Steven Gil/January 16, 2023 /Dynamics 365/Supply Chain Management/ 3 min read

D365 Supply Chain Management: is it ideal for any company? Types of industries that can benefit from using it

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Enhancing production control for the manufacturing industry

Is D365 Supply Chain Management ideal for your company? Nowadays, more and more manufacturing companies are struggling to find system solutions to enhance their operations and remain at the top of their performance without worrying if their company’s core does not match the supported manufacturing types by currently offered systems.  

Even when there is a wide variety of system solutions in the market, not all of them either support different types of manufacturing or adjust to other kinds of industries. Hence, companies, the majority of the time, have to adjust their necessities to what the system offers instead of having the system support their operations as they are.  

Here is where Microsoft Dynamics 365 Supply Chain Management appears in the manufacturing spectrum, supporting different industries with different manufacturing principles such as follows: 

  1. Discrete manufacturing  
  1. Process manufacturing  
  1. Lean manufacturing 
  1. A combination of the previously offered ones, called mixed-mode planning for more complex operations or industries. 

This blog intends to briefly describe these supported manufacturing types, their structure within Microsoft Dynamics 365 Supply Chain Management, how they work, and which kinds of industries are more applicable to them. 

What is Discrete manufacturing, and how is it used for different industries?

Most commonly used by construction and assembly companies, where the core of the business is to produce physical items either in low volume with high complexity or high volume with low complexity, applicable for industries such as automotive, technology, and supplies. 

Microsoft Dynamics 365 manages order-based production (production in individual production orders), varying sequences of work centers, basic or complex bills of materials, order-based cost accounting, and product variants within the same item reference to avoid increasing the inventory list of items. 

It also offers different types of supported dimensions to keep track of the items, such as the inventory, product, storage, and tracking dimensions, which are pretty helpful throughout the production lifecycle. 

Process manufacturing: What it is, and why it is beneficial for your company

Process manufacturing is mainly used by companies that make products in bulk quantities, such as beverages, paints, asphalt, fuel, food products, and pharmaceuticals. 

Unlike discrete manufacturing companies, process manufacturing uses formulas or recipes to blend components in batches. Process manufacturing builds something that cannot be taken apart; it uses batch orders instead of production orders, produces co-product and by-products, involves variable ingredients, and potentially has one or more product outputs.  

Microsoft Dynamics 365 manages a production lifecycle similar to the discrete manufacturing one.  

Every stage is designed to enhance the production process by linking the physical transactions with the financial part of the process and creating a straightforward process flow to improve the user experience 

It also retains complex formulas and manages shelf-life products, commodity pricing, advanced lot/batch tracking, and control. 

Lean manufacturing: Concept and how it is used for productivity

Lean manufacturing mainly focuses on waste minimization without sacrificing productivity principles. It emphasizes what adds value and reduces everything that does not; it is derived from the Toyota production system and focuses on its seven waste philosophies. 

This manufacturing type applies to any industry since it focuses on adding value to the finished goods, eliminating material, time, and money-wasting for manufacturing companies.  

Microsoft Dynamics 365 provides a wide variety of tools and features to work with lean manufacturing, such as Kanban, to signal demand requirements. Kanban boards to keep on track of the production operations, managing cycle and talk times, dividing operations by work cells, and creating adjusted production flow to support operations more effectively. 

It is important to say that applying lean manufacturing to a company implies a total restructuring of processes and sometimes a considerable implementation time due to its complexity.   

Mixed-mode planning: What can you do with it? 

As mentioned, this mixed mode is intended to be used for more complex operations that require a combination of the previously mentioned manufacturing types. 

In mixed-mode planning, you can model your supply chain based on the material flow.  

Dynamics 365 Supply Chain Management ensures that the material flow follows your models, regardless of the selected supply policy (Kanban, production orders, purchase orders, batch orders, or transfer orders). 

You can choose your overall strategy for supplying a product, regardless of the product structure.  

An example of how to use a mixed-mode planning 

For example, it could be a company with Kanban control in its assembly.  

The materials could be sourced for the assembly area by production orders, batch orders, Kanban, or any combination appropriate for the supply chain’s characteristics but still have complete visibility across supplies. 

This capability leads to optimized supply chain processes and enhanced visibility into the supply chain. 

To summarize, despite the number of different ERP solutions offered in the market, Microsoft Dynamics 365 Supply Chain Management continues demonstrating that it is one of the most complete, robust, and cost-effective systems to manage the supply chain within the manufacturing industry. This solution supports most of the manufacturing types in the most effective manner. 

Thank you.

D365 Supply Chain Management: is it ideal for any company? Types of industries that can benefit from using it 1

I hope you have enjoyed reading this blog and found it helpful to get insights into the impact that Microsoft platforms have on the operational efficiency of companies from the manufacturing realm.

Steven Gil
Dynamics 365 F&O Associate Consuntant

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