By Emir Dobraca, Edgewater Fullscope
In order to streamline operations and boost profitability, it is important that chemical manufacturers properly manage potency. It can be a powerful thing when it's automated.
After all, you pay your raw material vendors based on the percentage of active ingredient or concentration of what you receive. From there, all production recipes are based on a specific nominal concentration of the material being used; inventory is valued based on the actual concentration. The more precise all of this is, the more money you save in the long run.
Microsoft Dynamics 365 for Operations has added a number of fields around potency to improve its definition and automate its use in the manufacturing process. Key among these fields is “base attribute,” a generic term that refers to the key active characteristic of the product. This characteristic is an existing batch attribute of a fractional or integer type that defines this item as a potency item. The “Target” field is the standard or nominal value upon which this item is defined, costed and priced. Finally, how the attribute value is to be recorded (e.g., upon purchase or production receipt with information from a certificate of analysis, or by a quality order result) is documented.
Dynamics 365 for Operations uses this information to provide Batch Balancing to speed and improve production. A batch formula is defined interactively based on the concentration of a key ingredient or ingredients. The user selects inventory lots and based on the lot's current potency, automatically calculates the required inventory quantity of the active ingredient. Once all of the active ingredients in the formula have been fulfilled, the Balance Batch Ingredients function determines the quantity needed for the compensating ingredient and for the filler, and finally creates a pick list based on the adjusted formula for the warehouse worker to use to select the materials for production. This eliminates the need to guess quantity adjustment of non-active ingredient components in the formulation that are impacted by the actual quantity of active ingredient picked.
Check out our video: Top Five Challenges Facing Specialty Chemical Manufacturers and How to Solve Them
For example, a manufacturer is producing a batch of given compound that requires potassium chloride as a key material. If the potency of the potassium chloride is more or less than required, a quantity of water or other neutralizing material need to be adjusted. To prevent human error, companies don't want the operator to have to do the math for that calculation. Dynamics 365 for Operations automates the process and makes it simple for the operator to come up with a properly balanced set of ingredients. As each batch is launched, Dynamics 365 for Operations provides a screen for the operator that shows every ingredient and its actual concentration. It shows batch number, quantity and attribute value. Depending on which inventory batch or lot is selected, when the operator hits a button to balance batch ingredients, the system automatically recalculates the formula based on the lots selected. This procedure helps ensure quality, reduce costs, and eliminate waste.
A large part of Dynamics 365 for Operations’ elegance and utility comes through its flexibility: even though the metals industry will use a different formula than those used by the dairy or chemical industries, each can build their own formulas easily with this new functionality.
For more information about potency within Microsoft Dynamics 365 for Operations, download our whitepaper: Using Technology to Mitigate Risks in Chemical Manufacturing. In the meantime, let us know if you have any questions.