Verification of ERP Standard Time Using TOC Technique and Improvement of MES Routing Point

Abstract

Recently domestic manufacturing companies have been experiencing worsening profitability and stunted growth due to the long-term economic recession and the rapid rise of developing countries such as China and Southeast Asia. These difficulties force many companies to concentrate their core competencies on new value creation and innovation in order to gain momentum for new growth. Enterprise Resource Planning (ERP) has been considered as one of viable solutions. Among the various modules in ERP, shop floor control function in the production management module is rather limited. In order to overcome this problem, Manufacturing Execution System (MES) has been used as a subsystem which has a strong information gathering power and flexibility. Both systems interact closely with each other. In particular, ERP requires fast, accurate shop floor information at MES. This paper describes how to synchronize relevant information between ERP and MES with theory of constraints (TOC). The processing time information transmitted from the MES workplace is received at the ERP workplace. In the process, the received processing time is causing information distortion in ERP, when the information gathering standard of MES is different from the ERP information interpretation standard. The Drum-Buffer-Rope theory of TOC was applied to resolve this problem, therefore, information synchronization between both systems was made. As a precondition, the standard time of the upper ERP system was rearranged according to the capacity constraints resource. As a result, standard time restructuring has affected changes in labor costs. Standard labor costs have come close to actual ones, and information synchronization of MES transmission data has improved the reliability of standard product costs, such that it enabled various company-wide restructuring actions to be much more effective.