ERP boosts equipment manufacturer’s productivity by 30 per cent

Headquartered in Burlington, Ont., Higginson Equipment was founded in 1945 as a manufacturer of pneumatic and hydraulic NFPA-style cylinders, and as a distributor of fluid power and industrial product lines. In addition, the company manufactures “Economax” corrosion-resistant cylinders for the trucking industry, custom designs and builds special cylinders for a variety of uses, and leverages its expertise in pneumatics to create C-frame air presses.

In 2009, Higginson decided to part ways with its 15-year-old business software.

“There were three factors motivating our decision,” says company president Bill Allan. “First off, we’d been with our old system for 15 years. It was simplistic, and it didn’t have a materials resource planning (MRP) component. The writing was on the wall. Secondly, the recession – we needed to increase our productivity without increasing our manpower. Finally, we received funding in the form of two government grants, one through the Yves Landry Foundation, and the other through the Canadian Manufacturers & Exporters’ SMART Program. I was already a big believer in ERP. With government assistance, I couldn’t say no.”

A 20-person company with revenues in the $7 million range, Higginson recognized the necessity of optimizing itself for the future.

“We’ve been steadily growing,” says Allan, “but we needed something to help us get to the next level. We wanted to eliminate the inefficiencies and bottlenecks in our processes, and in doing so, we wanted to build a solid base for improvement and growth.”

To facilitate its strategy, Higginson engaged its long-time VAR to perform an assessment and recommend an approach.

“Our company-wide processes were analysed in detail,” says Allan. “As a result, we were advised to implement a new, more advanced ERP system. After doing due diligence, and on their recommendation, we chose Syspro.”

When it came time for implementation, Higginson did it with alacrity.

“We took what is usually a six-month process,” says Allan, “and did it in two months. We spent late nights, inventing on the fly, even made some rash decisions. Fortunately, the VAR that sold us Syspro gave us amazing support, and at the end of the day we got what we wanted.”

Bill Allan says the company’s new ERP
brought new efficiencies.

As Higginson implemented its new ERP, says Allan, most of the old, inefficient processes were funnelled into one of the following categories:

• Automated functions available in Syspro (e.g., automated work order creation from sales order; automatic serial numbers generation for manufactured parts)
• Product configuration (to automatically define product specifications, Bill of Materials and cost at the time of quotation)
• Integration with office productivity tools (such as Microsoft Office)
• Electronic faxing and remote connectivity.

“Syspro has made us much more efficient,” says Allan, “especially as far as the Bill of Materials and work orders are concerned. We used to have to do an excel spread sheet for every job, and then more spreadsheets to calculate cut-lengths of different materials. Now we just put the model number in and Syspro calculates everything for us.”

Before Syspro, adds Allan, Higginson’s system supervisor, a highly skilled machine operator, sat at his desk three hours a day doing repetitive calculations.

“Thanks to Syspro,” says Allan, “he’s now gained three hours a day in production time. We’ve also managed to eliminate a good number of mistakes. Occasionally, in the past, we’d cut a batch of tie rods incorrectly – not anymore.”

Because of Syspro’s modular nature, one can add efficiencies to work-flow as time and energy allows.

“One thing we want to do more of is load levelling,” says Allan. (Load levelling is the process of evenly distributing demand, in terms of orders or schedule, over a given period of time.) “We haven’t quite figured out how to take advantage of it, but load levelling will give us a bird’s-eye view of production. That will help us smooth things out, and see problems that might be coming down the road. It’s a nice feature that we still have to leverage completely.”

When asked about Syspro’s ROI, Allan gives thanks again to the government-sponsored grants.

“The grants considered,” says Allan, “Syspro is going to pay for itself in a year. The company is out-of-pocket approximately one person’s yearly salary. For a relatively small amount of money, we automated our business processes and removed the repetitive paperwork. But the real money-saving consequence of Syspro is that we can now do more with fewer people – and that makes us more competitive. I would definitely recommend Syspro to any manufacturer.”

For more information on Higginson Equipment, please visit www.higginson.ca.

Odete Passingham is marketing manager for Syspro Canada.