e Commerce and e Business REQUIRE e Manufacturing to keep up !

1. eCommerce and eBusiness REQUIRE eManufacturing to keep up! PIMA Information Systems International Conference

2. ERP, MES, APS, Quality Management: How do these Pieces EFFECTIVELY fit Together? PIMA Information Systems International Conference

3. Supply Chain Mgmt. & eCommerce Human Resource Management ERP Order Management Production Planning Inventory Management Logistics & Distribution Financials / Costing Purchasing MRP Customer Relationship Mgmt. Lab & Quality Info Systems Manufacturing Execution System Advanced Planning & Scheduling Data Warehouse & Decision Support Asset Maintenance & Mgmt. Process Control What are the pieces? PIMA Information Systems International Conference

4. Credit: AMR Research, Modified with Permission ERP Supply Chain Management Enterprise & Supply Chain Management Management Advanced Planning & Scheduling Manufacturing Execution Div.Corp Management Mill Management Mill Management Quality Management Machine & Production Unit Management Mill Operations Order to Delivery Processes Accounting, Purchasing, MRO, etc. Process Control/SPC Process Management Production Execution PIMA Information Systems International Conference

5. Production Demand Results Purchase Requirements Mills Pricing Orders Product Quality Invoices Receipts ATP Suppliers Customers Quotes ATP Orders Invoices Product Quality Financial Results Customer Service/CRM Procurement Resource Planning Front Office What is ERP? ERP System PIMA Information Systems International Conference

6. WIP Warehouse Management Production Execution Production Planning Finished Goods Shipping & Logistics MRP Quality CRP Maintenance Management Payroll CRM Purchasing Human Resources Order Processing Accounts Payable General Ledger Fixed Assets Consolidation Accounts Receivable ERP: What is it Really? A Commercial Off The Shelf (COTS) application software product that provides a set of tightly integrated functions necessary to manage a modern manufacturing enterprise. PIMA Information Systems International Conference

7. WIP Warehouse Management Production Execution Production Planning Finished Goods ? ? Shipping & Logistics MRP Quality CRP Maintenance Management ? Payroll CRM Purchasing Human Resources Order Processing ? Accounts Payable General Ledger Fixed Assets Consolidation Accounts Receivable ERP: What’s wrong in Pulp & Paper? Some of the functions provided by the major ERP products are a poor fit for the Pulp & Paper industry in their off-the-shelf form. PIMA Information Systems International Conference

8. ERP Order Services & Planning for Pulp & Paper….not always a good fit... Roll Dimensions Vs. SKU’s Make to order, not stock Order and/or Shipping Tolerances Calculate Converting Roll Stock Orders Trim Vs. finite scheduling Unique P&P material flows: Trees & Recycle Fiber Lines  Reels  Rolls  Converted Products PIMA Information Systems International Conference

9. ERP to the P&P Manufacturing Floor? Without an MES system, it’s insanity! “Every roll has to be a unique lot to track Quality data? “ I gotta key in 12 fields in 3 different windows before you can turn up that set? “…. this system can’t talk to our automated wrap line?” PIMA Information Systems International Conference

10. There are real ERP benefits for P&P companies however... • Integrated financial systems • Integrated cost systems • Integration of purchasing, maintenance stores, human resources, payroll, etc. • Growing functionality in some “ERP II” areas, e.g. Web commerce, customer asset management, etc. • Some P&P vertical market momentum but …. Some of the major ERP vendors will overcome critical functional deficits for the P&P market, especially customer order management issues, maybe planning/scheduling/ATP, and in some cases even integration with the shop floor. PIMA Information Systems International Conference

11. Plan Source Make Distribute Supply Chain Council SCOR model What is MES? Manufacturing Execution Systems manage the “Make” part of your Supply Chain PIMA Information Systems International Conference

12. Manufacturing Execution Systems Pulp & Paper Industry MES Suppliers • Honeywell HiSpec – OptiVISION™ • MAJIQ Systems - ELIXIR™ • ABB – ABB™ • Segment products from smaller companies coming to market • Home Grown – Legacy-R-Us™ PIMA Information Systems International Conference

13. The Unique MES Product Evolutionin Pulp & Paper • Customer Service • Converting • Warehouse Management • Invoicing • Raw Material Planning • Load Planning • Traffic Management • ERP Integration Quality Order Entry & Shipping Product Tracking Trim 1975 1980 1985 1990 1995 Now PIMA Information Systems International Conference

14. The MES evolution has yielded real benefits for Paper Companies • Better productivity & yield improvement • Better capacity management • Lowered waste • Better quality control • More efficient logistics, fewer errors • Ability to manage customer expectations • Complete & functional order to delivery systems PIMA Information Systems International Conference

15. Customer Orders Shipping Finished Goods Roll Quality Warehouse Mgmt. Scheduling MRP Winder Management Reel/Roll tracking Lab Data Collection I/F with Gauging Trim Converting Operations Mfg. Production Orders Financials Purchasing Human Resources Maintenance Management Costing But the ERP & MES products have major overlaps in Pulp & Paper! MES ERP Which vendor(s) should provide these overlapping functions and why? PIMA Information Systems International Conference

16. Production Planning & Scheduling Functionality that cuts across existing classes of Packaged products.. MES ERP, & Pure APS products PIMA Information Systems International Conference

17. Scheduling Resides, Where, Exactly??? P&P Specific Scheduling & Trim Bolt-on Products Most MES vendors offer block scheduling & trim Other manufacturing scheduling systems not specific to P&P Every ERP System offers some type of scheduling PIMA Information Systems International Conference

18. For Pulp & Paper, not just anywhere!!! P&P Specific Scheduling & Trim Bolt-on Products • Can’t correctly model dimensional relationships? • Don’t effectively model the many to one to many relationships? Most MES vendors offer block scheduling & trim • Don’t manage the key trim issue as an integrated part of the planning process? Other manufacturing scheduling systems not specific to P&P ??? • Don’t rely on real time production feedback to dynamically adjust the plan? Every ERP System offers some type of scheduling ??? • Their product development teams don’t understand Pulp & Paper! PIMA Information Systems International Conference

19. APS benefits are usually a matter of complexity and size Greatest Benefit from APS Single Mill Multi-Mill Multi-Machine Multi-Machine Multi-Product Multi-Product Rolls + Converting Single Mill Increasing Complexity Multi-Mill Single Machine Single Product Single Product Roll Based Roll Based Least Benefit from APS Increasing Size PIMA Information Systems International Conference

20. Quality Management functions probably have the least clear cut definition in terms of Package products. ERP MES LIMS Process Information Systems Hybrids, e.g. Mountain Systems PIMA Information Systems International Conference

21. Quality Management Information has multiple sources and multiple consumers... ERP for Customers The things you communicate to them about your product when it ships Gauging Data Lab Data Mill &Customer Specs MES for Production Operations The things that help production decide when product meets specs or needs to be scrapped Process Historian QM or PIMS for Process Engineering Groups The things that enable them to troubleshoot problems and tackle optimization opportunities Grade History PIMA Information Systems International Conference

22. The concept of quality management systems is still evolving in pulp & paper • The “Hybrid Systems” vendors have an opportunity to continue to grow their role and the functionality they own • The ERP & MES vendors will have to improve the depth and scope of their offerings or risk loosing these functions completely in the paper industry • Being able to address the needs of the quality information consumers in the enterprise is the key PIMA Information Systems International Conference

23. What about “Best of Breed”? How do we select the right Package products? How do we put it all together? What functionality do we really need? PIMA Information Systems International Conference

24. Develop a vision of your future state that is realistic and achievable You should identify your opportunities for improvement first..a “vision” for where you want to be • Understand and document your current state in terms of business & manufacturing objectives, business processes, manufacturing processes, and systems PIMA Information Systems International Conference

25. Understand the requirements for achieving your future state • What functionality is required? • Which vendors can meet the real requirements? • What are the integration requirements? • How will you sustain, grow, and adapt? • What realistic paybacks and benefits can the enterprise or mill expect? PIMA Information Systems International Conference

26. Develop a REALISTIC Plan for Implementation…. …neither Santa Claus, the Tooth-Fairy, or the Stork will deliver a successful COTS systems integration or implementation project…you have to plan them in detail and then have the right resources to execute the plan plus accountability for the integration PIMA Information Systems International Conference

27. Implementation Planning is not enough. A complete lifecycle plan is required for best of breed solutions. Support & Training New Requirements System Lifecycle Upgrades Enhancements PIMA Information Systems International Conference

28. ERP MES APS Process Information Quality Best of Breed Package solutions are achievable and today that is the only way pulp & paper companies can provide robust functionality across the entire “make” part of your supply chain….. ...and achieve emanufacturing! PIMA Information Systems International Conference

29. Questions, comments, electronic copies, etc. Mike McIntosh Mark Cubine mark_cubine@guidementor.com PIMA Information Systems International Conference