Metals Producers, Processors, and Service Centers
Today's metals industry is marked by intense global competition,
cyclical markets, changing demand patterns, and the commoditization
of products. While this environment is very challenging, it also
offers tremendous opportunities to companies that are able to:
- Ensure consistently high quality
- Respond to customer product and delivery needs faster than the
competition
- Reduce costs
- Optimize the use of capital assets
Metals producers and processors that master these key operational
capabilities position themselves to increase market share, revenues
and profits.
Real World Issues
Leading metals companies are recognizing that these goals can only
be achieved by integrating management of the entire business around
a common base of information and streamlined business processes.
That is what enterprise resource management systems are designed
to do. But there are fundamental product and process issues that
make the metals industry unique, and that must be effectively addressed
by such a system in order to be successful. Some of these real
world issues are:
Actual quality varies from heat to heat.
Many of the unique aspects of the metals industry stem from the
fact that every heat or lot of a given metallurgical grade is different.
Each heat has somewhat different actual quality - i.e. chemical
and physical properties - that must be taken into consideration
when they are used to make end products.
All material is defined by its attributes and characteristics.
Because all material has the chemical and physical properties of
the heat or lot from which it is made, and also has additional mechanical
and dimensional properties coming from how it is processed, it cannot
be fully identified by just a part number or material code. The
attributes required to identify material are different for different
types of items (e.g. length, height and width for a billet vs. OD,
wall and length for a tube). The actual values (characteristics)
of the appropriate attributes must be known for each item through
all levels of production from heat to finished product.
Inventory is tracked at the tag level.
Because of the variations described above, inventory is tracked
at the tag level (i.e. slab #, billet #, coil ID, spool #, bundle
#, etc.). Quantity, properties, dimensions, and inventory location
can be different for each tag #.
Material application is a function of actual quality.
Again, because of the variations described above, material is applied
to orders based on actual properties. Applicators must identify
and reserve available material with the right combination of properties
to conform to the specifications for each order (e.g. the chemical
and physical properties of the rod used to make wire must match
the customer's specifications for that product).
Material is often reapplied to other orders.
Material can be reapplied from in-process orders and Q.C. hold
status to other in-process orders with different specifications.
The chain of property contribution must be maintained to provide
product quality certification and conformance to specifications.
A given product can be produced in multiple ways.
The process/practice can be altered to produce a desired product
based on the material that is applied. Alternate starting sizes
can be used with additional operations (e.g. roll pass, mill, draw,
etc.). Certain properties can be adjusted by additional process
steps (e.g. heat treatment or annealing).
Quality control & tracking is critical.
Material must be tested at various stages throughout the production
process and certified test results are often required by customers.
Process and environmental data must also be continuously collected
for process control and process improvement. Traceability must be
maintained from the original heat and casting to the end product
shipped to the customer.
Units of measure are variable
A given item may be sold or purchased in any one of several units
of measure (e.g. lbs or kg, feet or meters, sqft or sqm). Production,
however, may be scheduled and reported in a different unit of measure,
so the various order quantities need to be converted for production's
use and then converted back for shipment.
Inexact quantities are a way of life
In purchasing, manufacturing and selling, exact planned order quantities
are virtually never realized. Shipment or receipt of a quantity
that is slightly more or less than the order quantity is a normal
practice. Customers often specify quantity tolerances that are acceptable
to them.
Effective scheduling is important to mill productivity
All metals companies are capital intensive and must effectively
utilize their capital equipment in order to be profitable. Because
of this, mill scheduling is driven by numerous factors in addition
to customer request dates. In order to minimize downtime due to
setups, most mills sequence production by either the attributes
of the material being produced (e.g. grade, shape, thickness, diameter,
etc.), and/or by the attributes of the material it is being produced
from (e.g. starting thickness vs. ending thickness). Many mills
also schedule around their biggest bottleneck (e.g. melt shop, rolling
mill, annealing furnace, etc). In some cases, a standard production
cycle of related products is scheduled in advance and customer orders
are booked against that schedule. This is often called a cycle schedule,
rolling schedule, or campaign.
Shipping/receiving logistics are a key aspect of operations
Because the material being shipped or received is typically of
considerable size and/or weight: loading/unloading capacity is limited,
freight costs are significant, and shipping mistakes can be costly.
Efficient carrier scheduling and proper loading are crucial to both
customer service and overall profitability.
The AXIOM Enterprise Resource Management System has been designed
with all of these issues in mind and much more. And it has the
special
capabilities needed by individual segments within the industry
as well. For a brief description of some of the special features
provided
by AXIOM to address the specific needs of various environments
within the metals industry, see:
Then see the Solutions
section for a more complete description of AXIOM's functional
scope and capabilities.
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