School of hard knocks: their first MRP system only starts some manufacturers up the learning curve - manufacturing resource planning

Software Magazine, April, 1988 by Sharon Brady

SCHOOL OF HARD KNOCKS

There isn't a computer professional alive who hasn't wanted to toss everything out and start all over again. Usually, the impulse passes before they can reach for the axe by the fire extinguisher.

But some people have actually trashed their old systems. Not with an axe, but with a decision. After that, they've installed the software that they wish they had had all along.

These revolutions have occurred in what are, on the surface, most unlikely environments: established manufacturing companies. These producers had to tackle inventory problems in order to meet profitability goals.

In facing the issues that plague discrete manufacturers everywhere, they were willing to take big risks. For each software revolutionary there was the possibility that a new MRP II system would fail. In spite of this--or, perhaps, because of it--the computer professionals came through.

Some of these companies had no choice. Unless they trimmed inventories and moved toward Just-in-Time manufacturing, they would be destroyed by Japanese competition or their own mistakes. Other users realized they had to completely revamp, not merely renovate, their inventory systems.

Two years ago, the peripherals division of Control Data Corp. realized it was time for a big change. "We had been running Mics, an in-house MRP system, on a Cyber 175," explains Randy Gottwaldt, a materials control manager for the division. "It was simply too slow."

Even though CDC's people had access to cheap, compatible Mips in the form of other Cyber processors, faster hardware wasn't the answer. The division's inventory control software, used since the early 1960s, had outlived its usefulness. "It would take us 48 hours to do a full run," Gottwaldt says, "and there was no way we could remain competitive unless we made the system more responsive."

CDC knew that it would be expensive and time-consuming to rewrite the code. Many of the programmers who had developed Mics and knew its inner workings had left the company. This opened up the possibility of bringing in a new system and scrapping the Cyber supermini.

A corporate steering committee suggested the division bring in Amaps, an MRP II product from Comserv Corp., now MSA Advanced Manufacturing, Inc. Amaps runs on the IBM 370 family of mid-range and mainframe processors, its System/3X and the Hewlett-Packard 3000 series.

Despite the pressure from corporate management, the people closest to the operation felt Amaps was not the best solution. "It was overkill. There was no reason for us to get that big a system," declares Gottwaldt.

He says his team felt a much smaller processor could do the job better than the old batch system, as long as it was interactive.

The pace of disk business has accelerated, according to Gottwaldt. "A production run that used to take a full week is now done in a day or so. Our MRP system had to be responsive to that kind of schedule; we knew we had to be online or we would be dead."

Control Data competes against dozens of other disk matters in a cut-throat market; its customers can be fickle, demanding and deaf when a vendor can only deliver an excuse.

In order to maintain its standing as a supplier of reliable hardware, CDC has repeatedly reduced the complexity of its disk drives. A by-product of this simplification is a shorter parts list. "Where our Bill of Materials used to have 30 items on it, now there are eight," Gottwaldt says.

But engineering improvements are only one ingredient in CDC's formula for profitability.

"The whole business is getting tougher, and the margins are getting tighter," he continues. Current products now cost only 20% of what the old ones cost, "which means that every penny is even more important."

That means keeping a tight rein on administrative charges as well as manufacturing costs. "We knew the Amaps system would work, but the high costs would eventually come back to haunt us," he added.

RUN ON A PC NETWORK

Gottwaldt and his colleagues determined that they would get the the best price-performance from an MRP II system that could run on a network of personal computers. The package they decided on was from Fouruth Shift, Inc., an eponymous firm located in CDC's home town, Minneapolis. The underlying hardware comprises 15 AT-compatible 10MHz PCs on a Novell network, using a Compaq 386 as the file server.

While the Cyber is no longer involved, the Compaq's disks, which house the database, are CDC's own 70Mb Wren II. The system easily supports a workload that Gottwaldt reckons averages eight users at a time and 10,000 transactions per week, which more than meets the division's needs.

Gottwaldt says, "The response time is as good if not better than a mainframe system would be, and it does everything we need it to do."

Gottwaldt says his team chose Fourth Shift because it appeared to have all of the necessary functions, the language was very similar to the Mics system, and because the vendor was also based in the Twin Cities. The CDC executive says a limitation of many PC-based MRP II packages, including Fourth Shift, is that financial modules are not fully integrated with the inventory software. This was not an issue for CDc since it had planned from the beginning to consolidate financial data with other corporate financial software hosted on large systems.