Quality Management in Dynamics 365 for Operations: Quality Control Settings in Inventory Management

Almost everyone who has been involved in the Microsoft Dynamics AX ERP industry is aware of the arsenal of tools that are now available in the latest ERP release: Dynamics 365 for Operations. What many are not aware of, however, is just how extensive and powerful the Quality Management tool can be if set-up and used properly.

For the most part it sits quietly in the background of the Inventory Management module, waiting for someone to awaken this sleeping giant. At first glance it is easy to overlook what is under the hood since the cover appears so simple. However, once opened, you can unleash enough power to dazzle many a non-believer.

In this first in a series of blogs I will cover how to set-up the Quality Control settings, which is the heartbeat of the Quality Management system. The Quality Control setup is where we will enter the pertinent information for testing, and I will go through this step by step.

Let’s start building the heart for Quality Management.

The Test Instruments for Quality Management

First we have to start by navigating to Inventory Management module > Setup > Quality control > Test instruments.

Now we are going to add a Test instrument.

Open the Test instruments form by clicking on Test instruments (#3).

Next, click the “New” button.

Add the test instrument you are going to use. In this case, it is a digital instrument meter (DIM).

Under Test instrument, enter the name or model of the unit that you are going to use.

The Test area is not mandatory, but if this is to be done in a specific area or the instrument is used in the lab, enter it here. Remember that the more information that you can enter, the easier it is for someone not entirely familiar with the process to navigate.

Next, the Unit. This field can be changed at any time so if you aren’t certain what this should be don’t worry, you can change it later if needed. In this case, the unit is for Gram; Dynamics 365 for Operations comes with a large number of preset units out of the box. If for some reason you cannot find the unit that you want, you can always add it manually.

The Precision is determined when the Unit is set-up.

You can now close this box and the Test instruments box.

Tests

The next thing we want to set-up are the Tests that we will be performing.

Click “New” and enter the name of the Test that will be done and a description of the Test. In this case it is “Thickness”. Other examples of tests can be Visual, Measurements, Tensile Strength, etc.

For the Type there is a dropdown; select the one that suits the test. Notice the Functions tab at the top of the box? This will allow you to change the Type of the test if you need to during setup. You cannot change this after it has been used in a record.

For Test Instrument, use the dropdown and the Test Instruments that we added earlier will be displayed.

Test Variables

Next we will add the Test variables. Go to Test variables.

A new form will open.

The next step is to add the Test Variables.  Before we do this, notice the Outcomes drop down at the top? We will being working on that later so don’t worry about it just yet.

Let’s go ahead and add some “Test Variables”. These are samples out of the box but you can add your own.

Now it’s time to check out the Outcomes.

When you click on Outcomes, a new window is opened. This window is directly related to the Test Variable that is highlighted when you opened the Outcomes window.

In this example we are looking at Temperature for the Test Variables. Since this is a new Variable, there are no outcomes associated with this, so I added “Too cold”, “Too warm” and “Acceptable” for the Outcomes.

Item Sampling

If you have been following along on the Quality control list, we are going to jump out of sequence. We are going to set-up the Item Sampling next. The reason for doing this out of order is that when you are setting up the Test Groups the Item Sampling is a requirement.

When you click on “Item sampling” a new form opens.

Now we are going to add the new Item Sampling “10%”. As you can see by the dropdown, this can be set-up as a Percentage or a Fixed quantity. Select Percent for the obvious reason.

There are a number of options to choose from Storage Dimensions to Tracking Dimensions. For now we will leave them blank.

Test Groups

Time to get back on track, so let’s set-up our Test Groups.

Click the “New” button and add a new record; in this case, “PrePeg” for “PrePeg WIP”. Add the “Acceptable quality” and “Item sampling” from the dropdowns.

Next, you will notice a box under “Destructive”. If you check this, you are telling Dynamics 365 for Operations that this item will be destroyed or unusable after the test and will be removed from inventory.

Time to turn our attention to the lower pane. For you production engineering folks, this is like adding a route to a BOM item. For the rest of you, it is simple.

Click “New” to add the test(s). The “Sequence number” should be in batches of “10” much like the routes in AX are setup. (This area can have a single test or a long list depending on what tests need to be performed at this time and place.)

From the dropdown select the test you will be conducting; in this case the “Temperature” we set-up earlier.

Next, you can add “Effective” and “Expiration” dates as you can do in BOMs and Routes.

Time to decide the “Test value determination”. Here you can select “Average”, Maximum”, “Minimum” or “Manual”.

Now switch to the General tab.

Indicate if this Test is to be reordered in the Certificate of analyses report.

What action do you want recorded on Failure. (Is this really an option?)

Lastly, switch to the Test tab. This is where the cool stuff happens and is mostly overlooked. The information here is where Dynamics 365 for Operations looks to determine if the test actually passes or fails.

Populate the fields with your Test measurement values.

This is where everything that we have been adding starts to come together. In this case, let’s focus on the tests for the “Temperature”.

Quality Associations

The next setup is really a great one; it does all kinds of really cool things. That is Quality associations:

Quality associations allows you to automatically start a Quality order based on the parameters you set-up. An item or a group can be selected from Production, Sales order, Purchase order or Inventory. You then decide if it is going to be an item or a group of items and which Site.

Then comes the Process. As in the example shown, this Quality association is for a production order and is to be Quarantined Before it is Report as finished. You can determine if the order should be blocked until it has been inspected or not.

And finally, you can add which Test group will be assigned to the Quality order.

Workers Responsible for Quality

Now we want to add the Workers responsible for Quality. This area is populated from the HR module and persons are added using the dropdown.

When you click on this menu item, a new form opens.

Part II: Quality Management Settings in Inventory Management

Welcome to Part II of the blog. In this second part I will cover how to setup the Quality Management settings of the Quality Management system, which is the easiest area to setup. The Quality Management setup is where we will enter the supporting information for testing which I will go through step by step.

In my content above we covered:

• How to setup test equipment
• How to setup tests
• How to setup test groups

In order to structure Quality management properly we are going to setup;

• Diagnostic types
• Quality charges
• Operations
• Problem types
• Quarantine zones

Quality Management Setup

Diagnostic Types

Let’s start with the Diagnostic types. In the second part of our setup, we need to navigate to Inventory management > Setup > Quality Management > Diagnostic types.

Here you will enter the different Diagnostics that you will be using. Typically this is where you list the type of exceptions that you will encounter.

To add a new Diagnostic type, simply click “New” and add the Diagnostic and the Description.

Quality Charges

The next step is to add Quality charges. This is useful, for example, when you want to charge back a vendor that sent you some defective parts, and they ask you to sort the good from the bad, and you want to recover your labor costs. This allows you to track the time that you spend on a particular task so that you can charge them back. This can also be used to track the cost of quality internally if you want to track a department or machine that has produced a product that has to be sorted or reworked.

Quality charges – Inventory Management > Quality management > Setup > Quality charges

To set this up, simply click “New” and add the Charges code and the Description.

Operations

Operations is where you will add what Operation process will be performed. Typical Operations can be Inspecting, Counting, Measuring, Cleaning, etc.

To set this up: Operations – Inventory Management > Quality management > Setup > Operations

Problem Types

Problem types are where a list of potential quality issues you want to test or track are created and stored. Examples can be: Measurement out of Spec, Off color, etc.

To set this up: Problem types – Inventory Management > Quality management > Setup > Problem types

Click on “New” to add the Problem type and Description.

Once that is completed, click on “Non conformance types”. Note that you may not be able to click on the “Non conformance types” until you have navigated away from this screen and returned.

Non Conformance Types

Using the drop-down, select what Non conformance type applies to this problem type. You can add as many types as you wish by clicking “New”.

Quarantine Zones

Quarantine zones are where you will keep your test items in virtual or real locations. This will keep your inventory separate and not available for production or shipping

Just as with all the other setups on this blog, click “New” and add the Quarantine zone and the description.

Now that the Quality Management settings are complete we can close this section of Setup out.

In my next part of the blog we will bring all this together to create and run the various quality orders, so look for that information soon.

Thanks for reading this blog, I hope it was of some help. In the meantime, if you have any questions about Quality Management in Dynamics 365 for Operations.