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Production volume increased by 30% due to operational control of production

Mechanical engineering
Production volume increased by 30% due to operational control of production
scale11,000 employees 3200+ userskpito increase the enterprise competitiveness
ProductProductionProject time1 year
year of briefcase2008geographyUkraine
IndustryMechanical engineeringcustomerZorya-Mashproekt Gas Turbine Research and Development Complex

Project Goals

Zorya-Mashproekt Gas Turbine Research and Development Complex is the Ukraine’s designer and manufacturer of marine and industrial gas turbine plants. Founded almost 70 years ago, the enterprise produces gas turbine engines, gears, marine installations for the power and gas industries. The company's products are in demand all over the world. In addition to the R&D Center, the company manufacturing facilities for mass production, as well as experimental and auxiliary production.

Based on the trends in the global market, the company's management set the following tasks:

  • to support production growth in natural and value terms;
  • to reduce costs and increase productivity.

 

Objectives of the production part of the project

The main objectives in the operational management of serial manufacturing were:

  • to improve business processes of detailed production planning for the company divisions;
  • to control the production plans;
  • to improve the accuracy of production capacity management;
  • to unify production workflow.

Project Description

Production automation at "Zorya" - "Mashproekt" was carried out in several stages. First, IT-Enterprise consultants provided the reengineering of business processes, and then the optimized business processes were automated with the ERP-system IT-Enterprise. Top-management of the enterprise supported the thesis that automation of business processes without preliminary analysis and reengineering is senseless.

In the course of the project implementation, the analysis of existing processes ("as is" model), modeling "as will be", approval of new business models, system configuration, trial operation and commissioning were carried out.

Business processes reengineering allowed to use the electronic original of the technical documentation.

Improvement the efficiency of production units included the centralization of production planning - from the main schedule to electronic production jobs, the integration of production accounting with labor accounting and payroll calculation. Online production monitoring was implemented.

To increase the efficiency of logistics processes, document workflow was implemented, and purchases were transferred to the company electronic trading platform, closely integrated with the ERP system.

 

Increasing the production efficiency

Prior to the automation project, production planning was carried out on the basis of phased records of technological sets - a specialized but obsolete methodology of MRP-planning, which took into account the industry specifics of the enterprise. Planning automation was implemented on the base this technological document with the help of automation department. Obtained solution was a local system for solving a specific planning problem. Later, production planning based on this methodology was implemented as part of the integrated corporate information system.

In 2008, top-management set the task of further increasing the production efficiency. The enterprise entered new markets, and the issue of increasing production volumes became urgent. Stuff optimization was an additional task: during the project implementation the number of plant employees was reduced from 16 thousands to 12 thousands people.

Thus, with the reduction of the company's personnel by 25%, it was required to provide productivity growth of 30%.

The primary task of the project stakeholders was to generate the master production schedule for an unlimited planning horizon. Since production cycles for a number of products exceeded a year, it was important for the enterprise to have a planning tool that would not limit managers in the decision-making process. Such an instrument was the IT-Enterprise production planning system.

After solving the task of generation of the master production schedule, specialists discovered new bottlenecks: the demand for the plant's products in the market was so great that the enterprise could not satisfy it. Analysis of the reasons allowed managers to identify a shortage of resources. To determine resources that are not enough - production equipment or working personnel, throughput capacity of production sites was analyzed.

The analysis of all technological processes resulted in creation of an electronic database of actualized processes. After that, the company's technologists assigned the equipment to the production processes in the system. The same work was done for the tools and specializations.

Further analysis showed that some factors were not taken into account that affect the actual duration of the production cycle. As a result, the time norms were adjusted, consolidated norms for products, equipment, specializations and production sites were calculated.

Due to the work carried out, the enterprise was able to accurately calculate their needs for the main workers (analysis of the workload of the workshops) and equipment (capacity requirements analysis by site, equipment groups and periods) and to plan the resource needs for the assigned tasks.

 

Optimization of the work of the service

Prior to automation, the logistics service provided the shops with materials based on hand-written applications. Top-management of the enterprise decided that all shops should generate applications in electronic form in the ERP-system. The basis for the formation of these applications could be only electronic documents – bill of components, norms and plans.

The analysis showed that before the implementation of the ERP-system up to 30% of inventories that are attributed to the fixed costs of the enterprise, should not be issued to the units. So enterprise constant costs reduced by 30%.

As a result of the implemented project, enterprise does not work with paper documents any more. All materials are issued only on the basis of electronic documents that stored in the information system and in the time frames limited by the plans.

Key project factors

Up to 30% production of products increased
Up to 45% sales of products increased
Up to 30% enterprise constant costs reduced

Results

A large-scale project of integrated automation of the plant affected all departments, however, special attention was paid to the optimization of production. During the business processes reengineering, the duration of the production cycle for some products was halved.

As a result of the project, the company achieved a 30% increase in output with a 25% reduction in the number of staff. Implementation of the ERP system and optimization of production lead to:

  • capacity load optimization at the working centers level;
  • timely fulfillment of export contracts;
  • lead time of manufacturing processes was reduced;
  • inventory levels of products and work in progress were reduced.

All activities of designers, technologists, planners and other personnel on "moving" the product from design and production planning to materials supply, manufacturing and product distribution are managed by the system.

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