Difference between revisions of "S3"

Revision as of 03:26, 5 October 2017

The collection of processes associated with ordering non-standard materials (raw materials, semi-finished products, finished products) and/or services based on specifications defined by or derived from customer order information. This may include supplier identification, qualification and selection, contract negotiation and new supplier onboarding.

The intention of Source-to-Engineering-Order is to order materials specified by explicit downstream demand (Customer Orders). These materials generally have not been qualified for the application specified or derived from the customer order. Engineering data may be exchanged with the supplying party, new material numbers may need to be created, and a specific reference or customer order detail is exchanged with the supplying party, attached to or marked on the product, recorded in the warehousing or ERP system in order to track individual deliveries.

Source-to-Engineering-Order is an ETO process.

Use Cases

• Ordering custom components
• Ordering materials for an industrial project
• Ordering specialized services applicable to a single customer project

Source-to-Engineering-Order processes are generally the most resource intensive version of the S processes, typically requiring extended lead times.

Notes

(Expectation of) repeat Sales Orders may lead a company to convert these Sourced materials to a standard offering, thus changing the sourcing process from Engineer-to-Order to Make-To-order or Make-to-Stock. This generally is a conscious decision requiring the material to be included in (future) product revision processes. Perfect Order Ratio Orders Defect Free Ratio Order Cycle Time Sourcing Cycle Time Supply Chain Costs Cost of Goods Sold Distribution Costs Cash Conversion Cycle Days of Inventory Days Payables Outstanding Engineer-to-Order t:Purchasing Source-to-Pay