by Don Lindsey

In QAD or any ERP System, the Item or part number is the identifier assigned to a specific unit or service. To borrow from The Sound of Music, it is the “name I call myself” (if I were an item).

Before diving into more about item numbers, let’s take a moment to talk about QAD (formerly MFG/PRO). What is QAD’s MFG/PRO? QAD is a fully-loaded ERP system, which has been used by thousands of manufacturing companies and hundreds of thousands user since the early 1980s. First released in 1986, the system’s APICS based functionality has improved significantly, while the general look and feel, as well as the general structure, has remained consistent. The QAD system is made up of groups of related business activities called ‘modules.’ The modules house the data for Distribution, Manufacturing, Financial, Service Support, Master Files and Supply Chain.

The item or part number is the bedrock of the QAD’s ERP system (or any ERP system for that matter). It contains all the information that identifies, describes, categorizes, and controls the defined item or service in QAD.

Here are some important things to note about item or part numbers:

• The item data is stored in a master record. It may be physically distributed across many locations, but it is logically treated as a single entity.
• The item number must be unique to each item or service it represents. If an item comes in differing length or grades, there should be a different item number assigned to each variation. (See below for further discussion on item and part number schemas.)
• The item’s descriptive data, in the item master file, helps humans identify, recognize, and categorize parts. It may also be used by the system for grouping part numbers, calculating sub-totals, and developing other query responses.
• Item numbers may also be referred to as “SKU” numbers, or SKU (Stock Keeping Unit).
• An item number can represent a service as well as a physical item. It is good practice to establish an item number for any billable entity. For example, one item number might correspond to a box of finished goods that are shipped to the customer, while another might represent a monthly rental fee. The rental fee is not a stocked or inventory unit which you can find in the warehouse, but assigning an item or part number to a service helps to improve data accuracy and unification.
• Item numbers are also used to link records together to form BOMs and formula records that define a Product Structure.

Item Master Overview
Items in QAD are part of the core master data and are used in nearly all system modules, such as manufacturing, distribution, and others. Item master maintenance can be found in the following menu: 1. Item/Sites->1.4. Item data menu. This submenu includes several programs which allow the user to maintain various item parameters, such as basic data, inventory data, planning data, and cost data.

The 1.4.1 menu is used to create a new item and maintain all its parameters in one screen with multiple frames. At the same time, the corresponding sub-screens can be found in other standalone programs such as 1.4.7, 1.4.9, etc. Item master information is utilized as a master template which can be used later, such as in menu 1.4.17, to define site-specific data. In any QAD built-in transaction (for example, MRP, Work Order release or Sales Order maintenance) the system will always look first for the site-specific record. If the site-specific record is not found, QAD will use the general [Item Master Data] template record for the information.

Sites
The site in QAD usually represents a physical place where you manufacture or store inventory. It can be a distribution center, warehouse, manufacturing facility, or a combination of these. Inventory control and planning information are maintained by site, including inventory availability, manufacturing methods, costs, sales, purchasing data, manufacturing plans and orders, and forecasts. Sites are created and maintained in 1.1.13 Site Maintenance. Care should be taken when creating sites because Cost, MRP and Locations and other information are controlled by the site record.

Business Flow
One of the reasons to have multiple item master sub-screens is that in many organizations, different people (departments) are responsible for different master data. For example, the company planner or scheduler updates the item planning data (maintained in menus 1.4.7 and 1.4.17, such as planning quantities and periods, lead times, etc.). Warehouse personnel are likely responsible for the item inventory data (maintained in menus 1.4.5 and 1.4.16, such as cycle counting intervals, default site and lot/serial control). Item costing information (menus 1.4.9 and 1.4.18) are the responsibility of the financial group – accountants and cost specialists.

Security access management becomes very easy when you use separate item data maintenance programs. Some organizations choose the following business flow:

• 1.4.1 menu – Item master maintenance is not accessible by the user community (administrators only)
• The Engineering Department can create new items in 1.4.3
• The Planning Department can update item planning and item-site planning data
• The Warehouse Department can update item inventory and item-site inventory data
• The Financial Group can update item cost data and item-site cost data

This model helps to ensure that only certain people are responsible for creating new items and that specific people can only modify specific information for which they are responsible. Usually, this business model also includes a well-defined and strict change control processes, where data cannot be altered without proper multi-level authorization and process documentation.

Segregation of Duties, Ownership and Centralized Maintenance
Each company needs to decide how to implement the item number creation process based on their needs and internal organization, but there are a few best practices to follow.  In most cases, the Engineering department is responsible for assigning the number s and other vital product/item parameters.

Companies with multi-site QAD implementations, however, face some business and technical challenges. There may be different company sites with ownership and responsibility for various items. Though this practice is acceptable and widespread, it is always best practice to centralize item master maintenance to avoid problems in item standardization and unification.
It is best to assign responsibility for new item creation to only one department in one location while maintaining site-specific information locally. This practice will necessitate the implementation of a data synchronization process to transfer master data between QAD databases automatically and to minimize manual input. It will also reduce the potential number of errors and the risk of data inconsistency.
There are a few options available that will help you synchronize master files.

• QAD Data Sync Product
• Automatic CIM load where information is sent from the master database to the target databases
• Semi-Automatic load, where notification is automatically sent, and data is loaded manually
• 32 Soft Data Loaders, which are MS Excel-based and offer a wealth of utilities to increase productivity, reduce errors and cleanly upload data from one QAD

In multi-system operations where QAD coexists with other systems, such as Financial or Supply Chain systems, master data synchronization becomes even more critical. In this case, master records are maintained in one system and replicated into another. Again, it is wise to assign only one source for master data maintenance and to make the synchronization process as automatic as possible.

Item Number Creation
Item numbering concepts have been argued and discussed in the business community since the inception of ERP systems—and even before in pre-computer manual inventory control systems.

There are three types of part numbering systems which apply the rule of uniqueness of identification mandate. (For more information on the uniqueness of identification, see Universal Unique Identifier (UUID).

• Significant—Each element of the part number has meaning
• Semi-Significant—Some portion of the part number has a meaning
• Random—The part number is randomly assigned, generally in sequence, so the part number is just a name and has no meaning attached

Many propose that item numbers have some meaning, i.e., significant numbering. For example, the item number is structured so that you know it is a finished good, manufactured at the Plant A, and is to be stored in a cold place.

Others firmly believe that item numbers should be assigned randomly/sequentially or semi-significant. All three concepts [Significant, Semi-Significant, and Random] have their pros and cons.

Meaningful item numbers are user-friendly, helping system users to identify the products quickly. However, there is always a possibility—and it happens quite often— that the company will run out of options at some point. Or, as is the case many times, the person who created the number schema retires or leaves the company and the tribal knowledge goes with them.

Here is an example. Let’s say the second digit of an item number represents the item’s color. At the time of implementation, the company had only three colors of this product available, and everyone was sure there would not be more than ten colors offered in the future. Now, the product is available in 15 different colors, necessitating the need to use two digits to define the color options in the item number. What are the choices? You could add another digit to the item number, but this will affect the way the item number is printed or displayed in various reports and documents. You could substitute the digit with a letter, but this will change the initial numbering system and still not guarantee that a similar problem won’t occur in the future.

In contrast, using a random or sequential process to create item number does not produce these complications. Of course, this option does not provide item numbers that are easy to decipher, but in the long run, it is the most recommended way to approach item number assignment.

Item Descriptions
It is important to note that item descriptions in QAD consist of two lines, but the second line does not always appear in the reports. For this reason, include as much information as possible in the first 24 characters of the item description.

The old rule of noun, adjective, adjective apples here in the world of descriptions. For example:

Item A       BOX, WOOD   ,12”x15”
Item B       BOX, PLASTIC, 8”x15”

In this case, when pressing F2 for a lookup, and sorting items by description, you will get all your similar items (boxes, in this example) together.

Data Accuracy
Data accuracy is essential for successful QAD implementation. Here are a few examples. Inventory data is critical for warehouse operations. Incorrect ABC class and cycle counting interval for an item will directly affect inventory accuracy since the item will not be counted in time. Inaccurate location type, which controls the storage, where this item can be placed, may result in item displacement and potential physical loss.

Planning Data is critical for the proper production scheduling and procurement planning. Order Policy controls the way the item is planned by MRP, and its wrong value may have a direct effect on the product availability and production.

Item Cost Data (GL Cost Set) is used by the system to generate GL transactions and to evaluate the inventory in the warehouse. Erroneous item cost will result in the wrong account balances and incorrect financial statements. Here we tried to cover only the most essential aspects of item master maintenance in QAD.

Last words
We tried to cover only the most essentials of item master maintenance in QAD. But suffice to say, the most important aspect of item numbering is that you adhere to the concept of unique identification. That is, you can not have one thing with more than one item or part number. Or, you cannot have multiple items or part numbers that define one thing. Either circumstance will cause chaos in your ERP system. The second most critical aspect of item numbers in an ERP system is that all the elements of the Item Master File must be complete and accurate. In QAD, 83 separate data fields uniquely define an item to the system. Every one of those 83 data fields must be as precise and timely as possible (Blank data should not be allowed). Accuracy ensures that QAD plans and executes according to its correct and complex logic.

Don Lindsey, CFPIM, CIRM is a knowledgeable Implementation Project Manager, Trainer and Business Analyst for all areas of QAD. He has been an implementation manager on several large, complex MFG/PRO projects, and has worked with the QAD system since 2007 in Manufacturing, Systems Management, Service & Support, and Finance. Don has a diversified background in a wide variety of manufacturing industries from Medical to Electronics to Industrial to Consumer Products. He has spoken for many years at the APICS Conferences, having taught in the APIC Certification program at California State University @ Fullerton for over 20 years.

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