The Journey From Line Efficiency The Journey From Line Efficiency
To Enterprise IntegrationTo Enterprise Integration
To SustainabilityTo Sustainability
Company Facts
Company Overview
• Enterprise consists of PepsiCo Americas Beverages, PepsiCo Americas Foods & PepsiCo International
• More than 185,000 employees around the world
• More than 50 company-owned manufacturing locations in North America
• 2008 revenues of more than $43 billion.
Key Dates
1965 PepsiCo Corporation founded through the merger of Pepsi-Cola and Frito Lay
1983 Quaker Oats acquires Stokely-VanCamp Inc. (Gatorade)
1998 PepsiCo acquires Tropicana
2001 PepsiCo merges with the Quaker Oats Company
Products
2008 Scorecard
Financial Information
PepsiCo Estimated Worldwide Retail Sales : $107 BillionPepsiCo Estimated Worldwide Retail Sales : $107 Billion
Impact on Manufacturing
The Challenge
Business Climate
• Continued double digit growth in the Gatorade / Propel businesses • Pressure to maintain dominant market share • Increasing number of SKU’s• Capacity shortfalls• Increasing Customer Service pressure
• Need to drive efficiency to world class levels to maximize asset utilization• Line availability critical during the Gatorade “season”
Impact on the Organization
• Design and implement a standardized problem solving and continuous improvement capability across all plants for all employees.
• Limited resources to effectively manage the data required to support the new capability• Implement a set of data collection and analytical tools to support the emerging continuous improvement culture in manufacturing.
Barriers to Success
Business Process Barriers
• Excessive redundant data entry
• Training in new productivity and problem-
solving techniques
• Identifying leadership resources
• Institutionalizing the team process
Technical Barriers
• Inconsistent data
• Lack of data visibility across the organization
• Inconsistent reporting
• Inconsistent interpretation of metric definition
• Analytical tools did not support team process
• Difficult to manage technical infrastructure –
no standardization
• Varying degrees of automated data collection
• Inconsistent interpretation of line and
machine events by legacy
• Multiple plant-owned applications
Initiatives that were being impacted by these barriers
• Innovation• Customer Service• High Performance Work Systems• Continuous Improvement – Total Productive Manufacturing (TPM)• Technical standardization across plants
Solving the Problem
• A team was chartered and formed to develop requirements for a tool to address the business process and manufacturing issues. The team consisted of Manufacturing, Process Improvement, & IT professionals
• Target solution providers were identified (including in house development)
• Requirements developed and RFI’s were sent to a variety of solution providers
• Evaluation criteria developed and solution reviews were conducted
• Decision was made to proceed with a proof of concept project utilizing the SAP Manufacturing Integration and Intelligence (SAP MII) application
Why SAP MII?
• Highly configurable
• Web enabled
• Approach & technology allows us to leverage existing infrastructure
• Flexible to meet future business needs and technologies
• Scalable / Extendible / Supportable
• High degree of usability for end-users
• Java based technology meets PepsiCo standard
• Strong customer base
• Highly regarded by AMR, ARC, & Gartner
Integration and Intelligence (SAP MII) application
Proof of Concept Goals
Validate Functionality and Capabilities of the SAP MII application
• Operator Interface
• Reports to Support Total Productive Manufacturing Business Process
• Manufacturing Performance Metrics (True Efficiency, MTBF, MTTR, Availability, etc.)
• Interface to Advanced Simulation and Loss Analysis Tools
• Ease of Configuration; Flexibility; Adaptability to a Variety of Data Sources
• Ability to Quickly Re-Apply Toolset to Other Manufacturing Sites
Proof of Concept Validation
• Ability to Quickly Re-Apply Toolset to Other Manufacturing Sites
Understand Infrastructure Requirements
• Cost to build
• Skill sets required
• Resources required
Gain knowledge to develop detailed Project Costs, Rollout Plans &Support Plans
Proof of Concept Approach
• PepsiCo and technology resources familiar with SAP MII to jointly develop the pilot LEDS application & reporting
• Using Rapid Application Development techniques, develop and deploy a LEDS pilot in 30 days
• Joint development of detailed LEDS design specification
• Training of PepsiCo developers on SAP MII
• Pilot lines to be chosen on the basis of business priorities • Pilot lines to be chosen on the basis of business priorities
• Implement pilot application on initial line at first plant
• Deploy application to remaining pilot lines
• Deploy application to controlled group of division users
• Develop on-going support model
• Joint development of PepsiCo wide roll-out plan for 2005 and 2006
Data Collection Performance Charting
Problem Solving Tools
AnalysisDrill Down
The Results
• Proof of concept project was successful !!!
• Decision was made to move forward with the LEDS based on SAP MII
• LEDS Team was formed
• Formal training was provided
• Hardware and software configurations • Hardware and software configurations supported as PepsiCo standard
• Additional LEDS functions identified and implemented
• Currently rolling out to all Gatorade manufacturing locations
• PepsiCo Team is self sufficient in the development & re-application of new functionality.
In 2006, Management Chartered A Mission To MARS …
A Change in Direction, A New Mission
A Mission To MARS …
MARS Strategic Intent
Why did we do MARS?
• Risk mitigation prior to deployment of SAP software– Collect and edit actual material usage data, manually or from process control equipment, Eliminate or minimize redundant entry.
• Shop floor capability to gather data in a relatively paper less system
• Advanced standardized QA capability developed for material lot management and traceability
• Factory floor reporting and analysis that is flexible and easier to develop, outside the SAP software environment. Focus on productivity tools for Line Workers and Supervisors.
• Develop work practices and training far ahead of the deployment of SAP software. Mitigate project • Develop work practices and training far ahead of the deployment of SAP software. Mitigate project risk by proactively managing change on the shop floor
• Automated “push” of Material Master & BOMs in SAP software to plant databases.
• Automated Receiving
• Batch Deck Management
• Manual and Automated Data Collection Of Material Usage
• Production Confirmation Transactions – From the shop floor directly to SAP software
• Lot Management & Product Genealogy
Capabilities Developed & Deployed
• Material and Labor Efficiency Reporting
• End of Shift Performance Reporting
Lessons Learned
Organizational Change Management
• Sponsorship from the top down- Direction has to be unanimous and fervent. Must be aligned with all other corporate initiatives.
• Advisory Boards- Made of Internal and External partners.
• Rigorous Work Process Designs- Intimate understanding of work processes. Standardization is key. Critical for enterprise implementation.
• Training- Leverage as many methods of communication as possible.
• Train the Trainer Program
• Written Operating Guides and One Point • Written Operating Guides and One Point Lessons (OPL)
• Checks for Understanding
• Standing Web training sessions
• Leverage Subject Matter Experts and Change/Deployment Leaders as the constant voice of the plant
• Analysis of Acceptance and Adoption- This is critical for achieving business and process gains. ex. Scorecards and Check Lists
• Consider the long run-
“It’s Not a Sprint, It’s a Marathon”.
Keys to Success
• Training – Self sufficient development team has developed the internal capability to create new functionality and quickly re-apply their learnings. Without formal training this wouldn’t have happened.
• Follow Technical Standards – All IT components are deployed by PepsiCo’s technical support teams according to their accepted standards. Plug it in and it works !
• Develop Engineering Standards for data collection methods and adhere to them – religiously !
• Communication – Structured, frequent, honest communication to our business partners and technical support teams is critical to ensure that timelines are met and expectations are fulfilled.
• Scope Containment – Maintain a “laser-like” focus on delivering against scope,
Lessons Learned
• Scope Containment – Maintain a “laser-like” focus on delivering against scope, objectives, and timelines. Project Management.
How to Fail
• Fall short on any one of the above and there will be problems.
• Implement the technology before the business processes are in place and people are trained. Do this and you will continually be re-working the technology.
Current Status
• LEDS functionality rolled out to all Gatorade plants and 2 Foods plants.
• MARS functionality rolled out to all Gatorade and Foods plants in North America (17 total facilities).
• Over 5,000 total users.
• Identical Software & Hardware footprint across all sites support plant operations on a 24 x 7 basis with system availability of over 99 %.
• Technical team : 2 Development Engineers, 2 Support Engineers
• Business team : 3 Deployment Leaders (responsible for training users, sustaining business process • Business team : 3 Deployment Leaders (responsible for training users, sustaining business process health, and scrubbing requirements)
Quaker Foods and Gatorade MES
• Support High Performance Work Teams
• Continue Shop Floor Integration
• Supervisor Scorecarding
• Cross Plant, Comparative Metrics
What’s Next?
Continue the journey to manufacturing efficiency:
System & Business Process Sustainability!!System & Business Process Sustainability!!
Thanks for listeningThanks for listening!!
Any questions ?Any questions ?
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