Aerocell Incorporated
ERP helps aerospace manufacturer double sales revenue
without adding employees
Overview
When their manual inventory management process and stand-alone
accounting system failed to keep up with the company’s growth, Aerocell
Incorporated decided it was time to implement an integrated enterprise
resource planning application. Aerocell, which has been making nomex
honeycomb panels and components for the aerospace industry since 1986,
needed a system that could survive and thrive in an environment regulated
by the Federal Aviation Administration (FAA). They selected Intuitive ERP
from Intuitive Manufacturing Systems.
The Challenge
As Aerocell began to experience rapid growth they realized the company
was facing a number of problems. They had no clear view of product costs,
productivity was frequently impacted by stock outs on the production
floor, accounting accuracy was poor and inventory turnover was exceedingly
slow.
“We just didn’t have the information and control we needed to manage
the business,” said Steve Durden, Controller for Aerocell.
The Solution
Aerocell moved forward in implementing the core modules of Intuitive
ERP, including general ledger material planning and procurement
capabilities, as well as the optional modules for Shop Floor Control and
Location/Lot Tracking for 25 concurrent users.
Intuitive ERP’s MRP and bill of material capabilities have provided
material planners with a better view of requirements and more control over
inventory management for the company’s 4,000 parts and 2,500 bills of
material. Work order functionality and shop floor scheduling allow
production controllers to better manage labor and equipment capacity and
also react to changing customer needs without disrupting the entire
factory.
Aerocell’s Results
One measure of the impact Intuitive ERP has had on Aerocell is the
number of inventory turns they experience. Prior to implementation,
inventory turned over about twice per year. After implementing Intuitive
ERP, inventory turns increased to six times per year, allowing the company
to improve cash management, reduce scrap, and rework write-offs as well.
In fact, Durden estimates that scrap has declined by 25 percent due in
part to the discipline and structure that Intuitive ERP added. With the
improved inventory management, Aerocell is also now able to offer
just-in-time delivery of product without excessive inventory levels.
The Location/Lot tracking option is critical to Aerocell’s business.
Because the company is in an FAA regulated industry, it is important that
they are able to track material movement from the receiving dock to the
shipping dock. Online traceability proved to be beneficial recently when
one of Aerocell’s customers received some products that failed upon
assembly.
They found the root cause was a bad batch of adhesive that had degraded
over time. Aerocell was able to quickly trace the original lot and take
corrective action to prevent the problem from reoccurring.
Ease of customization and access to data were also issues for the team
at Aerocell. While standard Intuitive ERP reports satisfy most of their
needs, Aerocell has been able to create additional reports easily,
customized to specific job functions, with unique selection and sorting
criteria. Additionally, Intuitive ERP’s use of 100 percent Microsoft
technology provides users with a familiar interface and user-friendly
architecture that can be easily managed and modified without specialized
IT resources.
“During our selection process it became clear that Intuitive ERP had
everyone beat on ease of use,” Durden continued. “Anyone familiar with
Windows can be up an running instantly and anyone with training in Access
can make minor modifications to the system if needed.”
Short implementation time was one key factor in the decision to go with
Intuitive ERP. According to Durden, he completed the system implementation
in less than one month with only two days of consultation from an
Intuitive implementation service provider (ISP).
“We were able to implement the system in 30 days, whereas other systems
we looked at would have taken us at least six months,” said Durden. “Even
more impressive is the fact that within a month after implementation our
employees were comfortably using the system without any major training.”
The impact of the implementation of Intuitive ERP was felt almost
immediately. In accounting, for example, Durden said operational benefits
were apparent within the first month.
“From an accounting point of view, we have been able to dramatically
reduce the time it takes to close the books each month,” he stated. “What
used to be a painful three week ordeal is now easily completed in less
than one week.”
The accounting group also found that the financial drill down
capabilities of Intuitive ERP provided a way to easily perform financial
analysis and resolve issues. Prior to implementation, it was nearly
impossible to dig into the detail of issues.
Perhaps one of the most significant indicators of Aerocell’s
operational improvement is their growth. Since Intuitive ERP was
implemented, Aerocell’s sales revenues have doubled from $7 million to
almost $14 million. During that time, production and administrative
efficiencies have enabled Aerocell to maintain the same level of
staffing—effectively doubling the sales per employee. |
Challenges