Increased Business Value With Collaborative Manufacturing

In today’s emerging global economy, seamless communication does not stop at the four walls of the plant. Sharing information in real time both within the enterprise and beyond is an essential component to maintaining information integrity and achieving operational excellence. This communication must also include supply chain-wide notification of status and events in real time to effectively link a global network of suppliers, manufacturers and customers. The right manufacturing execution solution will empower manufacturers to achieve seamless integration across their business systems and software—while protecting IT investments and customer relationships. It will achieve this by integrating Web-based solutions directly with enterprise and business-to-business applications. A manufacturing execution solution should also provide the platform for real-time information flow, eliminate process gaps and deliver competitive advantage—eliminating the delays and errors caused by systems which cannot effectively share operational data.

Finding the Right Manufacturing Execution Solution for Your Unique Environment
As you move toward coupling your manufacturing operations tightly with logistics, transportation and customer demand, finding the right solution is key. As with any enterprise-wide software evaluation process, there are a handful of important questions that must be answered prior to selecting a vendor. You must be able to find a solution that addresses your business’ specific pain points at a cost that works within your budget. For each vendor involved in the selection process, it is essential that your selection team gather detailed responses to the following issues:

• Breadth of technology - Does the vendor offer a wide range of supply chain-related solutions that integrate easily on the same platform? Does it have experience integrating with a variety of software and hardware systems? Does it have a history of releasing product upgrades containing new functionality that demonstrates a commitment to excellence in the space?


• Ability to adapt to change - How does the vendor approach changes to your system as your requirements shift? Does it utilize costly custom code? Do these changes carry forward during an upgrade?


• Company history - Has the company been in business for a number of years? Does it have a track record of solving problems for manufacturers? Does the product line demonstrate progressively more complex technologies developed using the most advanced toolsets?


• Financial stability - Will the company be around in three years to support the system you have purchased? Are the vendor’s sales growing? Does the company have a sufficient amount of emergency capital in case of an economic downturn?


• Customer base - Does the vendor have a long list of satisfied customers? Are the majority of these customers referenceable? Can the vendor prove it can keep customers happy over the long term?


• Implementation success - Has the company ever had a failed implementation? If so, how recently? What were the reasons?

Leveraged ERP Investment

Manufacturers that have implemented an ERP system have invested significant effort (and money) creating an enterprise software solution. Despite these investments, manufacturers often find their ERP systems do not provide the results they expected on the shop floor. ERPs often fall short because they are overly complex, difficult for shop floor employees to use, and rooted in traditional MRP batch-based processing. A manufacturing execution solution is designed to leverage an ERP investment, not replace it.
Manufacturing execution solutions address these issues by providing intuitive execution capabilities based on a real-time, lean execution philosophy. This means manufacturers get the best of both worlds—easy-to-use execution tools for the shop floor that also support planning decisions by continuously feeding real-time transaction information to the ERP. Manufacturing execution solutions share information with the ERP in real time, allowing the ERP to have an accurate representation of shop floor activities. With real-time visibility to execution, the ERP makes intelligent decisions about supply/demand matching and order promising.

Reduced Cost of Regulatory Compliance
Manufacturing environments are becoming increasing regulated. Whether the compliance requirement is for the FDA or Sarbanes-Oxley, the costs associated with achieving compliant processes can be excessive. With a rich transaction history that provides detailed audit trails and electronic approval processes, a manufacturing execution solution will facilitate compliant processes without excessive paperwork and manual work-arounds. Additionally, a manufacturing execution solution is designed to be responsive to change over time. This means that new regulatory requirements are easily met without system upgrades or customizations.

Personalized Manufacturing
Customer-specific manufacturing is a trend driving increased complexity and cost for today’s manufacturers. Customer specific bills of materials, routings and test instructions are challenging to manage, but can be a source of competitive differentiation. Manufacturing execution solutions respond to this challenge by offering personalization capabilities that meet today’s customer requirements and adapt to meet tomorrow’s unforeseen demands.
The ability to personalize a manufacturing execution solution is a key benefit—but not one that all applications offer. The greatest level of benefit will be achieved through a solution that accommodates personalization via configuration tool sets. With this type of platform, configurations can be made easily and cost-effectively. This means the manufacturers—not the solution vendors—truly own the system. With a flexible manufacturing execution solution, there is no custom coding required for configuration; changes carry over and workflow can be altered as needed after the system go-live. The result of this is that the system’s total cost of ownership is greatly reduced over the lifetime of the application.

Focused Technology Approach
With the most robust manufacturing execution solutions, nearly any station or work cell in the facility can be integrated into the system and either monitored, controlled or reported against. Machines, scales, gauges, statistical process control (SPC) systems, PLCs, label printers, serial devices, PDAs, automated material handling equipment, wired and wireless terminals, and RFID systems are integral parts of manufacturing execution—and the best manufacturing execution solutions will integrate seamlessly with all of them. Manufacturing execution solutions often feed multiple host systems and facilitate reporting beyond the current capabilities of many ERP systems.
Solving the problems inherent in today’s manufacturing environment is best accomplished using a modular technology approach. Manufacturing execution solutions start with bar code or RFID data acquisition to improve order visibility and extend beyond basic data collection as appropriate in each company’s individual situation. This allows for a right-sized application based on current business needs and areas requiring the most attention. Oftentimes, this provides self funding for future projects because ROI is generated quickly.

Continuous Improvement: “Adapt or Fail”

Manufacturers have learned that staying competitive means they must continually improve their processes or face the consequences of technological Darwinism—”adapt or fail.” Whether the initiative is Six Sigma or kaizen, traditional implementations of JDEdwards EnterpriseOne are nearly impossible to change when needed because they require expensive, time consuming custom code-based modifications. Because of this, the software becomes a barrier to operational excellence. This usually means that improvement opportunities are lost, or work-arounds are developed to accomplish tasks outside of the system. This results in poor data accuracy.
A new approach, called Lean Execution™ has recently been compiled on the belief that software should be a catalyst for continuous improvement—not an obstacle. Our implementation methodology not only provides a detailed view of plant history, but the flexible architecture also allows reconfiguration quickly and cost-effectively as the manufacturing operations change and evolve. We also provide the Business Intelligence needed to make fact-based decisions and adapt as manufacturing operations improve over time.
Maximized Supplier Relationships
In today’s lean and just-in-time manufacturing environments, collaboration with key suppliers is essential. The best manufacturing execution solutions provide manufacturers with the capability to exchange information among trading partners and enable true collaborative execution up and down the supply chain. A secure Web portal replaces time consuming phone calls and faxes as the basis for real-time information sharing and improved inventory visibility—critical factors in enhancing collaboration and streamlining supply chain operations.
Some manufacturing execution solutions also provide both the communication and visibility necessary to facilitate the effective delivery of goods from supplier to buyer. From the point of purchase order (PO) release at the buyer’s location through fulfillment, shipment and receipt, processes that have historically been performed manually—or in some cases simply not performed—are automated. With improved communication regarding compliance and/or serialized labeling requirements, inventory is received at the dock door with the required bar codes already applied. Functionality can also be provided to allow suppliers to perform other value-added services for their customers, including demand-pull replenishment, advanced shipping notification (ASN), and supplier quality inspections.
Rapid Product Recall Decisions
Product safety and quality are paramount concerns for manufacturers. When there are concerns about safety or quality, it is essential for manufacturers to have traceability tools that assist them in making product recall decisions. Manufacturing execution solutions aid in this process by capturing detailed product genealogies. When suppliers communicate a product defect, it is possible to trace exactly which finished goods were manufactured using the supplier’s defective component. This traceability can be achieved using lot number, serial number or other product attribute such as version, revision or “born-on date.”
Product recalls often result in enormous costs for the company issuing the recall. In most cases, companies lack information about the affected products. This results in companies inspecting individual products, or being overly cautious and recalling products that have no risk of quality or safety issues. Manufacturing execution solutions bridge this information gap for many manufacturers. With detailed product and order history information, these systems help companies deal with recalls in a timely, cost-effective manor.

Strengthened Decision-Making Based on Real-Time Information

A Lean Execution™ implementation supplies key personnel the decision-making data necessary to optimize manufacturing performance. From any location, the technology will allow managers to make immediate decisions on staffing, maximize labor efficiencies, control order fulfillment and monitor machine utilization. Real-time performance reports such as actual versus plan, production unit cycle time, production efficiency, scrap and downtime by machine or work cell can all be specifically configured for up-to-the-second review and action by management.
When unexpected events do occur, Lean Execution™ also helps managers and lead operators take proactive steps by utilizing your customized set of alerts and alarms. Using workflow notification key individuals are notified about potential issues—before they become costly problems. Manufacturing execution solutions do not stop after notifying operators of unexpected events. This type of system pairs event notification with appropriate workflow so operators take suitable resolution steps in real time without affecting operations.

Production order status and work in process are readily accessible via standard JDE Video Screens. This can also empower managers and other decision-makers to communicate information electronically to customers and other manufacturing locations. Ease of information access also smoothes the daily transition between shift managers and provides updated statistics on key performance indicators (KPI), wellness views and other important reports.

Lean Execution™ With JDEdwards EnterpriseOne

Fast Cost Reduction
Now that we have defined how proper implementation of JDE Manufacturing can create “paperless shop floor environments,” the next question to be answered is “What benefits will my company realize?”

Increased Levels of On-Time and Complete Shipments
JDEdwards provides the workflow, visibility and event notification required to ensure that manufacturing is meeting customer demand. Additionally, these systems reduce non value-added activity, increase data accuracy and provide the other ERP systems with the real-time data needed to maximize processing, planning and scheduling activities. This results in the ability to increase levels of on-time and complete shipments.
As stated earlier Lean Execution™ requires putting information in the hands of those who actually handle the inventory or produce the products. This is sometimes the biggest stumbling block in entire process because managers and supervisors don’t readily believe that the production and manufacturing workers can be trained to input the correct data. However, once this hurdle is overcome the solution creates a paperless environment by giving operators instant access to work instructions and CAD drawings, so they always have the up to date information required to build products that meet the customers’ demanding specifications.
More importantly, having information about events as they occur allows decision makers to easily identify or prevent potential problems and bottlenecks. For example, the planners may already be well aware of the problems created by shortages of key manufacturing materials that may halt production, shipments arriving late or incomplete, and backorders; however, with a few properly implemented steps the material pickers, the purchasing agent and the receiving department can also be updated as to the status of critical parts. Additionally, the lack of visibility into machines operating outside control limits or processes not meeting appropriate yields can ultimately delay customer shipments. With JDE Workflow, real-time notification of events and exceptions—often before they occur—allows the appropriate parties to take proactive steps to manage them. This will likely save the cost of expediting shipments that were unexpectedly completed late. Ultimately, the ability to keep costs in check, production and shipments on schedule, and customers happy increases bottom line profitability.
By streamlining data acquisition and execution for operators on the factory floor, it is possible to create efficient processes that consist only of the value-added activities. The result is a lean and efficient environment. Additional investment can be made into mobile data terminals for material handlers or strategically placed WIP stations or terminals on the factory floor, workers can then be directed to perform tasks and collect information in real time using either third party tools or standard user interfaces. In addition, new employee training time is significantly reduced, while workflow notification and electronic communication provides cross training opportunities within the existing workforce. Lean Execution™ solutions empower JDEdwards EnterpriseOne users to easily implement and manage truly paperless manufacturing processes.

History of Computer Planning Systems

MRP I (1970’s) Materials Requirements Planning
MRP II (1980’s) Manufacturing Resources Planning
DRP (Late 1980’s) Distribution Resources Planning
ERP (1990’s) Enterprise Resources Planning
MRP
Inventory Data – time phased net requirements
Master Production Schedule – used actual demand
BOM – exploded to lower level requirements.

MRP – a set of techniques which used BOM’s, inventory data and the MPS to calculate requirements for materials.
• Makes recommendations to release replenishment orders for material.
• Makes recommendations to reschedule open orders when due dates and need dates are not in phase.
Provided a short–range plan to cover material requirements that were needed to make a product. Material Planning Operations analyzed demand from all operations, including:
Central and satellite distribution centers and warehouses rate–based repetitive manufactured items, process and discrete manufactured items engineer–to–order contracted items, maintenance/ repair, operational items for plant and equipment maintenance, supplier–managed inventory.

Master Production Scheduling (MPS)

A schedule of items and quantities that a company expects to manufacture. In MRP it used actual demand.

Material Planning (MRP)

Used the master production schedule, the bill of materials, and inventory records to calculate time–phased net requirements for every item, and created a plan for covering material requirements.
MRP II
Forecasting
Comprehensive formulae to plan the future
Resources Planning (CRP)
Labor and machine capacity analysis
Manufacturing Cost Accounting
Integrate costing and manufacturing
Production Activity Control
Feedback mechanisms

MRP II is a method for the effective planning of all resource of a manufacturing company. Ideally, it addresses operational planning in units, financial planning in dollars, and has simulation capability to answer what if questions. It is made up of a variety of functions, each linked together: business planning, forecasting, production planning, master production scheduling, material requirements planning, capacity requirements planning, cost accounting, shop floor control, and the execution support systems for capacity and material. Output from these systems would be integrated with financial reports such as the business plan, purchase commitment reports, shipping budget, inventory projections in dollars, etc.
Management system based on network scheduling
Organized Common sense
DRP
Independent Demand Planning
Non–manufacturing Based (Distribution)
Advanced Warehouse Operations.

Distribution Requirements Planning (DRP) Plans and controls the distribution of finished goods based upon demand. In addition, DRP provides centralized control of distribution inventories and creates a coordinated replenishment plan.
Total Business Solution
Human Capital Management
Provide Education, Training and Inspired Leadership
Process and Information Improvements
Business Process Re–engineering & Best Practices
Leveraging Technology & Innovation
Oracle, JD Edwards, Microsoft, iQ4Bis, Lean Enterprise Intelligence System® and Lean Execution®
ERP
• Multi–Branch / Plant Planning
• Ties the entire business together
• Integrates MPS Automatically
• Pull System versus Push System
• Allows demand to flow through the system thus reducing inventory
• Forward Planning versus Rearward Planning.

The Manufacturing and Distribution Planning system is a part of Enterprise Requirements Planning and Execution (ERPx). ERPx allows you to coordinate your inventory, raw materials, and labor resources to deliver products according to a managed schedule. This closed–loop manufacturing system helps manage your data and optimize resources across your entire manufacturing and distribution logistics environment. ERPx formalizes the activities of company and operations planning, as well as the execution of those plans.