Finite capacity scheduling (FCS) systems or, more accurately, advanced factory planners and schedulers (APS) have achieved huge gains for those few that have implemented them well – but their spread still seems painfully slow. Given the increasing requirement for manufacturers to move closer towards lower cost make-to-order manufacturing, this does seem perverse.
Sadly, history, hype and scepticism borne of users’ experience with old, oversold, much less capable technologies in the late ‘80s and early ‘90s, are largely the problem. That and some software companies’ failure at the time to point out – and users’ reluctance to accept – the paramount importance of concurrently implementing process change, with appropriate change management, to mend what, in hindsight, were poor manufacturing practices belonging to a past era of make-to-stock.
Hence the all too frequently held belief that ‘finite scheduling is the last resort of a company whose processes are tortuous, ill-considered and inflexible – an IT Band-Aid applied to a festering wound’. And to be fair, manufacturers have in general found ways around scheduling problems with a mix of pragmatic production management and common sense, dressed up as popular initiatives or not.
But in 2003 we can do better – much better. It’s very different world to that of the ‘80s when electronic packaged FCS was born. Best practice processes, expectations, supply chains, competition and IT, have all moved on – big time.
Modern schedulers are about taking forecast, order book and real orders as they arrive, and being able to flex capacity – allocating materials, subcontracting and so on, weighing up priorities, due dates, costs and preferred sequences to minimise set-ups and change-overs. They’re also about doing all that while recognising the pressures to cut costs, provide for more product variants, smaller batches and shorter lead times – and providing better ‘on time in full’ customer metrics without chaos.
Simulation and optimisation software specialist Ilog is behind many of today’s APS systems – and the good news is they’re far more capable, much faster, far cheaper (at least than the top end of even five years ago) and can be considerably easier to implement. Notwithstanding process reconsideration, the data (BoMs, routings, machine capacities, inventory policies) often comes largely from whatever ERP and shop floor systems you have. With this, APS builds its own big, but also detailed, picture, with rules and dependencies, so that it can optimise production sequences not in isolation, but considering current orders, status, preferences, consequences, everything that’s going on.
The result: modern schedulers are accessible, capable tools – and about as far a cry from inadequate Band-Aid as you could get.
Here’s how it worked for Moss Plastic Parts, a midlands-based manufacturer of a huge range of plastic components for industry, which implemented the ST Point TOC-based APS (originally from STG, but now Manugistics Networks software) just under two years ago. Planning supervisor Giles Guthrie says: “Our on time delivery in full has risen from 65% two years ago to 99% now – and that’s with less people and more complex, shorter run, shorter lead time work.” Other top line benefits include customer overdues down from 173% of daily turnover two years ago to 27% today – and in December 2002 one quarter of that. Then schedule adherence, which was around 35% two years ago, now sits at 80% and savings in raw materials and finished goods inventories are around 20%.
Moss is a subsidiary of the £2 billion Bunzl Group making industrial plastic protection components for the automotive, furniture, packaging and oil field supply industries, as well as general engineering. Founded in 1952, the firm is based at Kidlington in Oxfordshire; it has 430 employees, 30,000 customers and operates at 15 sites, including distribution centres, six of which are across Europe. Most manufacturing – plastic injection moulding – is in Kidlington. It’s low value, high volume, commodity stuff, with some 20,000 product types, 4,000 being mainstay make-to-stock, the rest engineer- and make-to-order, with design and collaborative project management also on site.
The APS implementation was far from stand-alone. Moss’ business systems director Sarah Cobb is a strong advocate of enterprise IT to build business efficiencies, cut costs and bring competitive advantage. Over the last three years the firm has built on its SSA GT eBPCS ERP implementation with e-commerce systems, business intelligence software, shop floor data collection and rapid order entry systems – the latter via an integrated, browser- and web-based catalogue front end for sales, to improve service and cut costs.
All of that has been extremely successful: Cobb is on record as saying that not only have the challenges of integration and business process change through workflow been overcome, but the expected business efficiencies and advantage have been realised – and there’s more to come.
Recently she spoke of the experience with business intelligence, for example. “We take invoice line data at a customer and item level every night into an OLAP cube and make that available for the next morning… Our sales and marketing director has all the information on the previous day’s sales within five seconds of the morning coffee hitting the back of his throat. He can see what’s sold, what’s up, what’s down – and make decisions.
“That would have taken weeks to get before… [Our managers] say the project is the single biggest win [from our ERP]. To them it’s worth all the pain of going through the implementation of ERP for the level of cross-company data it provides.” And she cites being able to quickly identify customer profiles, customers in decline, customers growing, products growing, new business opportunities. “It starts to relegate the ERP system to a transaction engine throbbing away doing the transaction stuff. We’ve only scratched the surface: I’m responsible for production planning and I’m desperate to do the same thing for inventory.”
Returning to the APS, however, that too is linked directly into the ERP system, but what Guthrie has done is move it from being a relatively crude finite capacity scheduling advisory system to the suite that now drives the factory far more efficiently and responsively than was previously possible.
Guthrie emphasises that it was in no way an ‘out of the box’ implementation, nor an isolated initiative, but part of the strategic plan to improve production, cut costs and ramp up throughput. In fact, he admits to spending months “working with the engineers and operators trying to see how to make it happen,” but without initial success. Eventually, he changed direction and developed a new model of the production floor by rethinking, looking for commonality and simplifying.
“You have to get away from what ‘experienced’ people tell you,” he warns. “They’ll see machines as all very different, when you can think of some of them from a scheduling point of view as being the same. I redesigned the work centres so that 99% of the time, within each, work can go onto any one of several machines.” That did force some tooling management – manifolds and the like, for example, had to be tied to work centres and, to maintain the model, only moved with authorisation.
So changed routes and processes certainly played their part – but the system helped with that too. With rules developed to minimise set-ups and set-up hours by pooling tools, materials and colours, and driving for customer due date, while focusing on constraints, like available machine setters, the transformation has been achieved. “Now the system can schedule 400 jobs on 150 machines in an hour. That used to take two days. And I can look ahead three or four weeks and see that there are no problems.”
For Moss, APS information now percolates everywhere. First, it extracts consolidated customer orders in terms of BoMs (bills of materials), routings, material details, inventory, etc, and returns the plan to drive shop orders, materials purchasing and so on via MRP, as well as the machine controls. But beyond that: “Sales can see the schedule so we’ve got much better agility. We can create daily setting schedules and respond far more quickly and efficiently to opportunities without disrupting the plant, or pushing out other customer orders,” says Guthrie.
And he adds that lead times are also substantially down, not least as a result of de-cluttering the factory which is also now better able to handle the variability of production that’s increasingly required. He’s not saying there isn’t room for further improvement: schedule adherence could be better, although few would argue with the realities of ‘Murphy’ on the factory floor. With its link into the BPCS’ HR module for the critical skills matrix, next up might be running that more frequently to reflect absence daily. It’s a question of balancing diminishing returns.
It’s worth noting here that APS systems are primarily designed to achieve Moss’ top line result – better and more efficient on time delivery in full performance, with maximised plant utilisation come what may. They weren’t conceived primarily as tools for reducing WIP, materials, or finished goods inventories, or lead times, nor directly for process improvement: those are all secondary, but very welcome additional ROI factors.
The bottom line: scheduling itself is a non value-add process – but reactive, even proactive, optimised production can save cost and add value in spades. Making it part of an integrated IT environment then spreads the advantage everywhere. And at less than £20,000 per seat (Moss bought two), Cobb says it’s quickly paid for itself.
It’s hard to escape the conclusion that documented cost savings way beyond simple scheduling – and providing for the coming requirements of ‘collaborative commerce’ – are there to be had, and worth the effort and cost.
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