How a Next Generation MOM Can Drive Flexible Automotive Manufacturing

NOVEMBER 2006

Table of Contents
Executive Summary ....................................................................................... 3 Introduction .................................................................................................... 4 Are Traditional MES Solutions the Answer?................................................... 4 The Apriso MOM Solution: FlexNet ............................................................... 6
Easily Manage Changing Manufacturing Operations Processes ............................ 6 Enable Flexible Manufacturing .............................................................................. 6 A Closer Look at the Apriso Solution ..................................................................... 7

Case History: Mitsuba ................................................................................... 8 Conclusion ..................................................................................................... 9 About Apriso ................................................................................................ 10

2006, 2010 Apriso Corporation This white paper, the software described in it, and other program materials are copyrighted works of Apriso Corporation, with all rights reserved. Trademark Information Apriso and FlexNet are registered trademarks of Apriso Corporation. Limitation of Liability The information in this document represents to the best of our ability the product functionality of Manufacturing Execution, Manufacturing Operations Management and other software products. These materials are subject to change without notice. These materials are provided by Apriso Corporation for informational purposes only, without representation or warranty of any kind. Apriso Corporation shall not be liable for errors or omissions with respect to the materials. The only warranties for Apriso Corporation products and services are those that are set forth in the express warranty statements accompanying such products and services, if any. Nothing herein should be construed as constituting an additional warranty. Version 1006.0.

How a Next Generation MOM Can Drive Flexible Automotive Manufacturing

Executive Summary
Since the first automotive production lines went into operation in the last century, car makers have operated dedicated assembly linesone production line for each car model being produced. That simple concept of repetitive production sparked a revolution in efficient manufacturing and fueled a hundred years of automotive success. Today, automotive success is measured by a different manufacturing model: Flexible manufacturing. This paper will present how next generation Manufacturing Operations Management (MOM) solutions can provide automotive manufacturers considerably greater flexibility than a traditional Manufacturing Execution System (MES). Improved agility can lead to better operational performance, greater revenue opportunities and reduced costs. A case study will be presented, demonstrating how a next generation MOM solution can achieve these objectives. .

How a Next Generation MOM Can Drive Flexible Automotive Manufacturing

Introduction
Flexible manufacturing allows auto makers and suppliers to respond quickly to changes in customer demand, and to shift their production as needed to keep plants at full (and profitable) operation. IBM has cited "flexible assembly" as one of the key manufacturing requirements for competing in the coming years. Indeed, the 2006 Harbour Report on manufacturing efficiency cites Hondas ability to shift model production between plants in as little time as over the span of a weekend as a key differentiator in its economic success among OEMs in North America. In a traditional automotive manufacturing model, this type of changeover would normally take months and carry substantial penalties in terms of competitive responsiveness and ultimately, bottom line impact. Production sequencing is also gaining traction as a primary assembly and supply model, making it possible to vary what is produced on the production line without having to maintain excess on-hand inventory. Production sequencing is especially important for manufacturing companies with a highly derived product mix where multiple products are being built from the same base platform. In these operations, production schedules can dictate the sequential build of different models to meet specific customer orders and demand trends. Meanwhile, the automotive suppliers who serve flexible production plants are being forced to change as well. Suppliers must either pre-build the parts and keep the inventory on their shelves, or move to flexible and sequenced manufacturing so they can produce and deliver the production parts as they are needed.
1

Are Traditional MES Solutions the Answer?

While there are many components involved in flexible manufacturing, a key issue is how agile and adaptive are the execution systems used to manage production on the factory floor? Many manufacturers are still running their plants with legacy MES or homegrown systems that are not flexible, and offer few if any traceability capabilities. In fact, the typical automotive enterprise is a hodge-podge of non-integrated point solutions on the plant floor that are difficult to maintain and costly to change. And, they are typically different for every plant in the companys manufacturing network, making it nearly impossible to achieve critical management goals such as uniformly measuring manufacturing performance to key indicators, and deploying best-practice manufacturing process updates in a responsive, efficient and uniform manner.

"Changing Lanes for Success: Flexible automotive business models in times of accelerated change," IBM Institute for Business Value, July 2006

How a Next Generation MOM Can Drive Flexible Automotive Manufacturing

While there are many specific physical requirements including floor design and tooling selection for establishing a flexible manufacturing environment, analysts say automotive manufacturers also must update their factory floors with a truly adaptable, highly flexible nextgeneration approach to manage manufacturing operations. Furthermore, as the need for production facilities in new markets grows, manufacturers need a next generation Manufacturing Operations Management (MOM) solution they can deploy globally and efficiently, without the need for deploying large IT-based teams to remote locations for long periods of time. Just as individual production lines must become flexible, so too must the overall enterprise. To compete in todays highly competitive automotive industry; manufacturers must have the ability to respond wherever demand and market opportunity leads them. What would a MOM solution that supports these requirements look like? It would need to support rapid model changeovers and quick reaction times to meet sequencing and flexibility demands. It would also have to extend the 4 walls of a manufacturing facility by integrating the supply chain, provide visibility into global production processes with comprehensive part and process traceability. In addition, it would support easy deployment of best practices anywhere, rapidly and cost-effectively, so decision makers could take advantage of flexible manufacturing by driving decisions down to the plant floor. Greg Gorbach, Vice President of Collaborative Manufacturing at ARC Advisory Group cautions: Manufacturing organizations need to become more agile and adaptive to remain profitable. Those that can react to market changes faster than their competitors can, and adapt their processes to take advantage of those changes, will be at a competitive advantage. In the next section, we look at how Apriso, a leading provider of adaptive software solutions for global Manufacturing Operations Management (MOM), has addressed the need for more flexible control with FlexNet. Delivering expanded functionality than just a Manufacturing Execution System, Aprisos FlexNet is a platform for manufacturing operations management and execution, enabling flexible manufacturing in the automotive industry while driving improved profitability, greater material synchronization and lower costs in a global marketplace. A Manufacturing Execution System (MES) is a dynamic information system that drives effective execution of manufacturing operations. Using current and accurate data, MES guides, triggers, and reports on plant activities as events occur from point of order release into manufacturing to point of product delivery into finished goods according to Manufacturing Enterprise Solutions Association International (MESA). Manufacturing Operations Management (MOM) is a new term, and has a wider scope of meaning, including each of the operational areas of manufacturing, from production to warehouse, quality, maintenance and labor processes. And, a MOM system can be deployed across multiple locations for a more comprehensive, enterprise-class solution.

What is MES, and How Does it Compare to MOM?

How a Next Generation MOM Can Drive Flexible Automotive Manufacturing

The Apriso MOM Solution: FlexNet

Easily Manage Changing Manufacturing Operations Processes
Apriso has developed an integrated, collaborative next generation manufacturing operations management (MOM) platform for operations execution that goes far beyond traditional MES approaches by allowing automotive manufacturers to easily deploy, manage and monitor flexible manufacturing processes, in real-time, across the full breadth of their operations (production, warehouse, quality, time & labor, supply chain visibility) within a single plant or throughout the global enterprise and extended supplier network. The solution is designed to be fully integrated across the supply chain, from your suppliers to component operations to sequenced assembly lines. And because the Apriso MOM solution is highly adaptable, while also enforcing best-practices, it allows automotive manufacturers to efficiently adjust manufacturing processes to meet changing production demands.

Weekend changeovers to a new model or deployment of updated manufacturing execution processes across multiple lines become a simple matter, instead of a costly challenge.

Enable Flexible Manufacturing

Called FlexNet, this adaptable MOM platform is designed to support rapid deployment or changeover of manufacturing processes and execution-based applications. In the Apriso solution, the authoring of business processes automatically renders both shop applications and a user interface, which guides operators on the plant floor step-by-step through work instructions with full part and process traceability. Thus, changeovers to a new model become a simple matter, instead of a costly challenge. Consider also reporting and traceability. These are difficult challenges in a dedicated production line. In a flexible plant, where parts and end-products are subject to continual change, these challenges are greatly amplified. Because the Apriso platform consistently and accurately collects and unifies data from all manufacturing operations in real-time, automotive manufacturers can generate on-demand reports in response to regulatory or production requirements to proactively manage operations. Management can generate reports at any level of detail, down to the part number, process, lot number, serial number, person or machine. Even information such as time of operation, production tolerances and operation certification level can be examined. Such instant and deep traceability could save millions of dollars in lost production timefor example, in the case of a recall, management can know what part is at fault, and exactly where and when it was produced, eliminating unnecessary plant or line shutdowns. Other benefits include the ability to: Deploy plants more rapidly than the competition, at lower cost Limit liability by maintaining full traceability Identify and correct problems early, before they become costly Meet stringent demands of customers with confidence in your data and ability to deliver How a Next Generation MOM Can Drive Flexible Automotive Manufacturing

A Closer Look at the Apriso Solution

The FlexNet platform and application suite supports the key requirements of automotive manufacturers for comprehensive real-time, pro-active control of manufacturing processes across the global manufacturing landscape: Rapidly deploy processes anywhere FlexNet provides the ability to actively deploy and manage processes and best practices in a single flexible plant, or across all facilities and those of suppliers and customers. The system has full revision control and accelerates new product introduction and time-to-volume production by utilizing best practice processes, and managing operational data across the supply network. It also provides the ability to continually improve manufacturing processes, and deploy those improvements on a global basis rapidly, easily and cost effectively. Trace materials, processes and products across the enterprise FlexNet provides a complete, real-time view into manufacturing operations and those of suppliers. The software gives complete work-in-process production visibility and traceability across sites and multiple companies, with full material synchronization and manufacturing bill of materials (MBOM) enforcement. The configurable visual controls make it much easier to drive business process improvement and compliance initiatives. The system has full unplanned event alert and dashboard features and can record and manage deviations and exceptions across the supply chain. Decision makers can see problems before they become critical, and take action such as rescheduling, shifting production to a different plant, and other proactive steps. Maintain a single version of the truth FlexNet can enforce consistent KPI standards such as OEE for every location, and for every variation on a flexible production line, so every plant measures information accurately and the same way. Then, the software rolls the real-time information up to the business level where executives can make real decisions, based on real information, and take immediate action. Built on a robust KPI analytics engine, it provides detailed visibility into production status, product attributes, Statistical Process Control (SPC) and quality for resources, material, labor and machines, both locally and across multiple locations. Automotive manufacturers can aggregate their manufacturing worldwide, compare plant performance meaningfully and use accurate performance data to guide continuing process improvements.

Key capabilities for the automotive manufacturing environment:

Flexible and global manufacturing support Real-time manufacturing execution visibility & control from material receiving through finished goods distribution Comprehensive part and process traceability Multi-manufacturing model support including just-insequence and just-intime Centralized ERP support with standalone 24X7 critical path ability Adaptability Solution control at the business process level

How a Next Generation MOM Can Drive Flexible Automotive Manufacturing

Case History: Mitsuba

Mitsuba is a major Japanese tier 1 auto parts company with more than 12,000 employees worldwide. The company's products include auto electrical systems such as wiper motors, slide motors, door mirrors, seat motors, relays and horns. As part of its global manufacturing upgrade plan, the company chose SAP R3 to integrate material movement and accounting, to adopt MRP as the best-practice in planning and to allow future global expansion. For its plant execution solution, Mitsuba selected Apriso's FlexNet platform because of its seamless integration with SAP R3 as well as its ability to interface with devices and wireless PDAs, handling of barcode labels printing and data collection, detail tracking of pallets and cases, and user-friendly GUI for efficient interaction with shop floor users. All material transactions and production labor time transactions are posted from the shop floors of four factories and several warehouses by over 200 wireless PDA barcode scanners through FlexNet to SAP R3 in a near real-time manner with close to 100,000 transactions per day. FlexNet also tracks the material, quantity, location and inventory status of pallets and cases, each of which is labeled with a unique barcode label issued by FlexNet. The combination of real-time transaction and detail tracking allows Mitsuba to improve inventory and production process visibility, which in turn are expected to slash PDCA cycle time, further reduce inventory turnover, eliminate production waste, and realize full shop floor traceability and genealogy.

How a Next Generation MOM Can Drive Flexible Automotive Manufacturing

Conclusion
As automotive OEMs and suppliers improve their flexible manufacturing abilities, they must update the manufacturing execution software that drives the factory floor. A new generation of comprehensive, business process driven software applications is needed, not only to address the challenges of flexible production, but also to adapt to a global marketplace where manufacturing execution can be monitored and managed from a global enterprise view. Aprisos FlexNet adaptive operations execution platform and application suite provides automotive manufacturers a highly flexible solution that can integrate manufacturing operations from raw material in the automotive supply chain, to finished product distribution on the lot or in the warehouse. It automatically renders process changes as a user interface on the factory floor that guides operators step-by-step through new work instructions, so that model changeovers become a simple matter from a control point of view, with full traceability and reporting. The solution also allows automotive manufacturers to deploy best practices and continual improvements easily and quickly, trace complete product histories and create reports at any time for regulatory or production requirements, and monitor plant performance based on real-time information from all plant floors. Aprisos FlexNet adaptive operations execution platform is being used by leading automotive organizations to create flexible manufacturing plants that are manageable and profitable, and that can be deployed easily in a global marketplace.

How a Next Generation MOM Can Drive Flexible Automotive Manufacturing

About Apriso
Apriso Corporation is a software company dedicated to providing competitive advantage for its customers. It does so by enabling organizations to adapt quickly and easily to market changes and unexpected events. Since 1992, Apriso has been helping companies improve manufacturing performance by providing visibility into, control over and synchronization across manufacturing operations both within and in coordination across plants and the product supply network. Some of the worlds largest and most successful manufacturers have leveraged Aprisos unique combination of software solutions and expertise to transform their manufacturing operations to achieve and sustain manufacturing excellence. As an adaptive platform for manufacturing operations management, FlexNet manages production, quality, warehouse, maintenance and labor processes to provide visibility into, control over and synchronization across global manufacturing operations. Built with a native Business Process Management (BPM) framework that incorporates a unified data model, FlexNet applications enable continuous improvement and rapid response to market changes. FlexNet delivers a global view of manufacturing operations by utilizing a Service Oriented Architecture (SOA) to ease integration with enterprise applications, such as ERP and PLM, while interfacing with the shop floor and automation equipment. Apriso serves 180+ customers in 40+ countries across the Americas, Europe and Asia. Its customers include General Motors, Lear, Honeywell, L'Oral, Trixell, Lockheed Martin, Becton Dickinson, Saint-Gobain, Novelis and Essilor. For more information, please go to www.apriso.com.

10

How a Next Generation MOM Can Drive Flexible Automotive Manufacturing

www.apriso.com