Power Tools 1993 October - Disc 2/Power Tools (Disc 2)(October 1993)(HP).iso/custref/50912415/50912415.txt

Text File | 1992-03-09 | 15KB | 297 lines

MANAGING GROWTH WITH MANMAN at SILICON VALLEY GROUP
by Steve Robey, director
Management Information Systems
Silicon Valley Group
San Jose, CA

    Managing explosive growth has always been one of the
business world's most exciting challenges. Silicon Valley
Group, Inc. (SVG), San Jose, CA, can certainly attest to
that. Between 1986 and 1990, SVG -- America's leading
manufacturer of front-end semiconductor wafer processing
systems -- grew from $28 million in annual sales to $184
million through acquisitions and increased product demand.
    SVG employs about 1600 persons. Its Track Systems
Division in San Jose is a leader in photoresist processing
systems that process silicon wafers prior to
photolithography exposure and manage the subsequent
treatment steps. The Thermco Systems Division in Orange, CA,
supplies thermal processing systems for oxidation/
diffusion and low pressure chemical vapor deposition. SVG's
Lithography Systems subsidiary in Wilton, CT, supplies
photolithography exposure systems that use advanced step-
and-scan technology. SVG systems range in price from
$200,000 to $4 million, depending on configuration and
product line, that is, furnace, track, or exposure stepper.
    SVG's extraordinary growth increased the demands upon
its management information system (MIS). In 1986, SVG was
using an HP 3000 Series 48 minicomputer with about 50
terminals to run a third-party software package that was
underpowered and lacking the features needed in a
competitive commercial environment. Management was sure
there was a better solution to SVG's multifaceted
operations, and it set about finding it.
    The company established certain criteria for its
information system upgrade:
        o It had to be a comprehensive MRP II solution to
handle all of SVG's requirements, from financial to
manufacturing
        o Its capabilities had to be integrated, sharing
information and databases
        o It had to be flexible to meet SVG's needs as a
combined make-to-stock and build-to-order business. SVG is
trending to a build-to-order environment, and the MRP II
system would have to support that strategy.
    When SVG receives an order, it's usually for unique
wafer manufacturing equipment. To some extent each SVG
system consists of parts common throughout the product line:
power supplies, bake units, and so forth. By stocking these
in multiples in advance, SVG reduces both its cost-per-unit
and delivery time. With a combined parts list of 160,000
items, SVG clearly required a robust MRP II solution.

THE ASK on HP SOLUTION
    After several months of investigation, SVG found that
the MANMAN solution from ASK Computer Systems, Inc.,
Mountain View, CA, running on the HP 3000 multiuser system,
could comfortably support its business requirements, with
room for future expansion.
    ASK and HP have collaborated on such solutions
worldwide for over 17 years. Today, ASK is HP's largest
reseller, leveraging HP computer sales worth tens of
millions of dollars annually. Moreover, HP made a 10 percent
investment in ASK in Fall 1990. With ASK's subsequent
purchase of Ingres, HP and ASK are truly uniquely positioned
to meet SVG's MIS needs.
    For SVG, the principal appeal of ASK's MANMAN solution
is its common database and its generally comprehensive
approach to enterprisewide computing. MANMAN uses HP's Turbo
Image database to supply information to any module running
on the system. In unique situations in which MANMAN can't
answer a query from SVG users, SVG uses QUIZ, a popular
software package from Cognos Corp. to supply the required
information -- a truly flexible configuration.
    MANMAN modules update TurboImage instantly. Thus, any
user accessing the database has the most current
information, enabling intra- or inter-departmental
operations to proceed with the latest production
information. This guarantees very accurate reporting of
transactions among various departments.
BACKGROUND
    In March 1986, SVG started with MANMAN's Core Four
modules -- MFG, OMAR, AP, GL -- manufacturing, order
management/accounts receivable, accounts payable, and
general ledger packages. These modules function in the
following ways:
    o MFG, the heart of the MANMAN system, is used by SVG
to control priorities and capacities, facilitate master
scheduling, plan material requirements accurately, provide
shop floor control, and supervise critical cost-accounting
functions.
    o SVG uses OMAR to streamline order management and
accounts receivable with automated customer quotations,
order entry, billing and sales analysis functions. Cash
flow, on-time deliveries, and customer service have
consequently improved.
     o AP and GL, Accounts Payable and General Ledger,
support SVG's financial record-keeping and procedural
capabilities -- very important to SVG's capital-intensive
operations. SVG uses GL to consolidate the multiple general
ledgers of the two divisions using MANMAN.
    The partnering of HP and ASK for close to two decades
is evident in that the SVG's MIS team implemented the Core
Four modules in only 90 days. Without such a highly
developed working relationship between SVG's software and
computer systems suppliers -- ASK and HP, respectively --
this installation would have been impossible in that 12-week
period.
    SVG next added MANMAN's DecisionMaker module to sharpen
its decision-support procedures for the production staffs.
DecisionMaker summarizes key manufacturing, customer
service, and financial information on-line. SVG formats such
information into high-visibility exception reports for top
management decisions. For example, the Track Division's
Director of Manufacturing uses DecisionMaker to check
transactions on expensive inventory items weekly.
MORE HORSEPOWER NEEDED
    However, robust growth rates put increasing demands on
the system, necessitating upgrades. SVG migrated from its
Series 48 through an HP Series 70 to its present HP 3000
Series 950, a high-end HP Precision Architecture-RISC (PA-
RISC) system. The computer's reduced instruction-set is
enhanced by a microprocessor architecture that requires
fewer components. This translates into superior mean-time-
between-repair (MTBR) rates and simplifies system
maintenance.
    In fact, SVG operates with minimal attention to system
maintenance. A single part-time contract operator puts in
several hours of maintenance weekly in the early morning
hours as the system runs unattended.
    Minimal maintenance requirements and related
capabilties of the HP 3000 resulted in its winning the
annual Computerworld survey in September 1990 as the leading
multiuser system in price/performance.
    The HP 3000 at SVG supports 200 ports. Twenty of the
ports feed 600-line-per-minute HP printers; by means of a
data switch, SVG has expanded the other 180 ports into 350
ports. Of these, 200 are terminals and 150 are PCs. The
system otherwise includes an HP 7980XC tape drive, eight HP
7937 disk drives with 571 Mb capacity each, and two HP 670
disk drives with 670 Mb capacity each.
EXPANDING UPSTREAM AND DOWNSTREAM
    After SVG management's early success with the Core Four
modules it added two more modules to the system, one
upstream and one downstream.
    Upstream, SVG uses the ENGINEER module to integrate
engineering functions with manufacturing processes and to
interface MANMAN with the CAD/CAE design and engineering
systems.
    Before implementing ENGINEER, SCG had only one category
for entering bills of material (BOM). Manufacturing could
build an order the instant Engineering entered a BOM.
Whether it had been checked or not, the initiation of a BOM
was equivalent to a manufacturing release -- a manufacturing
process resulted. A Total Quality Management group would
then review this process for efficiency. Overall, the
process was tedious and prone to error.
FROM DESIGN TO MANUFACTURING
    Today at SVG, ENGINEER preempts such time-consuming
situations by providing complete control over the stages of
product design and the design's release to manufacturing.
The module provides categories of release to get the design
on-line for review sooner. These Release Status categories
are:  1) just been entered  2) release imminent, and  3) has
been released. SVG has thus cut its number of Engineering
Change Orders (ECOs) dramatically. ECOs in any manufacturing
operation are disruptive and an impediment to quality
manufacturing procedures.
    By providing a separate database off-line, ENGINEER
enables SVG's engineering department to manipulate its own
data without undue disruption to the manufacturing
department. Thus, data entry and error-correction time are
reduced to a marginal level within the production cycle. SVG
gains more time to focus on design modification, analysis
and review.
    For example, since so much of each SVG product is based
on the customization of existing designs, company designers
can use ENGINEER's "COPY" function to rapidly create a
prototype BOM and routing schedule. Product designers then
modify the design and BOM to meet the customer's
specifications.
    Once the engineering department is satisfied with its
design and BOM, it transfers both to manufacturing; the ASK
system copies released parts and products files overnight.
The new design's appearance in the manufacturing database
represents the release to build. This process effectively
allows production only on the basis of Engineering Change
Orders (ECOs). Nothing can be manufactured that hasn't been
created in ENGINEER and transferred to MFG.
    SVG overall has automated a labor- and paper-intensive
process. Accuracy and speed have greatly improved. SVG uses
ENGINEER for more control over the build structures and cuts
the processing time for ECOs.
    Moreover, ENGINEER has reduced paperwork functions in
the Documentation Control department by about 65 percent,
from about five hours daily to under three. Adding new part
numbers to the BOM, and processing ECOs, is now done much
more programmatically.
    Similarly, the SVG staffer responsible for expediting
spare parts orders can now prioritize back-ordered spares.
MANMAN highlights the oldest back-orders for priority
processing. Since 1989 the back-order queue has been reduced
from 60 percent to only 20 percent, a significant
improvement.
    Downstream, SVG has added SERVICEMAN to maintain
complete customer, equipment, and contract information. It
tracks field service calls, monitors depot repair activity,
and facilitates telephone/technical support operations.
    SVG enters field service data into the MANMAN database,
integrating it with other modules, and closing the loop with
Engineering. Each piece of SVG equipment is serialized and
tagged with a customer and a location. If a problem arises
with it -- for example, if a part should fail -- SVG records
that information into SERVICEMAN, which correlates it with
Engineering on the chance it may be relate to a design flaw.
    SVG also collects data to develop statistically-based
maintenance programs. By implementing a preventative
maintenance program related to "true warranty costs" and
mean-time-between-repair (MTBR) rates, significant savings
may result. SVG's director of Customer Service now has
available two reports through SERVICEMAN to more accurately
gauge MTBR rates and to monitor inventory for field service
use much more closely.
THE BENEFITS
    One measure of MANMAN's efficiency is seen in the cost
of MIS operations at SVG as a percent of revenue. This cost
typically runs about four percent for a manufacturing
company; at SVG, it's three-quarters of one percent and
dropping. Consequently, SVG will achieve its return on
investment (ROI) for its hardware/software expenditures in a
much shorter time.
    A major benefit at SVG stems from the unprecedented
availability of information from MANMAN. The QUIZ report
writer provides a fourth-generation development language
(4GL). SVG's MIS staff can create just about any report a
department may request. For example, the field service
department asks for a BOM with vendor part numbers in place
of SVG part numbers, and gets the report back in two days --
previously the information took at least two weeks to
complete. The information is useful to both field service
engineers and customers, who may need to deal directly with
the part's supplier in an emergency.
    QUIZ also enables SVG's MIS staff to tailor MANMAN to
its specific needs without reprogramming.
    SVG has reaped considerable rewards from MANMAN's
ability to manipulate large masses of data and report back
quickly. The company recently searched its parts databases
across all divisions, matching up common vendor part
numbers. SVG can now negotiate with its suppliers for better
discounts on the basis of historical purchase records.
Previously, this level of detail was not accessible.
    In summary, MANMAN has brought to SVG tighter control
over every stage of its engineering, manufacturing, and
service functions. As a result, SVG's competitive stance has
improved significantly, and at a reasonable cost.
FUTURE DIRECTIONS
    SVG is considering the addition of MANMAN's
"REPETITIVE" module. This would minimize the number of
transactions involved to build a product -- facilitating
SVG's just-in-time (JIT) environment. For example, a planner
can load daily build rates into REPETITIVE for two units a
day at the beginning of the week; REPETITIVE does the rest,
streamlining and managing the inventory on a "pull" basis --
only when parts are actually needed. This would take SVG
further beyond "traditional MRP" -- which it surpassed some
time ago -- and wholly into JIT operations.
    In addition, SVG is implementing advanced electronic
communications, including E-mail and Electronic Data
Interchange (EDI) between the company, its vendors, and its
customers. By summer 1991 SVG had established EDI linkages
with its bank for rapid, electronic check cancelling.
    Equally important, SVG's field service engineers now
file activity reports on spreadsheets in laptop computers at
customer sites or at point-of-use. The engineers then log
onto the SVG system via 24-hour dial-up modems and upload
their service reports and check sales order status. This
results in a tighter correlation between the field sales
groups and R & D, manufacturing and MIS departments at
headquarters.
SUMMARY
    In conclusion, Silicon Valley Group has made the
substantial investments in information technology required
to remain a leading manufacturer of wafer fabrication
equipment, a technology generally agreed to be indispensable
to America's future. Workforce morale has improved from a
sense of participation -- or "empowerment" --  among SVG's
350 users of PCs and terminals. Top management is able to
make fully informed decisions about strategic directions,
while the MIS department has demonstrated its prowess in
bringing to the company a truly integrated computer system
in a cost-effective and timely manner.