Royal Canadian Mint cashes in on improved IT processes with Microsoft Dynamics™ AX
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Company Overview
The Royal Canadian Mint (RCM) is a commercial Crown corporation involved in all aspects of coin design, production and marketing in one of the largest and most complex minting facilities in operation today. RCM sells its products to Canadians and customers around the world through a variety of channels. Faced with a time consuming heterogeneous legacy environment that was growing increasingly difficult to use and costly to support and upgrade, RCM decided to implement a new IT platform based on the Microsoft Dynamics™ AX enterprise resource planning (ERP) solution. Working with implementation partners Deloitte, eBECS, Hofinsoft and Junction Solutions, the RCM's new Dynamics AX-based environment delivers improved cost control through greater visibility into operations – helping the RCM improve time-to-market responsiveness, while helping the Corporation achieve its most profitable year to date.
Business Challenge
With a worldwide reputation for product quality, customer service, and minting technology, the RCM is at the forefront of innovation in producing currency. The RCM has over 800 employees and facilities in both Ottawa and Winnipeg. The organization produces all of Canada's circulation coins, coinage for other nations and collector coin export sales. To meet its distribution requirements, RCM leverages a worldwide network of dealers and distributors. Its business lines include Canadian and foreign circulation coins, numismatic coins, gold and other bullion investment products, and refining. Over the past 20 years, RCM has won many awards; including "2007 Most Inspirational Coin Award" at the 2008 World Money Fair for "Most Innovative Coin of the Year" and at the World Mint Directors Conference in 2006, for their 2004 coloured 25-cent poppy themed coin.
As a commercial Crown corporation, the RCM's primary objective is to deliver a fair return on investment for its sole stakeholder: the Government of Canada. According to Greg Smith, CIO for the Royal Canadian Mint, this process includes maintaining the long-term viability of the corporation through an on-going commitment to customer satisfaction, profitable growth and efficiency.
To that end, the RCM has made a commitment to becoming a "lean" enterprise – a customer-centric approach developed in the private manufacturing sector for organizing and managing product development, operations, suppliers, and customer relations. Being ‘lean' enables the RCM to be more responsive, flexible and adaptive to the dynamic environment in which it does business. From the refinery to coin production, from e-business to packaging and marketing, "lean" principles are designed to eliminate waste, increase value for customers and enhance efficiency across the company. Indeed a key factor in the RCM's decision to limit the mintages of its collector products includes restricting the number of coins made available to the public thereby enhancing their appeal in secondary trading and increasing the value of these coins for dealers and collectors.
For the upcoming Vancouver 2010 Olympic and Paralympic Winter Games, the RCM sought to develop and market its collector coin program in honour of the Games. As such, employees required improved visibility into current inventory and distribution levels.
Previously, the IT environment at the RCM consisted of outdated legacy applications and AS/400 terminal "green screen" user interfaces which were too inflexible to support the company's renewed customer-centric focus and lean manufacturing initiatives. With increasing volumes of data and rising support and maintenance costs, legacy applications were being extended well beyond their original design or purpose. In addition, the company needed a solution that was highly scalable, in order to be able to quickly accommodate extreme fluctuations in production due to demand.
"A similar Olympic collector coin program in 1988 was extremely popular and profitable, but were also extremely taxing to our IT systems. As we get ready for 2010, not only did we need to move away from the traditional AS/400 legacy green screen, we wanted to develop a more customer-focused platform that was flexible, scalable and intuitive, and would fit in with our lean manufacturing initiatives," says Smith.
Solution
To revamp its legacy system infrastructure, the RCM teamed with technology implementation partners Deloitte, eBECS and Junction Solutions to implement a new IT platform based on the Microsoft Dynamics™ AX enterprise resource planning (ERP) solution.
The company reviewed ERP products from Oracle and SAP but determined that Dynamics AX provided a lower total cost of ownership, could be deployed rapidly, was user-friendly, flexible, and was generally a better fit with the Mint's existing infrastructure. In the end, the Microsoft solution was chosen to quickly streamline the RCM's financial, customer relationship and supply chain processes. The Mint also purchased JunctionRES, a solution from Junction Solutions which is built on the flexible Microsoft Dynamics AX system and designed specifically for the multi-channel retail industry. The RCM is using the JunctionRES solution to streamline its order processing, customer relationship and supply chain processes.
"Lean principles mean that you don't manufacture until you have a demand. And in order to do that, you have to be more efficient, so that's really what the RCM was looking to establish. With Dynamics AX, RCM is able to streamline operations and offer more integration with existing technologies," says Yves Giguere, Project Manager, Deloitte. "More importantly, it fulfills the company's commitment to lean manufacturing processes. As a manufacturing organization, improving operations means saving costs, improving profitability and improving customer service."
Microsoft Dynamics AX is designed to work with familiar Microsoft products like the 2007 Microsoft® Office® system, Microsoft® Office® SharePoint® Server 2007, and because it is leveraging these tools today, the RCM could reduce training costs and increase user adoption. RCM is currently licensed for 250 concurrent users and 1000 staff.
"When we started looking, we knew we didn't need a solution that had every feature under the sun but rather a nimble one that our staff would use, and that could be implemented quickly," says Smith. "We did a comprehensive evaluation of leading ERP platforms involving 114 of our staff. An amazing ninety-five per cent of them came back and said that they found Dynmaics AX easy to use and could use it in their daily work."
Phase one of the technology implementation project took about 12 months. This involved deploying the Dynamics AX platform along with financials, advanced costing, procurement, fixed assets, manufacturing, maintenance and order processing. According to Smith, eBECS was instrumental in the successful implementation of the lean manufacturing solution on the Microsoft Dynamics AX platform. Plant maintenance was provided by Hofinsoft and RES and order processing was provided by Junction Solutions.
Phase two is currently underway and involves leveraging the core platform for business transformation, including implementing business intelligence (BI), refinery and shipping technology and the RCM is implementing Microsoft SQL Server 2005 and PerformancePoint Server 2007, replacing its existing Cognos BI solution.
Business Benefits
With the new Dynamics AX-based technology platform in place, the RCM now has a stronger IT platform to improve its lean initiatives and customer service. Today, the new real-time environment delivers enhanced visibility and transparency into operations and is helping the RCM improve responsiveness and time-to-market, and increase profits.
"We've had the most profitable year in our one hundred year history – all while implementing a new ERP system," explains Smith.
A more integrated information architecture
The new Dynamics AX-based environment leverages Windows Server® system, Microsoft SQL Server™2005, Microsoft BizTalk® Server 2006, and Microsoft® SharePoint® Server 2007 solutions in order to deliver a higher level of integration and a more intuitive and role-based user interface.
"Microsoft Dynamics AX is much easier to configure than traditional ERP solutions which makes it relatively fast, inexpensive and less risky to adapt to RCM's business requirements. As a result, we've managed to substantially reduce support costs and realize a lower total cost of ownership. We're now more efficient as an organization, which was our ultimate goal," says Smith.
Increased usability
Microsoft Dynamics AX delivers streamlined financial, customer relationship and supply chain management processes to boost productivity and more tightly integrate business processes. This helps the RCM standardize its business processes and improve overall operational efficiency and usability
"As a past example, our purchasing employees would have to fax status updates to our suppliers which was a slow and not always accurate process. So, what happens now is this status update data is pulled out of Microsoft Dynamics AX by the reporting system and automatically sent via the Microsoft BI solution. It has greatly improved the overall workflow and is saving us 4-5 staff hours every week," says Smith.
Foundation for future growth
The use of technology means the RCM is now meeting its lean manufacturing goals and has a solid and more efficient foundation for future growth. For popular campaigns such as the Vancouver 2010 Olympic and Paralympic Winter Games collector coin program, employees now have enhanced visibility into current inventory and distribution levels – translating into improved customer service.
"One of the most important features of Microsoft Dynamics AX for us was the flexibility. The new solution helps us make more informed real-time decisions by providing the proverbial single source of truth. We're moving to retire the legacy stack, improve operational efficiencies and continue our focus on being a lean and customer-driven organization," says Smith.
