Class A ERP Implementation: Integrating Lean and Six Sigma

by Donald Sheldon

Overview

Class A ERP is often misunderstood and confused with software tools and implementations but is actually a management system for continuous improvement. This book will resolve these myths by thoroughly describing the definition of Class A ERP and giving specifics for achieving Class A performance in a reasonable timeframe. Examples from successes will be referenced to and the author will build a case for breaking the journey to world-class performance into bite-sized, doable focus areas. Class A ERP Implementation will help organizations set the stage for maximum effectiveness of both Lean strategies and Six Sigma and establish ERP disciplines as the prerequisite to success.

Product Details

ISBN-13:	9781932159349
Publisher:	Ross, J. Publishing, Incorporated
Publication date:	05/01/2005
Pages:	304
Product dimensions:	6.00(w) x 9.00(h) x 0.90(d)

About the Author

Donald H. Sheldon is president of DH Sheldon & Associates, an international consulting firm headquartered in New York. As a practitioner, this leading expert previously served as Director and General Manager of The Raymond Corporation's Worldwide Aftermarket Services Division and as Vice President of Global Quality and Six Sigma Services for the NCR Corporation. Prior to forming his own firm, Mr. Sheldon was Vice President for BUKER, Inc, of Chicago, a world-recognized leader in management education and consulting. He has been published in numerous magazines and journals and is author of the book Achieving Inventory Accuracy and was co-author of The Road to Class A Manufacturing Resource Planning (MPR II). He has been a frequent speaker at colleges, international conventions and seminars and he is certified by APICS as CFPIM (Certified Fellow in Production and Inventory Management) and as CIRM (Certified in Resource Management).

Table of Contents

	Preface	xi
	About the Author	xiii
	Acknowledgments	xv
	About APICS	xvii
	Web Added Value	xix
Chapter 1	What Is ERP?	1
	Top-Management Planning	2
	Master Production Scheduling and Materials Management	4
	Data Accuracy	7
	Bill of Material Accuracy	7
	Inventory Balance Accuracy	8
	Integration with Lean and Six Sigma	10
	ERP as the Starting Point	12
Chapter 2	Class A ERP Performance	17
	Material Requirements Planning	17
	Manufacturing Resource Planning	18
	The Class A ERP Standard of Today	24
	Class A ERP Certification	27
	Summary	31
Chapter 3	Business Planning	33
	Business Imperatives	36
	Top-Level Management Systems	37
	Tricks in Building the Right Business Plan	38
	Financial Objectives Planning	38
	Internal Business Process	40
	Learning and Growth	42
	Customer Influences on Business Imperative Choices	44
	Supply Chain Influences on Business Imperative Choices	45
	Technology Affecting Business Imperative Decisions	46
	How Many Business Imperatives Should You End Up With?	47
	Linking the Financial Plans with the S&OP Process	48
	Product Planning in Class A ERP	49
	The Class A Measurement for Business Planning	49
	Talent Review	51
	Process Ownership of the Business Plan	52
	Summary	52
Chapter 4	Sales and Marketing Planning: Creating the Demand Plan	55
	Business Planning as an Input to Demand Planning	56
	Marketing Plans as an Input to Demand Planning	57
	Sales Planning as an Input to Demand Planning	59
	Historical Inputs to the Demand Planning Process	61
	Understanding the Outputs of Demand Planning	62
	The Weekly Demand Review	62
	Process Ownership in the Demand Plan	65
	The Measurement Process for the Class A Demand Plan	66
Chapter 5	Operations Planning	71
	Product Families	74
	Elements of Operations Planning	76
Chapter 6	Sales and Operations Planning	87
	Participants to the S&OP and Their Roles in Larger Multiplant Environment	89
	Some Thoughts on Alternative Labels for S&OP	91
	Roles in the S&OP Meeting	91
	Timing for the S&OP Process and the "Monthly Closing of the Books"	94
	Agenda for the Pre-S&OP	96
	The Spreadsheets for Both the Pre-S&OP and the S&OP Processes	98
	Summary: Keys to the Success of the S&OP Process	99
Chapter 7	Master Scheduling	103
	The Master Production Schedule	103
	Capacity Planning in the Master Production Schedule	108
	Rules for Level Loading	114
	Linking to the Operations Plan	115
	Master Scheduler's Role	119
	Master Scheduling Metrics	121
	Management Systems Requirements	123
	Process Ownership	125
Chapter 8	Class A ERP Material Planning	127
	Order Policy Decisions	129
	ABC Stratification	131
	Process Ownership in Material Planning	131
	Material Planning Metrics	132
	Integration with Lean and Six Sigma	132
	Running the Net-Change Calculation	134
	Inventory Management	136
Chapter 9	Class A ERP Data Accuracy Requirements	139
	Inventory Location Balance Accuracy	139
	Inventory as an Asset	140
	Allowing the Elimination of Buffer Inventory	140
	Control Groups	141
	Physical Inventory	148
	Eliminating the Physical Inventory Forever	148
	Process Owner of Inventory Accuracy	149
	Inventory Accuracy Metrics	150
	Bill of Material and Routing Record Accuracy	151
	Summary	158
Chapter 10	Class A ERP Procurement Process	159
	Why Develop Partnerships with Suppliers?	161
	Selecting Suppliers for Partnerships	162
	Implementing Supplier Partnerships	165
	Aligning the Sales and Operations Planning Processes	167
	Information Sharing	168
	A Word About Reverse Auctions	168
	Logistics as a Competitive Advantage	169
	Supplier Performance Ratings and Certification	170
	Integration of Lean and Six Sigma in Procurement	172
	Process Ownership in Procurement	172
	Class A Metrics in Procurement	173
Chapter 11	Shop Floor Control	175
	Communicating the Schedule to the Factory	177
	The Role of Material Requirements Planning	179
	Functional Manufacturing Versus Process Flow	180
	Dealing with the Word "Can't"	183
	Setup/Changeover Reduction	184
	Customer-Focused Six Sigma Quality	186
	Employee Involvement	188
	Team Planning and Management	189
	Kaizen Events on the Factory Floor	192
	Areas of Waste	194
	5-S Housekeeping and Workplace Organization	195
	Simple Problem-Solving Tools	196
	Process Owners for Shop Floor Control	197
	The Metrics in Shop Floor Control	198
	First-Time Quality	199
	Safety	200
Chapter 12	Customer Service	201
	Rules of Engagement	203
	Customer Service Exceptions	204
	Deliver on Time or Ship on Time	204
	Process Ownership for Customer Service	205
	The Metric for Customer Service	206
	Shipping Ahead of the Promise Date	206
Chapter 13	Class A ERP Project Management/Six Sigma Process Integration	207
	Class A Project Management	208
	Lean-Focused Project Management	209
	Six Sigma-Focused Project Management	212
	Defects	215
	Project Management Structure	215
Chapter 14	Class A ERP Management System	219
	Weekly Performance Review	220
	Clear-to-Build	224
	Weekly Project Review	224
	Daily Management System Events	224
	Other Management Systems in the Business	229
Chapter 15	Education and Training	231
	Class A ERP Education	231
	Training Requirements	234
	DVD Education for ERP	243
Chapter 16	Class A ERP Performance Metrics	245
	Barometric and Diagnostic Measures	245
	Starting the Metric Process in Class A	249
	Weekly Performance Review	250
	Posting the Metrics	250
Chapter 17	A Word About ERP Software	253
Chapter 18	Class A ERP Implementation	257
	Steps for Successful Class A ERP Implementation	257
	Summary	265
Chapter 19	Class A ERP Integration with Lean and Six Sigma	267
	Best-in-Class Lean	267
	Lean Tools	271
	Customer-Focused Quality (Six Sigma)	273
	Other Six Sigma Tools	278
Chapter 20	The Role of Consultants in Class A ERP	281
	Payback	282
Appendix A	Summary of Class A ERP Certification Criteria	285
Appendix B	Steps for Successful Class A ERP Implementation	292
	Index	293