Manufacturer speeds ahead with JIT

A powerful, finely tuned race car taking a speeding lead on a challenging track is an image Henry Banman would like to apply as a metaphor to All Weather Windows. Indeed, the hobby race car driver seems to enjoy steering the Edmonton-based company to become increasingly more streamlined and efficient. Banman is executive vice-president and a partner at this firm which is one of Canada’s largest privately-owned window and door manufacturers.

It has taken a lot of challenging work to get to what he hopes will be a long-term stint on the winner’s podium of this competitive market. In response to growth, All Weather implemented Oracle Financials, Oracle Inventory and Oracle Purchasing in 2000. The plan was to provide its accounting staff with real-time visibility into centralized financial and inventory data and to set the foundation for integrated manufacturing applications.

Banman says they chose Oracle from three short-listed vendors. While visiting the reference site of one vendor, the customer hinted at speaking more frankly to Banman when he wasn’t on tour! Another vendor didn’t want him to visit a customer at a company that he already knew. Oracle’s demo people impressed Banman by coming a day ahead to make sure everything worked so they wouldn’t waste All Weather’s time making last-minute fixes during the presentation. As well, Oracle offered integration between applications and had flow manufacturing as a component of its SCM offering.

In 2001, All Weather Windows expanded its ERP solution to include manufacturing and supply chain management including Oracle E-Business suite, Order Management and Flow Manufacturing. In 2002 it took down its chronic help wanted sign because staff turnover was lower while productivity was higher.

Until then, the company was pretty much guessing its materials management according to how full or empty its bins looked. “We’d run out every week or have huge inventory with products having a birthday,” says Banman. The days of counting inventory nightly were long gone for this 25-year-old, 700-employee firm with $100 million in gross annual revenue.

Banman says that prior to implementing the Oracle E-Business Suite, an inconsistent number of windows and doors were produced per day, with the plant often operating 20 hours a day, seven days a week, during the peak season. Now they can:

– produce more than 2,300 windows and doors each day with the plant operating 16 hours a day, five days a week;

– see in advance what the workload will be and move people to the appropriate production lines as required;

– reduce overtime costs since extra shifts are not required to meet customer orders;

– shorten delivery time from 25 to 10 working days, and turnaround time for the production of product to as little as six days if required.

Meanwhile, the volume of windows produced has increased up to 30 per cent and the head count down about 25 per cent.

“It used to be under the legacy system that you knew what windows you had to build the day they were scheduled to be built,” says Gerald McLennan, director of IT. “Now you can see every order in the system and what components are in it and can make sure you have them ahead of time.”

“Scheduling can move labour where needed to level load our different manufacturing lines so windows and doors, patio doors, skylights and whatever else comes into the shipping lane at the same time,” adds Banman. All these benefits come from new technologies on the plant floor that permit just-in-time (JIT) manufacturing. “We haven’t even begun to realize [benefits] from some of the automated door equipment.”

The company supplies custom windows to large buying chains, such as Home Hardware, and dealer businesses. It may be a lumber yard in rural Saskatchewan or McDiarmid Lumber Ltd. in Winnipeg who have a 20×20 All Weather Windows design centre with quoting software.

The Oracle E-Business Suite connects and streamlines All Weather Windows’ operations from the point an order is submitted to the delivery of products.

With Oracle Order Management, when an order is submitted and specifications are confirmed by All Weather Windows’ order group, the order is electronically sent to the shop floor. Ordering errors are greatly reduced and guesswork is subsequently removed from the fulfillment process, making production more accurate and reducing waste. All materials needed to create the product are then automatically compared against existing inventory and the customer receives confirmation that the product is available.

They also implemented a custom order management system that feeds into Oracle as a graphical front end for customers. The product, which they renamed Clear Quote, is m2o from Edgenet Inc. of Nashville, Tenn.

Once the order is delivered to the shop floor, Oracle Flow Manufacturing automatically plans the optimal resources needed to balance production by evaluating the production line and resource requirements.

It is the Oracle SCM that allowed All Weather Windows to move to JIT. Previously, larger contractors that build hundreds of houses a year would submit an order as soon as they had the sale even though they weren’t going to use the product for another month or so. “We were stocking just millions of dollars of finished product and not collecting any money off it,” says Banman. “Now they know when they release, they will get it.”

The company now confirms delivery prior to manufacturing on all JIT orders. The JIT capability has increased the amount of product that can be immediately shipped by as much as 100 per cent, significantly increased fill rates and allows All Weather Windows to better predict its raw material supply needs from existing demand. By reducing its finished goods to almost half during peak periods, there is plant floor space for new product lines.

JIT also means shipping lanes are very manageable and clean, says Banman. Where they used to have maybe 100 rental trailers sitting in the yard storing finished inventory that the customer wasn’t ready for, there are none. The ‘odds and sods’ retail store for selling off duplications, errors and unwanted orders has been closed for lack of merchandise.

Instead they are getting into the renovation market where they can do the supply and installation of windows, and projects like apartment buildings and condominiums. They can take on such projects and not disrupt the rest of the business. Also this year, they have put in two or three new product lines that they would not have tackled before.

They run Oracle on IBM Risc 6000 Model 6M1 with nine D50 application servers for load balancing. They have about 300 online users, including some right on the shop floor. All shipping lanes have barcode PCs and workstations.

There are 12 in the IT department, up from six during the implementation phase. The functional implementation team had six key users with one supplied from IT. “You typically don’t want your IT people on an ERP project other than for project management direction,” McLennan advises.

Getting this far takes as much courage, commitment and determination as driving in a road race. During the last six months of 2002, the company was basically restructured from the front end order on the customers’ desk to the factory floor and out the door.

For one thing, making people comfortable with change is not easy. “One of the challenges we faced is that for 20-some years we built windows with the knowledge people had in their heads,” recalls McLennan. “Now coming with a system telling them how to build windows and getting them to trust that system… probably caused us the greatest struggle — getting people little by little to give up that control. Working with the system has increased the flexibility of what they can build.”

Banman says a course in transition management that he took from William Bridges & Associates helped.

Being firm in saying no was also key. McLennan in effect poured concrete around the deadlines for the phased implementation to prevent project creep. “Scope doesn’t creep, it gallops,” he says.

Banman is quick to give credit to having the right people on board. He sees McLennan as a team builder inspiring staff to meet the ‘go live’ deadline by working full out even on New Year’s day 2002. For his part, McLennan cites having management commitment and control as vital because decisions during implementation usually have to be made within 24 to 36 hours. He also finds that the implementation team must have “the very best person you can’t afford to lose to the project… to define how you do business for the next five to 10 years.”

So now Banman feels like he’s part of a high-powered machine gunning down the race track. With McLennan’s IT team scouring the premises looking to shave off more inefficiency, it sounds like it can only get better.