When you create a production order, you start the process of monitoring and working with the item as it passes through the stages of the production life cycle. The system assigns an order status to each step in this cycle. The status tells you where the item is in the production process. When an order is created, it is assigned the status .
Before creating a new production order, you have to set up prerequisite general and production base data. When you select the item for production and determine the quantity that you want in the current order, the remaining fields populate with the information about the item that is already in the system. You can change these fields to suit the specific production order that you are working with.
When you create a production order, you initiate a request to start the manufacturing of an item. The production order contains information about what will be produced, how much (quantity), and the planned finish date. After you select the item number that you want to produce and enter a quantity, the remaining information that is required for the production order comes from the data that you already established in the bill of materials, work centers, routes, and operations.
Production orders are created for the following reasons:
To meet sales order demands when inventory is insufficient.
To supply BOM items as subassemblies to other items in demand.
They can be manually created by authorized personnel who foresee a need for an item to be produced.