A Passion for Manufacturing
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  • GDP historically does go up and down, but not very often to this degree in your lifetime. Starting in 2007 through 2010 we saw a large swing – we all felt it and manufacturers if they were on that kind of growth curve, you can believe they felt it. In retail the cost of goods is almost entirely a variable cost; this is not true of manufacturing where many fixed costs, such as depreciation, are included in the cost of goods.
  • In terms of Manufacturing output growth, you can see it’s in the same range as GDP growth , this is growth of 2012 Q1 over 2011 Q1 so the data is about a year old. Shows the world at 3.9% but what of course is interesting is to see that industrial countries contributed 1.6 versus 8.7 in developing countries. And within industrialized countries, NA was 5.3 and within developing countries, China was the whopping 12.7 growth. So clearly China and North America is were the growth was coming from last year.Let’s talk about 3.9% growth numbers in terms of an average company. When you’re not growing, you’ve only got one choice, reduce costs to maintain same profit level. The cost of goods in Retail is mostly variable cost. In manufacturing there is a much higher percentage of fixed costs in the cost of goods. So it’s harder to react to the changing business climate by just reducing costs.
  • Top 10 countries in terms of manufacturing output. (different metric than GDP).
  • Our value props tie to what’s happening in the industry. Growth is key and innovation is key to growth. The world is changing and companies are going to have to be light on their feet, change quickly and easily. And lastly, they’re going to need their people to help, in improving both product and process.
  • These three manufacturing verticals where we’ve put most of our energy into the product itself and marketing assets and where we have seen the most payback in terms of worldwide perspective on customers and revenue. This is where we’ll continue to prioritize our Microsoft marketing asset development and then continue to support our wide partner network to continue to provide as much coverage as possible for all verticals.
  • Here’s the 2012 Q1 output growth by vertical. I’ve highlighted segments that map to our focus verticals.
  • There’s specialterms or “reserved words” in manufacturing, like all industries. But because the industry is so broad and has so many verticals or niche categories, there’s lots of them to learn.
  • This presentation provides a high level overview of how we will direct the investment in Microsoft Dynamics AX through 2013/2014 We expect to update the deck every 6-9 months as more detail on the upcoming releases become available. Please make sure that you stay connected to your partner and/or log into CustomerSource to always get the latest version and update. As illustrated on this slide,and as detailed in the following detail slides, we will continue to invest heavily in delivering innovation to our customers. Without further ado, lets take a look at some of the highlights that customers can expect from us over the next couple of years and then spend the rest of the presentation digging into more detail. Q1 2012 we will extend the Microsoft Dynamics AX2012 to also support Retail organizations. The core themes of this release will therefore be focused on Store Management, POS, Multichannel & Merchandizing but we are also making investments around both Application Lifecycle Management & Management Reporting to help customers across all industries. In Q1 of 2013 we are planning to deliver even more innovation through our Microsoft Dynamics AX 2012 R2 release. Core themes of the release include Enhanced Business Intelligence (BI) & Reporting technology and we will be enabling Master Data Management for specific types of data. In this release customers also can expect enhancements in both the industry and broader horizontal feature set and we will also be rolling out AX into 11 new locations at this time. In our next major release we will expand our cloud strategy from delivering targeted solutions in the cloud to having complete symmetry between the cloud and on-premise solution. This will enable customers to have even more freedom as to which parts of AX they run in the cloud vs. which they run on premises or hosted and for the first time it will enable them to run the entire AX solution on the Windows Azure platform if they prefer. This release will happen in the 2013/2014 timeframe. With this high level overview in mind, let’s now drill a bit deeper into each update.
  • Back to our value prop. I’d like to go back to innovation for a minute.
  • Unfortunately, a lot of people think of steel mills, very old industrial equipment when they think of manufacturing. What they don’t think of is what is actually being manufactured, and how it’s being manufactured.
  • If you’re interested in innovation, you should be interested in manufacturing! It’s where 90% of our patents come from in the U.S. And almost 70% of the R&D investment.
  • So manufacturing is innovative and strategic. That’s why I’m passionate about it as an industry! It’s where it’s at!
  • Now let’s go back to speed and agility.
  • Now before we get into the challenges affecting manufacturers today, I want to tell you about the 6 major forces or industry trends, that Microsoft sees as shaping the future of manufacturing. Power Shift To ConsumersConnected ExperiencesGlobalization & Emerging EconomiesChanging DemographicsSustainabilityComplex RegulationsLet’s look at each of these forces with a little more detail:Power Shift To Consumers:In today’s digital world, consumers are no longer passive recipients. They are active participants. The emergence of consumer communities that drive and influences perceptions/demands is ever more significant. Manufacturers can also leverage these communities as means to reach out to these consumers directly. To succeed in the digital world, Manufacturers need to: Utilize digital marketing to reach and influence consumers directlyActively observe and serve consumer demandsDevelop New business models that focus on services along with product delivery to drive recurring revenue streams and deliver complete consumer experiences – e.g. Ford SyncConnected Experiences:People will be more connected than ever. They’ll:Engage in collaboration & knowledge sharingFind and access skills & enterprise anywhereSupport digital customer engagement anytime, globally, around the clockGlobalization & Emerging Economies:Emerging market countries, together with their rising middle classes, are creating a shift in economic power. More cars were sold in China in 2010 than in the United States, and India has the highest growth rate for mobile phones. Manufacturers need global scale to compete, but they must be able to execute locally. They also must be agile to respond to changing needs in widely differing markets worldwide. To succeed, manufacturers must pursue strategies such as “profitable proximity”—that is, developing capabilities to sense and respond to unique local needs.1 This includes assessing where to locate manufacturing capacity, where to source R&D talent, and how to distribute products in high-growth emerging markets.Changing Demographics:For the first time in history, the workforce spans multiple generations, with a spectrum of experience, expectations, and tools they use in the workplace. Millennials are digital natives; they are comfortable with multitasking and an always-on, always-connected world. These younger workers demand the latest high-tech capabilities and a seamless link between their lifestyle and their workstyle. Baby Boomers, however, typically struggle with the notions of social networking and tweeting, and they often resist technological change. From a geographic perspective, the workforce in developed countries is aging, while people in their 20s comprise the broadest segment of the workforce in India. This distinction has corresponding implications in consumer markets, too.Sustainability:The rapid growth in global demand is fueling rising costs in commodities and materials. It also is adversely impacting the environment and people’s quality of life. In some countries, such as Japan, public policies are incentivizing the development of smart communities—interconnections across water, power and utilities, smart meters, cars, road and traffic infrastructure, industrial systems, and consumers. An American Council for an Energy Efficient Economy (ACEEE) report titled “A Defining Framework for Intelligent Efficiency” says if the United States took advantage of currently available information and communications technologies that enable system efficiencies, it could reduce energy use by about 12 percent to 22 percent and realize tens or hundreds of billions of dollars in energy savings and productivity gains. High-tech and electronics manufacturers need to develop products and services that are environmentally friendly while simultaneously reducing emissions and energy consumption in manufacturing and distribution processes. Product designers need systems and capabilities to access environmental data for sourced products and components, to factor energy costs into the manufacturing process, and to design for reuse and recycling. Complex Regulations:Complex Regulation - In just the past five years, it is estimated that nearly 10,000 regulations have been created by federal and industry entities and that in 2005 alone, $15.5 billion was spent on a wide range of compliance programs and $80 billion will be spent over the next five years. Not to mention the US effects of Sarbanes-Oxley (SOX) and IE & A Regs such as Corporate Average Fuel Economy or CAFÉ – regulated by state (but a nightmare for global manufactures)Summary:To successfully respond to these forces, manufacturing organizations must be proactive, not reactive. And they need technology solutions that enable the agility that is required to thrive in this environment.
  • Forrester research on enterprise applications indicates that the top 4 issues are that they suffer from incl. a high cost of ownership, difficulty in upgrading and integrating across functions. In addition, they often don’t actually meet business requirements. Manufacturing companies often experience these issues as they were the first industry to really embrace ERP systems. These existing ERP systems are often the cause of poor operational performance in manufacturing companies, sometimes these systems are barriers to adopting lean processes or implementing mixed mode manufacturing and often the cost of upgrading the systems to meet changing requirements are prohibitive.
  • For many manufacturing organizations, there are lots of challenges with legacy ERP systems, most of which were designed in the 1980s. They’re usually complex, inflexible, and unable to provide the power and agility that today’s manufacturing organizations need to change, grow, and thrive. Let’s take a closer look at these systems and the problems they present.They usually have many complex interfaces thatare intertwined and tangled—like spaghetti. There’s no simple, affordable way to customize or integrate because there are so many dependencies on other systems. Duplicatedata in many disparate databases complicates the task of focusing on what’s critical―extracting, transforming, and presenting accurate data in the most appropriate format to enhance performance and easeofuse. The cost of translating, mapping and reformatting data is high and sometimes data incompatibility prevents the creation of business intelligence needed to make informed decisions.Batch processes run nightly or even weekly are often used as necessary workarounds to overcome the lack of integration and interoperability in legacy systems. This slows down the end-to-end business transaction and reduces your ability to meet customer’s demand and manage the supply chain efficiently. Key work-related functionality sits in many separate applications. When upgrading these systems or needing to have cross functional views of the same information, the customer, not the vendor, faces the challenge of solving integration problems.Business intelligence is an afterthoughtfor the design of many legacy ERP transaction systems. They’re not designed for business intelligence to be available during the business process and used for making operational decisions. Unfortunately, the implementation is not set up with BI in mind, requiring significant changes to original designs or configurations to just get minimal business intelligence needed during operational processes.The user experience is data entry or task-oriented,not role- or end-to-end business process-oriented, and there is little or no opportunity to customize or optimize the user experience on the fly. Against this backdrop, it’s easy to understand many of the legacy ERP challenges we discussed in the previous few slides. Legacy ERP systems are not designed to cope with today’s changing global business climate. And their IT budgets are consumed by maintenance, leaving fewer available funds to support new initiatives. Legacy ERP systems are reactive, not proactive. The manufacturing industry needs new solutions to keep pace with the current environment and the future trends we discussed.CLICK
  • The Gartner 2012 Magic Quadrant shows that Microsoft is now considered one of the leaders in ERP. Gartner calls out several strengths of AX incl:The flexibility and extensibility of Microsoft Dynamics AX [which] makes it a strong solution for midsize customers and should be of particular interest to large companies trying to satisfy divergent business unit needs, such as multimode manufacturing. Discrete, process and lean manufacturing principles have been integrated into one solution and can be used in parallel. The system also enables users to combine solutions from various industries. …the way it leverages the Microsoft application platform and productivity suite, with enhanced integrations to Microsoft's Visual Studio, SQL Server and BI, and SharePoint. Throughout the system, analytical capabilities have been more deeply integrated. Early adopters whom Gartner interviewed highlighted the ease of adding data visualizations and drill-down capabilitiesThe new architecture of Microsoft Dynamics AX 2012 supports the parallel deployment of extensions built by different partners into one solution. The partner layer can host multiple extensions, which are well separated from each other but can interact through clearly defined interfaces. Role-based UI personalization is seen by customers as being very flexible.Customers praise Microsoft's Premier support. Many customers value a strong relationship with Microsoft's development team. The new modeling capabilities of Microsoft Dynamics AX 2012 allow customers to graphically model various aspects of an enterprise, like the organizational setup and relationships between various business units, the allocation of people to organization units and the respective setup of user rights and access options.
  • Microsoft Dynamics 2012 AX R2 can be deployed as a full suite or workload by workload as you replace legacy systems. Integrated, full suite:End-to-end solution brings together people, information, and resources.Embedded, declarative workflow helps workers uncover new opportunities.New release simplifies international, cross-company business processes, data sharing, and IT infrastructure.  Not ready to deploy the full suite? You can expand and upgrade at your pace Workload-at-a-time: Microsoft Dynamics AX 2012 R2 grows with a companyMaintain an administrative headquarters solution while using a more cost-efficient, flexible ERP application.Add modules as organization’s needs change and grow.Enjoy familiar interface and strong interoperability with other Microsoft offerings such as Microsoft Office, Windows, and SQL Server.
  • Businesses can consume the Microsoft Dynamics technology in the model that works for them – as an integrated suite in a business or subsidiary, or workload by workload in larger enterprises, with the workloads together composing the simplicity of a suite. Systems with modules that can be turned on and off, depending upon what people need for their jobs, will enable shorter, less expensive implementation cycles. A workload can be an individual business process such as expense management, answer the needs of a subsidiary or acquisition, or address the operational requirements of a manufacturing or retail operation. Large organizations, especially, need the flexibility to adapt and change their business systems one workload at a time, whether those workloads are supplier relationship management or human capital management, or sales, marketing or customer service. This is why Microsoft designs its business applications as complete solutions seamlessly composed of separately deployable services. Customers can deploy as much or as little as they need while also benefiting from the synergy of a suite.
  • Examples of business scenarios within manufacturing incl: Product Data Management, Sales Order Management, Supply Chain Planning, Manufacturing Operations and Logistics.
  • Product Data Management within Microsoft Dynamics AX 2012 helps you manage the product design and bill of material for manufactured items. It supports larger organizations in a centralized, structured approach in creating and maintaining core master data.  Smaller organizations that require a more decentralized approach can, with some restrictions, create and maintain their respective products while their products are automatically added to the shared products repository.  Define manufacturing rules: make-to-stock; make-to-order; assemble-to-order; engineer-to-orderThrough BOM designer create BOM in a graphical way by drag and drop method, version control method - Site, Date control, and Quantity range optionsManage constant and variable scrap for different BOM componentsThrough BOM calculation functionality calculate product planned or standard costs and projected sales pricesSpecific definitions for Process items:Define the formula and attach co-products and byproducts to version createdDefine formula lines using scalable and percentage controlled functionalitiesDefine formula site specific consisting of many levelsThrough Formula designer create Formula in a graphical way by drag and drop method version control method - Site, Date control, and Yield, UOM, Bulk Item, Co-product, Catch Weight Size range optionsMaintain version control methodDate and quantitySite controlCatch Weight SizeUse a plan group with master planning to group similar items together for use as substitutes in the consumption of formula ingredientsThrough step consumption functionality setup complex consumption rules without the need of setting up multiple BOMs and/or formulasSales Order Management is the end-to-end business scenario that allows the customer to provide the right services and products to their customers through multiple sales channels, by managing the relationship, and by driving targeted campaigns for better satisfaction and loyalty. This business scenario also provides a great customer interaction experience by delivering accurate information instantly, while keeping track of payments and managing cases.Here are the different components that allow customers to efficiently manage their Sales Order Management process:Manage Customer Relationship: drive your sales and marketing activities. Segment your prospect and customers and manage your pipeline. Interact with, and track, your customers via phone calls and customer visits. Drive marketing campaigns and telemarketing activities.Collaboration: drive customer loyalty with improved services. Benefit from a variety of Solutions in order to communicate with your customer and provide the customer with adequate, real time information and thereby increase customer satisfaction.Multi-Channel: open new business opportunities. Improve customer loyalty by utilizing all technologies available to reach out to customers, including the internet, market places, social media, call centers, EDI, enterprise portal, and so on. Quote to Sales Order: sales tools for improved customer satisfaction. Enable your employees to provide improved customer service with an easy user interface, by defining the correct sales agreement, and by committing to quantity and delivery at the time the sales order is entered.Invoice and Collection Management: get paid faster and manage litigation. Centralize the collection management process, define collection priorities, automate collection letters, interest rates, and manage the litigation process using case management to keep track.Sales Order Management Benefits:- Facilitate employee ordering experience- Enforce policy control- Enable efficient purchasing process- Empower vendor interactionSupply Chain Management:Material Requirement Planning in Microsoft Dynamics AX 2012 is used for generating a timetable for matching supply with demand. Meet delivery schedules as promised to customer by better Inventory planning, resource utilization and scheduling.Calculate gross requirement for forecast schedule using forecast scheduling.Calculate net requirement to fulfil actual demand through Master scheduling.Inputs for decision making whether to procure, transfer or manufacture the product.Get the action messages and futures messages and use this information to modify planned orders.Process different planned orders for Discrete or Lean or Process manufacturing.Reduced inventory costs by having products when needed.Enhanced planning and visibility across an intra and intercompany supply chain by meeting delivery schedules as promised to customer with reduced inventory costs by having products when needed.Procurement - Direct Goods in Microsoft Dynamics AX 2012 procure-to-pay process has the following capabilities:Manage entire lifecycle of procurement from purchase requisition, planned purchase order to purchase orderImplement purchase policy using workflows along the different steps of the purchase processTrack modifications and keep purchase order historyCollaborate through the vendor self-service portalCheck budget availabilityUse case management to closely track goods receivingOptimize procurement processes by utilizing and streamlining operationsManufacturing Operations Management is the end-to-end business scenario that allows customer manage their manufacturing operations from designing new products to managing resources capacity, product availability and control activity through the entire production chain down to the shop floor. It is important to note that Microsoft Dynamics AX manages both Discrete and Process manufacturing but also Lean concepts to make production cycle leaner. Those can work into the same environment and fully support mix-mode.Here are the different components that allows customers to efficiently manage their Manufacturing Operations Management process:Capacity Requirement Planning: fast decision based on realistic capabilities. Dynamically define your organization and allocate resources using a capability based model for resource scheduling.Work Order Management: prioritize, track, maintain & manage your orders. Manage your production activities with: Production orders, Kanbans for lean manufacturing, Batch orders for process industries. Schedule your production, track execution and declare consumptions. Automatically retrieve all information about consumptions, routes to determine production costs.Production Control: regulate manufacturing performance. Get full visibility on your production process and manage mix-mode operations (discrete, process, lean). Manage resources allocations, control production, get real time reporting on operations in progress.Shop Floor Control: Tighter control with manufacturing execution. Simple touch enable user interface. Prioritize and assign jobs in a time window. Start, update, and complete jobs. Manufacturing Operations Management benefits:-Extend your product design process to the production.-Real time flexible  resource management.-Measure productivity and Business analytics.-Leverage mobile devices integration & adoption.Logistics is the end-to-end business scenario that allows customer to provide the right services and products to their customers through multiple sales channels, to manage the relationship and drive targeted campaign for improved satisfaction and loyalty, and to provide a great customer interaction experience by delivering accurate information instantly, while keeping track of payments and managing cases.Here are the different components that allow customers to efficiently manage their Logistics process:Plan and Schedule: balance your need in resources and inventory and manage your planning cycle and forecasting to lower your stock while meeting customer needs and keeping satisfaction levels.Inbound Logistics: optimize your receipt and put-away process.Quality Management: make customer satisfaction a priority.Outbound Logistics: create efficient customer deliveries and distribution.Returns: manage return process and track issues.Logistics benefits:- Empower users with role-based access to information.- Manage supply chain across geographies and time zones.- Enable efficient purchasing process.- Empower vendor interaction.Supplier Relationship Management is the end-to-end procurement business scenario that allows the customer to have a full experience of budgeting procurement, managing vendor relations and performance, sourcing for new vendors, negotiating contracts, executing procurement, and verifying accuracy of invoices and pay.Here are the different components that allow customers to efficiently manage their Supplier Relationship Management process:Budget: build and maintain your procurement budget utilizing Excel. Track budget alignment, potential variation to the plan, and potentially adjust the plan. Use workflow to check if your purchase order is within budget boundaries.Spend Analytics: accessible Key Performance Indicators (KPIs) and Business Intelligence (BI). Prebuilt reports and KPIs on category, vendor, organization and time dimensions, with critical spend management attributes.Supplier Management and Sourcing: Onboard vendors and send Request for Proposals (RFP) online. Manage your vendor relations from onboarding process to contract negotiation. Use vendor portal to improve vendor collaboration.Material Requirement Planning: balance your need in resources & inventory. Manage your planning cycle and forecasting to lower your stock while meeting customer needs and keeping satisfaction levels.Procurement: catalog based procurement. Rich requisition and purchase order processes, with configurable policy, catalog and punch-out support, approval workflow, and sophisticated tracking to budget and financials.Supplier Relationship Management Benefits:Facilitate employee ordering experienceEnforce policy controlEfficient procurement process for direct and indirect goodsEmpower vendor interaction
  • Deep market and customer insight: Inspire innovation using deep market and customer insight with a complete view of customer data through full traceability to the supply chain, finance and the plant floor. Improve business visibility with financial dimensions of operational processes.Visual contextual intelligence: Respond rapidly to customer demand with readily available, easy-to- understand and visual contextual intelligence built into the operational decision making process. Flexible, global Solution: Increase production planning and execution flexibility by unifying process, discrete, and lean manufacturing operations in one solution. Support your organization end-to end with rich, core ERP capabilities, including HR, finance, and governance, risk, and compliance (GRC) managementModern technology to attract the right people: Use modern technology to attract the right people to the right position to drive innovation. A single technology platform: Ease ERP implementation and administration, and gain IT efficiencies, with simplified application lifecycle management. Optimize IT investments to improve total cost of ownership (TCO) and productivity through interoperability between Microsoft Dynamics AX 2012 and other Microsoft technologies.Green and sustainable operations: Track waste, water usage, energy consumption, carbon footprint, and related costs with the Environmental Sustainability Dashboard. Reduce waste and streamline production using lean manufacturing techniques.
  • In today’s global marketplace, manufacturers rely on technology for product design, inventory management, resource utilization, production scheduling, process optimization, and more. They employ a mix of discrete, process, and lean manufacturing methods that are often managed through separate systems. This limitation makes it difficult to cost-effectively satisfy customer demands, particularly across multiple sites and geographies.Global multi-language, multi-currency solution: Expand into new geographies using built-in localizations for 36 countries. Multi-site material and capacity planning and scheduling: Enable global planning with unified operations resource models. Improve efficiency by sharing global data for general ledger, relationships, and products, and by using common processes for intercompany trade and shared services.Supports discrete, process, lean and mixed mode manufacturing: Improve control across a mix of make-to-order, make-to-stock, and other production processes with a single solution. Enhance customer and vendor agreements with flexible contract structures. Built for process and regulatory change: Adapt to changing process and regulatory requirements with model-driven methods:Optimize inventory and improve vendor negotiation: Collaborate across the global supply chain and connect employees, customers, suppliers and partners. Increase efficiency and reduce redundant processes: Configure processes with a graphical workflow editor that helps you identify inefficiencies and optimize performance. “instant-on” capabilities: Microsoft business solutions give customers the flexibility to deploy what they want, and only what they want.  Microsoft also gives customers the option to deploy them in the order that matches their immediate priorities.
  • 36 markets out of the box, all in a single instance, both local regulatory extensions and local languages
  • Timing:Key points:Script:More information:
  • Our value pros tie to what’s happening in the industry. Growth is key and innovation is key to growth. The world is changing and companies are going to have to be light on their feet, change quickly and easily. And lastly, they’re going to need their people to help, in improving both product and process.
  • Engage people by surfacing insights: Engage staff by surfacing actionable insight and business intelligence that enables proactive response.Gain immediate insight and boost productivity with RoleTailored user experiences: Take advantage of new Role Centers, fact boxes, and enriched previews. Provide ad hoc, self-service business intelligence and reporting for key manufacturing operations, including prebuilt reports. Provide business process context via notifications and alerts initiated by embedded workflows. Help ensure segregation of duties and simple user account setup and maintenance with role-based security and single sign-on capabilities.Collaborate easily with employees, customers, suppliers, and partners. Simplify collaboration with Microsoft solutions for vendors and customers, and integration with the administrative ERP (two-tier scenario) using Application Integration Framework enhancements. Support ad hoc, end-to-end business process integration with partners and customers through Sites Services, an online service for Microsoft Dynamics. Speed information sharing across virtual teams with presence information and Microsoft’s integrated communications.Accelerate user onboarding and adoption with a familiar user experience: Speed ramp-up for users of all generations with kanban boards and other visualization tools, touch-based screens for shop floor workers, and by using the familiar Microsoft Office look and feel. Use familiar productivity tools and share data between Microsoft Dynamics AX 2012 and Microsoft Office 2010.
  • Timing:Key points:Script:More information:
  • Key points:Our RoleTailored user interface graphically represents the work that each role needs to do. With 45 rolecentersincluded in this latest version. we are providing with a comprehensive solution that is ease to adopt and use. Script: A Role center should be set up for each role in the company, and it should provide a user with the right content for the job. Role centers should be: Simple and cleanly designed. Easy to skim and read. Aligned with the design guidelines. Easy to localize and customize. Prioritizing the content is extremely important for a great user experience. Therefore critical content such as activities, work lists, key charts, and other important components are visible at first glance and are clearly organized.Role centers should follow these general guidelines to Identify the needs for a role. For example, consider the following: What information does this role frequently need to do the job? What information would help this role be more efficient at the job? A Role center should answer these questions for the user: What is my workload? What do I need to do next? Are there any urgent actions that I need to carry out? What is the status of the things that I should be most concerned about? More information: http://msdn.microsoft.com/en-us/library/gg886608.aspx
  • So now let’s talk about our approach to the market. We’re going at the ERP marketing in manufacturing DIFFERENT than our large, entrenched competitors.
  • What may have prevented this in the past:Mobility (office workers are at their PC)Durability of the device (need to be hardened)
  • Microsoft is unique in being able to address a wide variety of customer needs from enterprise software to consumer devices to desktop, datacenter and cloud. Our enterprise software is built on our platforms which bring familiarity, ease of use, mission-critical performance, a rich ecosystem and low TCO. With R&D investment of $9 billion annually, there is significant technology innovation to be shared and leveraged across the entire Microsoft portfolio for retailers:Clearly, when it comes business solutions, Microsoft is “all in.”
  • Microsoft is committed to providing solutions that provide low TCO. This is a research report from Nucleus showing their cost comparison between Microsoft AX and several competitors. You’ll see Microsoft’s continued commitment to provide great value in our solutions for low TCO. We are committed to making Dynamics easy to procure, easy to implement, easy to use and easy to support.
  • Microsoft itself uses Dynamics in a broad variety of functions and locations. We use it to support our Retail Stores around the world, we use it to to process the orders for Dynamics itself, we use it in several manufacturing plants including the Xbox plant and for creating our software DVD’s. We use it for event, vendor and partner management, sales force automation and customer support. And it is our global expense management platform.
  • This presentation provides a high level overview of how we will direct the investment in Microsoft Dynamics AX through 2013/2014 We expect to update the deck every 6-9 months as more detail on the upcoming releases become available. Please make sure that you stay connected to your partner and/or log into CustomerSource to always get the latest version and update. As illustrated on this slide,and as detailed in the following detail slides, we will continue to invest heavily in delivering innovation to our customers. Without further ado, lets take a look at some of the highlights that customers can expect from us over the next couple of years and then spend the rest of the presentation digging into more detail. Q1 2012 we will extend the Microsoft Dynamics AX2012 to also support Retail organizations. The core themes of this release will therefore be focused on Store Management, POS, Multichannel & Merchandizing but we are also making investments around both Application Lifecycle Management & Management Reporting to help customers across all industries. In Q1 of 2013 we are planning to deliver even more innovation through our Microsoft Dynamics AX 2012 R2 release. Core themes of the release include Enhanced Business Intelligence (BI) & Reporting technology and we will be enabling Master Data Management for specific types of data. In this release customers also can expect enhancements in both the industry and broader horizontal feature set and we will also be rolling out AX into 11 new locations at this time. In our next major release we will expand our cloud strategy from delivering targeted solutions in the cloud to having complete symmetry between the cloud and on-premise solution. This will enable customers to have even more freedom as to which parts of AX they run in the cloud vs. which they run on premises or hosted and for the first time it will enable them to run the entire AX solution on the Windows Azure platform if they prefer. This release will happen in the 2013/2014 timeframe. With this high level overview in mind, let’s now drill a bit deeper into each update.
  • I’m a history buff. And the reason I’m a history buff is because history tends to repeat itself. And I think we’re poised in manufacturing, at Microsoft, with dynamics and the full stack….to make a difference in the industry.
  • This slide provides an overview of some of the key business processes that Microsoft and our partners address in our solutions.These range from the front office with Practice Development through the operational side of the business with Knowledge Management, Professional Development and Service Delivery, to the administrative side of the business with financial controls and reporting.This slide is also meant to convey that our solutions integrate out of the box with many of the Microsoft products that professional services firms are already running in their business today.These include Microsoft Office authoring products like Outlook, Excel, and PowerPoint; coordination tools and collaboration platforms like Microsoft Project, Lync, and SharePoint; and data and analytics platforms like SQL Server to name a few, providing a higher return on investment.CLICK
  • This slide provides an overview of some of the key business processes that Microsoft and our partners address in our solutions.These range from the front office with Practice Development through the operational side of the business with Knowledge Management, Professional Development and Service Delivery, to the administrative side of the business with financial controls and reporting.This slide is also meant to convey that our solutions integrate out of the box with many of the Microsoft products that professional services firms are already running in their business today.These include Microsoft Office authoring products like Outlook, Excel, and PowerPoint; coordination tools and collaboration platforms like Microsoft Project, Lync, and SharePoint; and data and analytics platforms like SQL Server to name a few, providing a higher return on investment.CLICK

Transcript

  • 1. A Passion For Manufacturing Melissa Cook Senior Director Dynamics Global Industries - Manufacturing
  • 2. Agenda
  • 3. The Manufacturing Industry: What Is It?
  • 4. Manufacture: To make or produce by hand or machinery, especially on a large scale.* *Webster’s College Dictionary The Manufacturing sector comprises establishments engaged in the mechanical, physical, or chemical transformation of materials, substances, or components into new products. http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=31&search=2012 NAICS Search
  • 5. Largest G2000 Auto & Truck Manufacturers http://www.forbes.com/global2000/list
  • 6. Largest G2000 Heavy Equipment Manufacturers http://www.forbes.com/global2000/list
  • 7. Largest G2000 Food Processors http://www.forbes.com/global2000/list
  • 8. Largest G2000 In Specialized Chemicals http://www.forbes.com/global2000/list
  • 9. GDP Growth – Global – All Industries http://data.worldbank.org/
  • 10. World Manufacturing Output Growth http://www.unido.org/
  • 11. Source: UN National Accounts Main Aggregates DatabaseManufacturing www.parliament.uk/briefing-papers/SN05809.pdf · PDF file
  • 12. Grow global manufacturing environment
  • 13. The Dynamic Manufacturer: Focus Verticals (using SICs) 20 Food and Kindred Products 21 Tobacco Manufacturing 22 Textile Mill Products 23 Apparel and Other Textile Products 24 Lumber and Wood Products 25 Furniture and Fixtures 26 Paper and Allied Products 27 Printing and Publishing 28 Chemicals and Allied Products 29 Petroleum and Coal Products 30 Rubber/Misc. Plastic Products 31 Leather and Leather Products 32 Stone, Clay, Glass and Concrete Products 33 Primary Metal Industries 34 Fabricated Metal Products 35 Industrial and Commercial Machinery and Computer Equip 36 Electrical Equipment and Components 37 Transportation Equipment 38 Measurement Analyzing, Control Instruments and Related Prod. 39 Misc. Manufacturing Industries
  • 14. World Manufacturing Output Growth By Vertical Unido.org
  • 15. World Manufacturing Output Growth By Vertical Unido.org
  • 16. Discrete Manufacturing • Example definition (from APICS): • The production of distinct items such as automobiles, appliances, or computers. • Typical characteristics: • Bill of material versus formula or recipe • Assemble, build • Products can usually be disassembled • Serial numbering (SN), engineering change number (ECN) • Measurement by count of distinct (discrete) items versus measurement by weight or volume
  • 17. Process Manufacturing • • • Example definition (from APICS): • Production that adds value by mixing, separating, forming, and/or performing chemical reactions. It may be done in either batch or continuous mode. Example items produced by process manufacturing methods: • Food • Chemicals Typical characteristics: • Formulas and recipes versus BOM • Mix, blend • Products usually can NOT be disassembled • Lots and batches versus individual item serial numbers • Grades, potency, shelf life • Measurement by weight and or volume
  • 18. Continuous Manufacturing • • • Example definition (from APICS): A type of manufacturing process that is dedicated to the production of a very narrow range of standard products. The rate of product change and new product information is very low. Significant investment in highly specialized equipment allows for a high volume of production at the lowest manufacturing cost. Thus, unit sales volumes are very large, and price is almost always a key order-winning criterion. Examples of items produced by a continuous process include gasoline, steel, fertilizer, glass, and paper. Typical characteristics: • Continuous usually means operating 24 hours per day, seven days per week. • Very infrequent maintenance shutdowns, such as semi-annual or annual or longer. • Production workers commonly work in rotating shifts. • Most of these industries are very capital intensive and management is therefore very concerned about lost operating time.
  • 19. • Pretty simple actually – reduce waste • It’s a Management Philosophy • Lean manufacturing, lean enterprise, or lean production, often simply, "Lean," is a production practice that considers the expenditure of resources for any goal other than the creation of value for the end customer to be wasteful, and thus a target for elimination. • Built on lots of history: folk wisdom of thrift, time and motion study, Taylorism, Fordism, JIT, Toyota Production System (TPS)
  • 20. • A durable good or a hard good is a good that does not quickly wear out, or more specifically, one that yields utility over time rather than being completely consumed in one use. Durable goods are typically characterized by long periods between successive purchases. • Nondurable goods or soft goods consumables are the opposite of durable goods. They may be defined either as goods that are immediately consumed in one use or ones that have a lifespan of less than 3 years. http://en.wikipedia.org/wiki/Durable_good
  • 21. Manufacturing Modes And Methods Dynamics is capable of all these methods and modes in a single instance….
  • 22. BTW - Some Other Handy Definitions To Keep Around National Institute of Standards and Technology (NIST) definitions below: •Cloud computing is a model for enabling on-demand, metered access to a shared pool of location independent configurable computing resources that can be rapidly provisioned. •Software-as-a-Service (SaaS) is one of three (3) cloud computing delivery models where applications running on a cloud infrastructure are accessible from various client devices through a thin client interface such as web browser.
  • 23. Innovation
  • 24. We still think about manufacturing in the U.S. as yesterday’s economy as opposed to the vanguard of innovation in our economy,” said Bruce Katz, a vice president at the Brookings Institution. But he points out, manufacturing accounts for “9% of jobs, 11% of GDP, 35% of engineers, 68% of private R&D, and 90% of our patents. We may be the only economy to decouple production and innovation.” http://www.industryweek.com/innovation/us-manufacturing-misunderstood-economic-powerhouse
  • 25. Manufacturing Is Also Strategically Important Manufacturing • Employs a large share of the labor force • Produces materials of strategic importance (infrastructure, defense) • Each dollar creates another $1.43 of activity in other sectors** • both “backwards” (such as with mining or construction), or “forwards” (warehousing, transportation, wholesale and retail) *http://www.economywatch.com/world-industries/manufacturing/ ** National Association of Manufacturing (NAM)
  • 26. Innovation
  • 27. The Big Shift: Forces driving transformation in Manufacturing
  • 28. Forrester’s Research On Enterprise Applications
  • 29. Manufacturing Technology Challenges ERP architecture from the 1980s is still deployed today Complex Interfaces Duplicate Data Batch Processes Functionality in separate applications Reactive Business intelligence (BI) Task-oriented user experience The result: Complexity, inflexibility and high cost
  • 30. Microsoft Positioned as a Leader in Gartner’s 2012 Magic Quadrant for Single-Instance ERP for Product-Centric Midmarket Companies “The focus of this Magic Quadrant is on ERP systems that support a single-instance strategy for multientity midmarket and upper midmarket companies. User-centric improvements focused on usability and deeper integration of analytical capabilities is at the core of leading systems.” Include attribution and disclaimers here: Gartner “Magic Quadrant for Single-Instance ERP for Product-Centric Midmarket Companies” by Christian Hestermann, Chris Pang and Nigel Montgomery, June 27, 2012. This graphic was published by Gartner, Inc. as part of a larger research document and should be evaluated in the context of the entire document. The Gartner document is available upon request from Microsoft. Gartner does not endorse any vendor, product or service depicted in its research publications, and does not advise technology users to select only those vendors with the highest ratings. Gartner research publications consist of the opinions of Gartner's research organization and should not be construed as statements of fact. Gartner disclaims all warranties, expressed or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose.
  • 31. Two Popular Deployment Scenarios
  • 32. Deployment Sweet Spots For Dynamics In The Enterprise Segment Full Suite Core ERP Workload at-a-time
  • 33. Business Scenarios – Vertical, Horizontal & Admin
  • 34. Dynamics Manufacturing Business Scenarios
  • 35. Product Data Management Make decisions based on facts and comply Logistics Manage warehouses and transportation Sales Order Management Gain loyalty with better customer services & accuracy SRM Set company policies & collaborate with your vendors Supply Chain Management End-to-end visibility throughout the supply chain Manufacturing Operations Benefit from end-to-end mixedmode manufacturing
  • 36. deep market and customer insight visual contextual intelligence flexible, global solution modern technology to attract the right people a single technology platform green and sustainable operations
  • 37. global multilanguage, multicurrency solution multi-site material and capacity planning and scheduling supports discrete, process, lean and mixed mode manufacturing built for process and regulatory change Optimize inventory and improve vendor negotiation increase efficiency and reduce redundant processes “instant-on” capabilities
  • 38. R2 global instance enablement Availability 25 Countries in Dynamics AX 2012 RTM 11 Additional Countries in Dynamics AX 2012 R2
  • 39. Innovation
  • 40. Engage people by surfacing insights role-tailored user experiences Connect employees, customers and suppliers Accelerate employee adoption
  • 41. Vince Retail Ops Lacey Manage Store r Inga Manage Mercha r Tim ndising Retail IT Mgr Manage John r Inventor y Clerk Lisa Custom er Service Represe ntative June Practice Manage r Tricia Project Member Sara Finance Director Custom er Employ Custom ee er Employ Service Vendor ee self Vendor service Self service
  • 42. Key Differentiators For Dynamics In Manufacturing
  • 43. Personal and Office Productivity – Leverage Into The Factory Worker Space
  • 44. And The One Microsoft Story – The Whole Stack
  • 45. Continued focus on Dynamics AX Total Cost of Ownership Return on Investment/TCO Summary of results from Nucleus Research report: 3 Year TCO Comparison $1.27M $5.22M $3.44M Ongoing Support Requirements 2.4 FTE’s 33 FTE’s 9 FTE’s 4.2 3.6 3.8 75% within 23 months 43% within 2.8 years 65% within 3.1 years 56% 50% 48% ROI Scorecard (5 Being Highest) Positive ROI Achieved % of Time Staff was Reduced Enterprise Applications Value Matrix http://www.microsoft.com/en-us/news/itanalyst/docs/05-01-12ValueMatrix.PDF
  • 46. Manufacturing 56
  • 47. Manufacturing 57
  • 48. Manufacturing Transportation / Logistics 58
  • 49. Microsoft Runs on Microsoft Dynamics
  • 50. Solution Roadmap (Highlights) December 2012 Calendar Year 2013 Calendar Year 2014+ Enhanced BI & Reporting Industry Enhancements for: • Retail & Distribution • Public Sector • Service Industries • Manufacturing • HR & US-Payroll • 11 New Localizations • Lifecycle services Feature packs : • H1 Calendar Year 2013 • Content Enhancement for BI Visualization • Master Data Management • H2 Calendar Year 2013, Industry Enhancements for Focus Industries Server & Service Releases: • MSFT Online Services Experience • Next Generation UX /w HTML5 • Innovation for focus industries
  • 51. Goldman et al. suggest that Agility has four underlying components: • delivering value to the customer; • being ready for change; • valuing human knowledge and skills; • forming virtual partnerships. http://en.wikipedia.org/wiki/Manufacturing
  • 52. Why Am I So Passionate About Manufacturing? Industrial Revolution Mid-1700’s • Marked by innovation and the increasing application of science to industry http://en.wikipedia.org/wiki/Industrial_Revolution
  • 53. Q&A
  • 54. © 2012 Microsoft Corporation. All rights reserved. Microsoft, Microsoft Dynamics, the Microsoft Dynamics logo, and SharePoint are trademarks of the Microsoft group of companies. The information herein is for informational purposes only and represents the current view of Microsoft Corporation as of the date of this presentation. Because Microsoft must respond to changing market conditions, it should not be interpreted to be a commitment on the part of Microsoft, and Microsoft cannot guarantee the accuracy of any information provided after the date of this presentation. MICROSOFT MAKES NO WARRANTIES, EXPRESS, IMPLIED OR STATUTORY, AS TO THE INFORMATION IN THIS PRESENTATION.
  • 55. Business Solutions for Manufacturing All Essential Business Processes – One Familiar User Experience • Centralize management of products and services across the organization, including bill-ofmaterials (discrete mfg. ), formulas (process mfg.), • Execute multiple production strategies, including configure-toorder, assemble-to-order, make-tostock, and make-to-order. Use both push • Define multiple inventory dimensions: dual units of measure, catch-weight calculations, packaging codes, variations to the main item, and lots. • and variant and configurable products. • and pull production control mechanisms. • Maintain items by using up to three item dimensions and predefined combinations. • Optimize production and materials planning, forecasting, and scheduling. Simultaneously schedule materials and capacity. Calculate • Manage multilevel formulas or recipes, co-products and byproducts, electronic signatures, and packaging options. • Manage the release of products and services to individual legal entities. • Specify dimensions for advanced inventory control, tracking, and tracing. • Configure custom products with a unique bill of material and routing using the product configurator. The product configuration models are based on constraints, and can be used from sales order, sales quotation, purchase order, and production order. • available-to-promise (ATP) and capable-to-promise (CTP) deliveries. • Create, schedule, view, track, split, roll back, or categorize production orders. • Understand WIP and actual cost through production tracking and reporting. Track detailed resource and throughput costs, including work • center costs. Report production variances to standard costs. *For a complete list of features see the manufacturing factsheet. here • Let customers request multiple quality specifications per product while combining similar products in production to improve machine utilization. • Analyze and monitor production costs and requirements for each sales order component using graphical representations of multilevel formulas and recipes. • Model manufacturing and logistics processes as production flows. • Control inventory with a variety of models and safety stock support. • Use kanbans to signal demand requirements. • Apply multiple options for inventory valuation, including: first in/first out (FIFO), last in/first out (LIFO), standard cost, and weighted average. • Monitor and manage kanban jobs using kanban boards • Master planning: Create and run multiple plans across multiple sites to meet demand and keep orders synchronized based on changes in • Register products, resources, and items for operations and jobs. Touch-enabled data entry simplifies the user experience  Automatically receive suggestions  for received item placement based on preset rules for one or multiple warehouses. Track received orders with pallet identification; generate an optimized picking route. Use bar codes to track items and locations electronically. • internal or external demand. Improve distribution planning and forecast scheduling with an overview of longer-term purchasing, production, and resource requirements. • Optimize enterprise-wide planning by providing upstream organizations in your supply chain with visibility into the demand of downstream organizations.
  • 56. Business Solutions for Manufacturing All Essential Business Processes – One Familiar User Experience (Continued) • Engineer to order / Project management • Configure to order – Product configuration • Engineering change management • Intercompany support • Enterprise asset management • Service management • Spare parts management • Supply chain planning and execution • Advanced Formulation(Potency management) • Advanced formula management • Production Formula Batch Balancing • Active ingredient inventory management • Attribute-based Purchase Pricing and Inventory Valuation • Lot Genealogy Inheritance • Batch Attribute inheritance to FG and Co-Products • Earliest Shelf Life date inheritance to FG and Co-Products • Enhanced Scheduling • Multi-priority/multi-layer sequencing management • Resource/Resource group based sequencing • Advanced Formulation(Potency management) • Lot Genealogy Inheritance • Enhanced Scheduling: Production Sequencing