Dear all,

In our B4c4 system, this is how we observed B4c4 calculates std machine and labor costs:
std machine cost=std machine hour*machine rate
std labor cost=man machine ratio*std machine hour*labor rate

Now we thought that's what we observed in our B5c system as well, and we documented it that way a while ago. Now we've patched our B5c a lot, and now seems like this is how B5c calculates the costs:
std machine cost=machine occupation*std (machine) hour*machine rate
std labor cost=man occupation*std (machine) hour*labor rate

With std machine hour being the time it takes to produce unit qty of item.

Did we document our B5c std cost calculation correctly but one of the patches we installed changed this, or we simply documented wrong thing? Thanks

Rgds,
Paul

I've used Baan IVc4 and is fairly new to 5.0b. Can you please elaborate on any other differences in the way std cost is calculated between the 2 versions?

Dear Shirley,

We're also still exploring the differences. Example of new features in BaanERP:
Ability to exclude fixed operation costs from valuation price if FTP is used. Please see explanation on the CPR Parameter: Include Fixed Costs in Valuation Prices
Ability to exclude operation overhead costs from valuation price. Please see explanation on the Direct costing option of price calculation codes
Ability to classify labor, machine, and overhead operation costs to even greater detail using multiple cost component each. For example, instead of just one overhead cost component in BaanIV case, now in BaanERP we can specify overhead in more detail by using depreciation, maintenance, etc. cost components

Rgds,
Paul

In B4c4:
If a task is man-dependend, at the machine cost the man/machine ratio is used.
If a task is machine-dependend, at the labor cost the man/machine ratio is used.

B5: never used it.

But as I read your post again, I get the feeling that some Baan develloper thought it would be more logic to forget about the ratio and just use each type of occupation for it's own cost calculation.

Can you give in a machine occupation unequal to 1 in B5?


Originally posted by Paul P
Dear all,

In our B4c4 system, this is how we observed B4c4 calculates std machine and labor costs:
std machine cost=std machine hour*machine rate
std labor cost=man machine ratio*std machine hour*labor rate

Now we thought that's what we observed in our B5c system as well, and we documented it that way a while ago. Now we've patched our B5c a lot, and now seems like this is how B5c calculates the costs:
std machine cost=machine occupation*std (machine) hour*machine rate
std labor cost=man occupation*std (machine) hour*labor rate

With std machine hour being the time it takes to produce unit qty of item.

Did we document our B5c std cost calculation correctly but one of the patches we installed changed this, or we simply documented wrong thing? Thanks

Rgds,
Paul

Welcome to the world of Baan 5C. Baan made some huge changes to the logic for calculating both cost and lead time of manufactured orders. Essentially they have out the functionallity of using operatioin overlap, and resource units ( on Man work centers) on the routings. In Baan4 and 5B you would use both of these to control lead time both without affecting the cost. In Baan 5c the logic changed the operation overlap to transfer qty (which is much nicer to use than overlap, because it isn't applied by percentage, so the order size doesn't effect the point at which you tranfer, instead it is by units). The bad part was the logic of when to use overlap and when to apply wait time ( now Queue or Tranfer Delay) got messed up and it was applying the wait time to everything. The resource units on the routing for a man work center are now applying cost instead of reducing lead time. What we saw when taking a part with the same routing and work center set-up from 5b to 5c was a drastic increase in lead time from start to finish and an increase in cost, which is no doubt what everyone is seeing. From the costing side, 5c is applying resource units to a man work center the same way it applied it to a machine. Instead of adding more people to increase output, it thinks that it is taking those additional people to get out the same quantity. Hence the increase in cost.

Now for the good news.
We have been working with Baan on a solution to put back the B4/B5b logic. They are doing this with parameter settings and adding back the critical work center type logic. When done you should be able to choose whether you want to use the old B4/ B5B logic or the new B5c logic. Those using the Scheduler will have to use the B5c logic, but the rest of us will set parameters and work center fields to make keep the logic we are used to. We are hoping that this solution is ready soon, and I believe that it was intended to solve the issue of cost and lead time for all B4 and B5B users trying to go forward to B5c.

Baan 5 also differentiates between shrinkage and scrap. One being consmed at the start of a work order and the other at the end.