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Date Posted: 8/22/2007

CFO’s Find Value and Growing Pains in Manufacturing Execution System Solutions

 
 

By Thomas R. Cutler 

According Tony Parkinson, CFO of Hollywood Woodwork, in Hollywood Florida, “We were finding it harder and harder to hire experienced estimators that truly knew our industry and we were spending an inordinate amount of time developing estimators from within the company.  We were concerned that much of the knowledge we had concerning the “art” of estimating was primarily in the heads of a few people who were looking to retire in the next couple of years.  We wanted to find an estimating package that was geared towards the architectural woodworking industry and would help us transfer the knowledge of our senior estimators into a system that could benefit everyone.   We knew if we could systemize the process at a more granular level we could better avoid “ballpark” estimates.  We would have the ability to modify and provide estimates quicker and at a more detailed level – something our customers were demanding.”

 

While a woodworking example in this instance, the nature of this scenario is indicative of all ETO (engineer-to-order) firms across many industry sectors.    Engineer-to-order is a style of manufacturing rather than one specific industry grouping. Some examples of industries where you will find ETO companies are:

 

• Dies, Tools & Molds • Machine Tools • Industrial Cranes and Hoists • Farm Machinery • Metalworking Machinery    • Construction Machinery • Foundry Equipment • Mining Machinery • Industrial Automation Equipment • Oil & Gas Equipment • Medical Equipment • Industrial Tractors and Trailers • Custom Boat Builders • Power Generation Equipment • Conveyors & Material Handling Equipment • Food Industries Machinery • Paper Industries Machinery   • Transportation Equipment • Communications Equipment • Fabricated Metals • Custom Sign Makers    

 

 

Parkinson noted, “In production and accounting, we needed a system that would give us more specific details of how a job was progressing through the plant so we could monitor it better and be able to schedule.  Before the new MES (manufacturing execution system) was installed, we were only able to monitor a job via “Big Buckets” such as Plant Manufactured Goods, Buyouts, and Installation.”

 

Other than TRAKware, the MES solution Hollywood Woodwork selected, Project Pak was the only other solution from which the company formally received a quote.  Parkinson, noted that the chosen MES solution included parametrics and could dynamically change bills of materials, bills of labor, labor routings, costs, selling prices, as well as the ability to schedule.

 

Checklist of Feature for MES in the ETO Environment

 

·          Estimating

·          Advanced production scheduling

·          Advanced parametric configurator / product configuration

·          Change order management

·          Manufacturing data collection

·          Shop floor control

·          Labor tracking

·          Work-in-process/progress (WIP) management

·          Material and inventory management

·          Project execution and control / job costing

·          Financials

·          Mobile access (laptop, wireless handhelds, etc.)

 

 

 

How CFO’s in the ETO Environment Find Technology Driving Culture Shifts

 

Implementing the new MES system created a culture shift throughout the enterprise beyond the initial estimating functionality.  While originally purchased for the Estimating Department it soon became evident that the organization needed to bring in representatives from all departments of the cmpany in order to have a successful implementation.  “As an “Enterprise” software package we have discovered that imposes coordination among departments throughout the company, it requires defined tasks, sequences, and data formats to be used by ALL people,” according to CFO Parkinson.

 

Growth Pains in Establishing a Systematic Process 

 

The company is still in the implementation stage and consequently the firm is still waiting to get a return on our investment.  Parkinson admitted, “I don’t think we fully realized that we were embarking on implementating an “enterprise” software package and not just an estimating software package.  Consequently, we did not involve and communicate with all the departments in the organization early enough to get their buy in – we are now!”

 

 

CFO’s top 3 reasons an ETO (engineer-to-order) manufacturer (such as Hollywood Woodworking) should consider in selecting an MES solution:

 

1.             Properly implemented, it will allow a company to focus on reducing costs and increasing margins.

 

2.             Enable the company to be more responsive to customers in terms making and keeping commitments, providing details, and delivering a job on time, on budget.

 

3.             Help take a lot of data and turn it to information to make better informed decisions.

 

 

 

 




Author Contact:
Thomas R. Cutler
TR Cutler, Inc.
Email: trcutler@trcutlerinc.com
Website: www.trcutlerinc.com


About Author
Thomas R. Cutler is the President & CEO of Fort Lauderdale, Florida-based TR Cutler, Inc., the largest manufacturing marketing firm worldwide – www.trcutlerinc.com. Cutler is the founder of the Manufacturing Media Consortium of three thousand journalists and editors writing about trends in manufacturing. Cutler is also the author of the Manufacturers’ Public Relations and Media Guide. Cutler is a frequently published author within the manufacturing sector with more than 300 feature articles authored annually; he can be contacted at trcutler@trcutlerinc.com.

 


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