František Finger, TRCZ: We Implemented WMS Mainly for Traceability
Complex system management of logistics allowed the TRCZ company for providing traceability and reducing count of errors at receipt and shipment
The TRCZ company is a daughter company of the Tokai Rika company, Japan. The company manufactures automotive parts, safety elements, and keys for cars. In the Czech plant in Lovosice, the company has implemented, step by step, a complex solution for the management of material flow, from call-offs to shipment, in cooperation with the Aimtec company. František Finger, logistics manager, speaks about real benefits of the project.
What has made you consider the logistics system support? How did your cooperation with the Aimtec company start?
We started our cooperation in 2005. We implemented their own DCIx system for the internal logistics management. The main requirement was to connect suppliers in a manner that would make the work of warehouse operators easier during goods receipts, check of warehouse stock, etc. In addition, there was a need to manage the warehouse stock even during transport to the plant. Step by step, we have connected all suppliers, currently having about eighty of them.
The process of connecting the suppliers was not always easy, therefore, we divided the suppliers into three groups. The first group responds to our current and real needs. As soon as the material is sent to the production, information obtained by scanning is sent to the supplier to let them know that the material quantity dropped below certain level, and the stock needs to be replenished. An order is then created automatically. Requests are generated based on the predefined frequency, and the supplier or external warehouse are forced to satisfy the call-off, and deliver goods to us.
What are the specific steps before the material is ordered, and what is the role of the DCIx system?
The DCIx system is connected to our enterprise ERP system, which controls the whole ordering platform, and plans the production. An order is created in ERP, and immediately transferred to the DCIx system. Information about requested delivery is sent to the supplier. The supplier supplies requested quantity of the material, and the order state change is shown in the application in real time. At that moment, the unique information about expected material is already available to us. As soon as the delivery is physically received to our warehouse, internal or external, information about putting into warehouse is entered to the system by scanning.
How do you make checks during the physical receipt of the material, and how is the material issued to the line?
The material is managed using a simple flow. Products subject to checking are automatically marked as suspicious. They are then divided to check compliant and check non-compliant products. All compliant parts are sent directly, or through another check, to the warehouse. Issue to the line is performed by scanning. This is a key action for us at all levels of warehouse operations. All processes and procedures begin and end with scanning. The cycle is closed by issuing the material to the line and creating the next order.
For the first group of suppliers, ordering based on automatic generation of consumption only is employed. How do the orders work in case of the second and the third group of suppliers?
For the second group, we generate the orders in a fixed manner. Based on the plan of production, the material is delivered on a fixed due date, such as once per certain period. Information is cumulated, and once per hour, a message is sent to the supplier to create a delivery based on it. The third group includes suppliers not connected for various reasons, and we make own settings for them to get connected to DCIx.
After the successful connection of all suppliers to the DCIx system, you have consequently connected all your customers, too. In which area?
One year later, a question arose why not to manage the shipment part of the plant, too, since the supplier part was working well. We used the DCIx system for the electronic data exchange with our customers. Our customers are world leading car factories, using their own EDI systems. The DCIx system helps us in processing information received from the customers.
In shipment, the DCIx system works in a similar way, with the difference that the customers send data through their EDI system. DCIx converts data to the production plan, which generates orders, and the plan is sent to the production. Based on the customer’s kanban, we manufacture products, which we send then to the warehouse. They are registered by the system, and the information is sent to the customer through EDI. With this step the cycle is closed.
What were your main requirements and goals connected with the logistic flow management system implementation?
Primarily, the main reason for the system implementation was to establish and prove backward traceability of products up to the level of input material. This is the key feature for the automotive industry and our customers, and we had to provide it and to assure its correctness. Then, we had to register all orders and supplies, and connect DCIx in real time to the requirements of our suppliers and customers. In this way, we can flexibly respond to their requirements.
The traceability is assured so that each handling unit is provided with a unique label, and thus, the handling unit is uniquely identifiable and backward traceable. Delivery notes are scanned again, and all the information from them is stored into the label barcode. During receipts of deliveries, all labels must be scanned, and the delivery note is closed. If the delivery note is not closed, it means the goods have not been delivered or scanned.
Has the project met your expectations?
At the beginning, we did not know the project would not only meet, but even exceed our expectations. In addition to the traceability, error rate of warehouse operators has been significantly reduced, and our efficiency has been increased. We have reduced stock by 75%, and increased usability of non-production areas by 50%. I am only speaking about the most distinctive benefits of the project.
What are your plans for the near future?
Together with the Aimtec company, we are planning extension of the DCIx system to the whole waste management. At present, this is the only part missing from the logistics point of view. The system has all the information about our products, and we would like to use it for the management of waste materials and packaging accounts. Any new projects will now be managed in this comprehensive system. It means our customers in the automotive industry using EDI will directly be connected to the DCIx solution in the packaging area.
František Finger took up the work in the TRCZ production management division in 2005. Since 2006, he has been working as the goods receipt department manager. He is responsible for logistics officers, internal and external warehouses, and transport. His team has 50 persons.