Dynamics 365 Business Central for the Manufacturing Industry

Manufacturing companies can take advantage of the advanced planning and scheduling functionality within Microsoft Dynamics 365 Business Central to run their businesses better. These features include up to 50 level deep Bill of Materials (BOM) per part, Routings that can be scheduled serial or parallel, and versioning in both the Bill of Materials and the Routings.

Often, I see customers hesitant to implement D365 Business Central for the manufacturing industry due to the user cost. Each user must be an advanced user to implement Business Central for manufacturing, however, the higher return on investment potential outweighs the cost.

Screenshot of Business Central showing item availability by BOM level.

Efficient MRP (Material Requirements Planning) is not just a way to identify what materials are required for production, it is a way to get significant financial return on your investment by reducing inventory costs and shortening production time, hence lower work in process costs. When is a two-dollar part more expensive than two dollars? When it holds up the production of a twenty-thousand-dollar production order.

I have witnessed multiple situations where production orders are sitting on hold, waiting for specific parts to arrive. This not only prolongs production, but takes up space on the production floor that could be utilized for other production orders. When purchasing is done through manual processes, it often results in missing items, but also over-ordering of items. Both these situations have financial consequences.

Screenshot of Business Central showing item types.

Some companies may counter that due to the quick turn of their production, material planning is not as essential. However, in many cases quick turn operations require better material planning. An order sitting waiting on parts can slow down the entire production process for all of the production in the shop.

While BOM and Routing versioning does not have a clear relationship to costing, there are gains to be made by utilizing this functionality. Alternate versions of BOM and Routings can be defined to handle situations when a particular component item is not available, or when a production order must be run on an alternate work center due to load or work center maintenance. In both these situations, production bottlenecks can be avoided and alternatives clearly communicated to production.

Screenshot of Business Central showing BOM matrix.

BOM and Routing versions allow you to not only manage alternatives, but they can also be used to track the design history of items. D365 Business Central always defaults to the latest version of both the BOM and Routing, assuring everything is up to date. In some cases, you may have customers with specific requirements that can only be handled by a custom version of the BOM or Routing. In the Planning worksheet, the user can override the default version with whichever version they would like to be used.

A successful manufacturing company can benefit and see return on investment from a knowledgeable implementation of D365 Business Central for their manufacturing needs. It can help reduce inventory costs to what is required, speed up production without material delays, and identify materials past due.

If you’re interested in learning how Dynamics 365 Business Central can help your manufacturing business, please connect with us.

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