Story
The below example explains a few of the important terms and
concepts used in the Oracle E-Business Suite. This would be a good starting
point for the beginners to better understand the concepts behind Oracle
Applications.
Say David is the owner of a wholesale fruit shop. He buys
various fruits like apples, oranges, mangos and grapes etc from farmers
directly and sells them to retail shop owners and also to the direct customers.
The farmers are referred to as VENDORS/SUPPLIERS in Oracle Applications. David
keeps track of all his vendors’ information like addresses,
bank account and the amount he owes to them for the fruits that he bought etc,
in a book named PAYABLES.
David gets an order from a retail shop owner of Fresh Mart,
for a shipment of 11 bags of apples, 25 bags of oranges and 32 kgs of grapes.
In Oracle Apps, bags and kgs are referred to as UOM (unit of measure), Fresh Mart is called CUSTOMER and the order is referred to as SALES ORDER. David maintains a book called
ORDER MANAGEMENT
where he writes down all the details of the SALES ORDERS that he gets from his customers.
Say the fruits have been shipped to the customer Fresh Mart.
David now sends him the details like cost of each bag/fruit, the total amount
that the customer has to pay etc on a piece of paper which is called INVOICE / TRANSACTION. Once the INVOICE has been sent over, the
customer then validates this against the actual quantity of fruits that he
received and will process the payments accordingly. The invoice amount could be
paid as a single amount or could be paid in installments. David’s customer, Fresh
Mart pays him in installments (partial payments). So David has to make a note
of the details like date received, amount received, amount remaining, amount
received for what goods/shipments/invoice etc, when David receives the
payments. This detail is called RECEIPT,
which will be compared to the invoice by David to find how much Fresh Mart has
paid to him and how much has to be paid yet. This information is maintained in
a book named RECEIVABLES to keep
track of all the customers, their addresses (to ship the items), what and how
much he has shipped to his customers and the amount his customers owe him etc.
David’s fruit business has begun to improve and has
attracted more and more customers. As a result, David decided to buy a cold
storage unit where he could stock more fruits. In Apps, this cold storage unit
is known as WAREHOUSE and all the
fruits are referred to as INVENTORY.
Due to increase in customers, David needs to hire more people to help him out
in his business without any hiccups. These workers are called EMPLOYEES. At the end of every month, David
pays the salary for all his employees through Checks. These checks are nothing
but PAYROLL in Apps.
At the end of every month, David prepares a balance sheet in
a book called GENERAL LEDGER to
determine how much profit/loss he got and keeps track of the money going out
and going in.
As the business grows, it becomes impossible to record
everything on a paper. To make everybody’s life easier, we have very good tools
in the market, which help the business men to keep track of everything. One
such tool is Oracle E-Business Suite.
Oracle Applications is not a single application, but is a
collection of integrated applications. Each application is referred to as a
module and has it own functionality trying to serve a business purpose.
Few of the modules are Purchasing, Accounts Payables,
Accounts Receivables, Inventory, Order Management, Human Resources, General
Ledger, Fixed Assets etc.
Here is a high level business use of various modules:
Oracle Purchasing
handles all the requisitions and purchase orders to the vendors.
Oracle Accounts
Payables handles all the payments to the vendors.
Oracle Inventory
deals with the items you maintain in stock, warehouse etc.
Order Management
helps you collect all the information that your customers order.
Oracle Receivables
help you collect the money for the orders that are delivered to the customers.
Oracle Human Resources
helps maintain the Employee information, helps run paychecks etc.
Oracle General Ledger
receives information from all the different transaction modules or sub ledgers
and summarizes them in order to help you create profit and loss statements,
reports for paying Taxes etc. For Example: when you pay your employees that
payment is reported back to General Ledgers as cost i.e money going out, when
you purchase inventory items and the information is transferred to GL as money
going out, and so is the case when you pay your vendors. Similarly when you
receive items into your inventory, it is transferred to GL as money coming in,
when your customer sends payment, it is transferred to GL as money coming in.
So all the different transaction modules report to GL (General Ledger) as
either “money going in” or “money going out”, the net result will tell you if
you are making a profit or loss.
All the equipment, shops, warehouses, computers can be
termed as ASSETS and they are
managed by Oracle Fixed Assets.
There is a lot more in Oracle applications. This is the very
basic explanation just to give an idea of the flow in ERP for the beginners.
Oracle Apps Important
Terminology and Tools:
Invoice
Receipt
Customer
Vendor
Buyer
Supplier
Purchase Order
Requisition
ACH: Account Clearance House
Sales Order
Pack Slip
Pick Slip
Drop Ship
Back Order
ASN: Advance Shipping Notice
ASBN: Advance Shipping Billing Notice
ATP: Available to Promise
Lot/Serial Number
DFF: Descriptive Flex Fields
KFF: Key Flex Fields
Value Sets
Organization
Business Unit
Multi Org
Folders
WHO Columns
Oracle Reports
Oracle Form
Workflow Builder
Toad
SQL Developer
SQL Navigator
Discoverer Reports
XML/BI Publisher
ADI: Application Desktop Integrator
Winscp
Putty
