Manufacturing Companies

Background

The development of packaged business software to support all main business processes has been a major development in information systems over the past two decades. Packaged software for most mainstream business processes came to market in the 1990s as the spread of the UNIX operating system as a de facto standard for mini computers and the increasing dominance of the Intel chipset led to a massive surge in the packaged software market. Building on the earlier MRP packages, other packaged software provided modules for sales order processing, ledgers, payroll and personnel as well as MRP, sometimes combined into one integrated package from one vendor – the ERP software suites of Oracle and SAP, for example.

Benson et al.’s (1992) “staple yourself to an order” example in the early 1990s illustrated well the potential for process improvement and introduced many practitioners to the concept of function vs. process. This was developed further in the 1990s by Michael Hammer and others (Hammer & Champy, 1993) who argued that process change was essential to business survival and acknowledged that this could be associated with new information systems. Hammer argued that there was no scientific definition of processes, but that there were three main business processes that could fit most company operations: “obtain a customer order”, “fulfill the order” and “new product development”.

These concepts were further developed by the emerging ERP software houses as they expanded the functionality of their products and started to differentiate between “process” manufacturing and “discrete” manufacturing, with different ERP products suiting their different requirements. Process manufacturers (for example, food and drink companies) would typically have short lead times, make to forecast and aim to hold minimum inventory. Discrete manufacturers (for example, the automobile companies and engineering companies) would have longer lead times, and often manufacture to fulfill specific orders. Chapter 1 provided two examples of technology transfer which centered on ERP products in contract packaging companies, these companies being akin to the process manufacturing model. In this chapter, the introduction of new systems in three manufacturing companies is discussed, two of which (at Dowty Propellers and Fixing Point) involve ERP products. Dowty Propellers, with its long lead times for specific orders for propeller blades, represents the discrete manufacturing model, whereas Fixing Point, a manufacturer of roofing and cladding components, aligns more with the process manufacturing model. In fact, Fixing Point elected to implement the same ERP product as that chosen by Brecon Pharmaceuticals in Chapter 1.

The third case study is of SKF AeroEngine Bearings, an engineering company in the aerospace sector. Whilst many such companies have deployed ERP products, the introduction of new systems and process thinking paralleled the development of the concept of full product life-cycle management for engineered products, from concept through design and engineering, to manufacturing, delivery and even product performance on client sites, spanning the new product development and order fulfilment processes identified by Hammer. This gave rise to a new set of information systems - Product Lifecycle Management (PLM) systems, which provide a framework for the monitoring and control of the product lifecycle in a particular business or product area. It is a compilation of business rules, methods, processes and guidelines as well as instructions on how to apply the rules in practice (Saaksvuori & Immonen, 2002). The PLM concept encompasses several systems. Ameri and Dutta (2005) described change management, document management, workflow management and project management as PLM systems that support concurrent engineering and streamlined product development processes. PLM seeks to fill the gap between enterprise business processes and product development processes.

The engineering industry also uses a range of other specialist (largely standalone) systems including Computer Aided Design (CAD), Computer Aided Manufacturing (CAM), and Computer Aided Engineering (CAE) packages, which are often interfaced with ERP, MRP and data warehouse/business intelligence systems. Many of these types of systems feature in the technology transfer project at SKF AeroEngine Bearings discussed below.