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CHAPTER 4 The Procurement Process 179
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CHAPTER
CHAPTER

The Production Process

LEARNING OBJECTIVES
After completing this chapter you will be able to:
1. Describe the master data associated with the production process.

2. Identify the key steps in the production process and the data,
documents, and information associated with them.
®
3. Effectively use SAP ERP to execute the key steps in the produc-
tion process.
4. Effectively use SAP ERP to extract meaningful information about
the production process.

he production process consists of the various steps and activities involved
with the manufacture or assembly of fi nished goods and semifi nished
Tgoods. Organizations implement a variety of production or manufac-
turing processes, depending on the type of material being produced and the
manu facturing strategy used to produce it. Among the most common produc-
tion processes are discrete, repetitive, and process manufacturing. Discrete and
repetitive manufacturing involve the production of tangible materials such as
cars, computers, and bicycles. Each unit produced is a “discrete” unit, meaning
it is distinct from other units and it can be counted. Further, the component
materials from which the unit is made, such as wheels and bolts in a bike, are
identifi able. There is, however, a fundamental distinction between repetitive
and discrete manufacturing. In repetitive manufacturing, the same material is
produced repeatedly over an extended period of time at a relatively constant
rate. In discrete manufacturing, the company produces different materials over
time in batches, often alternating between materials on a production line.
In contrast, process manufacturing refers to the production of materials
such as paint, chemicals, and beverages that are not manufactured in individual
units. Rather, they are produced in bulk, and they are measured in quantities
such as gallons and liters. Further, the component materials cannot be identi-
fi ed after production because they are mixed together in the fi nal product.
Imagine, for example, attempting to identify the raw materials in a gallon of

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