This week, we continue our conversation with DELMIA’s business development strategist Mike Bradford by talking about the benefits of implementing their MOM solution in your production facility – even if you have an ERP or Warehouse Management Solution – to reduce what he refers to as “the Manufacturing Blind Spot” in the manufacturing process.
The conversation will touch upon many of the software’s strengths such as increased visibility of production process, reducing manufacturing costs caused by inventory and material handling, reducing usage of warehouse space, and so on while also discussing firsthand experiences he’s had with clients before and after software implementation.
With that being said, let’s hear what the man of the hour has to say:
Gene: Let’s move on to the next question: why is it so important to have warehouse capabilities in your MOM solution?
Mike: Great question; and to be honest, we often get a lot of pushbacks there!
Mike: Here’s the thing: ERP Software manages inventory, right? But the focus ERP is inventory value; and you can buy warehouse management solutions that manage your warehouse for you. But, the issue is – for both ERP And warehouse management solution – is that they have a blind spot, and that blind spot is in the manufacturing process.
Mike: If you have a ten-step assembly line, an ERP or a Warehouse Management Solution knows what’s gone into the line and knows what’s come out at the end of the line, but everything in between is a black hole!
Mike: We had a farm equipment manufacturer that this saved them Tremendously in both inventory and material handling costs. When a combine hit station 2 on the line, it would trigger the warehouse people to kit for that same combine at station 8 on the line; knowing based on TAKT Time, and how long it took material handlers to do their job, that they would be able to build the kit and get it there in time.
Mike: They went from having boxes and boxes of inventory line side and lots of confusion for the operators- not knowing which components to use for the farm equipment sitting in front of them- to one, maybe two kits at the line; one for the combine or farm equipment they’re working on and the second one for the next one down the line.
Mike: But, with an ERP or Warehouse Management Solution, it’s very difficult to do something like that- if not impossible- because they have no visibility and what’s operation 10, 20, 30, 40, 50; they know what’s come in and what’s going out.
Mike: We just ran into this at another customer a couple of weeks ago on a plant visit. Where have a fairly long manufacturing time and they really didn’t know what they had in inventory because once they pull it out of inventory and brought it line side, they knew had moved it, but they didn’t know if it had been consumed yet, they didn’t know if it was still sitting next to the machine, they didn’t know they still showed up on their books; even though it may have been consumed and it’s an hour away from that machine being complete.
Mike: And, at that point, they backflush everything; they’ve lost tremendous amount of inventory visibility, and you end up having to have extra inventory to cover for that black hole; that “invisible inventory”.
Mike: Then, on the flip side of that, most MES systems, because they don’t include any warehouse capabilities, they’re always going to assume they don’t have visibility into raw material, components, or finished goods; so, they’re just always going to assume all the material is there. So, you may have production orders released and your M.E.S. System telling your operators to do things, and they don’t have the materials to do that.
Mike: By integrating those two things, it brings huge value; in fact, that’s one of the areas we see the greatest value for a lot of our customers!
Mike: We’ve had customers reduce their WIP Inventories by as much as 35 percent as well as reducing their raw material and finish good inventories by 15 to 25 percent; reduce their material handling costs by 35 percent- because now they’re only moving materials when they need to at the time they need to; huge drops in inventory costs, and even the ability now to add more assembly lines!
Mike: We had one customer in industrial equipment that was able to increase their throughput by 50 percent without adding a single machine or production line! The more efficient and effective synchronization of materials to their production line enabled them to speed up the production line and take away space that had been used for inventory and use it for other things.
Mike: There are a lot of reasons of how MOM can help your manufacturing processes. An upgrade is important, and it really does bring huge value to our customers.
For more interviews/success stories, be sure to check out the official D4M International YouTube page!
D4M is a privately owned company specializing in leveraging digital technologies to accelerate manufacturing clients to their transition to Industry 4.0. With long tenure and hundreds or successful projects, we are confident that our approach and experience provides the roadmap to help bring clarity and efficiency to your manufacturing operation.
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