Demand-driven model keeps best-of-breed vendors in the black
Frank O Smith, contributing editor -- Manufacturing Business Technology, 3/1/2005 12:00:00 AM
For years it was forbidden by MRP II orthodoxy. Then it became a headliner, given the power of Windows and memory-loaded PCs, only to become passé with the rise of Lean and flow production methodologies, whose apostles proclaimed there was no need for it.
We are referring here to finite capacity scheduling (FCS), a concept and an application with proven market stickiness, serviced by a cadre of best-of-breed solutions vendors that have honed niches within a niche while others were gobbled up by larger enterprise vendors, or just sputtered and disappeared.
"Many FCS vendors sold out to big ERP or supply chain vendors, where they became more focused on planning," says Julie Fraser, an analyst with Newburyport, Mass.-based Industry Directions. "The ones that have lasted have reasonably complete systems with a strong focus on detailed production scheduling."
Despite today's emphasis on lean manufacturing and flow, Fraser continues, "particularly when you're talking about demand-driven networks, finite capacity scheduling is one of the clear answers for what you can do at the last minute to quickly reload your factory and be more responsive as demand changes."
Lora Cecere, a director for Boston-based AMR Research, concurs. "We're seeing a lot of manufacturers bolt on factory scheduling. They may have a big ERP system, but they're finding that what the system provides isn't sufficient."
The success of certain FCS vendors is marked by "a resurgent interest in best of breed," Cecere adds.
RSS Solutions—one of the high flyers with 400-percent growth rate this year—targets lean/flow production with a lean module.
"Our approach to lean is practical," says Michael Cox, president. "There's nothing in lean that can find the pulse of a resource, or do 'what-if?' analysis." Given demand, RSS's NaView solution "can create the rate you need to meet delivery, and show you where the discrepancies are," he says.
Another vendor that is putting scheduling teeth to demand-driven lean production is JRG Software, which targets consumer packaged goods manufacturers. Paybacks are huge for companies that can master on-demand scheduling that links real-time information from retailers into daily multiple-plant scheduling feeding the supply chain.
"It's not enough to optimize a piece of equipment, or a line, or one factory," says Jonathan Knight, CEO. "You have to include the whole channel, from retailer back to the manufacturing process."
JRG's solution collects data from retailers, goods-in-transit transactions, and warehouses and pushes it back into the factory, enabling it to reschedule on demand.
"We call this bottom-up process 'build-to-consumption,'" says Knight. Because JRG hosts the solution, deployment takes only 10 weeks. JRG only began ramping up sales a year ago, but already has a double-digit customer list and expects 300-percent growth this year.
"At first we were looking to ERP vendors for a scheduling solution," says Mike Kopetski, director of logistics for Kennesaw, Ga.-based Wise Foods. "But we realized ERP is the plumbing, and isn't focused on making your company more dynamic."
JRG has enabled Wise Foods to reduce processing and packaging line changeovers by 35 percent, slash labor by $600,000, and capture more private-label business by being able to handle just-in-time promotions.
