (rather than just sales order demand) consumes the forecast. This same logic applies to demand forecasts for stocked end-items at different levels of a distribution network, so that transfer order demands consume the forecast.
A new option supports demand forecasts by customer and the associated forecast consumption logic by sales orders for the customer. It also applies to demand forecasts for a customer group.
A new capability involves an explanation of master scheduling logic, which can be provided as part of a net change explosion. You specify the calculation of this “trace” information as part of the dialogue for performing the net change explosion, and then view the results on the “Explanation” tab. The explanation applies to the multi-level product structure for the item. It provides a detailed breakdown of the coverage planning calculations, and the generation of action messages and messages about delayed dates.
A small refinement was made to the CTP logic for sales orders, so that it can first consider an item’s supply orders that meet the required date before considering on-hand inventory.
One approach to statistical forecasting was introduced in AX 2012 R3, where the forecast models in Microsoft SQL Server Analysis Services were used to create demand forecast predictions. In the new Dynamics AX, it was replaced by a different approach whereby future demand can be estimated using the Microsoft Azure Machine Learning cloud service.
Sales Order Processing Several new aspects of sales order processing were introduced. These include placing a sales order on hold, creating sales lines via copying from an Item List, identifying changes to sales orders via order events, and enforcing the start and end dates for selling an item. Other aspects include a new item-specific reservation policy that will be inherited by sales order lines, such as a policy of Automatic versus Manual.
When using the new Dynamics AX, the Delivery Alternatives page can be accessed for a sales order line in order to analyze product availability at different ship-from warehouses and different modes of delivery. Product availability may also reflect different product variants (such as size or color) in some scenarios. After evaluating the options, you can select the desired option and automatically update the promised dates, ship-from warehouse and mode of delivery on the sales line. You can also choose to ship a smaller quantity than ordered (based on availability) and ship the remainder at a later date, which results in a delivery schedule for the sales line.
The new Direct Delivery form can help coordinate the sales order and purchase order involved in a direct delivery. A new item-related policy identifies those items typically sold as a direct delivery, so that the policy will be inherited by sales lines for the item.
The assignment of serial numbers to a serialized item can be deferred until sales order shipment.
The basic model of sales order processing includes an additional option for using the Advanced WMS approach to sales order picking/shipping and the related use of mobile device transactions. The Advanced WMS approach has multiple impacts, such as different reservation logic and different options for the release-to-warehouse step.
The basic approach to warehouse management also has an additional option (termed the Picking Workbench) to support the wave picking concept for sales order picking lists.
Purchase Order Processing An approval process (termed change management) can be used for a manually-created purchase order for trade goods. An associated policy (termed activate change management) can enforce the approval process as a companywide, vendor-specific or order-specific policy.
An additional step in the basic model of purchase order processing supports external review prior to confirming an order.
The Vendor Portal capabilities apply to AX 2012 R3 but were deprecated in the new Dynamics AX. For example, the vendor portal can be used to reply to vendor-specific RFQs.
Another change to the basic model of purchase order processing entails the additional option for using the Advanced WMS approach to purchase order receiving and the related use of mobile device transactions.
Transfer Order Processing The basic model of transfer order processing includes the additional option for using the Advanced WMS approach to transfer order picking/shipping and receiving. The basic approach to warehouse management also has an additional option (termed the Picking Workbench) to support the wave picking concept for transfer order picking lists.
Production Order Processing One change entails the additional options within the Advanced WMS approach for production order picking and receiving, and the related use of mobile device transactions. The new capabilities support raw material picking work and wave picking, and the picking list journal is used to report actual consumption of components.
A new capability enables you to assign (and remove) a Stop flag for a production order. The Stop flag primarily serves warehouse management purposes and prevents changes in order status prior to starting a production order. For example, assigning the Stop flag to a scheduled order prevents a change in order status to Released (which prevents creation of raw material picking work) and to Started (which prevents reporting of labor and material).
When using the new Dynamics AX, some minor changes were introduced for displaying information on the Action Graph and Gantt chart; for displaying material availability information to support decisions about releasing production orders; and for reporting progress on production jobs using the touch-enabled Job Card Device page as part of the MES (Manufacturing Execution System) capabilities.
Subcontracted Production The major change entails the additional options within the Advanced WMS approach to support production orders and transfer orders, as noted in the previous point.
Inventory and Warehouse Management The new capabilities within the Advanced WMS approach represent the largest change in functionality in comparison to the basic approach supported by previous AX versions. They involve consideration of the strategic options for warehouse management, the new Inventory Status capabilities, and the impact of work orders on inventory transactions.
The summarized explanations of the basic and advanced approaches to warehouse management (within the book) do not adequately reflect the magnitude of incremental learning. A more realistic estimate of magnitude can be based on the companion book about Warehouse Management using AX. The yardsticks within Figure 1 reflect this different basis of page count metrics. The text within each yardstick indicates the common and unique functionality related to the basic and advanced approaches to warehouse management.
Quality Management The major changes include the use of Inventory Status and cases for quality management purposes. For example, the user-defined values for Inventory Status provide an additional option for inventory blocking, reporting inspection, and indicating inspection requirements for purchased items. An additional consideration only applies to the Advanced WMS approach, where you define a combined disposition code (with an associated Inventory Status and RMA disposition code) in order to report exceptions during mobile device transactions for receiving purchase orders and RMAs.
Cases can be used to identify a quality issue, and case management provides a multi-faceted approach to manage issues raised by customers, vendors or employees. A special variation of cases – termed a product change case — can also support maintenance of BOM and route versions for manufactured items.
The minor changes for quality management include two new options for holds and stop flags. That is, you can place a sales order on hold, and also assign a stop flag to a production order. In addition, the use of quarantine orders (and a quarantine warehouse) only applies to the basic approach to warehouse management.
Configuration Technologies for Custom Product Manufacturing A new capability within a Product Configuration Model supports the calculation of a configuration’s sales price based on responses. This provides an alternative to the cost-plus-markup calculation (based on BOM/routing information) of a suggested sales price.
3. Concluding Remarks
This article covered the incremental learning of new SCM-related topics by knowledgeable AX users. They can build on what they already know about the previous AX 2012 version, since it comprises the majority of the functionality within the newer versions of AX 2012 R3 and the new Dynamics AX. The proportionate amount of change was summarized graphically, and the major changes were also described.
Source: MSDynamicsWorld.com