Scenario 46 - Vendor Managed Inventory (VMI)

46.0 Overview

Scenario #46 describes integration of a Vendor Managed Inventory (VMI) consumption of goods.

The purpose of this scenario is to enable the visualization of the participants in the process and the dialogs between them for this specific integration. This scenario is not meant to be the only model for integrating general ledger applications to a budget applications. This is simply one model that may be used to guide one’s own integration efforts.

This scenario is for a buyer of goods to inform the supplier that goods have been consumed, and replenishment will likely be required. It is also for a retailer to inform the vendor that retail sales of goods have been made.

This scenario also applies to plant data collection systems and warehouse management systems to inform inventory systems that goods have been consumed and inventory records should be adjusted accordingly.

46.1 Scenario Diagram

The scenario below contains the participants involved in the interaction, the dialog flows or conversation between them, certain assumptions about the sequence of events, and assumptions about the technical approach, for example, publish and subscribe.

This is a model to be used as a design recommendation, not a required approach.

46.2 Assumptions

This scenario assumes a loosely coupled, asynchronous approach with transaction management required but not explicitly defined.

The environment for this integration may be within a single enterprise, or across enterprises.

The environment for this first half of the integration is typically within an enterprise and within a division and for this second half of the integration is typically between two enterprises.

It is also assumed that there is a replenishment contract in place that defines when and how the actual replenishment is to take place

This scenario also assume that one application will maintain the master data for integration.

46.3 Component Definitions

This scenario contains two overall applications: the sellers/supplier’s applications whom is assumed to be supplying the product or service and the application for party who is purchasing.

The definitions and details of these applications are left to the designer but are assumed to contain the functionality as defined by what is commonly sold in the commercial market place today. This definition is broadly accepted by the scenario designers and is a direct result of the decision not to define how the processing takes place within any individual application.

Each application must be able perform the services defined by the message BOD (business object document), but the internals of the application are not required or desired to be exposed at this level of standardized abstraction.

The most important factors in defining these participants is to ensure that an integration designer can communicate the requirements precisely enough to detail the interfaces needed and their interrelationships.

46.4 Business Workflow (Sequence)

The business workflow is graphically represented by starting at the Scenario top and reading from top down and from left to right.

This scenario contains the following events in the workflow sequence:

  1. Not shown - Overall purchase, replenishment or vendor managed inventory agreement is in place.
  2. Message is sent to supplier, distributor or third party logistics provider that material has been consumed. This is done in response to events such as these, depending on implementation context:
    • Material is replenished to the manufacturing line at manufacturing facility.
    • Material is assembled into final product.
    • Material is purchased and removed from facility by customer
  3. Supplier, distributor, third party logistics provider replenishes material, using information provided in the Show InventoryConsumption message, the demand and shipment forecasts, and the terms of the overall purchase or vendor managed inventory agreement.

46.5 Exception Handling

Exception handling is highly localized as the result of an implementation’s infrastructure, management and business rules. As such, this section of the Scenario documentation is planned to be used as a guide to help understand the additional intent of these Scenarios. If no exceptions are noted here, then it can be assumed that the Scenario designers agreed that the Scenario is straight forward and has no additional needs:

  • Note that the Confirm BOD is not shown in the scenario and that it is the most obvious method for providing an application level exception and feedback mechanism between business software components. Full Confirm BOD use is described in other OAGIS documentation in detail, but it should be noted that the specific use of the Confirm BOD may vary significantly from scenario to scenario and from integration to integration.

  • The Confirm BOD is typically intended to be used by the original receiving application to communicate to the sending application that the information it sent in the message BOD (business object document) was received and understood and can be processed.

  • If the information was not received or nor understood, or contained errors of any type, it is accepted practice for the OAGIS users to presume that the data was not acted on and in the absence of a Confirm BOD within a partnership previously agreed to time limit to resend the original message again.

  • As errors and assumptions are the bane of any implementation, it is strongly recommended that the Confirm BOD be used to prevent any potential problem although it is not a requirement by OAGIS use.

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