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A better way to manage change and transitions in project manufacturing

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This impact brief focuses on the benefit of MES integrated into the enterprise project reporting and accounting systems, particularly as it relates to managing engineering changes, project specification changes, changeovers and transitions.

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A better way to manage change and transitions in project manufacturing

  1. 1. A Better Way to Manage Change and Transitions Iyno in Project Manufacturing AdvisorsBy Jeffrey Hill and Julie Fraser, Iyno AdvisorsProject manufacturing presents unique challenges and opportunities for managingproduction changes or transitions. In operations, these can come about as production shiftsfrom one product to another, or as a product changes, or even as triage occurs inmaintenance, repair and operations (MRO). Production is not the only tricky part of thechange process; the accounting, materials management, and reporting are equallyimportant. They all need information flows between them to stay in lock step.Thus, managing transitions relies on having a capable Manufacturing Execution System(MES) in the plant that can integrate with business systems. An ideal system wouldenhance the management of all phases of the manufacturing process, provide the ability totrack design changes and changeovers down to the project and component level, and allowdetailed and timely manufacturing information to be integrated with financial and businessresource planning to drive better decisions throughout the organization.Business ContextThe MESA International research study report Pursuit of Performance Excellence shows thatmanufacturers who use MES systems are far more likely to have achieved a 10% reductionin the time to transition from one product to another (Figure 1). The same study showsusers of MES are also more likely to increase the average contribution margin for each unit made, a major component of manufacturing profitability, by Time to make 10% or more per year. Simply changeovers or put, companies that manage transitions MES / their production process using improved >10% MOM User MES have tighter control over per year production changes and costs. Average unit Other They can act more quickly to contribution satisfy transition needs too. margin improved >10% Transitions are a critical aspect per year for any project-based 0% 50% 100% 150% manufacturer to succeed. Average of Responses Typically projects have many changes from design, customer Source: Pursuit of Performance Excellence or material shifts. Moving © 2012 MESA International and Cambashi Inc. between multiple projects is Figure 1: MES users are far more likely than others to also quite challenging. improve more than 10% on both production and business metrics.© 2012 Iyno Advisors www.iyno.com
  2. 2. A Better Way to Manage Change and Transitions in Project Manufacturing There are many issues to consider. These may include:  Revisions to designs over a forty or fifty year production lifetime in aviation.  Each production run is essentially a custom project requiring new manufacturing tools and methods.  Project visibility, progress reporting, and accountability for government contracts, with audits and accountability across owned and subcontracted operations  MRO operations where initial operations steps dictate quick action in all subsequent steps. The common element among these environments is the need to control costs, improve processes, and maintain or enhance quality to differentiate in a highly competitive environment. Companies need production information to thrive, and the system to provide that is MES. Key Benefits of MES Some of the benefits of using MES integrated with ERP include:  Enhancing flow of work by making routings and work instructions available online for production, quality and maintenance personnel  Handling transitions through always up-to-date job materials and checking for certifications and training of operators and technicians  Enforcing streamlined production processes to support lean and continuous improvement efforts  Eliminating reliance on paper documents on the plant floor  Improving predictability by with standardized approaches to all phases  Making current status of a complex production run visible to production and business managers at any time.  Increasing control and transparency through integrating production operations with accounting, purchasing, inventory control, billing and cost and expense allocation.  Increasing availability of performance metrics supports continuous process improvement by supplying production and business managers with both an historical and current view of production projects. MES is known for providing a platform to increase the overall efficiency of production operations. It also provides the capabilities and the tools needed to manage the rapid transitions common to project manufacturing. Integrated with project-oriented business systems, it can catapult performance in transitions and the business to new levels.Iyno AdvisorsIyno Advisors combines experience, intuition, intellect, and research to focuses on how manufacturing and production companiesand their network of partners can best benefit from software applications and services. www.iyno.com 508.362.3480The Sponsor: DeltekDeltek is the leading global provider of enterprise software and information solutions for professional services firms andgovernment contractors. For decades, we have delivered actionable insight that empowers our customers to unlock theirbusiness potential. 15,000 organizations and 2 million users in over 80 countries around the world rely on Deltek to research andidentify opportunities, win new business, optimize resources, streamline operations, and deliver more profitable projects. Deltek– Know more. Do more.® www.deltek.com 800.456.2009 © 2012 Iyno Advisors 2 www.iyno.com

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