Case Study

Streamlining Processes

By implementing i2's production planning solution, pharma major Nicholas Piramal India has been able to reduce raw material inventories by 35 percent and increase customer response times

1. Removal of haphazard methods

Nicholas Piramal India Limited(NPIL) needed the Factory Planner to reduce customer response time lines. Also, the current process was not one, which integrated all the other existing systems. "Before we implemented Factory Planner, when we received a customer inquiry, our headquarters had to check with the plant to confirm material status, resource loading and production lead times," Neeta Sanghi, Senior General Manager, Planning, NPIL says. "It was a time-consuming and people-intensive process. We used an internally developed fore-casting system and had a fairly ad hoc sales and operational planning process. It was a disaggregated process that resulted in a lot of pain points."

2. Need for the factory planner

Some of the key objectives for their new production planning system included reduction in material inventory and customer response time, streamlining and acceleration in manufacturing planning and need for a single, accurate, and company-wide view of planning variables. "We chose i2’s Factory Planner because of their expertise and credibility as a factory planning supplier," Sanghi said. "The Factory Planner optimises manufac-turing operations, thereby, providing feasible plans to meet both customer delivery requirements and the manufacturer's overall business objectives. It can be deployed to reduce planning and manufacturing cycle times, to accelerate delivery performance, and to control inventory and production-related costs.

3. Integrating with existing systems

Production, scheduling, and material resource data—including requisitions, purchase orders, and work-in-progress items—flow from the company's SAP system into Factory Planner. The firm can now track daily performance for every production line in every production facility. Managers have leveraged Factory Planner to build a detailed database on resource utilisation and output for key production systems. NPIL has also extended Factory Planner to at least one packaging material vendor, making that supplier more visible and responsive. "We are building strong relationships with global pharmaceutical companies, we are investing aggressively in research and development, and we now have a differentiated export strategy with a target of making exports 50 percent of our business within five years," Sanghi says.

4. Advantages

Material inventories are down by 35 percent, yielding more than $200,000 in annual interest cost savings. Material visibility and availability have improved, and the company has greatly reduced material-related stoppages. More efficient planning has enabled the firm to reduce production changeovers by 25 percent, while closer adherence to plans has reduced expediting costs and improved average customer response times from two days to a half day.

"The i2 solution has greatly improved our visibility at both the plant and the headquarters level, and because we are all working on the same schedules, we have far fewer co-ordination issues," indicates Sanghi. "This system allows us to institutionalise our planning knowledge base, so we are less dependent on people and manual activities."