What is Backflushing?
From a functional perspective, backflushing automates the issuing of material to the manufacturing floor upon the completion of the production process, which the ERP system defines as the point when the manufactured part is transacted into Finished Goods.
From a backflushing evangelist’s perspective, Backflushing is a way to significantly increase manufacturing efficiencies by eliminating manufacturing Work Orders and its associated task of issuing material to the Work Order.
How does Backflushing Work?
The actual backflushing process is really quite simple and contains a few basic steps:
- Employees use the materials it needs to manufacture the quantity of the Part ID for a particular manufacturing schedule
- Scrap is tracked
- When the Part ID is ready to be transferred to another Inventory location (e.g., Finished Goods) the following information is entered into the ERP system:
- Part ID manufactured
- Quantity manufactured
- Scrap incurred
ERP SYSTEM CALCULATIONS and AUTOMATED ENTRIES
- The ERP system will reduce the amount of raw materials and/or any sub-assemblies for the:
- Per Bill-of-Material (BOM) in the ERP system for quantity manufactured
- Scrap recorded
- Increase the inventory in Finished Goods for the quantity of the part that was manufactured
One can certainly make an argument that any one of the above examples where the prevention of an error, cost avoidance, and/or process improvement could very easily pay for the cost of an alerts module all by itself.
Follow-up Analysis and the Importance of Cycle Counting
By definition, if the BOM is accurate and all scrap is recorded, the only material manufacturing variance should be for any scrap recorded over/under the yield in the BOM. The only way to verify the accuracy of the backflush process is to establish and follow an efficient and regular cycle count program. If the cycle counts result in significant material quantity variances, then either the BOM is not accurate or scrap is not being recorded properly and corrective action must be taken immediately.
Keys to Success
To have a successful backflush process there are a few important things to ensure:
- The BOM must be extremely accurate in terms of quantities, expected yield and structure (raw materials vs. sub-assemblies) and contain few if any variable components
- Scrap for the production run are recorded on a timely basis
- Production cycles are relatively quick
- A strong cycle counting program is up and running