Reinventing How Quarries Plan Sales, Production, Material Needs and Inventory Forecasts

10 September, 2018

First published in the September 2018 issue of Quarry Management as Smarter Scheduling

The importance of collaboration and real-time information sharing in today’s business climate cannot be overstated. It is even more important for quarry operations that are constantly trying to plan and match production levels to sales volumes. Plant managers are challenged to maintain optimal quarry cash flow and inventory while preventing plant overbooking and co-ordinating with multiple suppliers for raw materials − all to schedule on-time deliveries that meet customers’ changing orders. This is especially difficult because sales teams do not often have visibility into what materials are available to be produced and sold, and how a new order will affect production. It is also challenging for managers to produce accurate forecasts and get up-to-date information regarding the plant capacity and actual sales versus forecasted sales.

A digital transformation

The latest report by Forrester Research predicts that 2018 will see enterprises refocus on leveraging advanced collaboration and communication tools across the enterprise. They also predict that, in the coming years everyone within an organization will become a data analyst with the ability to leverage modern business intelligence (BI) tools to quickly sort, prioritize and visualize targeted information that is directly relevant to that individual’s line of responsibility. The hope is that better visual interfaces and real-time reporting will actively support collaboration across operational teams and drive better decision-making at every level inside an organization.

Not only that, the Millennial generation is expected to represent 50% or more of the overall workforce by the year 2020. Collectively, not only are younger generations ‘digital natives,’ meaning they grew up with technology, they also value it greatly and see it as a differentiator and ‘must have’ for employers. If companies want to hire and retain top talent going forward, they will need to continue to shift towards easy-to-use cloud-based tools and applications that support productivity and a collaborative environment.

It is out of this BI-focused landscape that Daniel Mekis began to unravel the communication, production, and scheduling problems facing many quarries today. As an assistant plant manager in California, he struggled first hand with the planning and scheduling of materials at various quarries, and felt that a lack of collaboration was a major part of the problem. His team tried Outlook, Excel and even Microsoft Access and SharePoint solutions to compile sales information and to plan and co-ordinate production.

‘Back when I worked as a plant engineer, it was our job to know if we were going to make enough material to meet the demands of our customers,’ said Mr Mekis. ‘Even if you know you’re producing 250,000 tons of material throughout the year, the sales quantities change daily, with many orders changing multiple times before they actually ship. Other problems we ran into were plant overbooking, the quarry running out of materials, sourcing materials from multiple suppliers, or using incorrect materials. I used to spend at least three hours for each plant per week compiling sales information to build a forecast report – which would show materials demand in different time intervals.’

Real-time planning

Quarries are beginning to take advantage of new collaborative tools that allow teams to move away from solving a problem on an individual island and move toward initiating well-informed discussions between the various branches of an operational team. One new approach that stands out is PlantDemand, an online quarry scheduling tool not just for planning and forecasting orders and production, but also for proactively ‘PlantDemand is a new concept for aggregate operations because it uses collaboration and real-time information sharing,’ said Dennis Schaaf, director of PlantDemand. ‘It provides a single source of truth to plan sales, production, material needs and inventory forecasts.’

PlantDemand’s online calendar is a:

Scheduling tool that allows plant managers to drill down into scheduling plans
Single source of truth that provides plant foremen, superintendents, engineers, sales and the back office with data on aggregate production, inventory planning and forecasting
Live sales calendar that allows teams to adjust the plant, hours, modes and sales, and because changes are reflected immediately, users can see how current production and future orders will be impacted, and how plant operations teams can solve inventory issues before they occur.

Automatic reporting

PlantDemand allows plant managers to create summaries and quickly run default and custom pivot-style reports against actual sales or forecasts. Automatic reporting features make it easy for the sales team to quickly enter orders and see exactly how much can be sold on any given day. Plant operators receive reports from inside sales or generate their own reports to see exactly what they need to produce and how much raw material they need to order from suppliers.

‘Most importantly for quarries, they can now forecast exactly what their customers want today and down the line, and they now have a ‘big-picture’ view to help them balance production, inventory and cash flow,’ said Daniel Mekis. ‘That just wasn’t possible before because everyone was bogged down with getting the day’s orders out of the door and keeping up with changes.’

Better organized, smarter scheduling

Ashlee Avila, inside material sales rep with Granite Construction, was one of the first subscribers of PlantDemand. Her department introduced strategic material purchasing by using the app to track how oil is billed for each product, allowing them to save time and considerable amounts of money. When out in the field or talking with customers, she can quickly log into PlantDemand and add notes to each order. This leaves a historical record of changes made, which might include noting last-minute cancellations, indicating customers who left mix, changed the ordered tonnage, or other variables. She also likes the fact that every morning she can see the sales calendar for the whole month in PlantDemand, and it is all colour coded by material for better organization and simplified viewing.

‘Before PlantDemand we used spreadsheets, but they didn’t scale to the level we needed,’ said Ms Avila. ‘We didn’t have a good way to forecast for the month or week and tell our guys what orders were coming. Now I can log in and within a few clicks I can see our sales calendar for the whole month, week or day. I also create a daily dispatch report every afternoon for our plant foreman, as well as a quality-control report that tallies all our orders for the next day. We save it as a PDF and it’s in a very easy-to-use format, so we’re all working from the same schedule.’

Ms Avila says PlantDemand’s mobile app is also extremely useful and she likes the way that she, the sales team and the plant manager can access it anywhere and at any time, with no software or hardware to install. She can use her iPhone to make changes to order dates or tonnage needed while in the field talking with customers. Sales staff also uses the mobile app when they are with customers to quickly see if the plant is running the next day and if so, what mix. This saves time by not having to call the office each time a customer has a question.

Smarter inventory planning

Using PlantDemand, plant personnel can also create a production schedule, production report, and inventory forecast by tying in the live sales calendar with the plant’s production plan. Users start by entering minimum and maximum desired inventories of each product, taking into account historical data, upcoming sales, volumes and demand. April Scott, inside material sales/materials dispatcher for Granite Construction’s Sacramento office, believes PlantDemand’s inventory planning and forecasting tools help prevent stock run-out, keep customers happy and maximize cash flow.

According to Ms Scott, PlantDemand provides added visibility into the schedule and helps keep track of customers and orders. With more than 15 customer orders daily and thousands of tons of material in sales, her calendar is very fluid. Previously she had to manage changes manually using an Excel report each day before sending out the daily schedule to the team. Today she uses PlantDemand’s shared calendar to send out a daily schedule to the sales team, the construction department and the billing department. PlantDemand also helps monitor materials inventories and identify issues before they happen.

‘Before, I’d find potential problems, but it was much harder because my schedule was on a clipboard or in a long-term schedule in Excel, not all in the same place,’ said Ms Scott. ‘Now PlantDemand looks at how much oil and aggregates are needed for upcoming orders, which helps the plant and oil suppliers prepare. The app also highlights where we’re over our daily tonnages and helps us prepare for potential overbooked days. That’s huge because we can fix these problems early before our customers even know there would have been an issue.’

Conclusion

Today’s most successful quarries are taking steps to improve how they track and manage sales planning, production, material needs and inventory forecasts. At the crux of more efficient operations is a commitment to expand visibility across the plant and empower the entire team with online tools that support information sharing and collaboration. When teams have the right technology and real-time data at their fingertips, quarries can become more competitive and more responsive to customer needs. For more information visit: aggregates.trimble.com/plantdemand