Under new MANAGEMENT

Hydro Polymers (HP), the UK arm of the Petrochemicals Division of Norsk Hydro, manufactures PVC polymer and related compounds. HP is part of an integrated production chain that starts with Norsk Hydro, based in Norway. The company has invested more than £1.5 million to replace its previous Data General business systems with a suite based on SAP R/3. This is the first step in a £6m roll-out of SAP R/3 across the parent company's entire petrochemicals division.

The pilot installation at the UK site comprised production planning, logistics and finance modules, including product costing, material staging and links to warehouse barcoding systems. It went live in May, the culmination of a 50-week implementation by 121 Consulting, SAP's consulting partner.

David Summerbell, planning and systems director at HP, tells PE: `We were getting frustrated that business managers couldn't access the costs of packaging and transportation at the same time, for example. Previously, manufacturing units were linked to the system by paperwork so data couldn't be transferred directly.'

HP was seeking an integrated business system with an open data structure. Manufacturing 1500 products on 16 production lines made it hard to keep on top of everything, considering that materials costs can change daily.

`We became aware of SAP R/3, with its graphical front end,' Summerbell says. `We soon realised that it offered quite a lot of things we were looking for: production planning; bills of materials for multi-batch; and a repetitive manufacturing model within the planning function.'

The feature which enthused HP about SAP R/3 was its R3 analyser, which presents a description of the process in the software. One can also install the graphical interpreter ARIS, which allows people to access information that lets them know if SAP is suitable for their needs.

121 Consulting analysed HP's business and work processes and compared them with the industry-recommended practices supported by the standard SAP package, with its associated Business Engineer tools.

John Blakey, project manager with 121 Consulting, says: `R/3 enables finite capacity scheduling of works orders and production planning. The aim is to integrate production and plant interfaces, so that information about process conditions can be fed back into the process and finished products can be automatically matched to customer specifications. Stock and work-in-progress are tracked, as are works orders, including product costing data.'

TAKE IT TO THE Bridge

A customised piece of software - a `bridge' - was written to link the SAP business system with HP's process control systems, which employ ABB Advant and Intellution software. Blakey says: `In SAP we hold the bills of materials to manufacture products as well as the production plan, routeing and schedule for each job.

`We then have the link to the process control system by downloading the bills of materials to that system, which holds additional data, to control the more detailed process requirements.'

The bridge is based on the Powerbuilder programming tool which enables transfer of the recipe handling system, which passes data to the Intellution process control system. Intellution sends back data on yields and quality details such as product specifications and completion quantities.

SAP's production planning for the process industries (PPPI) approach can send process control information right through to the control system.

The `bridge' also required the use of ABAP, SAP's own programming language, to act as an interface between SAP and Intellution systems.

One of the advantages of leaving the process control equipment separate from the business control system is that if there is a fault anywhere, the process itself will not stop, because the system has a buffer. This obviates the need for every transaction to be in real time.

Summerbell is complimentary about his new system: `One of the nice things about SAP is that it dates the information coming in from the keyboard as if it has come in remotely so if, for some reason we lose the automatic link, we would have a fall back.' he says.

Now that the UK system has been implemented, the next phase of the project is to roll out the system across the rest of Norsk Hydro's European division including the head office in Oslo. The other three production plants are at Rafnes (Norway), Stenungsund (Sweden) and Porsgrunn (Norway). 121 Consulting is now turning its attention to the multi-site requirements.

Summerbell adds: `When completed, the phased implementation of R/3 across the whole division will have taken only three years. Data will be available immediately to all parts of the business, enabling the division to work as a unit and share resources across national boundaries.'