Millennial calendar threatens manufacturing software

A lot of computer programs, particularly those written more than five years ago, will begin to malfunction in the year 2000. Those programs only have two digits in the year portion of the date field. So, instead of marching into the new millennium with the rest of us, they`ll try to repeat the 20th century.

To many of us this may sound like one more bad millennium joke. But for midsized manufacturers—of optical components, for instance—it can pose a serious problem, according to David Turbide, a manufacturing-software industry consultant. "We deal mostly with midsized companies, which we define as $20 million to $500 million in sales," he said. "And a lot of the midsized companies have either home-grown software or systems they installed eight, ten, or 12 years ago. That software will not work in another year or two. So there`s a big replacement market." The replacement market is for enterprise-resource-planning (ERP) and manufacturing-execution-system (MES) software to manage resource allocation and production processes efficiently in increasingly competitive markets (see "Digestive aids for acronym soup").

There`s also a lot of new business, says Turbide, who edits Midrange ERP magazine (MFG Publishing; Beverly, MA), because 85% to 90% of companies in the midsize range don`t have comprehensive information systems.

Tailored solutions

With about 300 ERP packages and 20 or 30 MES vendors on the market, selecting the appropriate package and implementing it properly can be daunting. The choices made by two optical-equipment manufacturers illustrate how different solutions can be crafted for different needs.

In August, Banner Engineering (Minneapolis, MN), a manufacturer of photoelectric sensors, used ERP software from DataWorks (San Diego, CA) to minimize the effect of the UPS strike on its shipping schedule. Rapid order fulfillment is a major competitive point for Banner, which ships 70% of its orders on the same day and 95% within three working days.

"During the UPS strike in August, we changed the way we log orders for our customers so that we could consolidate shipments and ship things by truck and also to other carriers, such as FedEx," said operations manager Andy Barnauskas. "And we made those changes in a matter of hours instead of days, which allowed us to keep shipping our product—even though we shipped about 80% of our product with UPS before the strike began."

SpecTran Communication Fiber Technologies (Sturbridge, MA), on the other hand, uses MES software from Camstar Systems (Campbell, CA) to control complex manufacturing processes for large volumes of single-mode and multimode glass optical fibers that are supplied internationally to leading cable manufacturers for ultimate use in applications ranging from residential hookups to metropolitan-area networks and from telephone to cable-television systems (see photo). Installing software to control the complex fiber-production process required a joint effort by the manufacturer and software vendor to carefully model each manufacturing process into the MES system, according to SpecTran project manager Bruce Turner. "We were installing the software system into a live production facility that was continually operating," he said. "So we needed to perform the implementation in a carefully staged manner."

While SpecTran`s strong process focus seems to make MES a natural choice, Banner`s focus on expeditiously managing production and delivery of discrete components allows that company to simply extend one of the repetitive modules in its ERP system to provide the MES function, Turbide explained.

"If a company is putting together optical instruments or lasers, it is probably more interested in ERP functions because the emphasis is on having the right materials and the right production schedules to use up the resources most effectively," Turbide said. "If a company is cranking out optical fiber, it has more of a process environment and would probably be more interested in an MES functionality."

No clear-cut line

Such generalizations are not carved in stone, however. A lot of manufacturing companies will buy an ERP system and find that many of the process control functions are included, Turbide said. Other companies will install sophisticated controls along with an MES system and find that they already have many ERP applications in place.

"It works both ways, whether you are coming down from ERP into the shop or you are coming out of the shop into the management side, you`re apt to run across these applications either way," he said. "And there`s no clear-cut line. Of course, the people that sell ERP want as much of the pie as they can get, and the people that sell MES want as much of the pie as they can get."

In June, Camstar announced a partnership agreement with ERP supplier J. D. Edwards (Denver, CO), with the goal of offering both functions to their customers. While some alliances are common in this industry, ERP-MES alliances are not, according to Turbide. "ERP vendors are famous for alliances," he said. "They extend their application capabilities by forming partnerships with point-solution vendors that have something specific that the ERP vendors need and don`t have the expertise or time to develop for themselves." For instance, in the last year or two, alliances with scheduling software vendors have produced ERP packages from maybe two-dozen companies with more sophisticated scheduling and planning functions.

Yet, while some alliances between ERP and MES suppliers have formed, they are less common than one would expect, Turbide said. He speculates that overlap between functions of the two types of software keeps the market too competitive for most ERP and MES vendors to consider sharing a tent. Of course, as those remaining two-digit systems tick ominously toward the millennium, even this may change. The bottom line for each manufacturer is simply to find a system—regardless of what it`s called—to best meet the company`s needs.

"Anybody who manufactures should be interested in what`s available to help them optimize their resources and meet the customer demand in the most effective way," Turbide said. "And that`s what both of these classes of solutions are aiming to do. They are just focusing on different portions of the process."

Digestive aids for acronym soup

Three categories of manufacturing software, one for planning, a second for execution, and a third for control, were defined by Advanced Manufacturing Research (Boston, MA) about seven years ago. Planning software, generally referred to as ERP(enterprise resource planning), focuses on forecasts, as well as long-range and intermediate plans. The execution category, MES (manufacturing execution software), includes functions such as data collection and data quality management. In the third category, programmable controllers operate machines and run tools.

David Turbide, an industry consultant and editor of Midrange ERP magazine, recommends the professional society American Production and Inventory Control Society (Falls Church, VA) and the industry group Manufacturing Execution System Association (MESA) International (Pittsburgh, PA) as "two big organizations" that can help manufacturers choose high-quality software that is appropriate to their needs.