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Process ERP vs. Discrete ERP Differentiation

Written By: josh chalifour
Published On: November 12 2007

People often ask us "what's the difference between process and discrete ERP?" We model both systems in such a way that they share many common components, nevertheless process manufacturing industries have unique requirements that differ from discrete manufacturing industries. Here's a rough overview of the difference.

A quick definition from APICS (The Association for Operations Management) describes discrete manufacturing as "The production of distinct items such as automobiles, appliances, or computers." Whereas process manufacturing covers "Production that adds value by mixing, separating, forming, and/or performing chemical reactions. It may be done in either batch or continuous mode." Now let's look at a few examples.

Think about what your company manufactures. Does it require mixing chemicals? If so, you may need an ERP system that does things like calculate ingredient quantities. If your industry produces the type of product that once made, doesn't lend itself to being disassembled into its individual components, it's likely you need to consider a process ERP system. On the other hand if your company assembles products from many component parts, you'll require discrete manufacturing functionality. In his article, Process Manufacturing Software: a Primer, Joe Strub explains the difference with examples.
"Once you make a can of soda, you cannot return it back to its basic components such as carbonated water, citric acid, potassium benzoate, aspartame, and other ingredients. You cannot put the juice back into the orange. A car or computer, on the other hand, can be disassembled and the parts, to a large extent, can be returned to stock."

In addition, P.J. Jakovljevic explains other characteristics in product development within a process manufacturing environment, such as the fact that the manufacturing materials may vary in quality or degrade over time, or that process manufacturing is scalable. He states
"... if the formula calls for 1,000 pounds of cake flour, but one only has 500 pounds, one can still bake cakes, just not as many. Conversely, in discrete manufacturing, one missing part means waiting for it before the finished assembly unit can start rolling off the production line."

We model functionality for manufacturing in discrete or process industries under the following categories.









































Discrete Manufacturing Process Manufacturing
Product Costing Formulas/Recipes
Shop Floor Control Process Model (Formulas and Routings)
Field Service and Repairs Process Batch Control and Reporting
Production Planning Conformance Reporting
Project Management Process Manufacturing Costing
Product Data Management (PDM) Material Management
Product/Item Configurator Product Costing
  Shop Floor Control
  Production Planning

If you're talking about requirements involving bills of material (BOM), listing the component parts for assembly you'd find those covered through the discrete manufacturing categories, whereas if you're talking about functionality for formulas, recipes, or ingredients, those would tend toward the process manufacturing categories.

To better understand which type of system would fit your environment, you can consider target industries addressed by different process ERP vendors such as Deacom, CDC Ross, and 3i Infotech. Or review some discrete ERP vendors such as Epicor, SAP, and 3i Infotech. That is by no means an exhaustive list, rather it's only a few example products, certified in TEC's knowledge bases.

Notice that 3i is listed in each, in fact other products are also available for both industries. The articles that I mentioned above (and below) mention some of the things to take into consideration from vendors with products that will support either industry. It's important to consider how these vendors adapt their products to the industry's needs.

Here are a couple more articles on the subject.
 
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