Case Study Westlock Controls Ltd

CASE STUDY – WESTLOCK CONTROLS LTD.

1. INTRODUCTION

Westlock Controls are manufacturers of automated valves used in the oil and related industries. Much of their production is exported around the world and almost all of the products the company manufactures are made to order. They implemented Sovman and Sage Line-100 in 2001 and have used these systems as the cornerstone of their ongoing investment in manufacturing solutions.

1. THE SYSTEM

The system in use at Westlock Controls is based on Sage Line-100 commercials suite with a large number of bespoke additions; a standard implementation of the Sovman Bill of Materials, Works Orders, M.R.P. and Capacity Planning modules; Microsoft ACCESS databases and a number of ‘helper’ programs written in Visual Basic and Microsoft Excel. The way these are used is described in the remainder of this document.

It should be noted that the description that follows is very much an overview. There are hundreds of programs involved in the system and most have been designed and developed over the 12 year period I have been collaborating with the company.

2. THE MANUFACTURING PROCESS – FROM SALES ORDER TO INVOICE

In order to speed up the input of Sales Orders and to stop Sales Orders generating demands on production before the order is finalised, Westlock use a fully bespoke Sales Order entry system. A ‘front-end’ series of programs allows orders to be ‘logged’ in a ‘holding’ file with an automatic acknowledgement email being sent to the customer. The order is than checked and approved before being transferred to the live Sage Sales Order system, with a confirmatory email automatically being sent to the customer. Any specialist, required text is also automatically added at this point by the bespoke programs. The system is able to place every order as a ‘To-follows’ order since every order is made especially for that customer.

A variety of additional data is captured during this logging phase. This includes:-

 Customer Declarations  Oracle Codes  Certificate of Conformity details  Commodity Codes  The item due date and production date  Any commission details  Project Analysis  MRO analysis

The date that the customer was promised the goods is captured and, at the point of despatch, a program captures the date that the goods were actually shipped to the customer. These dates are used in a bespoke Excel spreadsheet that measures and charts the promised date against actual delivered date to measure the company’s performance, by customer. (A similar program and spreadsheet captures this information for suppliers in the Purchase Orders system – see below).

The order entry program also checks that customer orders are not entered more than once, by mistake, by checking that the customer order number is not already on the system. It also shows the sales staff what the current cost of production for the entered item is, together with the last price used for this customer, (if they have bought this item in the past). This information is used by the salesmen if they wish to negotiate a special price for the customer for this item.

The sales staff are responsible for creating stock item entries for a new product and the program checks to see if a Sovman Bill of Materials exists for the item. If this is a new item, the sales staff fill out an on-screen form that takes highly detailed information of the product required. An entry is made in the main Engineering Database, held in ACCESS, informing the engineering department of the need to create a new Bill of Materials, together with details of the Sales Order, including the customer details and the due date that the order is required. The Engineering department can quickly develop a new Bill of materials for the item from this information. In future developments of the system the database will automatically generate a skeleton Bill of Material for the assembly in question by identifying the components required from the information entered by the sales staff. The Engineering department will then complete and verify the B.O.M. prior to manufacturing.

All dates are validated against Westlock’s own internal date system to ensure that entered dates are valid. This includes ensuring dates such as holidays, for example, are not entered as a due date.

Customer orders are checked against being over a credit limit and if they are staff are automatically given the option of creating a pro-forma invoice.

Any Sales Order amendments are given a revision number, displayed on screen, and the sales staff may use a bespoke enquiry program to see what changes have been made to the order, when and by whom. An email confirming the amendments is sent automatically to the customer.

Sales staff also use the main ACCESS Sales database to allow them to view Sales Orders (both current and historical) and, on current orders, to be able to drill down against shortages to see what items are currently missing on an order. It is intended that this information will also shortly include the anticipated arrival date of the missing items. The database, in future developments, will also contain an enquiry into the company’s product database, also held in ACCESS, that shows a full history for every item that the company has sold, including the customer and their details, the item’s serial number, its wiring details, its date of issue for manufacturing, its date of completion in manufacturing and its date of despatch from the company together with any associated technical information. This data is generated as the item passes through the manufacturing process (see below). This information is used by the sales staff for regulatory and historical enquiry purposes. Other planned future developments include the ability of Sales Staff to be able to view planned production for a period so that when discussing a likely shipping date with a customer on the telephone they can see which day is most suitable. In addition to data entry by Sales staff in the UK, entry of sales orders is undertaken by sales staff in Singapore during the UK night time period. The company uses a thin client system that allows Singapore to access the UK systems remotely and securely.

Credit notes are also entered via a separate but related bespoke system.

Currently in development is a web enquiry system to allow customers in any part of the world to view their current and historical orders on the system and to reprint invoices, instruction booklets and technical details associated with an order.

Every night a VB program is used to drive the Sovman Stock Status run at a preset time. The same program prints the Sovman suggested purchase orders report and the suggested works order report that are created by the Stock Status run. It also executes the Sovman planned input creation routine that automatically creates planned works orders from the Sales Orders placed on the system that day. At the same time the Sovman planned input release routine is run, to turn planned works orders into released works orders for the forthcoming number of days as decided by the production planner. Finally, the VB program runs the Sovman Automatic clear shortages routine to clear works orders of outstanding shortages using newly booked-in free stock.

The VB program is also set to run a number of other standard routines, including the Sovman standard cost calculation and updating routines and these too are run automatically overnight. Similarly a bespoke ‘Reverse MRP’ program is run that highlights in a report to the production planner those areas where production is planned but no longer required because the customer has cancelled their order or those areas where the quantity on the order has changed so that the planned works order needs amending. The program also informs purchasing staff where, due to changes on the sales order, component purchase orders require amending or cancelling. Finally, the program checks that released Works Orders have the necessary entries in the Labels database. This database holds details of labels that are affixed to each product such as wiring diagrams and certificates of conformity, etc. These labels are produced automatically by the issuing program (see below). For any that are missing an email is sent automatically to engineering asking them to add the label details as a matter of urgency and before the item is manufactured.

The next stage in development, currently being implemented, is for the system to automatically ask suppliers by email to supply quotes for items that may have not been purchased before or have not been purchased for some time. The quote system will also allow suppliers to provide the quote by logging on to a web site and the system will take this quote and allow the purchasing staff to automatically generate a Purchase Order from the web site using the quote once it has been agreed.

A bespoke Purchase Order creation program is used to generate purchase orders. This takes its demand from the Sovman suggested Purchase Order file and, allowing for any amendments, creates the Purchase Order and logs the date it was created and the date that it was sent. When the supplier acknowledges the order this date is also captured as is the date the order was fulfilled. This allows the purchasing staff to monitor supplier performance through a bespoke Excel spreadsheet. Acknowledged orders are excluded from appearing on the Sovman Suggested Orders report thus reducing its size. All purchase orders are priced according to a fully bespoke Landed Cost system that takes into account the overheads incurred in purchasing the items. The price that is held on the stock file for any item reflects its true cost to the company.

On a weekly basis a further bespoke Excel spreadsheet is run that takes all works orders that have shortages and produces lists of those shortages by supplier and for which Purchase Orders have been created. The purchasing manager can then automatically email all these lists to the relevant suppliers by clicking a button on the front of the spreadsheet to chase the suppliers for delivery.

The production planner is able to view planned works orders for a chosen period of time. These show which Production Line the order is currently planned to arrive at and the planner is able to change this to balance production across the lines. This may include changing which line the job is intended for, changing the due date of the order, etc.

The changes are undertaken using a fully bespoke ‘drag and drop’ program that allows the planner to move Works Orders by dragging ‘tiles’ on a screen to the appropriate place n the production line queue. In future this program will be converted to Windows 8 Metro to allow the planner to slide the tiles using a touch screen.

From the Works Orders that have been released overnight, bespoke picking lists are automatically printed at the operators’ work stations ready for them to commence work the following morning. The correct printer is chosen by reference to either the item’s product group or any changes the production planner has made.

At the start of each line a PC screen display shows which Works Order should be undertaken next, as the Production Planner may wish to change the priority of Works Orders according to specific requirements during that day. He is able to do this at any time by entering or changing a priority against a works order from his desk. The line operator’s screen is updated every 3 minutes.

The bespoke picking list has a bar code on it showing the works order number. The start-of- line production operator scans this bar code into a VB program when the job is started and this automatically issues the job using Sovman’s standard routine. Any special instructions input by the Production Planner are displayed as the bar code is read. The program then prints a wiring diagram label, containing the serial number, to be attached to the finished item, any other required labels and Instruction Manuals to be included with the products. (These manuals are printed on a special printer which then collates the pages and staples the booklets together automatically).

The program automatically retrieves the wiring diagram from a database of drawings held in an ACCESS database and the Instruction Manuals are held as a series of PDF files. The program also prints a number of box labels, depending on how many boxes are required for that number of items as calculated by the program. The labels and instruction manuals are printed to a variety of printers all pre-determined by the program. Also recorded are details of which staff actually assembled the items. Finally the program adds an entry for each item to the product database including details of the item, the customer, the sales order number, the works order number and the date, time and quantity being issued. This database forms a complete history of all orders received and processed by the company including all details about the customer, when the order was made, which staff were operating the line when the order was made, when it was completed, who inspected the goods and so on.

Once the item has been made another bespoke program is used by the Inspector on the line to check that the item meets the quality checks. The inspector may pull the item from the line and record the reasons why the item has been pulled. Note that staff on the line may also suggest improvements to the item and its system of manufacture based on their daily experience of making the item.

Once the items have been made, the end-of-line operator scans the picking list bar code into a different VB program. This program automatically completes the works order using Sovman’s standard routine and adds the date, time and number of completed items to the product database. The program also records who has inspected the items, whether for any reason the job was ‘pulled’ from the line and whether the BOM was incorrect. In the latter case an email is automatically sent to the Engineering department informing them of the need to update the BOM and the BOM is unverified to stop future use until it has been corrected.

One by-product of this system, not yet exploited, is that it is possible to measure how long any job takes by comparing the time of issue against the time of completion and thus be able to calculate staff and job efficiency. This will be used in the next phase of implementation.

A new system just about to be implemented allows stock to be moved around the factory using a handheld scanner and 2-dimensional barcodes. Stock is moved according to requirements generated from the production planning process. Eventually stock will arrive from suppliers with these 2-dimensional barcodes already attached.

The company also currently undertakes an annual stock take utilising a completely bespoke system. The next stage of development will be to use the handheld scanners to undertake rotational stock take on a monthly basis.

The despatch staff use a bespoke program to control shipping of goods. They enter a sales order number and select the items on the order that are being shipped. The program automatically completes the sales order and produces the delivery note to accompany the goods together with the invoice to be sent to the customer. The program also allows the operator to enter the details of the weight of each item and its dimensions for printing on an accompanying packing slip.

A tracking system is currently being designed that will allow the recording of the courier and collection time and when the customer can expect delivery. This information will be accessible through the web-site sales enquiry.

Gross margin details are generated for each item line for later production and also TDW details are stored.

Other areas under planned development include a rotational stock-take based on an ABC analysis of stock usage value; the ability for sales staff to be able to undertake a trial-kit of items including lead times of items out of stock so that they can determine likely production dates; A detailed RMA system to be able to track items returned to suppliers and to be able to analyse supplier performance in correcting the faults and supplier performance in delivering consistent quality and a system for Westlock to be able to analyse returned faulty items from Customers.

3. THE BENEFITS TO THE COMPANY

The above system has been developed to automate as much of the manufacturing process as possible. The use of bar coding, automatic updating and printing and self-monitoring have made errors in production far less likely. Indeed, one of the main aims of the developments has been to eliminate human error wherever possible.

The system allows the company to concentrate on getting sales orders made on time and accurately whilst carrying the least amount of stock possible. Overall quality and timeliness have been improved markedly at the company and this has been measurable. It has also reduced the need for costly staff overtime as jobs are now undertaken with more efficiency.

The combination of Sage Line-100, Sovman and the bespoke additions, (including the ACCESS databases and EXCEL spreadsheets), have greatly improved data quality and accuracy.

The system has not been developed or implemented overnight. Implementation started with Sage and Sovman and these have been gradually added to over time. Many of the functions are still quite recent and will be further refined as time goes on.

The company is constantly looking at ways that the system can be improved and built upon and further enhancements are in the pipeline. These include the ability for customers to enter orders electronically and further functionality to allow sales staff around the world to have greater access to the system.

CONCLUSIONS

This paper shows one example of what can be achieved with the use of the Sage Line-100 and Sovman systems used as the basis for a solid manufacturing system. By extending these systems, through the use of various bespoke programs and familiar tools such as Excel spreadsheets, the data that already exists in the system can be fully exploited to enhance any company’s manufacturing needs.

Roy Thompson August 2012