Power Tools 1993 October - Disc 2/Power Tools (Disc 2)(October 1993)(HP).iso/custref/50912971/50912971.txt

Text File | 1993-07-30 | 15KB | 296 lines

Furniture Manufacturer Strives for Enterprise
Integration Via Distributed Computing and MRP II

Retail Industry Case Study

Evenflo Juvenile Furniture, Inc., is a supplier to the retail
industry. That marketplace today demands electronic links to its
vendors, on-line availability of critical business and
production data, and shortened lead times. Evenflo is in the
process of implementing an MRP II system from Manufacturing
Decision Support Services, Inc. (MDSS), on a Hewlett-Packard
3000 multiuser system to meet those demands. Today, Evenflo's
network links five plants in the U.S., Canada and Mexico.
Initial MRP targets were established as follows:  a 10 percent
reduction in inventory, a two percent reduction in purchase
price, and increases of two percent in both productivity and
sales.
   By late 1992 Evenflo expects to achieve and in most cases
substantially exceed these objectives. Product lead times will
be reduced by as much as 300 percent.
   Evenflo intends to position itself to serve retailers of the
90's by shipping on time and having the ability to provide
immediate updates on product availability, ship dates, and order
status.

[Figure cover (Photo), Caption:  Evenflo relies on software from MDSS,
Inc., combined with the HP 3000, based on PA-RISC technology, to stay
competitive in the juvenile furniture industry.]

Background
Evenflo is headquartered in Piqua, Ohio, with four other plants
in Los Angeles; Jasper, Alabama; Tijuana, Mexico, and Brantford,
Canada. The company supplies juvenile furniture--including
mattresses and pads, high chairs, carriers, cribs, playpens and
car seats--to all major retailers, both in the U.S. and Canada.
   Evenflo is responding to the demands of a changing retail
market. It is linked to most major retailers via Electronic Data
Interchange (EDI) for faster, more integrated communications
that include orders,invoicing and acknowledgements. The improved
responsiveness, anticipated with MRP II and enterprise
integration, will help Evenflo reduce its product lead-times by
300 percent.
   To get the online control needed to satisfy customer demand,
Evenflo turned to Manufacturing Decision Support Systems (MDSS),
Inc., of Cleveland, OH. MDSS supplied Evenflo with an integrated
Manufacturing Resource Planning (MRP) II solution designed for
use on an HP 3000 Series computer.
   Evenflo is a complete manufacturer. It takes raw materials and
vendor-supplied subassemblies and performs various manufacturing
operations--e.g., stamping, sewing, binding, powder-coating,
heatsealing, and assembly--to produce high-quality juvenile
products.
   A strategy was developed in late 1990 that focuses on customer
service; more specifically, to shorten lead-times and meet
scheduled due dates. Evenflo subsequently decided on an MRP II
solution to integrate various interdepartmental functions. It
sought interactive, online control in both its manufacturing
facilities and commercial activities.

Automating Each Step
In operation at Evenflo, the MDSS MRP II system is activated by
receipt of a customer order. Orders are received by telephone,
fax, mail or electronically via an EDI link developed by
Evenflo's staff. Orders received via modem are passed
electronically into the MDSS system; telephone orders require
manual data entry. More than 50 percent of all orders will be
received via EDI by mid-1992.
   Evenflo developed the EDI links using a standard called VICS
(Voluntary Industry Communication Standard), a subset of ANSI
(American National Standards Institute) X.12. VICS was developed
by a committee of retail manufacturers and their suppliers to
standardize data transmissions.
   Once an order is entered, a validation process occurs. The
order's contents are checked against factors such as pricing,
product number, sales commission, freight, and sales terms. The
order data then goes to forecasting via a data transfer between
the MRP II system's order entry and manufacturing modules.
   There, if the system determines that manufacturing has the
capacity to produce the order amounts in the time frame
specified, the order relieves, or "decrements," the forecast by
the corresponding quantity.
   For example, if Evenflo expected to ship 5000 car seats in July,
and the new order is for 2000--and the volume was included in the
forecast--then the order ship date can be met with the existing
schedule.
   The system then takes Evenflo's inputs and calculates a
shipping date. Evenflo personnel can then tell the customer,
simultaneous with the initial taking of the order,when the
shipment can be made.
   Conversely, if the order is a special, the system indicates
that current production levels are insufficient to meet demand.
Evenflo must then decide to either increase production (by
adding manpower or equipment) or negotiate a compromise between
its production capability and the requirements of the customer.

Orders Integrated with Manufacturing
The next step is to schedule production. If the forecast has
been relieved as previously described, production is already
scheduled and proceeds according to the master production
schedule, which explodes all Bills of Material (BOM) items and
issues purchase order requisitions for the purchasing manager to
review and release.

[Figure page 3 (ComputerWorld survey diagram), Caption:  In a major
ComputerWorld survey of 20 users of each of the listed computer systems,
the HP 3000 placed first in 13 of 15 categories, for an overall ranking
of 71.]

   The production schedules are forwarded to the manufacturing
lines. There, the online capability of the MDSS software, backed
up by the RISC based HP 3000 and an Intermec (Lynnwood, WA) bar
code system, will support reports on direct labor and work-order
status every 15 minutes to indicate actual versus planned
production figures. When products are finished, an inventory
transaction will move them to shipping.
   A pick list issued four days prior to shipment date alerts the
shipping department to schedule the trucks. Shipping reports
back to order entry on quantities produced and issues bills of
lading. Order entry then issues the invoices.

Substantial Benefits
The results are impressive. Prior to the MRP II implementation,
Evenflo required six to eight weeks to turn around a customer
order. That's now accomplished in three to five weeks, and
Evenflo expects to cut that by half as the HP and MDSS solution
is further optimized.
   A few accounts are currently served in as little as three days.
   Evenflo's calculations, based on hardware/software costs and
anticipated cost efficiencies, indicate a payback period on the
investment of less than one year.
   The MRP II targets expected are:
o Two percent reduction in purchasing price
o Two percent increase in productivity
o Ten percent inventory reduction
o Two percent increase in sales
   By the end of 1992, Evenflo is confident it will achieve
benefits substantially greater than indicated above.

[Sidebar page 3, Caption:  The Simplicity of RISC
The HP 3000 and HP 9000 families use a reduced instruction set
computing (RISC) processor. This microprocessor architecture
relies upon an instruction set of about 130 instructions,
reducing load, fetch, store and execute instructions, for
example, to the ones most frequently used. System throughput is
much faster than that available in a CISC (complex instruction
set computer) microprocessor. This higher throughput contributes
to faster operations by enabling the opening of multiple windows
and executing programs in them, for example.
   Combined with PA-RISC, HP provides HP-UX, a multi-tasking, open
operating system that is a superset of standard UNIX(R).
   According to Automation Research Corp. (Medfield, MA), RISC
microprocessors have from two to five times the throughput of
CISC processors, a ratio expected to increase.
   Moreover, ARC predicts the percentage of RISC-based computersin use will increase from 31.1 percent of the total market in
1990 to 58.5 percent by 1995, a significant increase.]

Automation and Organizational Change
Executives at MDSS, Inc. believe software is more than disks and
tapes, and therefore more than "installation" is required.
MDSS's policy encourages users to be trained to capitalize on an
MRP II solution.
   Thirteen Evenflo employees thus far have attended Oliver Wight
training on how the software can be integrated throughout the
business, using a common set of information. MDSS is working
closely with Evenflo to outline tasks and activities and the
organizational changes needed to implement the MRP II system.
   To support the MRP II implementation, Evenflo has added a
number of stockroom clerks and supervisors to improve control
over inventory. These new personnel have access to terminals to
count and track inventory as it moves through the plant.
   Evenflo also hired a demand manager to forecast demand and
"negotiate" compromises between production and sales/work
orders. The company plans to add an additional production
scheduler, an important coordinating function within an MRP II
based enterprise.

Computers and Networking
Evenflo chose the HP 3000 Series 955 computer to support the MRP
II system and a substantially increased number of users. The HP
Series 955 was an upgrade from an HP Series 68.
   The HP Series 955 at Evenflo is configured with 200 ports (it
can support up to 600 users). At any one time, users range from
about 50 to an average of 80 to 90, all connected via HP 2392
and HP 700 terminals.
   Users are also connected to the system by HP Vectra PCs.
Evenflo is integrating word processing and spreadsheet programs
with data drawn directly from the HP Series 955 and using HP
NewWave Office to access data at multiple stations.
   The other plants are networked via X.25. Evenflo chose X.25 as
a standards based method of communicating data over a wide area
network (WAN). HP helped Evenflo set up the system whereby 32
users in Los Angeles, 16 in Canada, and 16 in Alabama
communicate with the HP Series 955 over dedicated lease lines at
9600 baud.
   Every record in the Evenflo database resident on the HP Series
955 has a separate plant identification. Every transaction--inventory,
sale, work orders--is identified by the appropriate plant code and
passwords. This standardization enables each plant on the network to do
all its inventory, work orders, MRP runs, and production data processing
on the HP Series 955, increasing the accuracy of internal record-
keeping, and reducing the expense of redundant data entry at remote
plants.
   Users type in their ID numbers, the MDSS software identifies them,
and they access the MRP II system. PCs at each site link
to the system as well. A product called OfficeExtend, from
Fransen/King (Seattle, WA) allows Evenflo to distribute its
printing functions remotely from its Piqua, Ohio headquarters.

HP Platform is Network Key
Evenflo specified the HP Series 955 for its online transaction
processing (OLTP) throughput. To successfully implement the
online network, Evenflo required a computer solution with no
contention for access (as with a mainframe) and no degradation
in response times.
   The HP Series 955's high throughput derives from HP's Precision
Architecture-RISC (PA-RISC) technology, combined with the MPE/XL
operating system. By simplifying the instruction set, PA-RISC relies
on fewer components, which means higher reliability, greatly reduced
mean time between repair (MTBR) rates, and superior price/performance.
   The computer's MPE/XL operating system is also POSIX-compliant.
POSIX (Portable Operating System Interface) provides an
industry-standard interface that enables proprietary or non-UNIX
computers to connect to a UNIX environment if need be.

Enterprise Integration:  MRP II
Evenflo is positioning to achieve Class A MRP II status, as
defined by the Oliver Wight organization. This requires meeting
performance criteria in areas such as production planning,
master production scheduling, material requirements, supplier
planning and control, shop floor control, capacity planning and
control, sales and operational planning, and new product
engineering.
   Today, Evenflo is well along to becoming an effective
time-based competitor in the retail supply marketplace. Evenflo
now offers its customers near-instantaneous information on
work-in-progress (WIP) and shipment data during the order-entry
process. It can update work order status at any time during the
production cycle.

Future Plans
To achieve even better performance Evenflo is bringing its
vendors into the loop. It is developing a plan to ensure full
vendor participation in its time-based management strategy.
   Evenflo will be giving its vendors schedule information and
making firm commitments to take a set number of purchased parts
during specified time intervals.
   Then, for subsequent shorter periods of time, Evenflo will
order a certain number of parts, reserving the right to cancel,
in which case it will pay for the vendor's unused raw materials.
For a third interval beyond that one, the company will issue
good-faith forecasts of anticipated demand.

[Figure page 5 (Photo), Caption:  The HP 3000 Series provides higher
performance while protecting existing hardware and software
investments.The higher performance and range of business solutions
available on the HP 3000, including MDSS software, allow companies such
as Evenflo to optimize their systems.]

Distributed Computing:  Key to Integration
Evenflo has established an internal partnership between its
different departments to use MRP II as an enterprise integration
strategy. The company decided that communication was the key.
The open exchange ofinformation between departments using the
same data translates into improved decision-support and lower
overhead.
   Evenflo chose MDSS because of the latter's commitment to
full-scale implementation of MRP II as an enterprise integration
system. MDSS is also a certified Premier Solution Provider of HP
computer systems.
   Information is the critical link that can pull together
engineering, manufacturing, procurement, marketing, and the
support functions. Open systems make possible a client/server
architecture in which users can transparently access all the
resources they need, distribute the workload most efficiently,
and gain a sense of empowerment by fuller participation in the
larger computing environment.


UNIX is a registered trademark of UNIX System Laboratories, Inc. in the
USA and in other countries.

Technical information in this document is subject to change without
notice.

(c)  Copyright Hewlett-Packard Company 1992  All Rights Reserved.
Reproduction, adaptation, or translation without prior written
permission is prohibited except as allowed under the copyright laws.

Printed in the USA M0192
5091-2971E

Associated files:  50912971.DOC, AA297101.TIF, LA297103.TIF,
AA297105.TIF
Furniture Manufacturer Strives for Enterprise Integration Via
Distributed Computing and MRP II, Retail Industry Case Study