Outsourced Purchase Order Enhancements (OPOE) modify the Outsourced Purchase Order so that the Description, Quantity Ordered and Cost provide more meaningful information to the Vendor, rather than reflecting “internal” information from the manufacturing routing.
OPOE adds an Outsourcing Description to the Manufacturing Routing, as shown below. The Outsourcing Description is used to record a description of the service that will be meaningful to your vendor. Rather than the PO showing your internal Routing Sequence Description (i.e. “Paint Chair”), it might say “Ultra Hard Enamel, Fabrikam Color #227”.
OPOE changes the Quantity and Cost to be per-unit shipped to the Vendor, rather than reflecting the hours and labor cost of the routing sequence. As shown below, an MO has an outsourced routing sequence for a Painting Service provided by an external supplier. Manufacturing is set up to use Machine Variable Overhead as the Outsourcing Cost Bucket, and the PAINT Machine assigned to this routing sequence has an Overhead cost of $15.30 per hour. Painting takes two hours.
GP Manufacturing’s suggested Outsource PO is for Item SERVMO0026-200 (a combination of “SERV”, plus the MO Number and the Routing Sequence), for a quantity of 2. The Extended Cost is therefore $30.60.
OPOE changes the PO so that Quantity to Order is 1 (because 1 CHAIR is being sent for painting), at a total cost of $30.60, and the Item Description is changed to the Outsourcing Description.