"The first Bit" automated production management and sales in KSIL

2019

On May 24, 2019 the company the First Bit reported that automated production management and sales in KSIL company. System "1C:ERP. Enterprise management 2" helps to execute orders precisely and in time that will allow to increase the volume of shipments to 1.5 times. Speed of assembly of orders grew. Practically the number of errors at a complete set of orders was reduced to zero — in the future it will lower costs for claims for tens of millions annually. The purchasing system was optimized, and it reduced costs for materials and their delivery between production sites. The company management expects the general cost reduction and costs for the amount exceeding 100 million annually.

According to the company, earlier the commercial service kept account in a system which was implemented nearly 10 years ago. During this time in the company the branch network appeared, production volumes many times increased. An old system did not correspond to requirements of the grown business any more, and its support and development required too big investments. Besides, all other divisions for accounting used the spreadsheets which are not connected among themselves, and it created additional difficulties for company management.

At such automation the company had no relevant and unrolled information on a business status. Activity of each division for the others resembled "a black box" — for example, the commercial service did not know at what production phase there is this or that order and whether it will be executed in time. The situation considerably became complicated the fact that orders gathered from hundreds of component parts which do not have identifiers — assembly was made on the printed schemes. All this resulted in a large number of errors, and as a result the company annually lost about 140 million rubles on penalties, a penalty fee and payments according to claims of clients.

It was necessary to create a single system which would reflect activity of all divisions and had necessary analytics for the solution of managerial tasks:

• tools are necessary for service of purchases for planning and purchase management;
• production needs an exception of situations when there are not enough materials or production capacities;
• in a warehouse it is necessary to organize storage system and quick access to necessary component parts;
• the reporting showing a real status of business is necessary for company management.

For project implementation a system was selected"1C: ERP. Enterprise management 2". First Bit became the partner in implementation.

600 jobs were as a result automated: in commercial service and purchasing department, on production and warehouses. For work with component parts and finished goods the equipment which is programming and reading out RFID tags is installed and at a complete set of orders began to use barcoding.

Key results of the project:

• The company received control of production work — at any time it is possible to learn what orders are already executed whether there are enough materials for production of the planned products, whether it will be made in time. It helps to prevent big financial losses — idle times of the machines expecting loading of ready orders were reduced and a penalty fee for failure to meet time constraints in accomplishment of orders decreased.
• Thanks to implementation of an effective production scheduling system and purchases by 1.5 times admissible maximum production volume increased. Now when planning a remaining balance of materials in warehouses and terms of their delivery, a possibility of the equipment, working schedules of employees is considered. Now production works quicker and practically executes all orders in time.
• The management of "KSIL" received the necessary analytical reporting on a company performance. Now there is an opportunity to authentically learn the amount of profit on what sections of work optimization is possible. The received analytics is already a big step to the best controllability business, but accumulating experience, the company will develop the system of analytics.
• Speed of assembly of orders was reduced and errors at a complete set due to integration of RFID with a system are minimized "1C: Erp.Upravleniye enterprise 2". All semi-finished products are marked by RFID tags, and finished goods - labels with a barcode. Employees of a warehouse with the help of mobile terminals easily and quickly find required materials for assembly of orders and also do not spend time for additional information input in a system — data are loaded automatically.
• Implementation changed a number of business processes in the company, having made them more effective and scalable. For example, the scheme of purchases of materials changed. Now one division is responsible for purchases for all production sites — it helped to reduce costs for materials and their movements between production sites.
• Implementation of the module of bits.CRM helps the company to avoid dependence on specific managers in customer relations — on any client history of the relations and the arrangement according to transactions are fixed.
• Labor costs on the routine transactions connected with manual accounting are several times reduced. For example, managers should not carry by orders payments from the bank statement — now it becomes automatically when choosing the account.

For us it was very important to construct a single system for work of all divisions that it became the tool for business management. We from the first days of system operation began to see results — the quantity of mistakes which were made due to the lack of necessary information earlier was reduced. And it is that case when we do not doubt that this implementation every month will yield the increasing and bigger result. Kirill Kryuchkov, CIO of "KSIL"