"Cycle company" reduced the volume of work in progress and surplus stocks using 1C:ERP

On September 10, 2018 the 1C company announced that specialists of Institute of Model Solutions LLC automated production management in TsIKL company.

Premises and project tasks

One of features of work of Tsikl company - the expressed seasonality of the product demand. Fully to provide needs of buyers, it is necessary to maintain in a warehouse optimal product quantity and semi-finished products taking into account the expected number of shipments in every month. Decrease in a warehouse stock below can give minimum to emergence of a commodity gap, and overstocking of a warehouse - to the losses connected with production and storage of unclaimed products. Therefore for the company it is important to plan rationally production taking into account forecast customer needs.

Earlier production was planned manually. Inaccuracies in plans, inevitable at manual calculations, resulted in excesses of stocks in warehouses and to a surplus of semi-finished products in work in progress. It, in turn, reduced turnover of invested funds. With growth of sales volume shortcomings of planning began to affect results of a company performance. The effective production management system which would allow to plan precisely production taking into account seasonality of demand was required for the enterprise. Moving on other production site with the accompanying changes in processes of management of production and a warehouse became an additional incentive to system implementation.

For implementation of the tasks it was decided to use functionality of the 1C: ERP Enterprise Management 2 system. "Institute of Standard Solutions — Production" (Institute of Model Solutions LLC) company became the partner in implementation.

Project Results

During the project 50 jobs were automated, in a system company executives, managers, technologists, masters of production, employees of a warehouse work.

Key results of the project for September, 2018:

• The production planning methodology is implemented. In a system the range of a remaining balance of finished goods, optimal for every month, and semi-finished products by each type of products is planned for the long period. Then on the basis of these data, taking into account seasonal sales plans, 1C:ERP calculates the balanced production schedules. As a result the quality of production planning grew, excess finished product output and semi-finished products was reduced, stocks in work in progress and in warehouses are reduced by 20%.
• There was an opportunity to analyze compliance of utilization of capacity to the made plans and, if necessary, to adjust plans for balancing (alignment) of loading. As a result the losses connected with idle times of production personnel and the equipment during the periods of seasonal recessions and emergency overloads during the peak seasonal periods are reduced.
• Operating control of work of production divisions is organized. Data on execution of operations and about the movement Inventories in production are entered into 1C:ERP directly in workshops, using data collection terminals with scanners of barcodes. The quantity of errors in production accounting was considerably reduced, the speed of collecting and data analysis about the course of production process grew by 50%, labor productivity of specialists in accounting increased by 40%. It allowed the company to execute quicker production orders, to reveal and eliminate the arising deviations in production processes quicker.
• Accuracy of planned daily planning increased, time for drawing up the schedule of production workers was reduced by 60%: the diagram of production is calculated on standard algorithms of 1C:ERP work centers providing optimal loading with arrangement of stages so that to minimize readjustments of the equipment. As a result the feasibility of planned daily tasks increased, deviations in terms of passing of production phases are excluded. The number of readjustments of the equipment is reduced, costs for readjustments are reduced almost by 10%.

"For September, 2018 we see that the solution "1C: ERP Enterprise Management 2" as the automation system of production is selected correctly. Thanks to joint work of our specialists and specialists of Institute of Model Solutions, assigned tasks are carried completely out: within the first month the function model was developed, for the 4th month of works project operation was started. Implementation of a management subsystem production allowed to organize a common information space for all services of the enterprise, to systematize processes of management of production and warehouses, to estimate utilization of capacity on the basis of data of an information system. Earlier we overproduced many semi-finished products and assembly units and often by the end of a season the big remaining balance of the excess nomenclature turned out, system implementation "1C: ERP Enterprise Management 2" allowed to reduce considerably volumes of excesses". Irina Aleksandrovna Hlupnova, head of IT projects of Tsikl company