Assembly in Action: Software Organizes Production, Inventory
Founded in 1972, Lou-Rich Inc. (Albert Lea, MN) manufactures complete products and equipment, mechanical and electromechanical subassemblies, engineered mechanical components and weldments, and aluminum extrusions for a variety of OEMs. The company also manufactures its own Panels PlusR line of equipment used in the construction of prefabricated wall panels. In the process, the company operates in multiple manufacturing modes, including make-to-order, make-to-inventory and ship-to-order. Not surprisingly, given the variety of it operations, tracking revenue and inventory is a perennial challenge.
"We didn't have detailed cost information under our old system," says Lou-Rich CFO, Steve Tufte, describing the company's former manufacturing software system. "A lot of the challenge revolved around inventory transactions. We used to make one big entry at the end of the month, but needed to get better information regarding those transactions so we can make process improvements."
To solve these kinds of problems, Lou-Rich implemented a battery of enterprise software products from IFS North America Inc. (Schaumburg, IL), including IFS Financials, Manufacturing, Engineering, Distribution and Human Resources, which Lou-Rich integrated into its existing payroll system from Ceridian Corp. (Minneapolis). IFS also customized a data collection system that Lou-Rich now uses plant-wide to track time and materials data.
The result has been streamlined processes and access to far more data than in the past.
"Our earlier process was that information went through multiple hands before it was entered into our system. But now, the person creating things is doing it live instead of handing it off to somebody," says Engineering Manager, Doug Olson. "There is a savings in time and increased accountability. Moreover, the time it takes us to create something in IFS is decreased versus our old processes. Now, the time is spent analyzing and doing things rather than creating documentation."
"On the purchasing side, we used to be pretty loose," adds Tufte. "People would order things and then ask for expense account codes. It's not like that anymore. We are requiring a lot more requisitions and documentation."
On the engineering side, the new system helps Lou-Rich keep track of both parts and costs because it requires engineers to specify their needs.
"When you are working on a prototype, it is easy to push through a generic job to get something done in a hurry," says Olson. "Before, we would order in material and let purchasing know they have to contact production when the material comes in. It is now automated through IFS."
Finally, by providing traceability, the IFS software allows Lou-Rich to improve both the efficiency of its processes and the quality of its products.
"I think we can address financial and customer issues more accurately," says Tufte. "At a part level, the system has helped us identify parts and processes where we have a problem with the standard or with the process. Where there are variances occurring, we can take it back to the part."
For more on enterprise resource software and planning, call 888-437-4968 or visit www.ifsworld.com.