Improvements in Process Manufacturing with Microsoft Dynamics AX 2012 R2
Posted on: March 28, 2013 | By: Jarrod Kraemer | Microsoft Dynamics AX/365
The Microsoft Dynamics AX 2012 R2 release includes new capabilities for process manufacturing companies. For the purposes of this blog, let’s focus on the benefits of Potency Management, Sequencing, and Lot Inheritance.
Manufacturers such as Peet’s Coffee and Tea or Amalie Oil Company have bits and pieces of discrete, process, and even lean manufacturing processes throughout their organizations. If you have mixed-mode manufacturing needs then you too may find the new “out-of-the-box” capabilities in R2 extremely beneficial. If you’d also gain value from improvements in your process manufacturing efforts, let’s take a look at three key process manufacturing enhancements within the R2 release:
The key to success for many process manufacturing companies is how well it is able to manage variability. This variability can come in the form of raw materials, work in process, or finished goods. Within process manufacturing environments such as chemicals, food, beverage, metals, paper, and life sciences this variability is often called by different names. In chemicals it may be called potency, in life sciences it may be called efficacy, and in food it could be called brix (sugar concentration), butterfat in milk, or alcohol percentage.
Potency management allows us to effectively gauge and value the strength of a specific material. For example, a 90% potent acid is more valuable than a 50% potent acid because you need less of it. Orange juice with an 18% brix content is sweeter than a lower percentage content, meaning you’d need less filler to hit your sweeteners targets.
Potency tracking and management also allows features such as batch balancing. In the food industry where a manufacturer is producing different varieties of yogurt, managing the butterfat content of milk is key.
Sometimes there is a variation in the percentage needed, and the worker needs to perform a calculation to ensure accurate inventory usage. With automated batch balancing capabilities in the R2 release, workers can now easily handle these computations and ensure high product quality, reduce wastes, and lower costs.
Let me first clarify the term “sequencing” as it might be better referred to as “basic sequencing” because in R2, the production planning capabilities focus on sequencing execution versus optimization functionality that would be found in more advanced scheduling solutions. With R2 sequencing we have the ability to run a production schedule based on the characteristics of an item versus simply using a lot number. This added flexibility grants production planners in both process manufacturers and even traditional consumer product goods companies the ability to minimize changeovers in their schedule. With basic sequencing we can assign 4 different characteristics at the item level, which define its sequence such as: allergen content, pack size, acidity, and so on.
To further explain the principals of basic sequencing I’d like to share an example of paint manufacturing requirements. When producing paints we deal with a variety of water versus oil-based, colors, and obviously packaging sizes. Even with this small list of variables we’ve detailed – which aren’t all inclusive in the paint industry – we can see how we’d need basic sequencing functionality:
• The first process we’d look at is what type of paint this is…namely is it an oil or water-based paint. They run their oil-based paint production on Tuesdays, Thursdays, and Saturdays.
• After each of these production runs the line requires a special clean out and inspection to be performed.
• They next want to run the production line by color, with white first, followed by yellow, green, blue, red, and then ending with black. The progression in paint colors is based off of the need for additional pigments and the potential cross contamination issue. In layman’s terms, it’s a lot easier to deal with potential pigment dyes from previous runs in the black color than if they ran the white color last.
• Finally paint is packed by size: quarts, gallons, and then 5 gallon barrels last. This basic sequencing directly within Dynamics AX 2012 R2 gives them the best schedule without having to buy an optimization tool, and increases throughput and efficiency.
Lot Inheritance (Lot Genealogy)
Let’s now look at Lot Inheritance features within Microsoft Dynamics AX 2012 R2. Some companies will call this Lot Genealogy which is a probably a misnomer because the initial version of Microsoft Dynamics AX 2012 already had solid tracking and tracing capabilities at the lot and sub-lot level. Lot inheritance is used with industries such as primary metals, semiconductor, A&D, paper, life sciences (especially biotech), and others. In the R2 release it allows individual item attributes to be based off a set of attributes originating from a batch.
Here’s an example: In primary metals I can take a steel beam (or roll stock) and attach all the dimensional and metallurgy characteristics (tensile strength, hardness, coating) as its attributes. If I take that stock steel beam and cut it in half, I want the downstream co-products to inherit most of the dimensional characteristics (like gauge), all the metallurgy characteristics, but not the width or length. This saves me an enormous amount of data entry typically required in documenting and testing the downstream co-products, and enhances the lot track and trace (genealogy) by tracing the heat number, critical in primary metals. In biotech a similar example is passing the blood type down to the 1000 cell cultures produced from the parent. There are many examples we can discuss but this feature is limited only by the creativity of the pre sales or implementation consultant.
The three enhancements we’ve just reviewed within Microsoft Dynamics AX 2012 R2 demonstrate a commitment to and focus on the process manufacturing industry. They are just a few of the many benefits Microsoft Dynamics AX 2012 R2 can bring to you and your organization. With R2 Microsoft is now delivering global planning and operations, enhanced execution capabilities, real-time insight and operational visibility—all within a single solution, enabling you to connect to your customers, suppliers, and employees.
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All the best!
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