How better supply planning boosts manufacturing recovery

Manufacturing has been as disrupted as any other sector by COVID-19, but smarter planning means Saft is confident it will be able to respond to changing customer needs.

The COVID-19 pandemic and resulting lockdowns across the world this spring led to the steepest manufacturing decline in more than a decade. However, according to research by IHS Markit, business activity is returning and companies are turning their attention to recovery.

Yet coming back after disruption is not as simple as flipping a switch and having everything return to how it was. The pandemic has increased customer demand in some sectors and decreased it elsewhere – and it remains unpredictable. As a battery manufacturer, Saft is essential to business continuity for our partners so we’ve had to be ready at all times to supply emergency products.

As with customer demand, there is also uncertainty in the supply chain. Saft’s manufacturing processes were already complex; running our facilities smoothly means managing everything from the supply of materials and demand for our products, to the available equipment and manpower, and vital safety and quality constraints. Additional safety measures introduced following the pandemic, such as extra space for our workers, add another consideration.

Managing all these elements efficiently is a challenge that demands good data and a reliable, flexible planning tool. For a long time, our operations were managed with a combination of enterprise resource planning (ERP) systems, spreadsheets and the individual knowledge of our site staff. This wasn’t ideal, especially for our most complex facilities. In Bordeaux, for example, we produce nickel- and lithium-based batteries for several different markets, including rail and aviation. Thousands of batteries are produced from hundreds of components and there is complexity at every stage, from assembly to chemical formation.

The best-laid plans

We wanted to be able to minimize backlogs and give more accurate delivery estimates to our customers. So, about a year ago, we started looking at Advanced Planning Systems (APS), a new generation of technology tool, and settled on one from sofco.

An APS can help optimize a company’s entire supply chain, including sales, production, delivery and supply planning. It makes it easier to manage stock more efficiently, including keeping track of raw materials that have a limited shelf life. Setting it up means “building” a digital version of your plant within the system, so you have visibility of the whole process. It’s a little like using software to plan your kitchen redesign, albeit on a much larger scale.

In early 2019, before adopting the APS, it took two months for our Bordeaux site to re-plan its client order book to clear a backlog in the rail business. Any re-planning because of an unexpected event, such as a broken machine, would be a major headache, too.

But since we started using the APS at our Bordeaux and Poitiers sites, we can now re-plan in two days; it’s a tool that actively helps keep production running efficiently. Our sites now re-plan every month, which means they can respond more quickly to new requests and give customers more accurate delivery estimates, which manages expectations better and ultimately improves customer satisfaction.

Improved forecasting

COVID-19 inevitably caused a complete re-planning of Saft’s customer order book. At Bordeaux and Poitiers this was not the major effort that it would once have been. These sites can use the APS to forecast demand, anticipating future peaks so they can decide either to smooth their workload or hire extra labor.

It will take six months or so for us to see the full results of the project, but the outcome so far has been encouraging, and it’s likely we’ll expand the APS to other facilities. A parallel project is trialing a Manufacturing Execution System, which will monitor the performance of the machines themselves and collect data on factory-floor processes. Our goal is for this to connect to the APS and ERP to create smart factories.

Recovery from the pandemic is not easy or simple and, moreover, the uncertainties are not necessarily behind us. However, businesses have always had to manage uncertainty and risk. Improved planning processes mean we can face these challenges with confidence.