Foods Company -
Diagnostic Assessment
1
Executive
Overview
Summary Assessment
Summary
2
ASSESSMENTOVERVIEW
Foods Company recently launched an integrated system platform in support of a growing business and footprint, however the system is
not performing to expectations; while it has not caused an operational shut down, it is requiring additional effort to perform.
Key Takeaways
Methodology
System Assessment and Gap Analysis was performed by:
System implementation was well
- Step 1: Analysis of system capabilities, implementation plan, and other relevant material prior to visiting Foods Company
beyond initial timeline and rushed
- Step 2: In-person dialogues with teams in the Finance, Operations, Procurement, Quality, R&D departments as well as other
into a GoLive state
stakeholders to uncover opportunities for leap-improvement
Critical steps of the implementation
- Step 3: Categorized key issues affecting the business cycle information flow leading to the system implementation issues
plan were either missed, not
- Step 4: Reviewed steps for critical transactions using manual, alternate systems, and BatchMaster modules and how
completed or insufficient
information is recorded and used
- Step 5: Testing of data output, and validation of parameters entered in BatchMaster affecting critical features
Poor Understanding of Business
- Step 6: Discussions with BatchMaster implementation team to validate system capabilities, implementation gaps, and
Processes and BatchMaster
alternative solutions
Capabilities
- Step 7: Conducted a Risk Analysis for practicality of recommendations
Limited training has led to frustration
and mistrust of the system
Time/People Constraints and Critical
Top Issues
Top 5 Actions
Decisions affected System
Inadequate Initial Discovery Stage
Re-engage BatchMaster to adequately complete the
Implementation
Turnover of Project Management Leads
implementation of Quality module
Skipped System Implementation Stage Tasks
Perform review of Bills of Material and routings within
Go-Forward Plan requires an Efficient
Data Validation and Incomplete Item Master Data
current system
Time Investment and Support from
Unconstrained system environment
Perform training and on site support for users, both in
Operations to fill gaps of Prior
Data input efficiency
office and on shop floor
Implementation
Limited or incomplete training was provided for
Documentation of key processes and refinement of
Solutions should in cooperate Process,
system users (data extraction)
management tools
People and System
Lack of enabled system controls
Enable system user controls
3
SUMMARY ASSESSMENT
Prioritization
Implementation
Process
Key Takeaways
Value Activity
System Capability
System Utilization
Status
Alignment
Criticality
Status
Based on an understanding and
Procurement
4
2
1
1
4
1
demonstrations of the system
Vendor / Contract Management
3
1
1
1
3
2
capabilities BatchMaster is a good option
Receive & Manage Invoices
4
4
3
3
3
4
for operating environment at Frozen
Manage Inventory
4
3
2
2
5
2
Foods
Customer Acquisition / Mgmt
4
4
3
4
4
4
Key portions of the system have not been
Account Setup
5
3
4
4
4
3
completely implemented, i.e. (Quality,
Item Setup
5
3
3
3
5
3
Production), limiting the utility of an
Order Entry
4
4
4
4
4
4
integrated platform
Production Scheduling
4
1
1
2
5
2
Production
4
1
2
1
5
3
Limited training on the system
Quality
3
2
1
3
5
2
capabilities led to frustrations and work
arounds for basic functions (Users are
Credit / Collections
3
2
2
4
3
3
able to enter data, but not extract
Invoicing
5
5
5
5
4
4
information)
Cash application
4
4
4
4
2
4
Pricing
4
3
1
1
3
2
Without process documentation or
Allowances & Accruals
4
4
4
4
3
4
communication many processes have a
Perform Close
4
4
3
3
4
3
weak alignment to the system in current
state
Perform Audit
4
5
3
3
3
3
Make Accruals
4
5
5
5
4
4
Many of the current state weaknesses do
Reconciliation
4
5
4
4
4
4
not require a ‘System’ solution, but
Record Transactions
4
5
5
5
4
4
require process and people reviews
Financial Reporting
4
3
3
3
5
3
Budget / Forecast
4
3
3
2
5
3
Business Performance Reporting
3
2
2
2
5
3
4
BatchMaster system capabilities
CURRENT
Assessment
Implementation Assessment
STATE
Key misses
ASSESSMENT
System & Process gaps
5
BAT CHM ASTER ASSESSMENT: OPERAT IONS
Product
Formulation
Bills of Materials
Process Routings
Work
Revision Control
New Product
Product
Management
Instructions
& Approvals
Request, Sampling
Specifications
Management
B
P
B
P
B
P
B
P
B
P
B
P
B
P
Laboratory
Lab Notebook
Physical Properties
Nutrition Analysis
Industry Database Integrations
Formula Search Analysis
Analysis
(USDA, Genesis, etc.)
B
P
B
P
B
P
B
P
B
P
Compliance
Quality
Quality
Non Compliance &
Inspection Plans &
Complaint
SDS (GHS), Food
Standards (FDA, ISO
Batch Recall
Control
Assurance
CAPA
Checklist
Management
Labelling
GMP, GFSI)
Management
B
P
B
P
B
P
B
P
B
P
B
P
B
P
B
P
Planning &
Master Production Schedule
Material Requirement Planning
Scheduling
Scheduling
(MPS)
(MRP)
B
P
B
P
B
P
Production
Production Control
Electronic Batch
Material
Material
Labor & OH
Batch Costing, Efficiency, Yield&
Tickets
Allocation
Usage/Waste
Reporting
Cost Variance Analysis
Reporting
B
P
B
P
B
P
B
P
B
P
B
P
Batchmaster Capability
Foods Company
Implementation
B
Strong
B Moderate B Weak
P
Fully Imp
P PartiallyImp
P NotImp P NotRelevant
ASSESSMENTCONT’D:NON-OPERATIONS
Customer
Activities Management
Opportunity
Service Management
Calendar
Dashboards & BI
Relationship
Management
Management
B
P
B
P
B
P
B
P
B
P
Logistics
Sales
Procurement (Vendor Qualification, Vendor
Inventory
WMS Inventory Type
Performance)
Management
B
P
B
P
B
P
B
P
Financials
General Ledger
Tax
Banking
Cost Accounting
Fixed Assets
Budgeting
B
P
B
P
B
P
B
P
B
P
B
P
Human
Employee Data Management
Human Resources
Payroll
Resources
B
P
B
P
B
P
Product
Multiple Costing
What If Cost Analysis
Mark-up, Margin
Formula Sizing
Multi-level Formula/BOM Cost Rollup
Costing
Modals
Analysis
based onCost
Targets
B
P
B
P
B
P
B
P
B
P
Batchmaster Capability
Foods Company
Implementation
B
Strong
B Moderate B Weak
P
Fully Imp
P PartiallyImp
P NotImp P NotRelevant
IMPLEMENTATIONASSESSMENT
1. PROJECT PREPARATION
2. BUSINESS BLUEPRINT
3. PROJECT REALIZATION
4. FINAL PREPARATION
4. GO-LIVE & SUPPORT
Project Kick-off
PlantTour
System Config and Set-up
User Training
Go Live!
Hardware and OS
ProcessMapping
Master Data Import
ReadinessAssessment
Go-liveSign-off
discussions
BRD & GapAnalysis
Pilot Sessions by Module
Cut-over plan
Operational Support(on-site)
Software Delivery and
Statement of Work
“Day in the Life” Pilot(CRP)
Installation
Chart of Accounts
System Acceptance
DiscoveryQuestionnaire
Reportsselection
1. PROJECT PREPARATION
2. BUSINESSBLUEPRINT
3. PROJECT REALIZATION
4 . FINAL PREPARATION, GO-LIVE & SUPPORT
Plant Tour
User Training
Project Kick-off
System Config and Set-up
Readiness Assessment
Hardware and OS discussions
Process Mapping
Master Data Input
Cut-over plan
Software Installation
Gap Analysis
Pilot Sessions by Module
Go Live!
Discovery Questionnaire
Statement of Work
Conference Room Pilot
Go-live Sign-off
Chart of Accounts
System Acceptance
Operational Support (on-site)
Reports selection
Legend: Our Assessment
Good
Fair
Unsatisfactory
Not Done
IMPLEMENTATIONTIMELINE
STAGES
TASKS
Days
F17-Q1
F17-Q2
F17-Q3
F17-Q4
F18-Q1
F18-Q2
F18-Q3
Project Initiation
4
4
Observations
Project
Days Planned
Discovery, BRD, Gap Analysis
20
Preparation
60
Some key tasks taking longer
&
Days Utilized
HardwareInstallation
3
Business
than anticipated, despite
19
Blueprinting
SoftwareInstallation
2
not resulting in desired
16
outcome:
System Config &Setup
16
Discovery, BRD process
30
Master Data Import
27
Master Data Import
88
Project
Iterative Pilot Stages
5
Realization
6
Limited Training
Internal PilotTesting
4
3
On-Site Conference RoomPilot
2
Testing and Validation prior
2
to the GoLive stage took 5+
Functional Training Sessions
5
months
5
Final Preparation
User AcceptanceTesting
15
& Go-Live
167
‘On-call’ Customer Support
Go-Live
via webmeetings
OperationalSupport
20
40
Post Go-Live
Transition to Customer Support
KEYMISSES
AREA
TASK
OBSERVATION
PROJECT
Confusion over Fat and Thin Client between Pre-Sales and Delivery Team. Planned task of 5 days actually
Hardware and OS Discussions
PREPARATION
was completed in 40 days.
Gap Analysis
‘Gap nalysis’ was prepared but it did not clearly state the businessrequirements
BUSINESS
BLUEPRINT
Mapping of stakeholder reporting requirements vs standard reports was not carried out. Several
Reports Selection
stakeholder reports required customizationwhich has consumed 300 development hours at USD 53k.
Operations Project Lead from Foods Company was nominated late into the implementation, having
Project Leads
different changes. Project Managers from Batchmaster underwent two changes as well as changes in the
implementationteam.
Sign-off on bill of materials, product data was done prior to input, but not validated once uploaded. Master
Master data input
data was manually inputted and tech-upload process was not followed.
PROJECT
Onsite functional pilot sessions were not carried out. These were done remotely over VC which reduced the
REALIZATION Pilot Sessions by
Module/Function
effectiveness
CFP, although started, was not completed due to technical glitches. There was no reschedule to the
Conference Room Pilot(CFP)
incomplete CFP session
System Acceptance
There was no formal system acceptance obtained from the users.
User Training
Only 10% of the people interviewed agreed to have received any productive and useful hands-on training
FINAL
Readiness Assessment
Access profiles not configured into the system
PREPARATION, GO-
LIVE & SUPPORT
Go-Live sign-off wasn’t taken from the users. Despite known project management misses, conscious
Go-Live
decision to Go-Live was taken.
10
ORD ER TO CA SH
System allows for Parent Company Customer Setup and multiple location
Security profile to add/update/delete customers not in place
Open Order Report requires manipulation to serve Production purposes
Customer sharing of Weekly Production programmed delivery not included in the Order Report as “soft demand” or equivalent
Production Scheduling currently done manually
Tracking of Production to fulfill customer order requires too much effort due to:
Lot Number ambiguity
Manual Recording (e.g. Supervisor Production Form not loaded in BatchMaster)
Discrepancies between shipped and produced not clearly reconciled
Inventory movement between Mateo St and Preferred Freezer lacks the ability to issue a Bill of Lading via BatchMaster
Discrepancies between inventory at remote storage and actual shipping to the customer are hard to research
No major issues encountered for Invoicing and Collections
Suite of Reports for Order-to-Cash business cycle lacking
11
P RO CU RE T O PAY
Vendor data sets were loaded but incomplete to take full advantage of vendor management
Security profile to add/update/delete vendors not in place
Purchase Requisition process currently manual given Limits of Authority and Approval routing not setup in BatchMaster
Controls to issue purchase order depend on manual checks
Inventory purchases are calculated manually using Excel and the Production Schedule not part of BatchMaster
Suites of Reports for the Procure-to-Pay not in full use or not existent
Purchase Price Variance reports are inconsistent and not reliable due to Item Master database missing information/validation
Inventory Movements and timing of release not properly setup in BatchMaster, resulting in incorrect availability of inventory
balances
Yields loaded in the Item Master database not reflecting accurate scrap factors affecting inventory levels
Quality Module not implemented affects inventory rejects and holds that are manually processed, affecting material flow
There is no Vendor management and/or performance tracking improve material fulfillment
A/P approval routing working with limited capability in BatchMaster due to lack of training and process information flow gaps
12
RE CO RD TO RE PORT
Policies and Standard Operating Procedures for Foods Company are limited or non-existent
BatchMaster reporting lacks the detail to book entries properly, so adjustments are made to book differences
Inventory adjustments not clearly defined as yield, shrinkage, scrap, etc. to track waste in the system
Financial packet for Management and Operations has limited use
Standard Cost components do not accurately reflect indirect manufacturing costs
Standard Cost using labor hours rather than units produced or other activity-led metric, resulting in under/over absorption
Month-end close process taking 2+ weeks to complete despite using SAP Business One
Production variances not properly stated given that Item Master and Routings are not adequately loaded in BatchMaster
Visibility of the Finance information flow, controls and security profiles are not available
Room for improvement in the Working Capital reports to improve cash management position
13
Opportunities for Improvement
OPPORTUNITIES
Project Plan to Implementation
Risk Assessment
& NEXT STEPS
14
RE VIEW KEY OPEN ITEMS
SR.N
KEY OPEN
RESOLUTION PLAN
Timeline
O.
ITEMS
Quality Control
1. Implement QC module for Texas - Inventory Hold and Release functionalities
1
10/19
Module
2. Implement Complaint Management and Batch Recall Management
1. Update critical information for Item Master and Routings datasets to enable BatchMaster MPS functionalities
Master Production
2. Parallel testing to ensure production planning is in place and Operations is comfortable with the approach
2
10/12
Schedule (MPS)
3. Improve reporting to provide clear visibility to the Ops team, including an enhanced production dashboard
4. Periodic data validation and testing to keep confidence in the scheduling process
Material
1. Develop a process and update dataset to enable the use of super batches
3
Requirement
2. Provide Ops and Procurement with enhanced reporting and proper Training on MPS and MRP functionality
10/12
Planning (MRP)
3. Update lead times and shelf lives for key ingredients and raw material, while fixing the available inventory issues
1. Link WIP to finished goods to Routings, listing yields for each step in each work center
In-Process Yield
2. Develop Batch ticket support form to include data related to Production variances including actual yield
4
10/19
ratio’s
3. Review inventory movements to ensure updates are taking place
4. Train shop-floor staff for data entry and /or use of handhelds / scanners
1. Develop a production tracking mechanism across all departments in Foods Company to avoid confusion about
5
Lot Traceability
Lot No.
10/26
2. Document and Train personnel on proper update of this information for Receiving, Shipping and Production
1. Include complete upload of Routings and Item Master datasets, as well as unit costs and parameters
2. Compare standard Production Variances Reports vs. Foods Company needs and determine alternative solutions
6
Variance Reporting
10/26
for gaps
2. Test the reports prepared with source-data and sign-off for production
15
OPPORTUNITIES
Order to Cash
Security Profile settings to ensure Limits of Authority and Segregation of Duties are in place
Define a Production Tracking approach shared across all departments and loaded in BatchMaster
Improve Reporting Suite for Order-to-Cash business Cycle to give visibility to all stakeholders
Complete the proper load of the Item Master data set, including production parameters and Routings
Training on Production Scheduling capabilities for BatchMaster
Create a data cube for downloading and uploading production changes to effect the Production Scheduling for refinements
not included in BatchMaster MPS feature
Implement the use of super batches to enable MRP and WIP planning process
Adapt Production Batch Ticket to include all variables captured during production process, replacing manual forms (e.g.
Supervisor Production Form, Receiving Tally,
Improve process for Inventory Movement to remote storage location (to include proper documentation e.g. Bill of Lading)
16
OPPORTUNITIES(CONT.)
Procure to Pay
Change label colors to visually see FIFO approach in the plant
Approval process to enter/update/delete vendor information
Purchase Requisition and Purchase Order process to be recorded via BatchMaster, following Limits of Authority
MRP and Item Master database fully loaded in BatchMaster, including lead-times for each product to improve procurement
of inventory
Develop a Vendor Management program, including set of reports and performance metrics
Implement the Quality Control module in BatchMaster and interface with production processes
Map out and develop clear instructions for inventory movements to ensure inventory accuracy
Item Master and Routings fully loaded in BatchMaster to include proper yield in each step as well as expiration date of
ingredients
Use of superbatches to trigger proper POs and delivery fulfillment
A/P and Treasury features in BatchMaster to be fully functional, avoiding system constraints to proper more than 10 checks
per batch
17
OPPORTUNITIES(CONT.)
Record to Report
Develop and implement companywide Policies and Procedures
Standard Costing process overhaul to properly reflect manufacturing cost of products
Properly segregate routing data in order to improve Production Variances
Process improvement for Month-end close process
Develop Management Reports to improve financial performance for the organization
Cost Accounting to work hand in hand with Operations in order to improve waste visibility
Non Specific Sections
Unit Conversion Rate - Lbs to Cases - to eliminate calculations in the assembly line
Use of scanners and mobile devices to ease data updates
Use of allergens in the Item Master dataset to minimize setup and/or downtime
18
ROA DMAP TO CO MPLE TING IMPLE MENTAT ION
While activities have progressed beyond the GoLive date, the system is not operating to expectations. A 6-week blitz is required to jump start
BatchMaster implementation efforts, including;
Refine processes
Complete Open implementation items
Define Roles & Responsibilities
Complete BatchMaster training
The initial blitz period will be followed by a full implementation of remaining modules and continuous improvement
Implementation Activity
Week
Week
Week
Week
Week
Week
Month
Month
Month
Month
1
2
3
4
5
6
3
4
5
6
Re-Establishment of PMO
Reengagement of BatchMaster team
BatchMaster User Training
Review & Refine SOPs
Review Bills of Material and Routings
Documentation of Key Processes
Define Roles and Responsibilities
Review of System reports
Refine Scheduling Process
Implementation of Quality Module
Management & Steering Committee Updates
<--------- Initial Implementation Blitz -------->
<------ Continuous Improvement ----->
19
RISKASSESSMENT
Identified Risk
Probability
Severity
People
T3
L
H
P1 Standard report suite different from existing reports
H
P8
P2 Roles & Responsibilities not accepted/not understood
L
H
P3 Resistance to new system/process
M
H
M
M
P4 Low morale during change process
L
M
P5 The wrong talent in key roles
T2
L
M
P6 Lack of leadership support
M
H
P4
R4
P7
P7 Too much strain on the organization
P3
H
M
P8Lack of role clarity upon implementation
M
T4
T1
P9 Processes not followed after implementation
M
H
R5
L
M
PA Lack of communication during change
P9
PB
R3
M
H
PB Poor Training or turnover of superusers
Process
P5
R1
L
H
P6
P1
R1 Lack of documentation of processes & training
R2 Process definitions not communicated or monitored
L
M
PA
R2
P2
L
R3 Disruption of plant move impacting processes
M
H
M
H
R4 Turnover affecting adoption of key processes
M
M
R5 Not enough process monitoring degrading outcomes
L
M
H
Technology
Severity of Impact(Unmitigated)
M
H
T1 System implementation is delayed
T2 Misaligned systems requirements and processes
M
H
T3 System training inadequate
H
M
M
H
T4 Systems configuration causes ops issues
KEY TAKEAWAY
20
Upfront effort to setup the system, Training, and discipline in process improvement are key to make the ERP system work for Foods
Company
APPENDIX
21
ASSESSMENTOFBATCHMASTERCAPABILITIES
Source: Technology Evaluation
22