AW: POs considered harmful for dependent demands

[Hermes Hartmut <Hartmut.Hermes@MCH11.siemens.de>]

Bob,

EDIFACT has some more specific message types which replace the use of purchase orders in many processes: DELFOR, DELJIT, HANMOV etc. Indeed I am not sure which different process you name "dependent demands". It would be helpful to have a process model identifying the parties and their activities.


Kind regards / Mit freundlichen Gruessen
Hartmut Hermes     
Siemens AG EL LP	   D-80286 Muenchen     
Tel: +49 89 9221 4564     Fax: +49 89 9221 3753 
Tel: +49 8233 600 222     Cellular phone: +49170 22 97 606  


> -----Urspr> üngliche Nachricht-----
> Von:	Andrew Macpherson [SMTP:andmac@idx.com.au]
> Gesendet am:	Dienstag, 15. Februar 2000 12:21
> An:	Bob Haugen; ebxml-bp@lists.oasis-open.org; ebxml-core@lists.oasis-open.org
> Betreff:	Re: POs considered harmful for dependent demands
> 
> Bob
> 
> I'm not sure if there is a real difference. Whether it is a PO or a
> dependent demand, one is satisfying a need with a service or a good.  No
> matter what you call it it is a request for item, quantity and price
> (information) coupled with a linked payment stream.  A distinction can be
> drawn between push and pull mechanism but ultimately it is the user with
> the need who initiates the process.
> 
> Andrew Macpherson
> 
> ----------
> > From: Bob Haugen <linkage@interaccess.com>
> > To: ebxml-bp@lists.oasis-open.org; ebxml-core@lists.oasis-open.org
> > Subject: POs considered harmful for dependent demands
> > Date: Tuesday, 15 February 2000 3:51
> > 
> > Maybe everybody already knows this, so this is the short version.
> > I have included this point in a different message, but wanted to
> > make sure it was as clear as I could make it.
> > 
> > I still see documents going to this list that seem to assume 
> > that purchase orders are the way all B2B ecommerce is done.
> > 
> > PO's are not a good mechanism for dependent demands,
> > and if they are set in stone in ebXML in such a way that
> > it is difficult to do business without using them, it will
> > need to be redone for Internet-mediated commerce.
> > 
> > Dependent demands are demands that are dependent on some
> > other demand, usually called the independent demand.
> > This concept comes from MRP, the predecessor (and still
> > included in) ERP software.
> > 
> > Dependent demands include the components of manufactured
> > products, retail replenishments, shipping for almost any 
> > purchased item, etc.
> > 
> > Purchase orders are a carryover from paper systems.
> > They are usually composed of a collection of line items,
> > often aggregating quantities over time periods.  They
> > have no knowledge of how the purchases items 
> > will be used, nor what processes and components
> > are required to fulfill the order.
> > 
> > Dependent demands, by contrast, are totally dependent
> > on whatever independent demand stimulated them in the
> > first place.  
> > 
> > All dependent demands should be linked to their
> > relative independent demand so if there are changes
> > anywhere in the network of activities, they can be
> > rippled out to the affected relatives.
> > 
> > For example, if a customer order for a finished good 
> > changes in quantity or timing or is cancelled - the
> > dependent demands should be changed correspondingly.
> > 
> > The PO is too heavy a mechanism for managing
> > dependent demands - something more like an
> > electronic Kanban or manufacturing schedule
> > or point-of-sale event notification would be 
> > better.
> > 
> > The same goes for invoices, which are unnecessary
> > for dependent demands.
> > 
> > Comments? Violent disagreement or agreement?
> > 
> > -Bob Haugen
> >