When we think of the manufacturing process – we can see two large groups of manufacturers forming clusters driven by the way handling raw materials. Better to say we can distinguish two manufacturing philosophies that found the way in the modern language
1st: Proces manufacturing
2nd: Discrete manufacturing
Process manufacturing is distinguished by a production approach that has minimal interruptions in the actual processing in any one production run, or between production runs of similar products.
On another hand – in Discrete Manufacturing is distinguished by the production of distinct items that use bills of material and routings to determine costs and lead times.
Process manufacturers build something that cannot be taken apart, technically you can take the mix out of the container and reuse the container, but you can’t take the ingredients out of the finished goods produced. This makes the process manufacturers ‘process’ or formula based.
Discrete manufacturers are making a finished good that may have screws, nuts, handles, etc. that can be taken apart and used on something else if need be. In discrete manufacturing, the manufacturing floor works off shop orders to build something. The individual products are easily identifiable. While in process manufacturing, you can’t tell the difference between one product and another.
Process Manufacturing – Software Implementation Example
Now we will dive deep in “process manufacturing” and see one of the implementations in ERPAG ERP Manufacturing software.
Before we start we need to have in mind that the size of the process and number of signals recorded have a direct impact on the complexity of software solution.
ERPAG as cloud-based manufacturing software is designed to cover small and mid-sized business.
When designing a software solution for this type of business you need to keep software simple and pay close attention not to overwhelm people with unnecessary data capturing and data processing.
We will track simple workflow in order to get PROFF of CONCEPT. Our storyline tracks a small manufacturing company that makes shaped wax aromatized candles and sells them over an eCommerce platform.
Here is the basic process definition:
Load material: wax bars (1kg)
Wax heating: melting the wax
Aromatizing: adding fragrance oils (0.1gr) and color
Shaping: shaping wax in 3D molds (100gr each approx.)
Colling: Cooling down in rest bins
Packing: Packing in 5 pcs box
Now it is time to introduce Ghost BOM or traveling BOM. The concept behind this is to track raw material thought process as it is being transformed.
We will create a BOM based item in Erpag for each step in the process.
IN: SKU RAW 001 (1kg)
OUT: SKU MLTWAX001
IN: MLT001WX (1kg)
OUT: ARM001WX (1kg)
IN: Wick 10cm
OUT: 3D001CNDL 10pcs
apply LOT# for each item
IN: 3D001 100pcs
OUT: SKU FIN Candle PAC ( 20box: 5pcs/box )
As you can see after each step we are outputting a phantom product (phantom BOM) that will be used in the next step of the process. In this way, we enable traceability and inventory control during the manufacturing process.
Transformation of raw materials during the manufacturing process
What is PHANTOM BOM?
Phantom Bill of Material (BOM) -is a subassembly that is assembled only to be included in another assembly. It is a method for moving around a group of components under one item number. A phantom represents an item that is physically built, but not stocked, before being used in the next step or level of manufacturing. This permits MRP and APS logic to drive requirements straight through the phantom item to its components.
Synonyms: blow-through, transient bill of material, pseudo bill of material. Paraphrased from the APICS Dictionary, Eighth Edition
Next step is to create a Phantom BOM Based Products for each of the process steps.
We will show a quick overview of the process form the Sales Order to delivery manufactured product.
As we receive SO next step is to trigger the fulfillment process in manufacturing. In the right menu, we can see the GENERATE button. By clicking generate, we will launch the ERPAG Manufacturing Project.
For each phantom, BOM ERPAG will create a separate work order under the Manufacturing project.
In each card you can see:
Input items-used sub-assemblies and raw materials in order to get the output items
Work operations used during the manufacturing process
In this way, in one pass you can generate all work orders and trigger automatic purchase mechanism -Fulfillment engine.
The system automatically compares available stocks against WO quantities and orders missing qty. Using the bulti in multicurrency and muti supplier engine, procurement is handled with ease. Once missing parts enter the warehouse system will notify a user that items for the WO are available.
Using the ERPAG mobile app you can time track each step of the process and capture costings as it happens.
In general discrete manufacturing and process manufacturing are totally different challenges from the software development perspective. For very complex cases as enterprise business, one should go for the vertically specialized manufacturing software.
On another hand, on a small scale there similar. The simplified model can get a great advantage to small business. Small business can mix discrete and process manufacturing and in that way capture and track the manufacturing process from start to end. Not only that you can benefit from the accelerating process in your company, but you can do it with an affordable software solution, without overwhelming organization with implementation and process migration.