A man with a plan
By Kevin Parker, editorial director -- Manufacturing Business Technology, 5/1/2005 6:00:00 AM
Joe Bellini, executive VP and general manager, Brooks Software, isn't the first person to notice that software platforms for "real-time" optimization of shop-floor operations are more widely found in asset-intensive than materials-intensive production environments.
In the semiconductor or other asset-based industries, any production downtime is a very bad thing, making the investment in such systems intuitively worthwhile.
But Bellini, an extremely sharp guy who's done stints in the senior ranks of Oracle Corp. and i2 Technologies, is betting a new set of solutions is ready to move into materials-intensive industries, such as electronics. That's because forecasting models that worked for those industries in the past don't anymore.
Given trends toward mass customization (think cell phones), says Bellini, "Materials-intensive industries have much deeper configurations and shorter product life cycles today. Forecasting accuracy at the product-family level has dropped from 80 percent to 50 percent. Yet just increasing inventory to meet customer needs is a going-out-of-business strategy."
Okay, but how can knowing what's on the shop floor help you, if you don't know what products consumers are going to buy?
"In a demand-driven environment, customer orders can be pegged to shop-floor WIP. For that you need to drive shop-floor visibility up through the enterprise system," says Bellini. "Then, ERP can deliver a plan that is based on real-time supply chain events and full knowledge of shop-floor resources."
Proof of the growing recognition of the need for this closed loop, says Bellini, is seen in recent purchases of retail supply chain vendors Retek by Oracle and Yantra by Sterling Commerce—acquisitions that garnered prices at attractive multiples.
Of course, it's simplistic to think the answer will always be to expedite whatever parts are called for by the emerging demand signals. One alternative is to shape demand, based on what is readily to hand, using pricing and promotions levers.
"You have to decide whether a demand or supply event is significant enough to disrupt the plant floor," says Bellini. "The thought of disruption scares people, but other options are available."
To be successful, Bellini believes materials-intensive industries will move to the same architecture Brooks supplies to asset-intensive industries.
Beginning in the late 1990s, Brooks Automation, a supplier of equipment used in the semiconductor industry, bought 11 software companies and assembled a product set for plant-floor operations that extends from simulation and scheduling through dispatching, MES, and materials control. A real-time data historian is a final key element.
Brooks soon learned that selling software was a very different business than selling equipment, and the combined acquisitions were spun off as a separate division—Brooks Software—which Bellini today heads.
At present, about $40 million—roughly one-third of Brooks Software's annual revenues—comes from materials-intensive industries. A payoff on the bet he's placing, says Bellini, would come from capturing a greater share of the revenue opportunity following from the emerging market for collaborative plant-floor systems in materials-intensive industries.
MES as the cure for complexity
07/01/2006Brooks sees lean, TPM as MES opportunities
09/01/2004
