Frozen food manufacturer Rich Products Corporation is experiencing dramatic business growth, particularly in Asia. To support this, its international division in China needed a consolidated business management solution to replace the disparate systems that hindered production schedules and restricted operations. Rich Products Corporation worked with Microsoft® Gold Certified Partner Tectura to deploy Microsoft Dynamics™ AX 3.0. Easy-to-use tracking tools help support critical food safety compliance. Clear information makes production processes easier to manage and regulate, boosting efficiency and reducing operational costs. And reports are now 99.9 percent accurate, supporting the kind of informed management decisions that help the business bring innovative new products to market quickly and cost effectively.

Situation

In 1945, Rich Products Corporation (Rich’s) entered the frozen food market with its non-dairy cream, created using Chinese soya-bean milk processing techniques. Based in the United States, it is now a leader in the industry with a product range spanning 2,000 lines. With 30 factories across the United States, Asia-Pacific, the United Kingdom, and South Africa, its products are marketed in more than 80 countries and its sales revenue exceeds U.S.$2.5 billion.

Rich’s maintains high product quality with stringent production standards that govern its global factories. These standards can be difficult to apply and monitor, with each location using a different IT infrastructure to support operations. The international division in Suzhou, China, for example, ran custom-built financial management software. Until recently, employees relied on spreadsheets to compile reports manually because the technology couldn’t integrate data from other departments. As a result, production plans and cost settlements were often delayed.

Several industry-specific factors prompted Rich’s international division to review its IT infrastructure, with food safety standards among the company’s highest priorities. Frozen food industry regulators enforce rigorous controls over manufacturing processes, and the need to comply with global rules and regulations have added extra complexity to the manufacturing process.

Production schedules are tight, so flexible, efficient, and cost-effective internal processes are vital to maximize profits and supply customers with the products they require. Huang Zhengkang, Asia-Pacific Region IT Manager, Rich Products Corporation, says: “Food organizations must trace production and sales processes, so that if a problem with a product arises, the manufacturer can quickly track the product through its production and respond accordingly. But limited integration at Rich’s meant this process took up to two days.”
Cold storage management is also vital. Staff place products into storage immediately after production for several days to avoid overfilling the warehouse. But a cumbersome data entry process at Rich’s meant the warehouse manager only had time to input information every few days. This meant the production process didn’t run at full capacity, risking delays to customer fulfillment.

Sales administrators collect customer purchase orders and confirmations, and coordinate inquiries and consultations. But administrators had to call the logistics department to check the status of orders. This process sometimes took up to half an hour. “To manage these processes, they also relied on paper-based requests, and checking sales was slow and time consuming,” says Zhengkang. To work more efficiently, sales administrators in each division needed to be able to access and record purchase information directly into the system.

Solution

Rich’s international division was experiencing dramatic business growth, particularly in Asia. It needed a unified business management solution to sustain this growth and boost user efficiency, with the plan to eventually deploy it at the company’s offices across the world.

In 2006, the division examined the market for a suitable solution, but initial tests showed many solutions lacked the integration features that could connect them with the company’s existing systems. Zhengkang says: “None of the technologies we looked at offered us what we were looking for—namely, options to customize, scalability, and ease of use. That is, until we found Microsoft Dynamics AX and Process Industries for Microsoft Dynamics AX.”

Microsoft Dynamics™ AX offers manufacturing organizations a unified solution to manage and automate entire production processes, from order to delivery. Its multilanguage and multicurrency features help global offices comply with local regulations and work more closely with local business partners and customers.

With help from Microsoft® Gold Certified Partner Tectura, Rich’s deployed the technology in the Suzhou branch and the solution has since transformed the business. Information is consolidated across all departments, making it easy for managers to understand detailed information such as production costs of specific orders. All authorized users access one set of data, which is updated throughout the production process and registers across the business in real time. The consolidated information gives managers far greater insight than before. They can quickly find the information to resolve any query, from day-to-day issues such as the status of an order, to in-depth analysis, such as the need for a new factory.

Tectura used rich customization features in Microsoft Dynamics AX to localize the software to fully comply with the latest financial standards in China, including standard financial vouchers, itemized accounts, and tax statements. Meanwhile, the seamless integration of the system with the organization’s tax control printing system, streamlines the printing of invoices and significantly reduces the risk of human error. Now, invoice numbers are connected with order numbers so that the overall production and sales process can be traced.

The solution also manages food safety quality assurance. Batches of stock remain unavailable in the system until they have received a 100 per cent quality review. Only when this process is complete does the system release the batch to market. Zhengkang says that the company customized to the system to help the business manage product expiry dates. “A material might have a shelf life of 100 days, so we don’t want to receive it if it expires in 30 days or less. We set the remaining live date in the system, so when stock is received that offers a lower shelf life, Microsoft Dynamics AX automatically blocks the receiving process.”

The success of Microsoft Dynamics AX in Suzhou has inspired Rich’s to implement the solution globally, starting with its operations in Vietnam in early 2008, followed by the United Kingdom later in the year. The rollout is set to take place in the company’s subsidiary in Tianjin, China, in 2009. “Microsoft Dynamics AX is easy to deploy and extend to new branches and factories. It is also easy to integrate with corporate systems for improved worldwide consolidation. For instance, a customized interface has been built to extract reporting information from our SAP solution at headquarters.

“Microsoft Dynamics AX is a great example of how Microsoft makes continuous improvements to its business solutions, helping organizations streamline production and support specific industry needs,” says Zhengkang.

Benefits

As new products emerge and the market matures, the Asia-Pacific region has become the new profit hotspot for Rich’s. Microsoft Dynamics AX, tailored especially for process industries, supports the organization’s growth with a flexible, customizable environment that can easily meet local needs. Microsoft Dynamics AX helps the business to meet strict food industry standards, and supports the development of innovative new products, ensuring they reach market faster than ever.

Technology Supports Food Industry Compliance
Process industry features in Microsoft Dynamics AX help employees to track items throughout production, from the purchase of ingredients to product sale. Track and trace features mean users can locate detailed information almost instantly. By using these tools, Rich’s can reinforce its high food-safety standards and adhere to strict regulations, while minimizing the costs of manual data management. “These processes are very easy to customize in Microsoft Dynamics AX, making our processes run more smoothly and giving us better control,” says Zhengkang.

Product lifecycle management features automate processes and integrate project, customer, and financial information. This automation, combined with an easy-to-use interface—which makes it easy for employees to quickly input data—helps to ensure the information in the system is accurate and up to date. This has helped Rich’s to regulate its production processes so that cold storage management runs at an optimum level continuously. Warehouse managers can review the stock levels at any time, and adjust production schedules where necessary without affecting the running of the system.

99.9 Percent Accuracy in Reporting Supports Critical Business Decisions
Manual processing of documents and reports is outdated. Sales employees can now consolidate information from across the business in minutes. In fact, the Suzhou factory has successfully reduced the time it takes to collate sales data by more than 90 percent.

The technology’s powerful planning and analysis features offer managers deeper insight into the business, helping managers prepare key performance indicator reports quickly, and support critical business decisions. Employees can rely on the timeliness of the information to pre-empt market fluctuations and resolve issues before they become problems. Inventory status management, for example, is improved, and the business can remain confident that products aren’t released before they pass quality assurance. Zhengkang says: “With Microsoft Dynamics AX, the accuracy of our financial report data has increased to 99.9 percent. We now generate reports in half the time, taking two days instead of four.”

As a company experiencing rapid growth, Rich’s needs a sophisticated and efficient system with the flexibility to cope with any process changes brought by future growth. “The implementation of Microsoft Dynamics AX not only improves our productivity, but, more importantly, it satisfies our need for more in-depth analysis to support management decisions,” says Zhengkang.

Flexible Solution is Easy to Customize and Manage
Microsoft Dynamics AX is easy for IT administrators to manage and maintain, and its flexibility helps them to set up specific restrictions to protect the business and its users quickly and easily. Recipe management is one of the most recent internal developments at Rich’s. Recipes for food products are controlled by access authorizations and approval procedures that maintain their confidentiality. The IT team at Rich‘s can now centrally control permissions to the system to help protect the organization’s integrity.

Technology Supports Business Innovation
The development of new food products at Rich’s relies on the support the business gains through technology. Integration and seamless production management supported by Microsoft Dynamics AX help Rich’s increase production of new offerings, and accelerate their time to market.
Staff now approve new products based on extensive production information held and managed by Microsoft Dynamics AX. It calculates production costs and plans based on inventory, purchase data, and production line operations, helping managers to identify whether a new product is likely to generate the right return on investment.

Inventory management tools within the solution help the company cost-effectively introduce new products to market. The batch number management function uses factors such as shelf life to help employees coordinate delivery of products from the warehouse. This reduces the costs associated with products sitting on shelves for too long. Shelf life is a major concern, but now that the system gives Rich’s an early warning on product expiry, the sales department can monitor key time zones in product lifecycles and adjust processes.

Accurate Data Boosts Satisfaction
By using Microsoft Dynamics AX, administrators in each division record order information directly into the system. The information is entered just once because there’s no longer a need to re-key it into several systems across departments. Authorized employees, regardless of their role or the department in which they work, can use this data.

Customer-facing employees access this information directly. When customers want to know the status of their order, for example, the employee can check its progress and resolve the query in minutes. These small but significant improvements to service generate reassurance from customers, helping to give Rich’s the edge over its competitors. Zhengkang says: “We have greatly enhanced customer satisfaction without increasing the workloads of sales personnel. The more efficient we are in supplying customers, the stronger our business becomes.”

For More Information

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For more information about Tectura products and services, visit the Web site at:
www.tectura.com

For more information about Rich Products Corporation products and services, please visit the Web site at:
www.rich.com

Microsoft Dynamics

Microsoft Dynamics is a line of integrated, adaptable business management solutions that enables you and your people to make business decisions with greater confidence. Microsoft Dynamics works like familiar Microsoft software such as Microsoft Office, which means less of a learning curve for your people, so they can get up and running quickly and focus on what’s most important. And because it is from Microsoft, it easily works with the systems that your company already has implemented. By automating and streamlining financial, customer relationship, and supply chain processes, Microsoft Dynamics brings together people, processes, and technologies, increasing the productivity and effectiveness of your business, and helping you drive business success.
 
For more information about Microsoft Dynamics, please visit:
www.microsoft.com/dynamics

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