Process DrivenCorning's Doug Anderson is juicing up existing assets by rewiring the processes that employ them
By Jeanette Burriesci The telecom and semiconductor industries have been rough this past year or more. And although Corning has survived many changes in the 150-plus years of its existence, it faces an ever-quickening pace of market movements this century. How will it navigate this bumpy landscape? As part of a Six Sigma program at Corning called Process Excellence, Doug Anderson, who leads IT for the heterogeneous Specialty Materials organization as its CIO, is deploying an ambitious project that is significantly changing the way things get done: He is opening visibility down to the finest granular level at the shop floor, coordinating efforts across disparate plants, giving managers tighter control over asset allocation, and capturing new efficiencies. We spoke with him recently. INTELLIGENT ENTERPRISE: You're in the middle of deploying a new manufacturing execution system (MES) called Virtual Factory (codeveloped with CamStar), which integrates with your ERP application at every plant. What was the impetus for this large undertaking? DOUG ANDERSON: We're going through a lot of change here because this implementation isn't just about IT, it's about business processes, how people do work, and how they think about work. It all fits together with a program we have in its second year called Process Excellence, a big piece of which is Six Sigma information statistics-based improvement. It's all about taking variability out of our business processes. That's the real competitive advantage that our IT organization can offer to the business: working together on improving business processes, in terms of transaction efficiency and people efficiency and making smarter decisions with better, more timely information. Something about Corning, which probably isn't unique, is that our factories and plant managers have a great deal of autonomy, and they're accountable for their factory results. Now we're making it possible to really share processes across factories, whereas in the past, every plant has kind of done its own thing, even when it's making the same things for the same customers. IE: So you're trying to improve efficiency by getting the plants to work together more? Anderson: You bet. That's a big part of what we're ultimately trying to get to with Virtual Factory. Plant managers are very receptive to Virtual Factory because it's going to save them money and time. Just a few weeks ago, we had some discussions about how we're now looking at restructuring some of our manufacturing organization: Instead of each plant being its own entity, a plant manager's going to have responsibility for a product line across multiple plants. Don't get me wrong, they've always worked together; it's just that when push came to shove under the old system, managers worked on their plant objectives, and if time permitted, maybe they'd work with somebody else. But it didn't make sense to have each plant defining its own manufacturing and business processes around the same product line. This is a real change. And it's not just my group. Now, engineering and other functional groups don't have to "reinvent the wheel" at every geographic location. That's going save folks money and improve our efficiencies overall. IE: Virtual Factory captures extremely detailed information from the plant floor and feeds it into your new PeopleSoft ERP system in near real time. Why did you need such granular data to be accessible so quickly and often? Anderson: Part of it is that the information is actually part of what we sell. And then the other part is that in order to successfully manufacture something profitably, you've got to be constantly working on yield and cycle times. Therefore, information is critical for continuously improving and refining manufacturing processes. ERP systems — and I've worked with a lot of different ones — aren't designed to track extensive, detailed, technical product attribute information. Rather, you've got a customer part number and a revision number and that corresponds to a PeopleSoft part number and revision number. But what our commercial groups demand and need to know is what our order backlog and sales history are, and they need to be able to break it down by all the different technical details associated with what's being sold: what type of fiber, what type of coding, what type of shape, what type of polish; they need to know all those detailed attributes. With our Virtual Factory and PeopleSoft systems, we're going to have the ability to pull those two pieces of information together. With our new system, we can answer these questions on a real-time basis. So they can say, "All right, here's what's going on, here's what customers are interested in today," attribute by detailed attribute. IE: Besides being able to offer your customers the kind of information they want about their manufactured goods and being able to better coordinate your plant assets, what are some of the other benefits to the enterprise you expect to accrue? Anderson: One of the things I think it's going to bring value around is facilitating things [such as] making capacity decisions, based on whether we're on an uptick or a downturn. We put a lot of work into figuring out how much manufacturing capacity we need to have online, and when and which plants we're going to commit that capacity to. That's a very manual-intensive process. But by having this improved information infrastructure in place, our reaction time is going to improve significantly. There's something we did in Specialty Materials with PeopleSoft that was kind of unique at Corning, and now other divisions are doing it, too. We have customers worldwide, some of our biggest customers being in Japan and Germany. Consequently, the European sales office had its own order management system, and the Japanese legal entity that sells to our customers in Japan had its own localized order management system. So a single customer order would get manually reentered four times: third party or in Japan, intercompany purchase order in Japan, intercompany customer order in the United States, and then customer order in manufacturing. What we did in Specialty Materials is put all those groups on a single PeopleSoft system. We now have a worldwide view of our customer order backlog. You can see exactly where all your open orders are for all your customers in one place. That takes bunches of cycle time out of the process; now everybody can see exactly what's going on, literally in real time.
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