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"Innovative Thinking" A Newsletter from Innovative IT Consulting In This Issue

April 2010

This month we review a topic that still causes confusion to many a CEO and CIO - the differences between Process manufacturing and Discrete manufacturing as it relates to ERP selection and implementation. In his tips column, John Pellegrino continues helping you get organized and manage your time better. I only have one question - What are you doing with all the time that John has been saving you? In case you missed last month's words of wisdom, CLICK HERE and start gaining back control of your day and your projects!

By Paul Sita, Principal, Innovative IT Consulting, LLC. Paul can be reached at 631-549-1685 or psita@innovativeitc.com.

Pick one. Very often when we engage in initial discussions with clients the topic of Discrete vs. Process manufacturing comes up. A client will usually just say “we’re a manufacturer”. Going in, we already have a good idea of what they do, but we’ll ask them if they view themselves as needing a Process manufacturing solution vs. a Discrete manufacturing solution – we’ll either get a blank stare, or an answer that indicates that they don’t fully understand how fundamental this difference can be.

Confusion reigns supreme. Why is this? Well the software vendors are partly to blame. They are great at pointing out how well they handle both? Really? They are quick to point out that they have “process features” built into a discrete model. And they will point out that although they don’t have Formulas/receipe management in their system, their BOM functionality has user defined labels so that customers can call their BOM a formula, and they are good to go. That’s just as good – isn’t it? Not really!

Process vs. Discrete at a high level.Discrete manufacturing is all about assembling things, and making things that are exact. When you make a pen, or a machine, you make 1 or 1000. You don’t make .95 or 995.2. When you make cheese and other dairy products, produce chemicals, or blend pharmaceuticals, you don’t know going in if you’ll end up with exactly 1000 pounds, or 995.2, or 10,000 pills vs. 10,215.

Something discrete can usually be taken apart. The parts can typically be returned to stock. The same can’t be said of the process industries. You can’t return the cheese to milk, you can’t turn the final chemical back into the components, and you can’t take a pill and turn it back into the various pharmaceutical components.

Formulas vs. BOMs A formula is something like a BOM. But something like doesn’t mean it is the same thing. Formulas typically involve significant instructions. Formulas typically involve a variety of units of measure, e.g. 2 gallons of this and 1 ounce of that. And when you’re done making your product, QA for Process typically involves testing and measurement that involves percentages, yields, potencies, etc. whereas for Discrete manufacturing you are typically looking at quality in some way as a pass/fail.

Batch size. In process, you can adjust your formula to produce a smaller batch if you only have half the ingredients. The same isn’t true in discrete manufacturing. If you need 8 bolts or 8 valves to make a machine, you can’t scale back and make half a machine.

By-products and co-products Process manufacturing very often results in by products – offshoots of the primary product you are manufacturing that may have applications all their own. This could be excess that is turned into another salable product, such as animal feed or pet products. In discrete manufacturing, there is oftentimes scrap, and while this has value, it is not typically part of another manufacturing or finishing process.

That’s not so complicated. We’ve only touched the surface. Hopefully enough to help you figure out exactly what kind of manufacturing your organization really does. And maybe it’s both. Clearly, every process manufacturer needs a BOM for final packaging and getting their finished product out the door. So there are discrete elements to process but not the other way around. Still, there’s a lot more to the difference between Process and Discrete-- things like instructions, pricing options, etc.

Word to the wise. Before you embark on an ERP project, come armed with the knowledge of what you do and how you do it, and challenge the vendors to show you how they can handle your specific requirements. Or better yet, call Innovative IT Consulting – and achieve Excellence in ERP.

By John Pellegrino, Principal, Innovative IT Consulting, LLC. John can be reached at 631-549-1685 or jpellegrino@innovativeitc.com.

This month's tip is another in a series of time/project management tips. This one relates to a "tweak" to a very common practice used by many effective people in all professions and even by some in their personal lives - the "to-do" list.

. . That which you can do today. We all know the benefits of a solid to-do list; it keeps things organized and prioritized, it allows you to focus on one task at hand, and there is a sense of satisfaction in checking finished tasks off the list. But, the key question is when do you create today’s list? Most people would answer, “first thing today.” However, my answer would be, “last thing yesterday.” I have made what I think is a very good habit of closing every work day out by creating the next day’s to-do list. After all, this is when these tasks are fresh on my mind, before getting inundated with all the personal things that come after work see January, 2010's tip. In this way you can start each new day “hitting the ground running".

Making a list, checking it twice. You can start each day by reviewing the list in case something in the night jogged your memory. But, be careful not to spend too much time as you do not want to give back the time you saved by doing it the day before.

"The best time to lay out your to-do list for tomorrow." (3 words)


_ _ _  _ _ _ _ _   _ _ _ _ _ _

Answer to last month's word scramble.

"One of the chief reasons for planning too big a bang in an ERP project." ( PENT UP DEMAND )

We'll continue to focus on critical aspects of ERP. And as always we'll deliver it right to your in box. Coming soon - look for contributions from key Innovative partners. Please keep checking the INNOVATIVE WEB SITE for useful tips, and our newsletter archives. Amaze your friends and coilleagues with your expertise!

Process vs Discrete manufacturing.

Learn the key differences between the two and avoid making a mistake.

Tip of the month.

Project management tip. Don't put off until tomorrow . . .

This month's word scramble.


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