best practices that enable the effective enterprise hank canitz sr. director manufacturing...
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Best Practices That Enable the Effective EnterpriseHank CanitzSr. Director Manufacturing Industries, QAD
QAD Explore 2012
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The following is intended to outline QAD’s general product direction. It is intended for information purposes only, and may not be incorporated into any contract. It is not a commitment to deliver any material, code, functional capabilities, and should not be relied upon in making purchasing decisions. The development, release, and timing of any features or functional capabilities described for QAD’s products remains at the sole discretion of QAD.
Safe Harbor Statement
Best Practices That Enable the Effective Enterprise
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• Manufacturing mega-trends• The effective enterprise• High potential best practices• Key take-a-ways• Next steps
Agenda
Best Practices That Enable the Effective Enterprise
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Manufacturing Mega-Trends
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• Long-term, far-reaching transformational processes- Can be predicted with fairly high probability at
least 10 years into the future- Have a broad impact
• Extends to most regions of the world and many companies
- Bring about radical, multidimensional political, social, and economic revolution
What Are Mega-Trends
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• The challenge- Global demand increasing while availability is
decreasing- Over next 25 years energy consumption will
increase by 60% with majority of growth in developing countries
• The impact- Strong up & down-steam partnerships will be
key- Integrated, efficient, & flexible supply chain
delivers a competitive advantage- Efficient & effective production is fundamental
Decreasing Dependence on Fossil Fuels
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• The challenge- In a recent study more than 35% of consumers are
interested in purchasing build-to-order products- A polarized economy will develop
• The impact- To meet CTO requirements manufacturers must
adopt:• SC technologies that enable more efficient production• Customer-facing technologies, like order configurators• More effective management of engineering changes• More accurate new product demand projections
The Emergence of Mass Customization
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Commoditized Products High Value Offerings
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• The challenge- Knowledge/data is king- Information has become a mass product and is
universally available- Information communication technology (ICT) has
unleashed a huge flood of data and information
• The impact- Global data management to match customer
global data access- Develop global strategies to enable workers with
relevant and actionable data- Business intelligence systems, intuitive user
interfaces, and management by exception
Knowledge Society
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Knowledge Society
Best Practices That Enable the Effective Enterprise
The Importance of production factors
Digital universe set to grow by a factor of 40 by
2020
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The Effective Enterprise
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Our Vision – The Effective Enterprise
Best Practices That Enable the Effective Enterprise
Where every business process is working at peak efficiency and
perfectly aligned with a companies strategic goals.
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• What does it really mean to you?• Speak the language of the CFO• Learn from others• You can't manage what you don't measure• Establish standards
The Effective Enterprise
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Effective Enterprise Indicators
Best Practices That Enable the Effective Enterprise
QAD KPIs
Fixed Assets
Return on Net Assets/EVA/Value/Free Cash Flow
Net Income
Net Assets
Revenue
Costs
Working Capital
COGS
SG&A
Distribution
Inventory
R&D
Receivables
Cash
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KPI Framework and Elements
Best Practices That Enable the Effective Enterprise
Metrics Best Practices
QAD Analytics
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Example KPI and Metrics
Best Practices That Enable the Effective Enterprise
Business Intelligence
Ops Metrics
Browses &Reports
Analytics
Inventory Accuracy
Inventory Turns
Obsolete Inventory
Expedited Orders
Stockouts
Safety Stock
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Example Best Practices & Enabling Solutions
Best Practices That Enable the Effective Enterprise
Improve Planning and Scheduling
Automated Cycle Count
Manage Overall Material Costs
Leverage Sophisticated Forecasting
Monitor Supplier Performance
Deploy S&OP Feedback Loop
Manage Pricing, Discounts, Rebates
Improve Inventory
Manage Outsourced MFG
Bar Coding / RFLean Manufacturing TechniquesReal Time Pick / Put Away
QAD SolutionAnd/or Service
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Best Practices
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High Potential Best Practice Areas
Best Practices That Enable the Effective Enterprise
TradePromotionsManagement
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Best Practice - Pyramid Forecasting
Best Practices That Enable the Effective Enterprise
A forecasting technique that enables management to review and adjust forecasts made at an aggregate level and to keep lower level forecasts in balance. (APICS)DEMAND-SIDE
HIERARCHY
Market
Family/ Market
Product/ Customer
Product/Customer/Distribution Center
SUPPLY-SIDE HIERARCHY
SBU
Family
Product
Product/Dist Center
Product/Dist Center/Customer
Roll U
p F
ore
cast Fo
rce D
ow
n
Adju
stment
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• Extensive statistical algorithms• Alerts for exceptions• Collaborative forecasting• Support for S&OP• Support for planning bills• Enables multi-faced pyramid forecasting
How QAD Enables – QAD Demand Mgt
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QAD Demand Management 6.1
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• Improved DIFOT 10-40%
• Inventory level reductions 12-70%
• Reduced obsolescence 30-50%
• Distribution & transportation savings 5-30%
• Improved plant efficiency 2-33%
• Improvement in forecast accuracy 5-20%
Achievable Value
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• The activities, including adjustments, replacements, and basic cleanliness, that forestall machine breakdowns. (APICS)
• Purpose is to ensure that production quality is maintained and that delivery schedules are met.
• Also to prolong machine life and to maximize machine efficiency.
Best Practice - Preventative Maintenance
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• Ensures a consistent maintenance work order process
• Captures maintenance labor and costs
• Improves maintenance labor utilization through planned preventative maintenance
• Allows scheduling of preventative and predictive maintenance based on elapsed time or actual throughput
• Provides for mean time between failure (MTBF) calculations and reporting
• Breakdown alerts
How QAD Enables – QAD EAM
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QAD EAM
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• Improved production scheduling efficiency
• Improved overall equipment effectiveness (OEE)
• Reduced maintenance related down time
• Reduced percentage of reactionary repairs
• Reduction in maintenance budget
Achievable Value
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• Reducing the total time required to manufacture an item, exclusive of lower level purchasing lead time. (APICS)
• For make-to-order (MTO) or configure-to-order (CTO), it is the length of time between the release of the order to the production process and shipment to the final customer.
Best Practice - Lead Time Reduction
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A powerful application designed to simplify processing of configure-to-order products- Captures engineering knowledge- Guides through the selling process- Automatically generates work orders and
routings
How QAD Enables - QAD Configurator
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• Guided sales- Flexible questionnaire design- Powerful price calculations
• Instant conversion of customer requirements into manufacturing requirements- Product configuration rules- Seamless integration
Intuitive, Informative, Intelligent
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• Decrease costs- Reduction of:
• quotation handling time
• order entry time
• order error rates and correction time
• Increase revenue
- Attraction of new customers• Ability to
- Increased customer retention
- Streamline quotation and order entry processes
- Bridge communication gap between sales & engineering• Ability to
- Provide competitive advantage by allowing customers to “have it their way”
- Allows engineering to focus on design and innovation
Achievable Value
Best Practices That Enable the Effective Enterprise
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Best Practice - Trade Promotions Mgt
Sales & Marketing,
Supply Chain,Finance
Supply Chain
Finance
Sales & Marketing,
Supply Chain,
Finance
Best Practices That Enable the Effective Enterprise
Optimize
Localize
Execute
MonitorCollaborat
e
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• Averages 20% of gross sales• TPM facts
- Comprises as much as 70% of marketing budgets- Ranks as the 2nd highest cost behind CGS- $8B wasted every year in deduction management- Deduction investigation average $260 per event
• Customers often tell us- Can’t tell what value they are getting- Or if one promotion was more effective than
another
Why is TPM Important?
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• Next generation of trade, promotions management solution from QAD- Powerful promotion planning
- Efficient deduction resolution
- Automated claims processing
- Tight integration with financials
- Robust reporting/analytical tools
How QAD Enables – QAD TPM
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QAD Integrated Solution
Best Practices That Enable the Effective Enterprise
Enterprise EditionGroupsProfilesBudgetsPricing
Sales OrdersDeductions
Accruals BI
Reporting
DM
ForecastsTPM
Promotions
RebatesClaims
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QAD Trade Promotions Management
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Deal Profiles – Immediate Discount
Best Practices That Enable the Effective Enterprise
Discount Type: Percentage or AmountCombination Type: Combinable or ExclusiveQuantity Type: The type of quantity to be used in determining quantity breaks in the price list detail (Amount or Quantity)
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• Shortened planning cycle • Improve pricing, invoicing, and accounting
accuracy• Improved ability to determine profitability of
customers and products • Shortened deduction investigation and
resolution time• Reduced outstanding claims and rebates• Improved ability to make better promotion
spending decisions• Improved sales forecasts accuracy
Achievable Value
Best Practices That Enable the Effective Enterprise
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Key Take-A-Ways and Next Steps
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Key Take-A-Ways
Best Practices That Enable the Effective Enterprise
FinancialModel
QADKPIs
MetricsBest
Practices
QAD Solutionor Service
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Next Steps
Best Practices That Enable the Effective Enterprise
Schedule a Discovery/Vision Engagement
ConductDiscoveryMeetings
ConductVision
Workshop
DeliverImplementations
DeliverQ-Scan
Assessments
Key Performance Indicators
Propose Alternatives
Assess / Plan
Standards
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Hank CanitzSr. Director Manufacturing Industrieshcc@qad.com
Questions & Answers
Best Practices That Enable the Effective Enterprise
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