best practices in manufacturing d365ug/axug northern
TRANSCRIPT
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Best Practices in ManufacturingD365UG/AXUG Northern California
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Agenda
Introduction and Overview 5 Minutes
Industry Thought Leaders 10 Minutes
Production Environments 15 Minutes
Leveraging the Tools 20 Minutes
Questions and Discussion 10 Minutes
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Presenter
Arbela Technologies
“Best Practices”
Introduction and Overview
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Presenter – Kurt Beers, Manufacturing Solutions Architect
HIGHLIGHTS
• Manufacturing Solutions Architect
• 20 years of ERP implementation experience.
• 10 years implementing Dynamics AX
• APICS Certified Professional (CPIM, CSCP)
SPECIALTIES
• Supply Chain and Inventory Management
• Master Planning and Production Scheduling
• Regulated Industries (FDA, FAA)
• Project Management
• Solution Design
• Integration Design
Contact: [email protected]
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Arbela Technologies
• Founded in 2002 by ERP & Supply Chain Veterans.
• Leading Microsoft Gold Certified Partner Since 2004.
• Headquartered in California with Offices in Georgia, United Kingdom, & Denmark.
• Specialize in Large, Complex, Multi-company Implementations (Multi-currency, Multi-site, Multi-language, & Shared Services).
• Extensive Industry Knowledge in Manufacturing, Distribution, Retail & Global Financial Management.
• Offer Full Dynamics AX & CRM Implementations, Upgrades, Audits & Development.
• Dynamics 365 competency – Add-on development
• Security, Compliance, & Auditing Solution for Dynamics AX 2009, 2012, D365.
• Centralized Master Data Capability & Consolidation Solution for Dynamics AX 2009 & 2012, D365.
• Extensive Manufacturing add-ons for Dynamics AX 2012 and D365.
98%Customer Retention
95%Customer
Satisfaction
100+Customers
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Best Practices - Definitions
APICS
A method or technique that consistently shows results superior to those achieved through other means, often used as a benchmark. Best Practices can be defined within an organization, within an industry , or across industries.
• Current (not emerging, not obsolete)
• Structured (goals, scope, process and procedure)
• Proven (demonstrated in a working environment with metrics)
• Repeatable (demonstrated in multiple organizations or industries)
Gartner
A group of tasks that optimizes the efficiency (cost and risk) or effectiveness (service level) of the business discipline or process to which it contributes. It must be implementable, replicable, transferable and adaptable across industries.
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Best Practices – Objectives for Manufacturers
Business Perspective
• Adhere to proven concepts and processes
• Focus on value added activities and eliminate waste
• Standardize where possible
• Innovate where there are opportunities to differentiate or add value
IT Perspective
• Follow proven implementation methodologies
• Align to the business objectives to be supported
• Leverage the application tools as designed to the greatest extent possible
• Look for opportunities to enhance, extend or integrate in order to gain efficiency or support key business initiatives
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Just In Time – Zero Inventories
Lean - Toyota Production System
Theory of Constraints
Six Sigma Process Improvement
Planning and Control Systems
Leading Industry Thoughts
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Zero Inventories - Robert Hall
“Stockless Production” – Make only what is needed, when it is needed.
Characterized by:
• Reduced Setup Times
• Small Lot Sizes
• “Pull” systems
• Quality at the source
• Product Design for Manufacturing
• Supplier Integration
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Lean Thinking – Robert Womack
Focus on Value Creation and the elimination of waste.
• Overproduction ahead of demand
• Material waiting for next process
• Unnecessary movement or transport of material
• Additional processing due to rework
• Excess Inventory beyond the required quantities
• Unnecessary time spent looking for parts or tools
• Defective Material
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The Goal - Eliyahu Goldratt
Throughput analysis with a focus on those activities that limit delivery of customer orders.
• Theory of Constraints and Critical Chain
• Find your “Herbie”
• Eliminate “Sub-optimal” processes and metrics
• Drum-Buffer-Rope
• Operate at the pace of the constraining resource
• Buffer inventory ahead of the constraining resource
• Pull at each stage in the production flow
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Six Sigma Process Improvement – Richard Schonberger
Focus on process discipline and consistency with a data driven approach to process improvement
Are your initiatives really resulting in increased creation of value?
• Eliminate waste in operations
• But still must adapt to customer and market factors
Example
• Increasing inventories would generally be considered “waste”
• But what of that Inventory leads to new Markets?
• Dell Example
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Manufacturing Planning and Control Systems13
Business Planning
Sales and Operations Planning
Demand Management
Master Production SchedulingRough Cut Capacity
Planning
Final Assembly Schedule
Material Requirements PlanningCapacity Requirements
Planning
Adapted from Vollman, Berry and Whybark
Manufacturing Execution Processes
Resource Requirements Planning
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Thought Leading Organizations
Several professional associations that serve to define, establish and promote “Best Practices” within their disciplines:
• APICS (now the Association for Supply Chain Management)
• Supply Chain Council
• Theory of Constraints International Certification Organization (TOCICO)
• Institute for Supply Management (ISM)
• Council of Supply Chain Management Professionals (CSCMP)
• American Society for Quality (ASQ)
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Order and Production Strategies
The Shape of Material Flow
Lead Time Expectations
Variety and Options
Operations and Market Variables
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Manufacturing Strategies – What Kind of Plant Are You?
Make To Stock – Produce before receipt of a customer order. Production to replenish inventories.
Assemble to Order – Final assembly performed upon receipt of a customer order. The Assumption is that all components and major subassemblies are produced and stocked in advance of order receipt.
Make to Order – Produce upon receipt of a customer order. Final product may be composed of standard components, or components produced specifically to meet the order requirements.
Engineer to Order – Customer order initiates a design process where new Products are defined, BOMs specified and ultimately produced.
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Lead Time Considerations - Manufacturing Strategies
Design Purchase Manufacture Ship
Inventory Manufacture Ship
Manufacture Inventory Ship
MTS Delivery Lead Time
Manufacture Assemble ShipInventory
ETO Delivery Lead Time
MTO Delivery Lead Time
ATO Delivery Lead Time
Assemble
Assemble
Assemble
Engineer-to-
Order
Make-to-Order
Make-to-Stock
Source: Arnold et al., Introduction to Materials Management, 6th ed.
Assemble-to-
Order
Inventory
Variety
Volume
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Product Options and the Demand for “Customization”
From Henry Ford in 1909- “A person can buy a car in any color they choose, so long as it is black.”
…To standard base models with a multitude of colors and optional features (Air Conditioning, Stereo System Selection, Transmission type, power vs manual features, etc.)
… To Dell computers – Pick your features and components and design your computer from scratch.
… To Converse and Vans shoes – Choose your color, your fabric, other materials, eyelets, soles, etc… And, they deliver it in a few days.
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Plant Type Analysis - VATI
Plant types describe how materials flow through a factory. In Theory of Constraints, this is called the VATI analysis, and can help with scheduling problems. Draw the diagram from the bottom of your page to the top of your page.
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Plant Type Analysis – What Kind of Plant Are You?
• V Plant (One to Many): One (or few) raw material converted into many different end items. Examples – Wood and Metal Products.
• A Plant (Many to One): Typically complex assemblies where many components and subassemblies are combined to produce a (relatively) small number of end items. Examples – Aircraft, Ships, Some Electronic goods.
• T Plant (Multiple Lines or Many to Many): One (or a small number) of general material flows can split to make many different products. Examples - Computers or any other product with configuration, size or color options.
• I Plant (One to One): Small number of inputs flow in a sequence to produce a small number of outputs. Few points of divergence in the material flow.
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Postponement – Delayed Differentiation
What is the point of divergence in your product structures or material flows?
Delay the final differentiation (production, assembly, packaging, etc.) until the latest possible time without impacting customer lead time expectations.
• Reduced Risk associated with anticipation
• Reduced Finished Goods Inventory Cost
Focus is on the point of divergence in the material flow as the inventorying level.
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Postponement – Company Examples
Kitchen Cabinet Maker
• Modular Design
• Wood and Hardware options available for all standard modules
• Configured to fit Kitchen space
• Make to Order (Configure to Order)
• “V” type plant
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Postponement – Company Examples
Office Furniture Manufacturer
• 20 – 30 base models
• Numerous options with in each model (including thousands of textile options)
• Quick turnaround (2 – 3 days from customer order)
• Assemble to Order (Configure to Order)
• “T” Type Plant
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Postponement – Company Examples
Brewery
• Relatively small number of branded beer, each with numerous package options for Finished Goods
• Three week fermenting cycle
• Moderate Customer lead time expectation (3 – 4 weeks)
• Long Lead times on many Raw Ingredients
• Make to Order Plant
• “T” Type Plant – Some properties of an “I” Plant
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Postponement – Company Examples
Aerospace Composites Manufacturer
• Fairly small number of critical Raw Material
• Produce an Intermediate Stage Raw Material
• Material may be cut and formed into a wide variety of end items
• Hybrid – Make to Order / Assemble to Order
• “V” Type Plant
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Plant Type Analysis - VATI
Plant types describe how materials flow through a factory. In Theory of Constraints, this is called the VATI analysis, and can help with scheduling problems. Draw the diagram from the bottom of your page to the top of your page.
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Configuration Technologies
Forecast Models
Master Plans
Coverage Settings
Order Settings
Planning BOMs
WMS Replenishment
Power BI
Leveraging the Tools
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Mandatory Setups
• ‘Product subtype’ must be set to “Product master”
• ‘Configuration technology’ decision
• Choice of ‘Configuration technology’ affects options in ‘Product dimension group’
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Selecting a Configuration Technology
• First question – Do you really need a configuration technology?
• Exploring the Options• Predefined variant
• Do you have products with more than four options in them?
• Dimension-based configuration• How many more than four options do your products have?
• How do configuration choices affect Production BOMs?
• How often do you add new products?
• How does your engineering/product development department function?
• Constraint-based configuration• Accommodates greatest complexity of options
• Allows attribute-based pricing
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Why Use Configurations?
• Control – If sales is allowed to make parts at will, we can have engineering issues.
• Pricing - Attribute-based pricing supported through a configurator only.
• Discrete Part - Despite all of the variability, it's still really the same fixture. Whether it’s black or brown, has a full shield or half shield, or an 8' power cord or a 12' cord, it's still really the same thing to us.
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Summary of the Various Contexts for Planning
• Within functional areas (Purchasing, Production, Distribution)
• Across functional areas within organizations
• Across trading partner organizations
• At strategic, tactical and execution levels
• Over long, medium and short time horizons
• Based on volume (S&OP) and mix (MPS)
• At aggregated (Family) and component (BOM) levels
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AX Planning Fundamentals – Static and Dynamic Plans
• Static Plan - The master scheduling calculation uses the current data to generate a net requirements plan. This plan remains unchanged until the next time you run master scheduling. It is an operating plan that various company personnel, such as a purchaser or production planner, can use to base their decisions on and carry out their daily tasks and activities.
• Dynamic Plan -This plan starts out with the same net requirements plan that was generated by master scheduling. However, you can update the dynamic plan each time the master data changes. This could be when you create a new sales order, for example. This enables you to monitor the changing order network and item availability without disturbing the static plan that others are using for their work processes
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AX Planning Fundamentals – Forecast Models and Plans
Forecast Plan - Gross Requirements plan in AX
• Long Range Material Requirements
• Long Range Capacity Requirements
Forecast Model - Identification of a specific Forecast in AX
• May be used to correlate with various versions or arrays from Demand Management System
• May be applied to Finished Good, Subassembly, Raw Material, or any combination of the three.
• Multiple Models and Sub-models may be used in Master or Forecast Plans
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Master Planning Parameters – Default Plans35
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Master Plan example in AX – Specify your Forecast Model36
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AX Planning Fundamentals – Which Plans are you using?
Cabinet Maker –
• Static for Daily Requirements
• Dynamic for short term changes to Plan
• Forecast at Raw Material Level
Furniture Manufacturer
• Gross Requirements for long range Supplier Capacity
• Static Plan for Daily Procurement
• Dynamic Plan for short term changes (multiple times daily)
• Specific Plan for Production Scheduling – Orders Only
• Forecast at Component Part Level
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AX Planning Fundamentals – Which Plans are you using?
Brewery
• Static for Raw Materials based on long range forecasts
• Dynamic for Make To Order Production – No Forecasts
• Static Plan uses forecast at Finished Good Level
Composites Manufacturer
• Gross Requirements Plan for Inter Company Supplier Capacity
• Static Plan for Daily Procurement and Production Scheduling
• Dynamic Plan for short term changes
• “Hybrid” Plan with forecasts directly on key Raw Materials
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Material Planning – Managing Demand and Buffers
Assuming that we are not operating in ETO or true MTO environments, there will be some need to maintain inventory.
• Buffer vs Safety Stock
• Primary vs Contingent
• Demand Driven vs Variation Driven
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Material Planning – Managing Demand and Buffers
Tools for driving component and subassembly inventory in advance of Finished Goods demand:
Planning
• Planning BOM
• Forecast for Subassemblies and Raw Materials (Consider Reduction Principle)
• Minimum Stock Levels per planning dimension (Site or Warehouse typically)
Execution
• Visual replenishment of production line locations
• OR – WMS Replenishment work for production lines
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Planning BOM Example in AX41
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Planning Route / Bill of Resources example in AX42
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Other Considerations for Planning
Material Control
Backflushing
Batch Tracking
Serial Tracking
Expiration Dates
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S&OP Master Plan example in AX44
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The Power of Power BI
Improved Data Visibility is top reason for implementing ERP system.
ERP systems are optimized for transactions – not for Reporting and Analysis
Power BI provides a flexible and easy to use framework for building rich data visualizations and detailed analytics
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C-level: See Your Sales Data in a Whole New Way
• Stay connected with access from almost anywhere, any device
Give sales managers the
ability to get data needed for
self-service BI like forecasts,
performance, and market
trends
Get immediate insights
across all your data through
self-service analytics
Manage sales performance and identify opportunities and trends
Click to see video
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YTD Sales – Customer Sales Trend47
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Product Analysis – Which Configuration is Selling Most?48
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Weekly and Monthly - Customer Sales Trends 49
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ERP
CRM
BI & Analytics
IoT
Field Service
Productivity Applications
Mobility
Azure
How we support the Microsoft Enterprise
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Dynamics 365 Business Apps 3rd Party AppsProductivity
Microsoft Ecosystem
Power BI
Outlook
SharePoint
Teams
OneDrive
Skype
+
Application Platform - Common Data Service
Azure, Data & Analytics
Sales
Finance &
Operations
Customer
Service
Marketing
Field
Service
Project Service
Automation
Machine Learning
Cognitive Services
Internet of Things
Cortana
Bot Framework
SQL Data Warehouse
+ +
Purpose Built Apps
Custom Mobile Apps
with PowerApps
Compose Workflows &
Integrations with
Flow
Business Processes
Common Data
Model
+
Microsoft
AppSource
Marketplace
Other Data
Sources
LinkedIn Recruiter
& Sales Navigator
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Adding Intelligence to your Dynamics Investments
Intelligence
Dashboards &
Visualizations
Information
Management
Big Data Stores Machine Learning
and Analytics
CortanaEvent HubsHDInsight
(Hadoop and
Spark)
Stream
Analytics
Data Intelligence Action
People
Automated Systems
Apps
Web
Mobile
Bots
Bot
FrameworkSQL Data
WarehouseData Catalog
Data Lake
Analytics
Data Factory Machine
LearningData Lake Store
Cognitive
Services
Power BI
Data
Sources
Apps
Sensors
and devices
Data
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Build applications that understand people
SpeechVision wledgeLanguage Search
• Faces, images, emotion recognition and video intelligence
• Spoken language processing, speaker recognition, custom speech recognition
• Natural language processing, sentiment and topics analysis, spelling errors
• Complex tasks processing, knowledge exploration, intelligent recommendations
• Bing engine capabilities for Web, Autosuggest, Image, Video and News
Intelligence
Cortana
Bot
Framework
Cognitive Services
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The Microsoft Graph
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Arbela Agile Methodology
Agile Methodology
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Arbela Agile Methodology
Analyze Design & Develop Deploy Optimize
Kick-off
Education, Scoping & BPM
Fit/Gap List
Design Workshops
Setup Workshops
Unit Testing
Data Migration C
on
fere
nce
Ro
om
Pilo
t (C
RP
)#1
Fit/Gap Feedback & Updated Scope
Co
nfe
ren
ce R
oo
m P
ilot
(CR
P)
# X
Development
Design Workshops
Setup Workshops
Unit Testing
Data Migration
Foundation, Standard CRMNo Customizations
Standard CRM, Security, ISV, Customizations for Reports, Interfaces,
Extensions, Forms & Workflows
Final Data Migration
Readiness Assessment
Go-Live
Repeat
On-Site Support
Optimization
Transition to Support
Come back for first month endAssist with re-training
Optimize environment and processes
Arbela Transition of Ownership Client
Environment Setup
Production Environment
Set Project Scope at High Level Process
Level & Kick-off Project. Compare
functionality between versions
and eliminate customizations
Readiness for Go-Live & Final Cutover
UAT
Training
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Project Management & Governance
Project Management
Project Plan
Resource & Budget Management
Communication & Training Plan
Governance
Change Management Procedures
Organizational Change Management
Steering Committee
Milestone or Monthly Steering Committee meetings
Resolution of Escalations & Approvals
Overall Guidance of Client Resources, Budget & Approach
Issue Management
Risk Assessment & Management
Project Status Meetings & Reporting
Development Best Practices
Deliverable Responsibility Matrix
Change Request Created
Reviewed by PM’s
Approved for
Analysis?
Change Order Closed.
No
CR Analyzed & Estimated
Yes
Submit to PM’s
With-in PM
Approval Limit?
Sent to Steering Committee
CR ExecutedApproved?
No
Yes
No
Yes
Change ManagementProcess
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