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A Passion For Manufacturing Melissa CookSenior DirectorDynamics Global Industries - Manufacturing
An Industry Tour Leading to Focus and Value Prop
Agenda
A Quick Detour Into Terminology
The Next Tick Down On Value Prop
Dynamics Manufacturing Workloads Briefing
Summary & Wrap-Up
The Manufacturing
Industry: What Is It?
Manufacture:To make or produce by hand or machinery, especially on a large scale.*
*Webster’s College Dictionary
The Manufacturing sector comprises establishments engaged in the mechanical, physical, or chemical transformation of materials, substances, or components into new products.
http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=31&search=2012 NAICS Search
The Manufacturing Industry: Who Is Part Of It?
Largest G2000 Auto & Truck Manufacturers
http://www.forbes.com/global2000/list
Largest G2000 Heavy Equipment Manufacturers
http://www.forbes.com/global2000/list
Largest G2000 Food Processors
http://www.forbes.com/global2000/list
Largest G2000 In Specialized Chemicals
http://www.forbes.com/global2000/list
The Manufacturing Industry: Growth and Size?
Source: UN National Accounts Main Aggregates DatabaseManufacturingwww.parliament.uk/briefing-papers/SN05809.pdf · PDF file
The Dynamic Manufacturer – Value Prop
Empower People
Inspire Action through operations’ intelligence
Speed and Agility
Improve capabilities to compete
In the global manufacturing environment
Drive Innovation
Grow your business by meeting constantly evolving customer needs
20 Food and Kindred Products21 Tobacco Manufacturing22 Textile Mill Products23 Apparel and Other Textile Products24 Lumber and Wood Products25 Furniture and Fixtures26 Paper and Allied Products27 Printing and Publishing28 Chemicals and Allied Products29 Petroleum and Coal Products30 Rubber/Misc. Plastic Products31 Leather and Leather Products32 Stone, Clay, Glass and Concrete Products33 Primary Metal Industries34 Fabricated Metal Products35 Industrial and Commercial Machinery and Computer Equip36 Electrical Equipment and Components37 Transportation Equipment38 Measurement Analyzing, Control Instruments and Related Prod.39 Misc. Manufacturing Industries
The Dynamic Manufacturer: Focus Verticals (using SICs)
World Manufacturing Output Growth By Vertical
Unido.org
World Manufacturing Output Growth By Vertical
Unido.org
So What’s the Difference Between Discrete and Process Manufacturing?
Discrete Manufacturing
• Example definition (from APICS): • The production of distinct items such as automobiles,
appliances, or computers. • Typical characteristics:
• Bill of material versus formula or recipe • Assemble, build• Products can usually be disassembled• Serial numbering (SN), engineering change number (ECN) • Measurement by count of distinct (discrete) items versus
measurement by weight or volume
Process Manufacturing • Example definition (from APICS):
• Production that adds value by mixing, separating, forming, and/or performing chemical reactions. It may be done in either batch or continuous mode.
• Example items produced by process manufacturing methods: • Food • Chemicals
• Typical characteristics:• Formulas and recipes versus BOM• Mix, blend• Products usually can NOT be disassembled • Lots and batches versus individual item serial numbers• Grades, potency, shelf life• Measurement by weight and or volume
Continuous Manufacturing • Example definition (from APICS): • A type of manufacturing process that is dedicated to the production of a very
narrow range of standard products. The rate of product change and new product information is very low. Significant investment in highly specialized equipment allows for a high volume of production at the lowest manufacturing cost. Thus, unit sales volumes are very large, and price is almost always a key order-winning criterion. Examples of items produced by a continuous process include gasoline, steel, fertilizer, glass, and paper.
• Typical characteristics:• Continuous usually means operating 24 hours per day, seven days
per week. • Very infrequent maintenance shutdowns, such as semi-annual or
annual or longer. • Production workers commonly work in rotating shifts.• Most of these industries are very capital intensive and management is
therefore very concerned about lost operating time.
Lean Manufacturing
• Pretty simple actually – reduce waste• It’s a Management Philosophy• Lean manufacturing, lean enterprise, or
lean production, often simply, "Lean," is a production practice that considers the expenditure of resources for any goal other than the creation of value for the end customer to be wasteful, and thus a target for elimination.
• Built on lots of history: folk wisdom of thrift, time and motion study, Taylorism, Fordism, JIT, Toyota Production System (TPS)
Durable Versus Non-Durable Goods
• A durable good or a hard good is a good that does not quickly wear out, or more specifically, one that yields utility over time rather than being completely consumed in one use. Durable goods are typically characterized by long periods between successive purchases.
• Nondurable goods or soft goods consumables are the opposite of durable goods. They may be defined either as goods that are immediately consumed in one use or ones that have a lifespan of less than 3 years.
http://en.wikipedia.org/wiki/Durable_good
Manufacturing Modes And Methods
Mixed Mode
Process Manufacturing
Discrete Manufacturing
Lean
Dynamics is capable of all these methods and modes in a single instance….
BTW - Some Other Handy Definitions To Keep Around
National Institute of Standards and Technology (NIST) definitions below:
•Cloud computing is a model for enabling on-demand, metered access to a shared pool of location independent configurable computing resources that can be rapidly provisioned.
•Software-as-a-Service (SaaS) is one of three (3) cloud computing delivery models where applications running on a cloud infrastructure are accessible from various client devices through a thin client interface such as web browser.
The Dynamic Manufacturer
Empower People
Inspire Action through operations’ intelligence
Speed and Agility
Improve capabilities to compete In the global manufacturing environment
Drive
Innovation
Grow your business by meeting constantly evolving customer needs
I don’t think of Manufacturing when I think of Innovation…
http://www.industryweek.com/innovation/us-manufacturing-misunderstood-economic-powerhouse
We still think about manufacturing in the U.S. as yesterday’s economy as opposed to the vanguard of innovation in our economy,” said Bruce Katz, a vice president at the Brookings Institution. But he points out, manufacturing accounts for “9% of jobs, 11% of GDP, 35% of engineers, 68% of private
R&D, and 90% of our patents. We may be the only economy to decouple production and innovation.”
The Manufacturing Industry Leads Innovation!
Manufacturing Is Also Strategically Important
Manufacturing • Employs a large share of the labor force • Produces materials of strategic importance (infrastructure,
defense) • Each dollar creates another $1.43 of activity in other
sectors**• both “backwards” (such as with mining or construction),
or “forwards” (warehousing, transportation, wholesale and retail)
*http://www.economywatch.com/world-industries/manufacturing/** National Association of Manufacturing (NAM)
The Dynamic Manufacturer
Empower People
Inspire Action through operations’ intelligence
Speed and Agility
Improve capabilities to compete In the global manufacturing environment
Drive
Innovation
Grow your business by meeting constantly evolving customer needs
Power Shift To Consumers
Connected Experiences
Globalization & Emerging Economies
Changing Demographics
Sustainability Complex Regulations
The Big Shift: Forces driving transformation in Manufacturing
58%Poor cross-functional processes
42% 44% 9% 86%5%
58%Difficult to upgrade 43% 44% 9% 87%3%
58%Business
requirements versus apps mismatch
48% 32% 15% 80%5%
58%High cost of ownership 58% 33% 91%2%7
%
Very significant Significant Not significant or slightly significant Don’t know
Source: “Enterprise Apps Customers Have Issues,” Forrester Research, Inc., February 26, 2010.
Forrester’s Research On Enterprise Applications
Duplicate Data Batch Processes Complex Interfaces
Manufacturing Technology Challenges
Functionality in separate applications
Reactive Business intelligence (BI)
Task-oriented user experience
The result: Complexity, inflexibility and high cost
ERP architecture from the 1980s is still deployed today
Microsoft Positioned as a Leader in Gartner’s 2012 Magic Quadrant for Single-Instance ERP for Product-Centric Midmarket Companies “The focus of this Magic Quadrant is on ERP systems that support a single-instance strategy for multientity midmarket and upper midmarket companies. User-centric improvements focused on usability and deeper integration of analytical capabilities is at the core of leading systems.”Include attribution and disclaimers here:Gartner “Magic Quadrant for Single-Instance ERP for Product-Centric Midmarket
Companies” by Christian Hestermann, Chris Pang and Nigel Montgomery, June 27,
2012. This graphic was published by Gartner, Inc. as part of a larger research
document and should be evaluated in the context of the entire document. The
Gartner document is available upon request from Microsoft. Gartner does not endorse
any vendor, product or service depicted in its research publications, and does not
advise technology users to select only those vendors with the highest ratings.
Gartner research publications consist of the opinions of Gartner's research
organization and should not be construed as statements of fact. Gartner disclaims all
warranties, expressed or implied, with respect to this research, including any
warranties of merchantability or fitness for a particular purpose.
Two Popular Deployment Scenarios
Integrated, full suite Workload at-a-time
Deployment Sweet Spots For Dynamics In The Enterprise Segment
CoreERP
Full Suit
e
Workloadat-a-time
Business Scenarios – Vertical, Horizontal & Admin
Horizontal Operational Business Scenarios
Industry Operational Business Scenarios
Administrative Core Business ScenariosFinance HR
HCM Project Budget Formulation
Expense SRM Sales Force Automation
Marketing Automation
Customer Care
Manufacturing
Distribution Public SectorRetail Service Industries
Dynamics: An End To End Solution For Manufacturers
Dynamics Manufacturing Business Scenarios
Horizontal Operational Business Scenarios
Manufacturing Operational Business Scenarios
Core Administrative Business Scenarios
Finance HR
HCM Project Budget Formulation
Expense SRM Sales Force Automation
Marketing Automation
Customer Care
Supply Chain Planning
ManufacturingOperations
LogisticsSales Order Management
Product Data Management
Typical ISV Extensions By Workload
• Product Data Management Item Versions, ECM, Advanced Product Configurator for items and
project based • Sales Order Management
Bid Management • Supply Chain Management
Demand Planning • Manufacturing Operations
Enhanced Graphical Project Scheduling; Enhanced Production Control & Project Control (including Integration with Projects); Project-based MRP & Production
• Logistics Enhanced Project Logistics
• Additional Workloads Warranty and Service (Field Service Scheduling; Plant Maintenance)
End To End Manufacturing Solution Product Data Management
Make decisions based on facts and comply
Sales Order Management
Gain loyalty with better customer services & accuracy
Supply Chain Management
End-to-end visibility throughout the supply chain
Manufacturing Operations
Benefit from end-to-end mixed-mode manufacturing
Logistics
Manage warehouses and transportation
SRM
Set company policies & collaborate with your vendors
Drive Innovation
deep market and customer insight
visual contextual intelligence
green and sustainable operations
flexible, global solution
modern technology to attract the right people
a single technology platform
Get Instant InsightsKeeps KPIs front and center
Dashboard supports timely decision making
Gain insights with easy navigation
Enable Speed and Agility
global multi-language, multi-currency solution
multi-site material and capacity planning and scheduling
supports discrete, process, lean and mixed mode manufacturing
built for process and regulatory change
Optimize inventory and improve vendor negotiation
increase efficiency and reduce redundant processes
“instant-on” capabilities
Availability
25 Countries in Dynamics AX 2012 RTM
11 Additional Countries in Dynamics AX 2012 R2
R2 global instance enablement
AX2012 R2
AX2012 RTM
Public Sector
Manufacturing
Retail & Distribution
Service Industries
Support Country Regulations-36 Markets
Kanban Scheduling BoardSchedule Cycle time
performanceindicator
Capacity – Loaded/Total
Kanban quantity Overview
Lean schedule group: colors
Job status symbols legend
The Dynamic Manufacturer
Empower People
Inspire Action through operations’ intelligence
Speed and Agility
Improve capabilities to compete In the global manufacturing environment
Drive Innovation
Grow your business by meeting constantly evolving customer needs
Empower People
Engage people by surfacing insights
role-tailored user experiences
Connect employees, customers and suppliers
Accelerate employee adoption
Engaging and Visual
Delivers timely, accurate information
Provides a single, unified view
Adapts to your ever changing organization
EXECUTIVEMANUFACTURING
HR
FINANCE SALES & MKT RETAIL PUBLIC SECTOR
SERVICES SECTOR
TEMPLATES
Simplify User Experience SaraFinanc
e Directo
r
Customer
Customer
Service
Employee
Employee self serviceVendorVendor
Self service
VinceRetail
Ops Manag
er
LaceyStore
Manager
IngaMerchandising
Mgr
TimRetail
IT Manag
er
JohnInvento
ry ClerkJune
Practice
Manager
TriciaProject Membe
r
LisaCusto
mer Service Representativ
e
Time To Market
Agility
Key Differentiators For Dynamics In Manufacturing
TCO Global
Productive
The Human Side of Manufacturing
Personal and Office Productivity – Leverage Into The Factory Worker Space
MS Stores Dynamics
SharePoint
Office
Windows
SQL Server
Windows Mobile
Surface
Kinect
Windows computers & Tablets
Microsoft Services
DeploymentConsumer Applications Devices
$9B Annual R&D Investment
And The One Microsoft Story – The Whole Stack
Continued focus on Dynamics AX Total Cost of Ownership
Microsoft AX
$1.27M
2.4 FTE’s
4.2
75% within 23 months
56%
TCO & ROI Results
3 Year TCO Comparison
Ongoing Support Requirements
ROI Scorecard (5 Being Highest)
Positive ROI Achieved
% of Time Staff was Reduced
SAP
$5.22M
33 FTE’s
3.6
43% within 2.8 years
50%
Oracle
$3.44M
9 FTE’s
3.8
65% within 3.1 years
48%
Return on Investment/TCOSummary of results from Nucleus Research report:
Enterprise Applications Value Matrixhttp://www.microsoft.com/en-us/news/itanalyst/docs/05-01-12ValueMatrix.PDF
Microsoft Dynamics AX customers
Manufacturing56
Manufacturing
Microsoft Dynamics AX customers
57
Microsoft Dynamics AX customers
Manufacturing Transportation / Logistics 58
Sales Force Automation
Xbox Manufacturing
MBS Order Processing
Retail Store Operations
Microsoft Runs on Microsoft Dynamics
DVD/Media Manufacturing
Events Management
Customer Support
Partner Management
Global Expense Management
Vendor Management
Datacenter Procurement
Solution Roadmap (Highlights)
December 2012
Enhanced BI & Reporting Industry Enhancements for:• Retail & Distribution• Public Sector• Service Industries• Manufacturing• HR & US-Payroll• 11 New Localizations• Lifecycle services
Calendar Year 2014+
Server & Service Releases:• MSFT Online Services
Experience• Next Generation UX /w HTML5• Innovation for focus industries
Microsoft Dynamics AX 2012 R2 MS Dynamics AX ‘7’
Calendar Year 2013
Feature packs :• H1 Calendar Year 2013 • Content Enhancement for BI
Visualization• Master Data Management
• H2 Calendar Year 2013, Industry Enhancements for Focus Industries
What’s An Agile Manufacturer?
http://en.wikipedia.org/wiki/Manufacturing
Goldman et al. suggest that Agility has four underlying components:• delivering value to the customer;• being ready for change;• valuing human knowledge and skills;• forming virtual partnerships.
A Passion For Manufacturing
Why Am I So Passionate About Manufacturing?Industrial Revolution Mid-1700’s
• Marked by innovation and the increasing application of science to industry
http://en.wikipedia.org/wiki/Industrial_Revolution
Q&A
© 2012 Microsoft Corporation. All rights reserved. Microsoft, Microsoft Dynamics, the Microsoft Dynamics logo, and SharePoint are trademarks of the Microsoft group of companies. The information herein is for informational purposes only and represents the current view of Microsoft Corporation as of the date of this presentation. Because Microsoft must respond to changing market conditions, it should not be interpreted to be a commitment on the part of Microsoft, and Microsoft cannot guarantee the accuracy of any information provided after the date of this presentation. MICROSOFT MAKES NO WARRANTIES, EXPRESS, IMPLIED OR STATUTORY, AS TO THE INFORMATION IN THIS PRESENTATION.
Business Solutions for Manufacturing
Process Manufacturing *
• Define multiple inventory dimensions: dual units of measure, catch-weight calculations, packaging codes, variations to the main item, and lots.
• Manage multilevel formulas or recipes, co-products and by-products, electronic signatures, and packaging options.
• Let customers request multiple quality specifications per product while combining similar products in production to improve machine utilization.
• Analyze and monitor production costs and requirements for each sales order component using graphical representations of multilevel formulas and recipes.
Product InformationManagement• Centralize management of
products and services across the organization, including bill-of-materials (discrete mfg. ), formulas (process mfg.),
• and variant and configurable products.
• Maintain items by using up to three item dimensions and predefined combinations.
• Manage the release of products and services to individual legal entities.
• Specify dimensions for advanced inventory control, tracking, and tracing.
• Configure custom products with a unique bill of material and routing using the product configurator. The product configuration models are based on constraints, and can be used from sales order, sales quotation, purchase order, and production order.
DiscreteManufacturing *
• Execute multiple production strategies, including configure-to-order, assemble-to-order, make-to-stock, and make-to-order. Use both push
• and pull production control mechanisms.
• Optimize production and materials planning, forecasting, and scheduling. Simultaneously schedule materials and capacity. Calculate
• available-to-promise (ATP) and capable-to-promise (CTP) deliveries.
• Create, schedule, view, track, split, roll back, or categorize production orders.
• Understand WIP and actual cost through production tracking and reporting. Track detailed resource and throughput costs, including work
• center costs. Report production variances to standard costs.
All Essential Business Processes – One Familiar User ExperienceMaster Planning, and Quality & Inventory mgt.• Control inventory with a
variety of models and safety stock support.
• Apply multiple options for inventory valuation, including: first in/first out (FIFO), last in/first out (LIFO), standard cost, and weighted average.
• Master planning: Create and run multiple plans across multiple sites to meet demand and keep orders synchronized based on changes in
• internal or external demand. Improve distribution planning and forecast scheduling with an overview of longer-term purchasing, production, and resource requirements.
• Optimize enterprise-wide planning by providing upstream organizations in your supply chain with visibility into the demand of downstream organizations.
*For a complete list of features see the manufacturing factsheet. here
Lean Manufacturing
• Model manufacturing and logistics processes as production flows.
• Use kanbans to signal demand requirements.
• Monitor and manage kanban jobs using kanban boards
• Register products, resources, and items for operations and jobs. Touch-enabled data entry simplifies the user experience
Automatically receive suggestions
for received item placement based on preset rules for one or multiple warehouses. Track received orders with pallet identification; generate an optimized picking route. Use bar codes to track items and locations electronically.
Shop FloorControl
WarehouseManagement *
Foods & Beverage
• Advanced Formulation(Potency management)
• Lot Genealogy Inheritance
• Enhanced Scheduling: Production Sequencing
Product InformationManagement
• Engineer to order / Project management
• Configure to order – Product configuration
• Engineering change management
• Intercompany support• Enterprise asset
management• Service management• Spare parts
management• Supply chain planning
and execution
Specialty Chemicals
• Advanced Formulation(Potency management)
• Advanced formula management
• Production Formula Batch Balancing
• Active ingredient inventory management
• Attribute-based Purchase Pricing and Inventory Valuation
• Lot Genealogy Inheritance• Batch Attribute inheritance
to FG and Co-Products• Earliest Shelf Life date
inheritance to FG and Co-Products
• Enhanced Scheduling• Multi-priority/multi-layer
sequencing management• Resource/Resource group
based sequencing
Business Solutions for ManufacturingAll Essential Business Processes – One Familiar User Experience (Continued)
