An analysis of process industry production and inventory management systems

The process industries - those firms that add value by mixing, separating, forming and/or chemical reactions by either batch or continuous mode - continue to lag behind the discrete industries in the identification and implementation of effective production and inventory management (P&IM) techniques. A contributing factor is that the process industries have traditionally been lumped together and contrasted from the discrete industries as a whole, thus leading to misunderstandings regarding individual process industries. From site interviews and the literature, we identified four critical dimensions - planning resource requirements (for materials and capacity), tracking resource consumption, control of work-in-process (WIP), and degree of computerization - represented by seven variables by which to contrast and analyze process industries. Based on in-depth field studies of 19 diverse process plants, we find that there exist at least four distinct types of process industry P&IM systems: (1) simple, (2) common, (3) WIP-controlled, and (4) computerized. (C) 2000 Elsevier Science B.V. All rights reserved.