In process rejection

At any stage of production, there are some material wastages during the process, which have to be accounted for. For example, ours is a labels manufacturing industry. We make labels for garments. These are woven in strips and then cut. There is rejection due to weaving faults, labels setting on machine, operator error etc. Right now, we make our work orders by hand and account for all the expected rejection(which we standardize based on experience), by increasing the work order quantity by that much. Now, we have to monitor the rejections at various processing locations through which the material is being processed. After process rejections at each level, the final product quantity should be at least the amount we require for dispatching. Some times, it might happen that the process rejections may be very high due to any reason and final production quantity will drop. In that case we'll have to take additional production. This can be taken as a case study.

Yes, it is an overhead. But, it is a part of production also. In many industries, such as spinning textiles, the wastage quantities have to be monitored at every stage. These wastage can be sold in scrap and can generate some revenue. Also, it is critical to monitor wastage for effective work order planning. There needs to be a way to add a percentage of expected wastage to the order quantity while generating new work orders and then subtract actual wastage from production quantity at every stage so that only the good material is forwarded to the next stage. The total actual wastage per work order along with its percentage can be listed for analysis.

Just mark any wastage in resources using a flag in the table that automatically gets added to the work order without any arbitrary % increase in the initial WO. Such wastage would be needed to be incorporated even in jewellery industries and possibly accommodate unaccounted / not accounted  / adjusted resources / organized embezzlement as well.

Tags might come in handy for wastage that need to be attributed to a particular WO.