5 reasons discrete manufacturers struggle to maximize the use of assets

Discrete manufacturers struggle to maximize the use of assets

Yet again, the discrete manufacturing industry is under pressure. With increased competition and a more demanding customer base forcing many manufacturers to look for new ways to increase their bottom line, it’s no surprise asset life extension is a popular topic.

Manufacturers can enhance their success by creating a proactive asset management culture, taking a more sophisticated approach to maintenance that optimizes asset performance and value. This is crucial for businesses to ensure that they can meet demand and reduce production costs.

Below are 5 common scenarios found in many discrete manufacturing organizations where maximizing the use of assets is a difficulty.

1. Reactive maintenance
Reactive maintenance is characterized by poor equipment performance, unpredictable breakdowns and ongoing minor plant stoppages. The poor condition of the equipment results in quality defects and stoppages, which in turn leads to unexpected production losses and overspend of the maintenance budget. Together, these can cause deficits that run into millions.

2. No proactive maintenance
When very little or no proactive maintenance exists, a “fire fighting” maintenance regime results, whereby temporary repairs or “band-aid” solutions are regularly applied to keep the equipment running.

3. Limited planning and scheduling
When planning and scheduling is reactive, it is often the planned activities that get dropped from the daily work schedule. Proactive strategies seem to be of little value to an organization struggling to meet the pressure to keep the plant running. It is hard to move into “asset management” mode and accurate equipment history is often not available.

4. Maintenance vs production mentality
When maintenance and production teams aren’t working together – or, worse, are in conflict – then any impetus for positive change soon dries up. Maintenance personnel are blamed for failures, morale is low and staff are too busy fixing things to conduct any inspections or preventative maintenance.

5. Lack of support
To improve asset performance, you need the strong support of leadership and management teams in order to stop the fire fighting and target long-term sustainable asset management. The journey must start at the top of the organization.

Good leadership is critical to the team’s overall success. Your leader should be able to articulate the common sense of purpose, and unite all members of the team so that you are working towards this purpose. The asset management team should be seen as a force to be reckoned with, yet should remain approachable and open. All site employees should be aware of the team’s existence and know how to contact them with any ongoing plant issues or frustrations.

How to successfully maximize the use of assets
The goal in improving asset performance is simple. To enhance the overall operations of the plant or facility and improve business performance.
More specifically, there are three key success factors for any asset improvement program:

Loss elimination
This involves tracking production losses and assets with high maintenance costs, and then finding ways to reduce those losses or high costs. Efforts should be focused on the largest and most critical opportunities.

Risk management
Better manage the risk of your strategic objectives in the areas of Health, Safety and Environment (HSE), quality, production and reputation. Common tools to identify and reduce risk include:
• FMEA – Failure modes and effects analysis
• FMECA – Failure modes, effects and criticality analysis
• VAA – Vulnerability assessment and analysis
• RCM – Reliability centered maintenance
• RBD – Reliability block diagram

Life cycle asset management
Studies show that as much as 95% of the total life cycle cost (LCC) of an asset is determined before it is put into use. With this in mind, the Reliability Engineer (if you have someone in this role) should be involved in the design and installation stages for new assets and modification of existing assets.

The discrete manufacturing series
Our series focuses on five common problems discrete manufacturers are currently facing, and how to solve them, including case study examples of where discrete manufacturers have implemented our solutions and seen success.

In our tip sheet ‘How manufacturers can maximize the use of assets’, we explain various steps that you can take to ensure you’re leveraging the use of existing assets to generate maximum ROI. You can download a copy of the tip sheet here.

For more information or to contact us visit Tridea Partners website.

Microsoft Dynamics AX Advanced Favorites

One of most widely used features in Microsoft Dynamics AX, is the ability to perform powerful searches on any of the AX grid pages. What many don’t realize is you can save these searches or filters as part of your favorites. This functionality is also available in Dynamics 365 for Operations as part of the workspaces. This article will show you how to add these filters as favorites in Dynamics AX 2009 or Dynamics AX 2012.

First, configure an advanced filter, in one of the grid screens. In this example, all sales order grid was used.

Dynamics AX Advanced Favorites

In this example, we’ll create a filter to show us all unconfirmed sales orders, created in the last 100 days.

Dynamics AX Advanced Favorites

Once you put in the filter criteria, click on the modify and “Save As” and save your query.

Dynamics AX Advanced Favorites

Now you can use this query as the default for a menu item you add to your favorites. To do this, right click on the “All Sales Orders” menu option on the left hand navigation, and click “Add to favorites..”

Dynamics AX Advanced Favorites

Give your favorite a name “Sales Orders Unconfirmed last 100 Days” and select the query you want to save with the favorite.

Dynamics AX Advanced Favorites

Now, when you click on the favorite, it will open already filtered based on your query.

Dynamics AX Advanced Favorites

This post was written by Jason Federspiel, AX Functional Consultant at Tridea Partners. Tridea is a leading Microsoft Dynamics provider.

“What-If” Costing using Dynamics AX 2012 R3

Microsoft Dynamics AX offers a nice set of tools for quickly performing a “what if” analysis on the impact of price changes (labor costs, material costs, or both) on the standard cost of manufactured items with multi-level bills of materials.

A high-level summary of the process is as follows:

  1. Setup a Cost Version of type = Planning that has a Fallback Principle = Active costs
    • This allows us to define “what-if” costs where applicable, while referring back to the current standards wherever a “what-if” cost is not entered.
    • This allows us to run the what-if analysis while only having to key into the system the incremental changes
  2. Make the proposed changes to the labor rates and/or raw material costs at any level in the product structure/BOM, assigning the changes to the new “What-If” costing version.
    • Update the price in the Cost Category form to perform what-if analysis based on labor rate changes
    • Update the cost price of an item on any level of the BOM/Formula to perform what-if analysis based on material purchase price changes
  3. Run a Cost Calculation for the “What-If” costing version on the top-level FG item.

This article was written by Matthew Boese, Partner at Tridea Partners, a Gold Certified Microsoft Dynamics Partner.

 

Microsoft Dynamics AX 2012: Inventory Replenishment

In Microsoft Dynamics AX 2012, by setting up some item coverage settings and default order settings, you’ll easily be able to have Microsoft Dynamics AX recommend inventory replenishment when running master scheduling. Below are the steps to set this up.

Navigate to Product Information Management > Common > Released Products and select the item in edit mode.

  • On the Plan FastTab, select the appropriate coverage group for your company and item.

Inventory Replenishment

 

  • On the Plan tab of the action pane at the top, select item coverage and use the wizard to create the item coverage settings based on the coverage group selected (i.e. site, warehouse, minimum inventory, maximum inventory, lead times, etc), then click close. (See screen shot below)

 

  • On the Plan tab, select default order settings then set your purchase site, inventory site, minimum order quantity and purchase lead time, then click close. (See screen shot below)

 

  • On the Plan tab, add the site specific order settings such as site, purchase warehouse and inventory warehouse, then click close. (See screen shot below)

Inventory Replenishment

Next you’ll need to know which planning strategy to use with Master Scheduling. There are three types of plans to choose from to support your company’s operations. Dynamic plan is for short term planning and can be updated every time the master data changes. Forecast plan is for plans involving forecast and demand. Static plan is for long term planning, which remains unchanged until the next time you run master scheduling. These plans can be configured in the Master Plans form in the Master Planning module under setup then under plans. For example, if you have an item in which you want to maintain a minimum inventory level for the long term, then you would choose static plan.

 

On the Plan tab of the released product, click on Net Requirements. Select the plan type from the drop down menu at the top. Then in the middle section on the overview tab, select update > master scheduling and click ok. This runs the master scheduling to determine if inventory of this item needs to be replenished.

Inventory Replenishment

 

You can also run master scheduling from Master Planning > Periodic > Master scheduling. By running master scheduling from the Master Planning module, you can select multiple items to run at the same time.

 

Once the master scheduling job has completed, if AX determines that inventory should be replenished, it will automatically create a planned order for the item(s) that were included in the master scheduling run. The next step is to convert any planned orders (purchase, production, transfer) to actual orders.

Once you’ve converted your order, you can return to the released product form to view the status of your item under Net requirements. If you run master scheduling again from this screen while there are existing orders (planned or firmed), and/or on-hand inventory, and the quantities are at or above the minimum inventory quantity as set in the item coverage settings, then AX will not generate a planned order. If there are no planned orders, no open purchase orders and on-hand inventory is below the minimum, then AX will generate a planned order when you run master scheduling.

This article was written by Tracey Schebera, Dynamics AX Consultant for Tridea Partners. Tridea is a leading Microsoft Dynamics provider. www.trideapartners.com