Energomash (Chekhov) optimized the management of complex order production using 1C: ERP

2022: Automation of plant operation

On May 26, 2022, Institute of Model Solutions announced that the manufacturer of the Energomash (Chekhov) - ChzEM pipeline valves optimized the management of complex order production using 1C: ERP.

Illustration: vk.com

Specialists of the company "ITRP" automated the operation of the plant "Energomash (Chekhov) - CHZEM." Operational inter-farm planning is organized. It is possible to pre-determine the availability of resources (personnel, equipment, materials) to estimate the executability of orders in given volumes and dates. Operational accounting of work in process has been implemented. Traceability of each production order with details prior to production and process operation is ensured. Procurement planning is optimized, materials, raw materials and components are delivered to workshops and sites in a timely manner, while the amount of inventory is reduced, according to the company, by 15%. Equipment downtime has been reduced, production rhythmicity has increased. Increased control over costs, accurate calculation of the actual cost. Cases of non-compliance with contractual deadlines became one and a half times less.

Energomash (Chekhov) - CHZEM is a Russian supplier of high-pressure pipeline valves, since 2009 it has been a member of the Energomash group of companies. It develops and manufactures equipment for steam-water working environments for energy, including nuclear, oil and gas, chemical and other industries .

The key area of ​ ​ the enterprise's work is the production, installation and maintenance of equipment for thermal and nuclear power plants (TPP/NPP). Each unit of production has a complex composition. The production cycle is 4-6 months. To work efficiently, the company needs to purchase the necessary materials and components in a timely manner, rationally plan the work of production departments, and monitor the passage of orders along a complex technological chain.

Previously, part of the production management tasks at the plant was solved using a foreign ERP system. Spreadsheets were used for management accounting, calculation of actual cost and margin of orders, creation of tasks to workshops and sites, management of task priorities. In the spreadsheets, managers calculated material requirements, planned purchases, determined the timing of orders, taking into account the reserve of production capacities and materials for open and planned orders. In the quantity accounting of work in process (WIP) there were errors, "negative balances," doubles of the item, re-sorter. There were frequent cases when managers ordered materials from suppliers that were not needed by the production, or in the wrong quantity, or at the wrong time, or at inflated prices. All this led to delays in the execution of orders.

The company needed a unified information system for all departments and tasks, which would allow it to form an executable order schedule for production with the calculation of the priority of orders online, organize end-to-end traceability of orders in production, and optimize procurement planning. It was necessary to strengthen control over the release of materials to the workshops, establish accurate quantitative accounting of NZP, and improve the accuracy of calculating the actual cost of orders to estimate the margin by market segments. In addition, it was necessary to strengthen control over the profitability of orders in the direction of APEC/TPP and reduce the risks of late fulfillment of orders in this key area for the plant.

To solve the tasks, the solution "1C: ERP Enterprise Management" was chosen. The implementation partner was the Institute of Standard Solutions - Production (ITRP), which has the status of 1C: ERP Center and has been specializing in automation of production enterprises for more than 20 years.

The main work on the project was completed in 8 months. During the project, the description and functional modeling of the key processes of the enterprise were carried out, functional gaps were determined, the necessary modifications and settings of the system were implemented, balances and regulatory information were transferred from the foreign ERP. 50 workplaces are automated.

Key project outcomes:

• Optimized production planning. It became possible to automatically generate tasks for workshops and areas with the choice of a planning option: you can assign the launch "as early as possible," taking into account time the equipment work already reserved for other tasks, or "as late as possible" by the specified date of release of the finished product by order, depending on the priority of the order. Traceability of each production order with details prior to production and process operation is ensured. In the system, at any time you can get data information about the current state of each order: the volumes of work performed and work not completed, where - on which operation, in which workshop - there was a lag in the execution of the order. This technique allowed shop/site dispatchers to optimally manage the start-up priorities in production units. Cases of production delays on orders due to opacity reasons for performers of work priorities have become one and a half times less.
• The system has transferred the main documents for internal management (production stages, shift tasks, orders of materials for the warehouse, permits for replacement, report on the execution of shift tasks), the volume of manual paper documents: workshop "shortages," disparate requests to the supply service, reports and reports on the implementation of the schedule, etc. Dispatchers of workshops and sites faster perform their operational tasks, faster search and analysis of production information. The time for preparing documents, creating warehouse orders and reports for management is reduced by 30%.
• Preliminary calculation of the calendar requirement for work personnel for execution of production orders has been implemented. As a result, it became possible to quickly evaluate the possibility of fulfilling an order by a given date.
• It is possible to calculate the calendar demand of production for materials and components for each order. Accurate and timely information about material balances in warehouses, materials in transit, and expected deliveries is available in the system. This helps the Supply Service to monitor the availability of production and material orders, to plan procurement efficiently, and, in the event of supplier breaches of obligations, to review orders in a timely manner, taking into account priorities. As a result, the stock level has been reduced by 15%, working capital has been released, the necessary materials are uninterrupted into production, and obligations for terms with customers are revised in a timely manner.
• At the production sites, accurate quantitative accounting of parts and assembly units (DCE) was organized, it became possible to estimate their cost in each order. The system calculates the actual cost of the finished products automatically based on the data on direct and indirect costs, movement of components, materials and products in production. All this allows the enterprise to quickly track the profitability of market areas and segments, rationally manage pricing and make decisions about the priorities of work areas in long-term planning. Cost analysis helped to identify unreasonable costs (registration in the workshops, creation of excessive backs, excessive electricity consumption, main points of scrap) and take measures to eliminate them.
• Separate accounting and control of production support with materials, components and raw materials for fulfillment of orders of thermal and nuclear power plants is organized. This allows you to quickly assess the profitability of the key direction for the plant. The risks of delays in the execution of TPP and APEC orders are reduced.
• The work of accountants and employees of the personnel department has been simplified. Regulated accounting performs management accounting functions due to the speed and reliability of the data, as well as the availability of the necessary analytics in the system.

"With the introduction of 1C: ERP, the production business processes in the enterprise have become more controlled: the traceability of each order is ensured, at any time you can find out at what stage of production it is, how provided it is with resources and materials. This allows you to analyze the cause of delays and take timely measures to minimize the risks of delay in orders. The number of orders completed on time has increased, thereby increasing the accuracy of fulfillment of obligations to our customers. We were able to make decisions on the priority of activities based on their profitability. The program interface has been optimized, it has become easier and more convenient to generate reports. ERP from 1C provided real tools for business management. In the future, we are going to introduce budgeting, and after clarifying regulatory data, we are going to move to automated post-operational production planning, " notes the general director of Energomash (Chekhov) - CZEM Denis Anatolyevich Efimov.