Tube Specialties Manufactures a Better ERPBy Samuel Greengard
The complexities of enterprise resource planning (ERP) are not lost on most business and IT executives. In many cases, these systems are complex and unwieldy. This can lead to diminished productivity, subpar results and a drain on enterprise time and resources.
One company taking direct aim at the challenge is Tube Specialties Co., a Troutdale, Ore., company that builds engine and machine components that require tube bending, pipe bending, tube fabrication and pipe fabrication. These systems, used primarily in large trucks and equipment, require highly customized data and manufacturing processes. In the past, "We were suffering from near daily business operations interruptions—including system crashes—as a result of a legacy system. We had data that was coherent but practically useless for analysis," said Peter Schubert, product development manager.
But the problems didn't stop there. Tube Specialties, which operates facilities in Oregon, North Carolina and Mexico and employs more than 500 people, had long depended on electronic data interchange (EDI) to communicate and interact with customers. Unfortunately, the legacy IT environment couldn't keep up with large and growing transactional volumes.
"As a manufacturer, we receive daily updates for thousands of components from our customers," Shubert said.
The customer onboarding process for the legacy ERP system could take months. The bottom line: "We recognized a need for a new ERP framework that could function more effectively in today's business environment," he added.
In December 2013, the company switched to SAP to address these and other problems. The migration took about three months and tapped the expertise of consulting and integration services firm Itelligence Inc. In February 2015, Tube Specialties further enhanced the capabilities by adding SAP HANA and HANA Live to introduce an integrated business intelligence (BI) platform. Says Schubert:
"It has delivered a solid engine to drive the business forward," Schubert said. Among other things, the platform normalized production cost information and provided far better and deeper insights into data. "We now have the required level of insight into our production transaction flow. We can derive costing information faster and more accurately," he explained.
The platform, including SAP Fiori, offers far greater flexibility for developers and much improved data availability for users, including those relying on mobile devices. For example, Tube Specialties has achieved a 95 percent reduction in the run time of targeted ECC transactions. This equates to seconds rather than minutes when employees enter transaction codes and handle other tasks, he noted. However, the gains also extend to data quality.
“The ability to exercise BI transparency in real time in a manufacturing environment is extremely valuable," he said.
The initiative has resulted in the company trimming two full-time equivalent operators.
At the business level, the initiative has led to a company that is far better equipped to address the needs of customers and the marketplace. "It changes way operators in the production work centers perceive the queue of work and how they prioritize work. They can use real-time information make choices about production orders, scheduling, capacity planning, and more. Today, everything flows according to plan," Schubert said.
In addition, the platform provides far better security.
"We have taken a giant step forward in IT functionality and data analytics."