APICS-TPA - January 1997

January 1997 € Volume 7 € Number 1

Solutions

Intelligent Planning Solutions Help Office Systems Manufacturer Keep Its Promises

Herman Miller Inc., a Grand Rapids, Mich.-based manufacturer of office systems, processes more than 3,000 orders each week for office furniture and accessories.

Because Herman Miller produces all office needs -- from panel and office wall systems to desks to chairs to paper clip holders -- its strength is in providing customers with complete office systems. As a result, 80 percent of the company's business is project-based. Fulfilling these orders requires coordination of the company's diverse operating units to produce all of the materials a customer needs. For example, walls and partitions are produced in the Systems plant; desks and hanging components in the Work Surfaces plant; chairs in the Seating plant; and metal file cabinets in the Storage plant.

Traditionally, customer orders came into a central order entry area and accumulated in the mainframe. They were then grouped by operating unit, batched and sent to the individual plants. This system was time consuming and added no value to the customer.

Herman Miller wanted to eliminate the batching process because orders were being stripped of customer identity and the plants were unable to distinguish between orders. As a result, there was no way to tailor production based on importance and/or promised ship date.

After production, each plant sent completed items to distribution centers for shipment. This system proved inefficient. Sometimes, late production of a small component of an order could cause hundreds of thousands of dollars worth of inventory to sit in the distribution centers until the entire order was completed. The costs in terms of wasted time, storage and misused manufacturing resources were enormous, not to mention customer frustration when orders were shipped late.

As a result of these issues, Herman Miller assembled a search team to examine the company's business processes and purchase a system that would streamline those processes and achieve the following goals: compress cycle times, increase direct shipping, give customers identity in the factory, reduce inventory, cut costs, and move from a weekly to a daily production schedule. Basically, the company wanted to be able to make -- and keep -- promises to its customers.

After consulting with analyst groups and meeting with a variety of vendors, Herman Miller chose the Rhythm family of intelligent planning solutions from Irving, Texas-based i2 Technologies, Inc. Part of Rhythm's appeal was i2's implementation methodology.

The cycle began with i2's Supply Chain Optimization Assessment (SOA). During this phase, i2's supply chain specialists studied Herman Miller's business and worked with the company to develop an operating model for improved performance. Implementation was then undertaken to achieve the company's goals.

i2's implementation methodology is based on business releases. In Herman Miller's case, these consisted of 30-day periods during which a specific business result had to be accomplished. For example, Business Release 1 might be called "Daily Schedules." In that case, the implementation team would have 30 days to reengineer business processes and deploy software features that would replace the old weekly protocols with daily scheduling.

The software has been implemented without any modifications and the initial installation was up and running in two weeks. Rhythm was able to seamlessly extract information from Herman Miller's proprietary order entry, accounting and inventory software packages and perform up-to-the-minute planning and scheduling functions, responding to changes in the supply chain immediately.

Herman Miller installed the software at six sites with four to five business releases scheduled for each. Implementation began at the first site in June 1995 and the last site was finished by Sept. 1,1996 -- three months ahead of schedule.

Since implementing Rhythm, Herman Miller's average lead time is four weeks -- with some product lines shipping in as little as one week -- and 95 percent on time. Prior to installation, lead times averaged five to six weeks, with 80 percent shipped on time.

Rhythm is also helping Herman Miller to reduce its reliance on distribution centers. Because the entire process is now planned sequentially, the components of an order may be shipped to the customer directly from the plant, in the order that they are needed. For example, a customer will receive panel systems and partitions, then furniture, then accessories. The company plans to direct ship more than 80 percent of orders over the next two years.

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Product Data Management System Proves To Be A Clutch Performer

To deliver products to their customers faster, The Dana Corporation looked for a way to increase productivity at its Warren, Mich., plant. Dana produces a Formsprag mechanical over-running sprag clutch commonly used in inclined conveyors, high-speed gas turbine starters and other industrial operations. Due to the various applications of the clutch, alternating specifications are required. This leads to an abundance of engineering drawings and product-related data. Dana needed a software system that could manage and control the tremendous amount of information. It found such a system from B.A. Intelligence Networks, Inc. (BAIN).

Located in Southfield, Mich., BAIN provided Dana with a product data management (PDM) system -- MANTA -- that supports design and engineering activities throughout the entire product life cycle through visual presentation of product-related data.

To speed up production, Dana needed engineering and manufacturing to share drawings and engineering materials electronically. By putting all product-related data on-line, information can be accessed from all over the facility. "We needed a PDM system to make data and drawings more accessible to the people who needed them. Too much time was spent trying to retrieve information from various departments. We wanted to expedite the entire process," says Dave Foley, project facilitator at the Warren plant. "MANTA enables us to track, control and manage the various tasks and data involved in product design, including creation, file management and release/change control."

A major benefit Dana is receiving from MANTA is the ability for engineering and manufacturing to share information. Past methods for exchanging information would occasionally lead to errors such as the use of obsolete revisions. With MANTA's revision control features, errors are reduced to a bare minimum. MANTA structures information so that only the most recent revisions are accessible, and obsolete drawings are organized and managed without the use of microfiche. According to Foley, "With MANTA, errors in production are minimal. We can control the flow of information so that only the up-to-date drawings are accessible. For obvious reasons, this is quite an attractive feature to us."

The saving of time is another significant benefit of MANTA. Before implementing the MANTA system, accessing particular drawings or data from this vast pool of information was usually time-consuming. With MANTA, drawings are viewed electronically with speed and ease from the shop floor or anywhere within a wide area computer network. Additionally, employees never have to waste time redrawing to create extra copies. The original drawing is always readily available for duplication.

The Enterprise Document Control feature saves time by allowing the management of documents on an enterprisewide level. For example, the human resources department manages the paperwork on 2,200 of the company's retirees. With MANTA, the information is scanned into the system. Explains Foley, "If we were to look for one document out of each of the 2,200, it would take 110 hours. With MANTA, it takes three minutes."

The use of MANTA on Dana's shop floor is a revolutionary occurrence in manufacturing. Having MANTA on the shop floor leads directly to a reduction in sets of drawings and copies of drawings located throughout the plant. Therefore, there is a greater probability that the correct drawing will always be selected. "Having MANTA on the shop floor is an exciting opportunity in manufacturing. Aside from the time savings in obtaining drawings, the worry is taken out of revision control. Now the correct drawing can be obtained from the floor, and the chance for mistakes is less than minimal," says Foley.

The Dana Corporation knows that its success lies in customer satisfaction. Therefore, the company will take whatever steps are necessary to ensure productivity is high. This goal is what led Dana to MANTA. "Everything about MANTA makes our product design more efficient. MANTA utilizes an open architecture, it works with any database, and the system's graphical representation of product-related data is uniquely easy to work with. MANTA allows us to stay at the top of our industry," says Foley. "We couldn't ask for anything more."

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