May 2008 Edition

SHOP MANAGEMENT

Better Management Through Resource Integration

An enterprise resource planning system brought unity, and increased revenue, to a company suffering from data segregation

All of the data in the world might be available to a business, but without a system that provides usability, it’s just so much noise. Such was the case with ATI Industial Automation, Apex, NC: it wasn’t missing data that was causing a problem, it was the coordination and use.

The enterprise resource planning – ERP – system at ATI Industrial was ineffective. It didn’t keep pace with the thousands of new products added to the company’s inventory; it was incohesive.

The company, a maker of robotic end effectors, used a hodge-podge of systems with uncoordinated spreadsheets and lone data islands throughout the company. Each department used separate spreadsheet packages so data sharing was limited and inconvenient.

As the company experienced rapid growth, departments struggled to keep pace. The result was difficulty managing on-time deliveries and inventory control. With major companies in the Fortune 500 as clients, ATI couldn’t afford to experience customer dissatisfaction through late deliveries or loss of product quality.

"We needed to move away from the limitations of the system we had," Dave Lora, information systems manager and software architect at ATI, said. "We had few options for customization and integration. The biggest problem was that people in the company were fed up and demanded a change."

The company needed an integrated ERP system to overcome isolation of departmental data; an establishment of a system would unite operations. The company also needed to accommodate its engineered-to-order and assembled-to-order products, two processes that can work against Lean Manufacturing. A team was formed to investigate alternatives.

The team saw enterprise resource planning as a way to meet the need for consistent quality information in every segment of the business. It decided to select and deploy an ERP system.

The Chosen One

The team’s evaluation process included needs analysis, RFPs from vendors, detailed interviews with selected vendors, and a final recommendation. When the results were in, Intuitive, by Consona Corp., Indianapolis, was chosen by ATI.

"Intuitive’s customization features and open architecture let us integrate the information infrastructure," Lora said. "By eliminating isolated systems, we cut out duplicate data entry, reduced errors, and improved data integrity. The integrated infrastructure is an advantage our competitors find hard to imitate."

The firm’s objective with Intuitive was to integrate a data environment and ensure all departments could access current and accurate product data. Implementation of the system let the company’s engineering teams access business-level data to support better design processes. Manufacturing could tap the latest design information for development of efficient production processes.

The ERP system helps manage maintenance and tracking of a large inventory of individual modular products along with product configurations that have their own SKU numbers.

Intuitive also let ATI support a Lean environment. Many of its products are customer-unique. The EPR system helps it provide engineered-to-order and assembled-to-order robotic configurations. The earlier in the design cycle the supply chain can be apprised of the resources needed, the Leaner the development process.

"The Intuitive solution made a difference for us," Lora said. "It is customizable with an open architecture. We can build new forms and reports within the system’s framework, something we couldn’t do with the old system. We’ve achieved a high level of integration."

Ongoing Implementation

After the initial implementation, ATI continued to build on the system by customizing applications such as a flexible physical inventory system, price lists, serial number tracking, and a company intranet that integrated with Intuitive.

ATI was a beta test site for Intuitive’s Ver. 8.1, an ERP solution built with Microsoft .NET-managed technology. The test team appreciated the improvements to the system’s Capable-To-Promise module because it lets users identify the when and how of delivery to customers, based on critical materials and finite or infinite workcenter scheduling.

Using a .NET application increased efficiency within two critical areas within ATI’s business: manufacturing and purchasing. Because Intuitive ERP is .NET, there are no concerns about scalability.

Another improvement with the new release let the company achieve greater visibility into individual workcenter status, including automatic rescheduling of upstream or downstream operation rescheduling using drag-and-drop. With the new capabilities, the manufacturer found it had a more nimble and cost-effective response to specialized product configuration, engineering, production, and quality.

ATI has seen significant return on investment from the ERP package. Intuitive offers waste reduction and production optimization. The company achieved revenue growth of 70 percent within the first two years after the Intuitive implementation because of the flexibility, scaleable architecture, and integration with customized applications.

Growth and On-time Delivery

According to Lora and his team, the infrastructure provided by the Intuitive system contributed to the growth. There was more control of serial-number tracking, quality control, and inventory management. The company now manages a growing product set and improved customer service and product quality.

The Buyer’s Workbench within Intuitive let purchasing personnel manage 2,500 items, an impossibility with the previous system. The new system brought together the information, tools, and functions needed for procurement and consolidated purchasing activity into one interactive, .NET-enabled workbench.

With the ERP package, ATI achieved unprecedented levels of on-time delivery. The internal on-time delivery target was 95 percent. After Intuitive was implemented, that goal was met and then surpassed. The team also reported significant improvements in on-time delivery and inventory control.

Another benefit of the package was the nondisruption of the business during implementation.

"We had a successful ERP migration from day one," Lora said. "We kept up with a strong shipping week with few hiccups, even though we had hundreds of orders in process."

Lora attributed this success to his team’s intensive, six-month implementation planning process and a dedicated implementation team. The team provided training for employees and leveraged Intuitive’s virtual training resources.

"You can’t underestimate the scope of a project like this," he said. "We played out scenario after scenario with our Intuitive implementation consultant, and we rehearsed the data migration every day before the changeover. Implementation isn’t something done at the beginning, it’s ongoing. With software like Intuitive ERP, keeping up with the latest version means enhancing our toolbox. We get access to new features that can help our enterprise achieve continuous improvement." Consona Corp.

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