There are two kinds of manufacturing in this world…
Two categories exist to define how a product is manufactured: discrete, and process.
As ERP products are typically borne out of niche necessity, most only model one type of manufacturing, and are designed to do that one thing very well. However, a properly designed ERP solution will anticipate the requirements of many different modes of manufacturing.
This type of flexible cloud manufacturing solution obviously comes in handy if you are a company that engages in many different modes of production under one roof. This is called a “mixed mode” platform.
What is process manufacturing, exactly?
Process manufacturing describes the production of a good whose components, once assembled, cannot be divided or disassembled. Think food manufacturers; for something as simple as bread, Mrs. Baird’s creates a product whose ingredients (wheat, flour, margarine, yeast, etc.) are impossible to separate. Process manufacturing poses challenging requirements, including intricate formulas and recipes, and maintaining traceability through complex batch-level production. When selecting an ERP system, process manufacturing begs careful qualification:
-Will the software allow flexible units of measure tracking, so buyers can order goods in precise measurements, and can the same goods be automatically converted to the stocking unit of measure?
-Does the system allow for robust product management, including material shelf life, and can you define expiration dates dynamically on receipts of incoming material?
-Can the system track the cost of goods per their ratio of consumption against the various yields of production (e.g. finished good yield, waste yield, re-usable product yield, etc.)
What is discrete manufacturing, exactly?
Discrete manufacturing is quite different. Discrete manufacturing is the creation of goods whose parts may be taken apart and sold separately as subassembly or raw components if desired. Imagine a car manufacturer; the challenges that Ford faces lie within the complexity of ordering engines, tires, nuts, bolts, and a multitude of other parts, and then assembling them in a critical order. Many parts are deeply specific and may be contracted out to more niche contract manufacturers. Common discrete manufacturing requirements include:
-Inventory control and traceability through picking & kitting in production
-Multi-level BOMs and assembly tracking
-Subassembly work order tracking
-Shared components, customer manufacturing, high-mix / low-volume production
A good rule of thumb: process manufacturers run production from a “recipe”; discrete manufacturers drive production from a “BOM”.
What qualifies as a "mixed mode" solution?
Mixed mode manufacturing means you drive drastically different modes of manufacturing under one roof. You may produce batches of formula in house from a recipe, then include those batches as a subassembly within a discretely tracked parent assembly or finished good, i.e. from a BOM.
Mixed mode manufacturing compiles the ERP benefits and challenges of both process and discrete manufacturing into single system. This is the constant value of a SaaS ERP platform: integration. Use a platform that seamlessly integrates all of your requirements, instead of attempting to glue specialized modules together. Cetec ERP is used by process manufacturers, by discrete manufacturers, and by mixed mode manufacturers. The Cetec ERP platform qualifies for the true definition of a mixed mode platform.