When it comes to cycle counting, the first thing that comes to mind is ABC classifications of the items and then a cycle count program to count items throughout the year on a continuous basis.
There is nothing wrong with the ABC classifications if the organization is mature enough with its items and the classification criteria is going to be somewhat stable during the year. For example, the classification criteria is the on-hand quantities, that classification is only good at the time of creation. Three months later, the classification could be different. What if the company adds new items and starts transacting? There are a few challenges with the traditional ABC Classifications.
Category-based Cycle Counts
Oracle recently rolled out Category-based cycle counts in Oracle Fusion. In my opinion, it’s a powerful tool that could easily replace the ABC model. I believe that the Category-based Cycle Counts has various advantages over ABC Classification:
- If all items are the same for cycle counting purposes, use an existing catalog, or see if any of the other catalogs can be used
- If none of the existing catalogs work, then create a Cycle Count Catalog
- Assign your items to the catalog: in our experience, this approach is more intuitive for most companies than performing the ABC classifications.
- Create a Category-based cycle count and let Oracle create counts based on the categories
The clear advantage with this approach is the flexibility of adding items and changing the item’s classification or category at any given time without cumbersome setups and IT work.
Another added benefit is that Oracle Fusion Cycle base can be used to perform highly accurate counts, if performing manual counts.
I will cover the newly improved Cycle Count pages with Redwood Experience in my next blog. As a preview of that blog, Oracle is not improving direct manual classification and that may make the usage of ABC Classification attractive again.
This new approach to perform Cycle Counts in Oracle Fusion Supply Chain is a powerful tool worth exploring.
Contact Mehmet Erisen at Perficient for more introspection of this functionality, and how Perficient and Oracle Fusion Cloud can digitalize and modernize your ERP platform.
