"Star" completed the first phase of creation of an ACS for geared production

Implementation of Infor ERP SyteLine at the JSC ZVEZDA plant

About the enterprise

JSC Zvezda is one of the largest industrial enterprises of St. Petersburg, the Russian leader in production of easy high-speed diesel engines of different function. The Zvezda plant was founded in 1932 in Leningrad based on Machine-building department of the oldest enterprise of the country – the Bolshevik plant. Core activities of JSC Zvezda are development, production, implementation and service maintenance of diesel engines, diesel generators and the automated diesel power stations, the diesel - geared and other units, a reverse - geared transfers, delivery of spare parts, service maintenance and repair of products. The engines and diesel generators released by the plant are used mainly in shipbuilding, on the railroads and in small-scale power generation. Products have complex structure, a row from them includes about 2500 nomenclature units. The production cycle makes about 45 days. About 2000 people work at the enterprise.

Implementation premises

At a certain stage of the development the JSC Zvezda enterprise, as well as many other enterprises, faced a number of problems in the organization of exact planning and effective management of production, stocks, finance.

To modern economy the enterprise came from the Soviet past with a number of the problems, typical for mechanical engineering, caused, first of all, by a market change. In the nineties demand for the diesel engines and diesel-generator stations which are earlier made by large batches fell approximately by 10 times that forced the plant to reduce amounts and to pass to work on the schemes "production under the order" and "assembly under the order".

Besides, sales in the "new" market stopped being rhythmical that was not considered in the existing production cycle. As a result, there was a problem of optimization of distribution of the arriving cash flows which are not considering a possibility of production.

Other call of the modern market — increase in level of customer requirements to the made products and emergence of demand for exclusive completions. Answering it, the designer of the plant is developed by a large number of modifications of the existing products that led to growth of the nomenclature in quantitative expression.

New market trends demanded radical changes in the organization of business processes that led to decrease in controllability by the enterprise since the management system could not support these changes.

Emergence of a large number of modifications of the existing products and frequent replenishment of their list led to a complication of the organization of purchases and supply. Frequent making changes in constructions and technologies by Design-technology division of the plant caused the necessity in urgent repurchase planning. Provision was aggravated with lack of the worked procedures of such adjustments.

The decrease in control of increase in stocks and volumes of work in progress which arose in a situation of dynamic changes led to freezing of an essential part of current assets. As the information system existing at that time did not allow to conduct exact supply planning, procurement were performed with a permanent reserve, and as a result, the above-standard stock accumulated. In such situation it was difficult to build the optimal balanced production programs that provoked permanent failures to meet time constraints of shipment of products. In the conditions of permanent emergence of new modifications and change of listed products there was no opportunity to quickly calculate exact cost value of products that periodically led to sacrifice sales.

As one of means using which it would be possible to improve a situation with controllability processes of the enterprise the ERP system implementation project was considered. In the nineties on JSC Zvezda the solution based on BPCS was used. However, by 2005 there was already a number of arguments for benefit of ERP system change.

Choosing a Solution

In the course of primary selection of software solutions which could be used at the plant Star considered the following ERP systems: SAP ERP Microsoft Axapta (Microsoft Dynamics AX) Infor ERP SyteLine, the adapted option 1C 8.0.

At decision-making the following criteria had the greatest value: functionality, cost, experience of implementation of the advanced solutions by the supplier. Finally, having got acquainted is closer to a system and having visited those enterprises at which the solution from "Frontstep CIS" was successfully implemented, the management of Star stopped the choice on SyteLine ERP system.

Having gone for cardinal changes, the management of Star decided that the corporate system of management on the basis of Infor ERP SyteLine developed especially for discrete production should provide complete information "transparency" of work of the enterprise in real time, increase competitiveness and level of capitalization of the enterprise.

Project Objectives

In the situation which developed on Star the management of the enterprise expected from implementation of the ERP system of the solution of the following tasks:

• increases in available current assets due to minimization of all types of stocks and materials as a result of exact planning;
• increase in sales volume due to increase in the service level of clients;
• reduction of cost value of finished goods due to increase in effective management of costs;
• ensuring support of an effective management system and processes of interaction of divisions and also, creation of "information base" for development of the company.

Implementing solution

At the end of 2005 on Star the project on implementation of a new corporate system of management on the basis of Infor ERP SyteLine (with the built-in module APS) which had to provide synchronous and optimization planning, logistics management, production and finance started. Implementation of a corporate system of management was broken into the next stages:

• Preparatory work, the including inspections of business processes of the customer and development of a prototype of future system.
• Training of the working group of the project from the Zvezda plant that they could accept active uchasktiye in the next stages of the project that significantly increases efficiency and speed of implementation.
• Creation of the target business model (TBM).
• Creation of pilot option of a management system for logistics, production and planning and its experienced and test operation.
• Testing.

Start in commercial operation of the automated control system

During implementation of an information system the following blocks were started:

• Purchase management and reserves of materials for the main production according to sales plans (integration with the 1C 7.7 system, formation of the purchase plan and account register).
• Sales management, sales planning taking into account opportunities of production and stocks (input of forecasts and customer orders, formation of the cash receipt plan).
• Production management, including setup of the interface to PDM to the Pilot system managing data on products and delivering in Infor ERP SyteLine data (structure of products, routes and technology processes, standards for work and materials) on the basis of which in the ERP system planning and the accounting of course of production, sales management, by purchases, stock accounting and work in progress is carried out. The labor input of operations on production division (workshop) was aggregated on all transactions executed in this division.
• Planning of activity of the main production and purchases. Setup at the enterprise of schedule system on the basis of resource model in which groups of "resources" corresponded to working crews with the fixed nomenclature, and workshop – one transaction.
• Accounting of the course of the main production, including accounting of component parts and materials, a time recording (reconciliation of a remaining balance and work in progress).
• Management of direct production costs (movements of material values between workshops, reduction of terms of stay in warehouses of parts and nodes, ensuring completeness of production of products).

Integration of Infor ERP SyteLine with an accounting system of enterprise "1C 7.7". The plant's management Star seriously treated formation of the project team: the order regulating employee involvement level in the project was issued and the percent of their employment in is mute. Experts in functional units, representatives of IT department, designers, technologists and departmental engineers of work were involved in implementation.

The created working group attended a specialized production management seminar in the beginning, and then already completed a course on the Infor ERP SyteLine system. Much attention was paid to motivation of the personnel involved in the project: a number of financial incentives was entered. The general project duration was 18 months, 26 employees of the enterprise entered into project team.

Results

In May, 2007 the Infor ERP SyteLine system covered all processes on inventory management, supply and sale, accounting of course of production and production planning and purchases. The enterprise did a great job on formalization of all technology processes and on reduction of the existing standards to reasonable regulations.

For the management of the enterprise of one of criteria for evaluation of a project success there was a disposal of the saved-up stocks: now the level of a remaining balance considerably decreased because real requirements became visible and, the purchasing amounts calculated on on their basis began to be reduced significantly. At the same time the plant can see now on what materials there is no movement what stocks of parts exceeded regulation and why it occurred. Before 70% of the parts made by the plant it was required in further production not in the nearest future, and only in the remote perspective, taking the place until then in warehouses that already is not present.

The solution provided more exact planning of productive activity that at once allowed to begin work on optimization of current assets: exact planning allowed to begin process on minimization of stocks of finished goods, materials and work in progress. Now purchase plans are analyzed regarding demand of the purchased nomenclature thanks to what reducing costs for purchases happening due to timely identification of above-standard stocks and their use in production is reached.

Systems capabilities of production planning allow to predict terms of accomplishment of orders with a high accuracy that, respectively, allows to work more surely and reliably with customers, avoiding delays and penalties.

Besides, there was a solution allowing to optimize "safety stock": according to the list of certain products the necessary reserve is supported that gives the chance of fast reaction to requirements of the market.

The Infor ERP SyteLine system provided complete information transparency of work of the enterprise in real time, having provided heads with operational and reliable information about plans and the management reporting for heads of different levels.

At ERP system implementation many settled interaction mechanisms, both in divisions, and between them, significantly change, and project team first of all should apprehend such changes adequately. Success of implementation was provided with effective work of a project team, presence of employees at it with flexible thinking, qualification of consultants, successful technologies of testing and start.

The big role was played by existence in a command of maintaining the normative reference information (NRI) of the experienced employees motivated on result that guaranteed correctness and completeness of NSI. Creation of a system of adoption of operational solutions in case of detection of mismatch of archive NSI on structures of a product of information from production was an important component of this work.

Creation of AS for geared production

On December 8, 2017 the FRONTSTEP company announced end of the first phase of creation of an automated system for geared production of PJSC ZVEZDA.

At the beginning of 2017 PJSC ZVEZDA opened section of geared production. This production site expands production and technology competences of the manufacturing enterprise of heavy geared transfers weighing up to 50 tons.

In the project the concept of implementation of tasks is developed and protected. For December 8, 2017 works on the embodiment of a concept are conducted.

In terms of solving of tasks of integrated management of all main business processes, there was reasonable a building functioning in PJSC ZVEZDA of the integrated IT system regarding management of a production site.

Works are conducted according to the delivery contract and system implementation of automation of technology production processes and tests. At the beginning of works on control automation as technology production processes FRONTSTEP developed and approved the general Concept of IT solution, in details simulated and described end-to-end algorithms and interrelations of basic processes of productive activity.

Orders for production of reducers appear in the IT system at the time of the automated formation of production plans of PJSC ZVEZDA, at the same time section of geared production is in terms of planning by one of production workshops in end-to-end process of production of products - thus in a system the product demand of workshop forms.

For creation of works orders (ZNP) the short-term planning horizon in 10 days is used, works orders are created according to structure of the ordered products (positions of specifications) taking into account issue date of a ready complex.

Preparation of production of PJSC ZVEZDA includes:

• technology preparation of production;
• formation of operational schedules of production;
• formation of dresses on production and planned daily tasks at the level of workshops, sections and jobs (accompanying documents for tracking of course of production, documents are supplied with barcodes);
• providing with materials, parts and component parts of jobs under each task (check of a complete set, the material requisition in a purchase order type and movement from warehouses to production is automated).

On the basis of the created works orders (ZNP) on assembly the completeness of the assembly units (AU) is calculated, on each completed ZNP the accompanying documentation – the Route sheet (reflects technical process) and the Pick list forms (contains structure of a product). It agrees to the tasks put in production, are issued the material transfer requisition and parts. On the basis of transactions ZNP the planned daily tasks (PDT) form, information is output to info panels located in close proximity to jobs.

The accounting of course of production is carried out in real time using technology of barcoding:

• Registration of the fact and runtime of production operations;
• Completing of assembly transactions;
• Registration of write-off of materials for production;
• Registration of production and its shipment, marking of products;
• Defects registration;
• Registration actually a worked time of specific contractors;
• Registration of movement of Inventories: receipt from suppliers, issue from material warehouses in production (a complete set of works orders), movement between warehouses, places of warehousing;
• Equipment downtime time management;
• Accounting of the tool – issue, return, time of the actual operation (for the purpose of tracking and regulation of technology wear of the tool and the equipment).

Data entry in a system or an output to the screen of terminals is performed by scanning of barcodes on the accompanying documentation. It allows to accelerate considerably work and to avoid the potential errors connected with "a human factor".

Staff of production divisions of the enterprise can work with any combination of data acquisition devices:

• stationary and figurative terminals with readers of barcodes,
• hand scanners,
• wireless scanners of barcodes.

Technological capabilities of the solution allow to transfer instantly all data and to automatically register them in the ERP system.

Operational collection of information for rendering corrective action on the basis of continuous tracking course of production on all sections of creation of finished goods is as a result provided.

On info panels in work centers information in real time will be displayed:

• The status of execution of operations on planned daily tasks;
• The plan fact of accomplishment of works orders in a change/month;
• Quantity of the defective products, and so on.

The reporting will become available to the management – the IT system on the basis of data retrieveds will allow the management to perform comprehensive assessment of functioning of work centers in the course of control and production analysis, analyzing the reasons of deviations of course of production from the planned level:

• The analysis of overall effectiveness of use of the equipment with analytics of availability and the reasons of idle time, the analysis of defects - in analytics day/month/year;
• On products:
  • plan fact of production for quantity,
  • on labor input,
  • as a percentage;
  • defects with analytics of the reasons.

The proposed solution on production management using technology of barcoding showed:

• flexibility (specialists of the enterprise can adapt functional logic for changes of business processes);
• accuracy of the data (error check is performed at the time of formation or registration of transaction);
• efficiency of data entry (allows to execute transactions in real time);
• cost reduction (due to cost control, reduction of labor input of reflection of transactions in the accounting system and decrease in number of iterations on information input).