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Mining for numbers

By Kelly Konrad

The marriage of MES with ERP makes for a more productive and efficient workflow from start to finish

October 2014 - In the evolution of any process, advancement usually comes at the expense of uncomfortable change. But in the case of Swanson Industries Inc. and its goal of process improvement, progress was painless.

Based in Morgantown, West Virginia, the 50-year-old company founded by Paul Swanson manufactures parts for the fluid power industry, such as rods and cylinders for hydraulics, and whose clientele feature prominently in the mining, offshore oil and gas, and equipment industries.

It was six years ago that Swanson first adopted Cleveland-based Factivity’s manufacturing execution software (MES) for its shop floor, eliminating the pen-to-paper method of tracking and quantifying production data. Factivity was founded in 1984, initially as a service bureau that now develops, implements and supports software solutions for manufacturing companies.

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“Customers wanted to install their own in-house mini-systems and Factivity (at that time under the name MDSS-Manufacturing Decision Support Systems) sold an ERP product on HP computers,” says CEO John Leibert. “In the 90s it became apparent that our customers needed much better visibility into the factory floor. We designed a Manufacturing Execution System (MES) to provide control functionality for paperless factory floors that did not need bar code readers, used a Windows touch-screen and can attach to many different ERP systems.”

Integrating with an ERP

When Swanson first implemented an ERP system, a critical piece of the puzzle was the ability to effectively track progress on the shop floor. Factivity is designed to do just that—plug into an existing ERP, eliminating the need to redesign the system in its entirety.

“One of the single biggest advantages Factivity offers is that our product can integrate into a wide spectrum of ERP systems,” says Leibert.

“We wanted to do some kind of automatic data collection,” says Jill Woisnet, vice president at Swanson. “We had one or two people working overnight to key in what was done on each part. That information was good but the person writing it down or the person then keying it in could make a mistake and we were always 24 hours behind. It wasn’t real time. We also wanted something for the person on the shop floor that was easier to do. With Factivity, we were really happy with how it worked.”

FFJ-1014-erp-image2Swanson started using QAD (an ERP program that supports Factivity’s MES software) in 2008, when those segments of the company that were focused on manufacturing, remanufacturing and distribution. “At the companies where we had shop floor processes, we installed touch-screen data collection devices and started using the Factivity software to run those devices,” says Woisnet.

Whereas ERP software is geared toward improving efficiency on a macro level, tethering a wide variety of business functions together, MES software is designed to operate on a micro level—tackling the shop floor. Its data collection is then integrated into an existing ERP, enhancing its reporting capabilities.

“It collects the information as the employees use the touch screens to enter what they are doing and sends it back to QAD,” says Woisnet, “so that no one has to key the information in manually.”

“When you’re doing both manufacturing and, for the most part, remanufacturing, to a certain extent you know what you are going to do,” says Woisnet. “With manufacturing, you know for sure you are going to go through 10 steps every single time. QAD and Factivity work very, very well with that. On the remanufacturing side there’s a little bit more flexibility—there’s not that many different options you can go through.” Once all the possible steps are entered again, QAD passes the information into Factivity. After operators are done with a work order, Factivity collects the time and passes it back automatically to QAD.

Real-time data makes a difference

Because Factivity tracks work on the shop floor in real time, there’s less guesswork involved when a customer wants an update.

“Customers will call and ask, ‘When are you going to have this done? Can you rush this through?’ And the first step is to find the part and where it is in the system,” says Woisnet. “Previously, we would be a day behind in retrieving that information. Now it’s a lot easier to find a particular part because you know the last thing that was done with it because it’s all real time in Factivity. This gave us better capabilities to locate pieces on the shop floor.”

Woisnet says the shop floor data collection on work orders or jobs was so beneficial that the company wanted to build on that by collecting time and attendance. About six months after installation, Swanson opted to deploy Factivity’s Time and Attendance Workbench. 

“The time and attendance workbench is the focal point of improving office and accounting effectiveness,” says Leibert. “It eliminates the time associated with finding labor variances that are so often undiscovered in many manufacturing environments.”

Typically, the payroll system is the sole record management system for regular and overtime hours worked, paying employees for time spent punched in. What that system can’t do is accurately reflect the actual amount of time spent on a work order. The time and attendance module is directly tied to machines on the shop floor, making it possible to better reflect how much labor cost goes into each piece, making cost estimates more accurate.

“Many companies have no idea of the real labor cost on a part,” says Leibert. And if they do, it’s associated with a standard cost, not an actual cost. Factivity’s time and attendance workbench ties job and payroll costs together, to show shift by shift the job times next to the payroll time, eliminating labor variance.”

“It gives us a lot more flexibility,” says Woisnet. “In the same database, we have what the employee worked on and what he got paid and you can see what they are doing and when they have idle time.”

Tracking the ‘where’ with repairs

Swanson not only manufactures and remanufactures product. Part of the business includes its five repair centers where parts are shipped with the expectation of a quick fix.

“One of our biggest market segments is the coal industry and also the off-highway industry,” says Woisnet. “Something stops working, the mine will tear it apart and bring it to us and maybe they want it back in two days. So we tear it down and see what needs to be done. Sometimes it needs new parts, sometimes it needs labor. We do that and get it ready to ship back to them.”

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That kind of work lends itself to a less structured, more chaotic workflow. Simply put, it is impossible to plan ahead for unscheduled repairs.

“We don’t know from one day to the next what is going to come through the door, says Woisnet. “It may be something we saw before, it may not be and maybe it needs to be torn down before we can really figure out what needs to be done on it.” 

Last year, the company decided to replace the in-house custom system with a Factivity module that would integrate directly into the QAD ERP system.

“It was time for everyone to get on one system instead of these two different systems,” says Woisnet, also noting the liability and lack of support inherent in the existing system. “Again, you don’t know what’s going to come through the door, you don’t know what you are going to have to do to it. There is a module in QAD called SSM—a sales and support management module—and that’s what we determined would be the best thing to use.”

Because QAD doesn’t have a touch-screen data collection system, Woisnet turned to Factivity to brainstorm options. “We really did like using the touch-screen data collection at the other locations, so we talked to John about it and asked, ‘This is what we would like to do, do you have anything that can take care of that for us?’ John looked at it and said, ‘We’ve never done that before but that sounds interesting. Let us look at it and see if we can come up with something.” 

With the goal in sight, Factivity’s team of software engineers are designing a module that will collect machine data and send it to the SSM module inside Swanson’s ERP. Woisnet anticipates a fall rollout.

“Factivity allows a touch-screen approach to selecting items from the Bill of Material for purchase and then uniquely creates a routing for the factory floor based on the evaluation made during tear down,” says Leibert. “It will be a real productivity boost and allow commonality between these remanufacturing centers and the standard manufacturing centers.” FFJ

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