May 15, 2009 by Peter Schroer
Significant global growth goals and fierce international competition are two key factors driving MEGA Brands’ new product innovation strategy and the company’s emphasis on quality and cost.
MEGA Brands Inc., formerly known as MEGA Bloks, is headquartered in Montreal, Que., and is a leader in high quality, fun and educational construction toys that inspire children and parents to play together. With more than $600 million in annual revenues, MEGA Brands is one the fastest-growing toy brands in the world, and is continually extending into new lines of business with innovative new products.
With dozens of new product launches every season, the company needed to manage quality processes during product development, while attaining specific price points and margin goals. MEGA Brands needed to be able to develop new products with superior quality within stringent cost targets. In addition, to support continued growth, the company had to improve global co-ordination and visibility throughout the New Product Development and Introduction (NPDI) process with a specific emphasis on quality.
In 2005, MEGA Brands implemented the Aras Innovator solution for enterprise product life cycle management (PLM) to automate business processes critical to new product development, quality management and brand introduction.
During product development, Aras Innovator enables MEGA Brands to create multiple bills of material (BOMs) for a specific product so that design cost structures can be analysed. Different parts, materials and production locations are compared to determine which new product configuration will achieve the best quality and margin. At the point of release to manufacturing, the product manager selects the optimal bill of materials in Aras and locks in the product structure for the global supply chain.
With the PLM solution, new product information is managed online, allowing the ability for MEGA Brands to communicate safety requirements and quality specifications to suppliers worldwide in a secure format over the Internet.
“Our market segments are decidedly competitive and require that we innovate constantly, while ensuring superior quality and managing costs,” said Daniel Bourgeois, vice-president of product development for MEGA Brands. “Aras enables us to manage our product development and introduction processes for supply chain readiness.”
BUILDING ON SUCCESS
Since implementing the Aras Innovator solution for PLM more than three years ago, MEGA Brands has significantly increased product profitability by managing design to cost targets and global product development more effectively. New product decisions are based on hard data, and quality risks are identified and mitigated before products begin volume production.
By collaborating and controlling quality during development, MEGA Brands is able to ensure new product quality and reduce development cycle times in the process. Graphical online workflows in the Aras solution have also improved visibility and reduced the time necessary for product changes, resulting in the ability to respond more quickly to rapidly changing market conditions.
In addition, because Aras is a Microsoft enterprise open source software solution provider, MEGA Brands has unlimited user access for no charge. By using the modern Aras SOA (service-oriented architecture) solutions on the Microsoft platform for enterprise PLM, MEGA Brands has saved more than half a million dollars on license fees, infrastructure costs and consulting expenses.
MEGA Brands has achieved a global competitive advantage on quality and margin by taking advantage of a PLM solution, and continues to extend its leadership position through innovation.
Peter Schroer is president of Aras Corporation (www.aras.com).