This is our first post by a guest contributor, Abdel-Rahman Hassan. We’d love to welcome more guest contributions – please contact us via .
At the beginning of every manufacturing project, and while D365 F&O supports both discrete and process manufacturing industries, it is very important to decide carefully which manufacturing type within the solution is the best fit for the industry.
To help explain the difference, I will split industries into three categories: Discrete Manufacturing, Process Manufacturing, and “Stuck in the Middle”.
Discrete Manufacturing
In many industries, it is obvious and easy to say, “this industry is discrete manufacturing”. This is usually the case when counted “discrete” units are produced from parts and components or even materials in machining and subassembly operations that usually ends with a final assembly operation. The discrete product can be configurable like the case in automotive where the customer can select every configuration as part of placing their order before waiting for a new car for example to be made to order.
Examples are vehicle manufacturing, appliances, electronic devices, medical devices, and producing furniture.

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Process Manufacturing
The other obvious category is process manufacturing. This is usually the case when bulk quantities of products are produced from ingredients in mixing or blending operations with lot size considerations. Batch traceability and expiry date control are commonly, but not exclusively, used in process industries.
Catch weight is another special requirement for process manufacturing that takes place when each unit of the product has a unique weight, and the stock is controlled by two units of measure (weight unit and a discrete unit).
A single operation may produce many products including co-products and by-products. When this is the case, only process manufacturing functionality is the right fit.
Examples are; industrial gases where many gases are produced from one air separation process and iron production, where iron is the main product and slag is a by-product.

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“Stuck in the Middle”
The third category I call “Stuck in the middle”, simply because it consumes recipe ingredients in mixing, blending, or transforming operation like process, but it has one output like discrete. Here arises the confusion.
Examples are pharmaceuticals, and agricultural products where the operation makes only one output. This category usually triggers the common question “Which manufacturing type should we use?”

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To answer this question, please consider the industry’s potential need for any of the process manufacturing functionality elements like;
- Formula sizes (Lot quantity)
- Percentage yield on formulas
- Ingredient quantity as percentage based on weight or volume
- Alternative ingredients on formula lines
- Scalable consumption
- Batch ID inheritance from an ingredient to the finished product
Note, the list above is not comprehensive. I have picked the most common elements.
If there is a need for any of the above, consider using process manufacturing.
Conclusion
The first two categories are easy to recognise and hard to miss, however, the last category can be a confusing one for many manufacturing consultants. Assessing potential need for specific process functionality can be the key to decide if the Production type on the released product in D365 F&O should be “BOM” for discrete, or “Formula” for process manufacturing:
