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Support your organization’s business processes for running production operations

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Applies to: Dynamics 365 Finance, Dynamics 365 Supply Chain Management, Power Apps, Power Platform, Power BI

This article describes how you can use Dynamics 365 products to support your organization's business processes for running production operations.

The run production operations business process area covers the activities in an organization's internal production process. Any manufacturing organization finds it critical to track and control production operations. The goal is to ensure consistent product quality and minimize production costs. Running production operations also requires coordination and communication between many departments, such as engineering, operations, quality, sales, planning, and procurement.

The process for executing production operations varies from business to business, depending on industry and product, but it follows the same basic steps. At the beginning of production, materials are consumed into the process. A combination of people and tools or machines then run the specific production steps. Finally, the sub-assembly or finished good is created as the output of the process. The definition of these steps is done as part of the Design to retire end-to-end business processes and refined further in the define production strategies business process area.

Define this business process at the beginning of an implementation of Dynamics 365 Supply Chain Management. It's a foundational process for any manufacturing company.

Stakeholders

Many people across the organization should contribute to the decision-making process and design of the run production operations area. The list includes but isn't limited to the following roles:

  • Inventory stakeholders – examples: Warehouse manager, Transportation planner

  • Planning stakeholders – examples: COO, VP of Operations, Operations Manager, Planning manager

  • Production stakeholders – examples: Production manager, Production scheduler

  • Engineering stakeholders - examples: Product owner, Engineering manager

  • Costing stakeholders - examples: Cost accountant, Controller

  • Quality stakeholders – examples: Quality manager, Quality technician

Run production operations process flow

The following diagram shows the high-level flow of the run production operations business process area. Each solid gray rectangle on the diagram represents an end-to-end business process. The solid blue rectangle represents the business process area. The diagram shows the subprocesses for the business process area. The arrows on the diagram show the flow of the business process in an organization. If a subprocess can lead to more than one other subprocess, the parallel subprocesses are shown as branches.

Execute production operations process flow

The following steps are illustrated in the run production operations business process flow diagram.

  1. Start

    1. A parallel branch from Start includes Inventory to deliver

      1. Consume materials in production

      2. Put away finished goods or sub-assembly inventory

  2. Plan to produce end-to-end process

  3. Plan production operations

  4. Run production operations

  5. Is operation outsourced?

    1. A parallel branch for Yes leads to Outsource production operations, which has an unshown connection to 10. End

  6. Start production if operations aren't outsourced

    1. A parallel branch, Adjust production plan, connects back to Plan production operations

  7. Consume materials in production

    1. Control production quality

    2. Track production costs

  8. Use production resources

    1. Control production quality

    2. Track production costs

  9. Report production output

    1. Control production quality

    2. Track production costs

    3. Put away finished goods or sub-assembly inventory

  10. End

Benefits

There are many key benefits to using Dynamics 365 to help the organization run the production operations. The following sections outline the key benefits that an organization might monitor and measure for the run production operations process.

Increase production throughput

Dynamics 365 Supply Chain Management collects and shows immediate feedback from the shop floor from workers and sensor data. This input empowers supervisors to quickly identify when different operations are delayed or deviate from the allowed boundaries and take appropriate actions. With the connection between production and maintenance, workers can register production downtime immediately. Supervisors can then either reschedule the remaining work to a new machine or expedite repair on the machine. Increasing production throughput results in shorter lead times and can also help improve the percentage of orders delivered on-time and in full (OTIF).

Reduce material shortages

Production fully integrates with the other business processes in Dynamics 365 Supply Chain Management. Planners can see real-time inventory of materials throughout the production process so that they can make sure that materials are replenished appropriately. This process reduces the number of stockouts and the subsequent production delays.

Improve product quality

Dynamics 365 Supply Chain Management connects production and quality so that quality managers can investigate the source of quality defects. This way, they can drive continuous process improvements to reduce the defect rate and improve the overall product quality.

Next steps

If you want to implement Dynamics 365 solutions to assist with your plan to produce business processes, use the following resources and steps to learn more.

  1. Plan supply and replenishment

  2. Define production strategies

  3. Plan production operations

  4. Run production operations (the article that you're currently reading)

  5. Outsource production operations

  6. Control production quality

  7. Track production costs

Return to the overview of business process areas at Plan to produce business process areas.

You can use the following resources to learn more about the run production operations process in Dynamics 365.

Contributors

This article is maintained by Microsoft. It was originally written by the following contributors.

Principal author:

Other contributors: