Process manufacturing Dynamics AX2012 capabilities

A lot of poeple have asked me what can process manfuacturing do in Dynamics AX2012? This post will hopefully serve the purpose.

Process manufacturers deal with resource rich industries on buy side and with aggregators & retailers on sell side, both having larger bargaining power. The constant squeeze between two powerful groups’ reduces already thin margins and this is likely to exacerbate for US & Western European manufacturers in the coming years as manufacturers in the emerging markets stake their claim for even larger share of the pie.

Process manufacturers therefore continuously need to reduce costs, improve quality & maintain security standards to be able to keep their margins in the markets that are important to them.

Process Manufacturing for Microsoft Dynamics® AX 2012 (formerly known as process industries or PI) gives process manufacturers a low cost solution that can model lean, discrete & process manufacturing in one box, is versatile & flexible to model new organizations, products or processes, supports most common multi-X scenarios and can be extended to support specific vertical requirements without the need of additional IT investments.

Process Manufacturing for Microsoft Dynamics® AX 2012 enables manufacturers and distributors of natural, industrial or consumer packaged products to control costs, increase profitability, maintain stringent quality standards and manage compliance using a familiar user interface on an advanced technology platform with cost of ownership that is significantly lower than the competition.

Process manufacturing for Microsoft Dynamics® AX2012 is available in two different SKUs. Process Manufacturing logistics is targeted at customers who would like to automate their distribution processes for products that are usually manufactured in a batch or semi-continuous processing environment. Process Manufacturing production is targeted at customers who would like to automate their batch or semi-continuous manufacturing processes. Process manufacturing logistics SKU is a pre-requisite for process manufacturing production SKU.

Both SKUs contain enough functionality that can also address some needs of customers with discrete manufacturing environment. Key functionalities enabled by process manufacturing are:

  • Maintain complex formulae
  • Manage short life products
  • Manage commodity pricing
  • Manage product compliance
  • Setup & apply complex rebates
  • Advanced lot tracking & control
  • Enhance cost management of multiple outputs
  • Procure, store & sell products in dual units of measure
  • Manage production for assembly or disassembly for single or dual units of measure

SKU 1- Process manufacturing production

Process manufacturing production for Microsoft Dynamics® AX 2012 enables manufacturers of processed goods to quickly define complex formulae, to accurately control production costs, to easily model discrete & process production scenarios and to switch between make or buy decisions with agility.


  • Easily model disassembly sequences or products with multiple outputs in different batch sizes or multiples
  • Effectively model batch processed products that are consumed into a discrete or lean assembly or model discrete or lean sub-assemblies consumed into multiple output products
  • Flexibly consume or produce products in dual units of measure with constant or varying consumption
  • Dynamically calculate ingredient consumption even for items consumed non-linearly in single or dual units of measure
  • Maintain with ease many formulae for producing same product by using different material combinations or for producing different products using same combinations
  • Setup, measure & improve production yields by having the flexibility to define yield for several different combinations and comparing it to the production results
  • Quickly scale some or all ingredients in the formulae based on available inputs to estimate outputs
  • Reduce inventory & purchasing costs by defining several alternate ingredients and consumption priority for each on the formula
  • Easily toggle security restrictions on formulae access by activating any of the four built-in security levels
  • Control packaging material costs by setting up configurable products as different packaged products and linking them to processed products


  • Reduce waste by using production policies to ensure right formula for production is automatically selected based on a given tank size and other factors
  • Link multiple packed productions to multiple bulk productions. Consolidate them to improve operational efficiency, minimize bulk storage and optimize packed product production
  • Quickly add, remove or alter number, type or amount of multiple outputs
  • Improve profitability for each of the multiple outputs in a production by accurate allocation of costs over them before, during or after production & revalue goods by comparing actual with estimated costs
  • Always produce to customer specifications by ensuring discretionary picking of ingredients based on certain attributes
  • Rapidly react to a change in production conditions based on results of automatically created quality orders
  • Consume ingredients and produce multiple outputs in dual units of measure and record nominal or actual values in such units all through the process
  • Achieve real time visibility on plant floor and at higher levels by re-sequencing jobs based on actual capacity on the floor and by recording production output on such jobs in dual units of measure and for multiple outputs

SKU2 - Process manufacturing logistics

Process manufacturing logistics for Microsoft Dynamics® AX 2012 enables distributors of processed goods to forecast and plan supply & demand and to manage procurement & sales in dual units of measure natural or consumer packaged products with short or long shelf life while meeting strict quality standards, complying with regulatory requirements & providing visibility into profitability for the distributor.


  • Easily create & release products with dual units of measure to multiple legal entities
  • Seamlessly manage products with dual units of measure through forecasting, planning and production and be able to define & view such products on forecasts, planned orders, demand & supply views, and on production and consolidated orders
  • Manage flexibly single and dual unit of measure products on purchase requisitions, purchase agreements and release order lines together with stocked and non-stocked products
  • Manage flexibly single and dual unit of measure products on sales quotations, sales agreements, release order lines and delivery schedules together with stocked and non-stocked products
  • Improve product yield and operational efficiency by recording actual values in both units of measure at every stage of the process


  • Enhance backward traceability and reduce time required for recall by integrating information about vendor batches for purchased lots into manufactured lots of semi-finished or finished products
  • Improve profitability by differentiating product based on specific product characteristics per lot & only shipping lots that meet certain company or customer criteria
  • Reduce costs of rework by arresting the progress at any stage for any process, of a poor quality lot through various supply chain processes
  • Enhance lot control with the ability to record and recall as needed, characteristics of an inventory lot as procured, produced or as sold
  • Measure quality of each lot with or without dual units of measure for single or multiple production outputs at any stage of processing and attach such results to the inventory lot
  • Increase customer satisfaction and reduce cost of rework by meeting all demand of a particular customer from the same lot if so desired
  • Enhance operational efficiency and order promising by having the ability to instantly search all inventory and find lots with specific characteristics
  • Improve inventory visibility by having access to all the inventory lots and associated functions in one unified view


  • Manage plan, procure and sales processes for fresh, frozen or long shelf life products based on expiry period or best before period
  • Improve warehousing efficiency by earmarking locations based on product shelf life and issuing goods only as per process or customer requirements
  • Reduce waste by using the ability to retest shelf life products reaching the end of their shelf life
  • Improve order promising & reduce stockouts by incorporating shelf life information into planning processes and planning views
  • Differentiate service and increase profitability by incorporating residual shelf life demanded by customer at ship-to location


  • Manage full or partial visibility dual units of measure based products through all inbound and outbound warehouse processes
  • Increase warehouse efficiency by using the ability to mix products in same shipment that are constrained by varying levels of additional requirements like ship from single lot, based on specific characteristics, shelf life and dual units of measure


  • Receive, store and send product safety data sheets for hazardous products as needed
  • Keep product safety data sheets current with the company and customers
  • Comply with local regulatory agencies by restricting or regulating the sale of certain products in certain regions
  • Record necessary compliance related product data for various regulatory agencies
  • Record usage data for all products and use available third party integrated service to calculate usage of regulated substances for yearly reporting
  • Manage quality and compliance by ensuring that certain products can only be supplied by approved vendors


  • Improve profitability by managing different rebate & trade merchandising programs for different customer segments
  • Monitor and manage rebates processed either at invoicing or accumulated by user defined periods. Rebates can be setup by different currencies, units of measure or by differing qualifying levels and can be paid to customers by several different methods


  • Effectively react to changing commodity costs so the prices of sellable goods always stay current with the market
  • Manage sellable product prices such that trade agreements are always up to date and new contracts reflect the price change

You can find more detail about how to use process manufacturing capabilities in the product on technet

Comments (12)
  1. Kenneth Christensen says:

    I believe that a "Catch weight" item not can be a product master. In other words, a "Catch weight item" cannot have variants. Is this true?

  2. AksheyGupta says:

    Yes, we didn't come across scenarios for this. CW is targeted at protein industry where people prefer to work without variants. What is your scenario?

  3. Kenneth Christensen says:

    In our scenario we use CW to handle dual unit of measure, liters and case on produced finish items. At the same time we would like to have variants on the item e.g. color. The problem is that we cannot set up a CW item as a product master.

  4. AksheyGupta says:

    CW is designed for protein industry, for managing boxes of poultry & other meat products. It can be used for other purposes as you are using but we don't plan to extend this to product variants. We have other customers who produce paint or in general specialty chemicals and they have one product ID per SKU, so 5 liter pail of blue paint is a seperate product from 20 Liter drum of same blue paint – they don't use variants and don't use CW. Perhaps using a similar simpler product setup will be less risky and more cost effective than the complexity of managing variants and CW.

  5. Kenneth Christensen says:

    Thank´s for your input. I conclude that CW not can be applied on product masters.

  6. Mustafa Chohan says:

    CW is now available for variants in MS Dynamics AX 2012 R2

  7. Akhwand Usman says:

    Its written above that we can have Catch Weight unit in Purchase Requsition, is that true because I can find any field for that.


  8. Hi Akhwand – You are right! Catch Weight is not supported for Purchase Requisition's as stated in the blog post. We will have that corrected

  9. Nasr says:

    Hello Mr Gupta,

    we used formula management in meat company. we calculate the whole lamb formula, In formula management when we put percentage of material the system calculate that percentage which we mentioned in formula setup but in-case the quantity changed changed at the time of report as finished than calculation will be changed but our system carry only formula qty

  10. AksheyGupta says:

    % controlled should calculate correctly when as a formula, then inside a works order, based on batch order quantity and then inside a works order, based on RAF qty. Please let us know your scenario in more detail.

  11. Vijay says:

    Can some provide me answer Job Order/production order qty. = 10 tones

    A maximum of 5 coils 2 tones  each may be produced

    During report as finished 4 coils consumed 8.5 tones which are registered with an unique coil number. In this situation

    the production team make the necessary corrections in the furnace and produce the remaining coils.

    However the system only allows to register the actual remaining qty.  i.e.(10 – 8.5) = 1.5 tonesand the balance quantity is  registered as separate coil number.

  12. Johan Hoffmann says:

    Hi Vijay,

    I have looked at your scenario and this is how I would handle the process

    I create a production order for 5 coils. The serial number is used for giving each coil an Unique coil number. I use the serial number group on the item to assign serial numbers by physical receipt

    1. Create a production order for 5 coils
    2. Estimate and start the production order (without posting the pick list)

    3. Go to the pick list and adjust consumed quantity from 10 to 8.5 and post the picking list journal

    4. Go to the Simple registration form for the finished good (Menu item: Update registrations in production order action pane)

    5. Select a quantity of 4 pieces and update -> 4 Serial numbers are generated

    6. Report as finish 4 pieces on the production order (remember to unmark field "End", because we still want to produce the last coil)

    Now 4 Unique coils have been reported and they have consumed 8.5 toner

    We now want to produce the last coil, and we assume the actual consumption is 2.1 toner

    1. Open the production picking list journal form and create a new journal and post a consumption of 2.1 toner
  13. Go to the simple registration form and register the last coil -> serial number is generated

  14. Report as finish the last coil

  15. Now 5 Unique coils have been reported and they have consumed a quantity of 10.6 toner

    Best regards,


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