Firm a planned production order with marking in Dynamics AX

So this came up the other day – and caught me out. We were reviewing the master planning setup for a make to order (MTO) product.

There are two ways of processing MTO items in Dynamics AX: the first is to create the production order from the sales order line:


From the sales order line choose Product and supply > New > Production order, and the system opens the ‘Create production order’ form, and you’ll notice that the production order is being raised with reference to the sales order:


Obviously, Reference number is the sales order number, less obviously, Reference lot is the sales order line.

After you’ve created the production order you can see the sales order reference on the production order:


(Don’t forget to schedule the production order after you’ve created it.)

Incidentally, back on the sales order line notice that the inventory transaction status is now showing as ‘Ordered reserved’, and once the product is received from the sales order it’s immediately reserved, and the sales order line inventory transaction’s status becomes ‘Reserved physical’:


Also, if the item is batch or serial controlled, the batch or serial numbers added to the production order are immediately transferred to the sales order. However, note that this process will only work if the production order receipt and sales order issue are the same warehouse.

The other way this can be setup, is to use master planning to create a planned production order. For a make to order item you will use a Coverage group with a coverage code of ‘Requirement’:


So, I create another sales order line, and I’ll run master planning, and that creates a planned production order:


Now before I firm this planned production order, I’m just going to back up and point out a bit of setup. In the Inventory management parameters, I’ve not ticked ‘Reserve ordered items’:


Now that little tick box has been the subject of its own post, here so I’ll not labour it now. But notice that it didn’t stop the sales order line reserving from the production order above, and nor will it below.

I’ve set my MTO product up with a simple, a very simple, bill of material:


And, as luck would have it, I don’t have any stock on hand of that component, but there is an open purchase order due to be received:


So back to my planned production order – I’ll firm it (or pedantically one I created earlier), and on the Setup tab I’ll requested Extended marking:


Although you’ll find this setting on the Master planning parameters, the system actually uses the last setting you used on the Firming form.

As before, the production order shows the sales order reference:


And also the sales order line shows the production order reference:


So far so good – but quite un-expectedly the component is also marked to its incoming purchase order:


And to support the marking, the inventory transaction on the purchase order line is split:


Of course this is a simple example – in practice this creates problems if there is a simple common raw material (like zinc, or plastic) you can quickly end up with hundreds of additional inventory transactions, or you can find that the system’s marking to purchase orders when you have on-hand – but the on-hand is pegged to safety stock.

So as I said at the beginning, this came up when we were looking at master planning, and the company had adopted this second process (firming planned production orders with Extended marking) as opposed to creating production orders from the sales order lines. That’s understandable – you’d expect your production planners to be working from a planned order form, not from sales orders.

However, neither process is perfect. The major problem with relying on master planning to create a planned production orders is that if there is ever on-hand inventory of the make to order item that isn’t physically reserved to sales order (for instance if you process a sales order return, or cancel a sales order and don’t cancel the corresponding production order and end up making something) then master planning just doesn’t create the requisite planned production order.

So actually in a true make to order scenario I like to rely on a customisation that creates the production orders automatically (and schedules them) – typically when the sales order is confirmed.

I confess that I have no idea why in the second scenario the component is being marked – if I find more information I’ll update this post. I’d also be interested to receive any comments if this has caused you problems in your environment.

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One thought on “Firm a planned production order with marking in Dynamics AX

  1. Since this was published we found that the major problem our customer encountered was that production order back-flush consumption fails if the marked to purchase order hasn’t been received (even if there is available inventory). However production order consumption at start (forward-flush) processes correctly.

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