• Manufacturing  |  Traceability  | 
  • 4 Min Read
  • Manufacturing 101: Process Manufacturing vs Discrete Manufacturing

    Michael Clark

    Written by Michael Clark
    Thu, Jan 03, 2019

    Key Takeaways:

    • Process and discrete manufacturers face increased pressure in today’s highly competitive, volatile marketplace.
    • Warehouse automation offers them the opportunity to gain visibility, improve efficiencies, reduce costs, and scale operations.
    • Process manufacturers leverage technology to meet compliance regulations.
    • Discrete manufacturers use these solutions to better manage inventory.

    Both process and discrete manufacturing remain critical components of the global economy.
    Both process and discrete manufacturing remain critical components of the global economy.

    Manufacturing is the backbone of the world economy. Daily, businesses create new products and improve existing ones, but not all manufacturing is the same. Process manufacturing mixes different elements to create products, such as plastics, pharmaceuticals, and food. Discrete manufacturing creates goods, like cell phones, wind turbines, and automobiles.

    In either case, manufacturers nowadays face significant competitive pressure forcing them to streamline their supply chain, lower costs, expand product lines, and improve customer service. To address the challenges, they need a robust shop floor/inventory solution, one that delivers immediate traceability during the manufacturing process.

    Manufacturing represents a large, vital sector of the world economy. In 2017, it generated 14.7% ($11.1 trillion) of the $75.2 trillion created worldwide, according to the International Monetary Foundation. Beneath these enormous numbers are a plethora of products that come in all shapes and sizes.

    Nowadays, customers demand more: more pricing options, more means of delivery, and more access to supply chain data. Technology increasingly plays a key role in meeting those requests.

    To better understand manufacturing’s underlying business drivers, let’s take a close at each subset.

    Process manufacturing and discrete manufacturing both involve the production of goods, however, the type of goods and the manner in which they are produced vary:

    • Process manufacturing follows a sequential model and sometimes creates materials, such as steel, used in finished products.
    • Discrete manufacturing follows an asynchronous model and constructs a finished product, like a smartphone.

    What is Process Manufacturing?

    Process manufacturing revolves around the flow of sequential steps, like cooking, where the end of one step immediately leads to the start of the next. Manufacturers collect ingredients and then create a predetermined volume of a material, such as plastic, food, and paper, within one facility.

    According to BCC Research, the top five process manufacturing markets are:

    1. Oil and Gas
    2. Food
    3. Pharmaceutical and Life Science
    4. Plastics
    5. Metals

    The process to create these materials is becoming more complex. Suppliers constantly create new products attempt to differentiate themselves. In order to maximize yield and minimize expenses, they need real-time insight into their supply chain. Many materials need to be stored in special locations because they can be negatively impacted by a change in temperature or a delay.

    What is Discrete Manufacturing?

    Discrete manufacturing (or discrete processing) breaks the production up into pieces, pulls them all together at the end, and creates autonomous items. Here, manufacturers employ a series of steps that are not dependent on another and asynchronous in nature. An Illinois plant creates a car brake pad in the morning and an Indiana facility manufacturers a side mirror in the afternoon. Production rates vary, and each step can be started or stopped, depending on how well the operation proceeds.

    The top five markets for discrete manufacturing are, according to market research firm BCC Research:

    1. Automotive
    2. Electronics and Computers
    3. Consumer Goods
    4. Aerospace, Aviation and Defense
    5. Machinery and Heavy Equipment

    These manufacturers rely on multifaceted, sometimes multi-national, increasingly complex, rapidly moving supply chains. Coordinating all of components is challenging because change is constant and speed to market has become paramount to success.

    Process Manufacturing requires ingredient traceability to retain compliance.

    Improving Process Manufacturing with Traceability

    The manner in which these materials are produced and the compliance regulations constantly evolve. Being able to trace elements and finished products has become corporate gold for process manufacturers. So, businesses need to gather more supply chain data and make it easily accessible throughout the enterprise.

    Let's look a real-world use case:

    In business since 1965, Caito Foods operates four distribution centers that move fresh produce to stores in the Eastern, Midwest and Southeastern United States. The Food Safety Modernization Act and Produce Traceability Initiative (PTI) required that Caito Foods identify each item’s country of origin so its grocers can display that information on their sales floor signage. To meet that regulation and gain full product and ingredient traceability, the food producer successfully deployed RFgen Mobile Foundations for Oracle’s JD Edwards with RFgen Warehouse Director.

    Improving Discrete Manufacturing Processes with ADC

    Traditionally, items were loosely tracked as they left one facility and traveled to their next destination. That is no longer tolerable. Currently, competitive pressure requires real-time, fast, reliable and accurate access to information. Data access enables the organization to respond to changes in demand or unexpected problems, like a delivery truck getting a flat tire. Automatic data capture (ADC) may be the answer.

    Vision Engraving provides an illuminating example:

    In business for more than 20 years, Vision Engraving & Routing Systems is the largest engraving machine manufacturer in North America. The company relied heavily on a paper-based production order process to monitor the building of approximately 250 machines on its production line. Employees spent a great deal of time manually entering and updating tracking information, which reduced the time they were actually producing product.

    The manufacturer deployed RFgen Mobile Foundations for SAP Business One and replaced its paper entry with wireless barcode scanners to achieve automatic data capture (ADC).

    The end result?

    Vision Engraving reduced order processing time by 684 hours per year, eliminating hundreds of hours annually. Employees no longer needed to hand-deliver paperwork in the warehouse (or the 60,000+ sheets of paper required to do it). Savings amounted to $22,500 per year and the company achieved a full Return on Investment (ROI) in less than twelve months.

    Read the full story here »

    While manufacturers create a variety of different products, they share many of the same business drivers, including the growing need to improve traceability. The right shop floor/inventory solution automates more functions, lowers operating costs, enhances productivity and improves product quality, ensuring competitiveness in today’s dynamic manufacturing market.


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