best practices that enable the effective enterprise hank canitz sr. director manufacturing...

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


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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


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


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


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


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


Metrics Best Practices

QAD Analytics

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Example KPI and Metrics


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


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


TradePromotionsManagement

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Best Practice - Pyramid Forecasting


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


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Best Practice - Trade Promotions Mgt

Sales & Marketing,

Supply Chain,Finance

Supply Chain

Finance

Sales & Marketing,

Supply Chain,

Finance


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


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


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


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Key Take-A-Ways and Next Steps


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Key Take-A-Ways


FinancialModel

QADKPIs

MetricsBest

Practices

QAD Solutionor Service

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Next Steps


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 [email protected]

Questions & Answers


best practices that enable the effective enterprise hank canitz sr. director manufacturing...

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