Implementation project of 1C: ERP Enterprise Management 2.0 in "Asia Cement"

The McSoft Optima company completed at the end of 2015 the project of complex automation of Aziya Tsement LLC - one of the plants on production of cement in the Penza region. The system created on a basis of 1C: ERP Enterprise Management 2.0 helped to organize operational planning of production and repair of the equipment. Control of observance of the diagram of production is strengthened, uninterrupted supplies of necessary raw materials and materials are arranged, shipment and the product delivery to buyers accelerated. Integration of 1C:ERP with a management system for a production equipment allowed to organize the automated process of production with the minimum participation of operators. Costs of the enterprise, including number of staff are optimized, cost value of finished goods is reduced.

In 2007 the Asia Cement company acquired mineral rights of Sursko-Maissky section for the purpose of geological studying, exploration and production of cement raw materials. In three years (from August, 2010 to September, 2013) the modern plant which production capacity is 1,860,000 tons of cement a year was built. Opening of new cement works in the territory of the Penza region became a significant event in social and economic life of the region.

Production of cement - process, continued production. Its main features at the enterprise are:

• extraction of raw materials (chalk and marl) by own efforts for production of clinker - the main semi-finished product for production of cement;
• special approach to production planning: to release the greatest possible amount of cement proceeding from performance and the plan of repairs of the capital technology equipment is planned;
• difficult calculations of volume of finished goods in a warehouse (in silos);
• existence of the industrial control system (ICS) used by production of semi-finished products and finished goods;
• difficult technology processes with several inputs and several equivalent exits of different products.

Initially for automation of the new enterprise it was supposed to use a foreign ERP system. However, as of September, 2014, this system was not implemented, management accounting was kept using spreadsheets. There were cases of failures of shipments of finished goods due to the lack of the uniform automated control system for sales and transport logistics. Failures in process of orders and the subsequent purchases of raw materials led to deviations from the production program and to non-performance of production plans. The company management did not obtain operational information necessary for the analysis and decision making.

Such situation did not suit investors and management of the company, especially taking into account a complication of an economic situation in the market of construction materials. The decision on implementation of a new ERP system, preferably Russian production which could become the full-fledged management tool the enterprise was made.

Key requirements to a new system were formulated:

• A system should cover all business processes of the enterprise
• A system should become the working management tool joint activity of employees
• A system should provide the automated preparation of the managerial and regulated reporting
• Information from other enterprise information systems and the connected weight equipment should come to the ERP system directly, passing operators
• The acceptable cost level on implementation and maintenance.

According to the results of market research of the software for automation of manufacturing enterprises the 1C: ERP Enterprise Management 2 system was selected.

Implementation was executed by the staff of McSoft Optima company, user support was performed, including, forces "Asia Cement". In extremely short time, in 6 months, more than 150 jobs were automated.

Key results of the project:

• Automated management of sale and logistics, including shipment of finished goods that allows to take quickly orders from clients and to select optimal conditions of transportation. Uninterrupted shipment of finished goods and its delivery automobile and by rail is provided. Besides, in a system the procedure for granting of an individual discount to the client in the form of a retrobonus based on a month is implemented. When calculating a discount the volume of the selected finished goods for the period, existence of receivables, including delayed, and other conditions is considered.
• Management of material resources is optimized. End-to-end accounting of materials requirements for needs of divisions is adjusted, dispatching of internal material requisitions is organized. Operational planning of purchases of raw materials taking into account selection of carriers, planning and dispatching of the movement of cars with raw materials on own railway branch is provided. It allowed to provide timely deliveries of required materials and raw materials.
• Production planning and repairs of the capital technology equipment is optimized. It is provided exact forecast data on production. It helps the management to develop operational strategy of management of stops of the equipment for achievement of an optimal rhythm of production process without significant decline in production. Any changes of planned and actual data instantly are reflected in the corresponding reports. Heads of production services quickly obtain information on product output and on results of release of semi-finished products on repartitions. Control of observance of the diagram of production is strengthened. Besides, continuous monitoring of product quality is conducted, measurements of quality are fixed in a system hourly.
• Integration with a management system for the plant equipment is executed: data on work of production on each repartition get to 1C:ERP by the day/in shifts / in a foreground mode: release parameters (humidity, temperature), use of materials/semi-finished products, actual release of products/semi-finished products, packaging of finished goods, operation of the key equipment (operating time, idle times), current measurements of a remaining balance of finished goods / semi-finished products. It allowed to adjust the automated process of production with the minimum participation of operators.
• Integration of a system into the weight equipment allowed to optimize work of mining workshop, railway workshop and department of logistics. Data entry errors due to lack of "intermediate link" in the form of operators are excluded:
• Mining workshop. Integration with dynamic scales and use of RFID tags on dump trucks allowed to determine precisely the weight of the extracted raw materials when exporting from a pit, to exclude errors of the operator and to increase capacity.
• Railway workshop. Integration with dynamic railway scales allowed to automatically determine the weight of cars when unloading raw materials and loading finished goods. It excludes errors of the operator and also accelerates loading/unloading of cars since data instantly get on the monitor of the railway manager.
• Department of logistics. Integration with autoscales allowed to accelerate process of loading of finished goods and to provide its operating control. Data on shipping weight get on the automatic dispatcher's monitor, passing operators.
• There was a possibility of interactive modeling of the production program next year and trackings of its accomplishment. The production program is connected with operational budgets of divisions. Aggregated data of budgets of divisions form the budget of cash flow and the income and expenditure budget. The main operational budgets are calculated automatically according to a system. The main advantage of system implementation of budgeting - the disciplined approach of services of the enterprise to planning of the expenses and the maximum control of observance of budgets by the chief financial officer.
• The algorithm of calculation of forecast cost value of finished goods next year according to budgeting is implemented. A system automatically models future product cost on the basis of these forecast budgets of divisions and data of the production program. As a result for the last year it was succeeded to optimize cost value of finished goods, next year further decrease in this major indicator is expected.
• Control of terms of passing of planned maintenance of motor transport is strengthened that allows timely and with the minimum time expenditure to service own vehicle fleet. Duration of idle times of cars is minimized. The cost forecasting mechanisms implemented in a system on TO, insurance and fuel and lubricants help to plan the budget of division for future periods.
• Automated management of finance, control of use of money is strengthened. Application of the payment schedule for operational management of cash flows allows to use effectively money resources and to exclude emergence of cash gaps. Also in a system credit portfolio management and deposits in rubles and in currency is conducted.
• Preparation of the managerial and regulated reporting is completely automated. Now the management of the enterprise can quickly obtain key information on activity of the enterprise. The delay of submission of reports to regulatory authorities is almost excluded. The volume and time spent for input, processing and information analysis by employees of the enterprise owing to automation of all key business processes was considerably reduced. The reporting is prepared twice quicker.