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VOLUME -22 NUMBER 8
Publication Date: 08/1/2007
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Electronic Mfg. Services
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Components & Disty
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August 2007 Issue
Components & Disty
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Provides Integrated, Global Supply Chain Solutions
Semiconductor processing relies on supply chain management.
By Gerard Groundwater, Vice President, Chief Information Officer, Anadigics, Warren, NJ and Harpal Singh PhD., CEO, Supply Chain Consultants, Wilmington, DE
While broadband and wireless technologies have been around for more than 2 decades, they have significantly grown in complexity in the last few years. As the Internet and cable have become more and more widespread, people have also begun to expect faster and more reliable access. The same is true for wireless technology. As people expect to do more with wireless and broadband, Anadigics is the technology behind increased capabilities in each new generation of products.
Founded in 1985 and headquartered in Warren, NJ, Anadigics is the leading worldwide supplier of radio frequency integrated circuits (RFIC) for the growing broadband and wireless communications markets. The company's high-frequency RFICs enable manufacturers of communications equipment to enhance overall system performance by reducing the size of their products, while also adding greater complexity through increasing power efficiency, improving reliability, and reducing manufacturing cost and time to market.
Known for its aggressive design and manufacturing standards, Anadigics relies heavily on an efficient supply chain to successfully meet the demands of its customers. With new products constantly being introduced, profits and earnings are closely tied to how quickly a product can be brought to market. Often, a three-to-four-month delay can result in a significant erosion of prices and total profits. Typically, yields improve over time while prices decline. Additionally, the semiconductor industry usually has an extended supply chain. Manufacturing steps are spread out over different countries, and production must be coordinated between the fabs and downstream facilities. This can be especially challenging because the downstream processes are often sub-contracted.
And, while the semiconductor industry is faced with unique manufacturing challenges, it can also take advantage of several opportunities that are specific to this market. Opportunities are often evaluated using rough estimates of profitability and costs, without taking into account current constraints and conditions. This becomes especially important in an environment of declining prices and increasing yields. Many companies do not adequately reconcile bookings with capacity and shipments. A direct result is that the "starts" are not well synchronized with desired shipments and large amounts of in-process inventory builds up. More importantly, capacity is not utilized effectively to meet shipments.
Even though manufacturing facilities are typically spread out over multiple locations, the different schedules can, in fact, be synchronized so that the entire supply chain functions as a single virtual factory. However, this is often not done, and planning time lags result in mismatched production schedules.
For a number of years, Anadigics used hybrid solutions developed in-house along with some vendor-based solutions for managing its forecasting. While the company was able to produce accurate forecasts using this method, it was very time-consuming and did not provide an integrated solution that the fast-growing company required. Additionally, as a global company with manufacturing facilities in the U.S., Thailand, the Philippines, Taiwan and China, Anadigics required a supply chain solution that would enable planners and sales reps at a variety of locations to communicate effectively.
As a high-growth company, Anadigics was looking for an integrated solution that could help the business continue to grow and improve. Because Zemeter
is an SQL-based technology, it provides a solid framework, and users found the software easy to learn. The platform also integrates well with other Microsoft-based applications that Anadigics uses.
SCC first worked with Anadigics to implement the Demand Manager portion of the Zemeter solution. Demand Manager allows demand planners at Anadigics to create and update forecasts, plan for price changes and promotions, and analyze demand data, such as orders and shipments. Currently more than 20 users access Demand Manager on a regular basis. While the software is located at the company's headquarters, sales reps located across North America, Asia and Europe are able to access Demand Manager through the company's Virtual Private Network (VPN) via the Internet. This enables sales reps to efficiently generate an accurate forecast for the company's customers all around the world.
There has been a significant improvement in productivity since the company began using Zemeter Demand Manager — the biggest one has being the amount of time planners now have to analyze the data. Demand Manager enables planners to produce an accurate forecast, allowing them to review the demand and have a high-level meeting, which includes senior management, once a week.
Running Regular Reports
Demand Manager also allows the company's planners to run regular reports based on forecasts that are input from sales reps all around the world. The reports not only show where the company is against the forecast, but also indicate where each salesperson stands, how many days left until the end of the quarter and how close actual sales are to the target. The reports have proven to be a major metric in communicating with the salespeople, and have also enabled the company to significantly focus its Sales and Operations Planning (S&OP) process on key information analysis.
Anadigics has also implemented the Zemeter Supply Planner and has begun implementing Finite Scheduler. Supply Planner enables the company to balance production, inventory and distribution resources against business requirements to develop a plan that optimizes the use of supply resources, while the Finite Scheduler will allow the company to realistically convert business plans to production batches.
The Finite Scheduler uses state-of-the-art algorithms to sequence production activities and optimize resource allocation in continuous time. Detailed production schedules are a prerequisite for true available-to-promise capabilities, and provide the visibility into the production facilities so that customer requests can be evaluated against the capability to make realistic promises. The company anticipates the project will be fully completed by late summer or early fall.
As Anadigics continues to see its demand increasing, Zemeter gives the company an integrated solution that provides demand management, supply planning and finite scheduling. Without those three things, customer service representatives wouldn't be able to access the actionable data needed to provide improved Available-to-Promise (ATP) capability — a critical component in meeting customer needs.
For more information, contact: Anadigics, 141 Mt. Bethel Road, Warren, NJ 07059
908-668-5000 fax: 908-668-5068 Web:
or Supply Chain Consultants, 5460 Fairmont Drive, Linden Green Center, Wilmington, DE 19808
302-738-9215 fax: 302-454-7680 Web:
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