White Paper: Is Your ERP System Built For Your Industry? It Makes A Difference

This white paper discusses the manufacturing element of enterprise resource planning (ERP). Most ERP solutions target either the process or discrete sector, and a few, like Microsoft Dynamics AX, straddle both.

Most ERP enterprise applications have three major components: manufacturing, distribution and finance. In the world of process manufacturing, quality management, since it is so imbedded in all the processes, also becomes a core requirement.

To understand the nuances of process manufacturing that are discussed later in this document, it helps to first understand the three general types of manufacturing companies:

• Process manufacturing companies
• Discrete manufacturing companies
• Hybrid manufacturing companies

The ideal ERP system should allow a user to select which method to use for which process. A product can be built using a discrete bill of material, or a formula, all in the same application. Hybrids can use either work orders or repetitive-based production. In a work order, the materials are issued to a specific job and a routing (production process) is associated with that build. A work order can use a BOM to fabricate or assemble product, or a work order can use a formula to blend ingredients, react or disassemble product. A process work order in often called a batch, and that batch can manage co- and by-products, recycles, waste, scrap, yield and variable production.