SAP Helps Companies Drive Maximum Performance with Adaptive Manufacturing

SAP AG (NYSE: SAP) today announced new and enhanced capabilities to mySAP ERP, its world-leading enterprise resource planning (ERP) software that will help customers gain new insight to better manage their manufacturing businesses. These capabilities will allow customers to gain improved visibility across plant floor operations and thereby better enable processes in the areas of lean manufacturing, track and trace, six sigma and compliant manufacturing. Underlining SAPs ongoing commitment to realize the adaptive manufacturing vision, these capabilities are enabling leading manufacturers, including Dow Corning and Rexam, to drive superior performance through improved responsiveness and business transparency. Additionally, SAP announced the successful commencement of its shop floor partner program, aimed at creating a strong ecosystem of software vendors supporting shop floor technologies. The announcements were made at the APICS conference being held in San Diego, California, October 10-13.

The disconnect between the factory and the enterprise is a critical challenge confronting most manufacturers today, and inhibits them from becoming responsive to customers and unforeseen demand or supply events, said Dan Miklovic, vice president and manufacturing research director at Gartner. Integrating manufacturing with enterprise and supply chain processes is an imperative for the factory to be responsive in demand-driven supply chains.

New and Enhanced Capabilities Leverage Intelligence Dashboards and Support Manufacturing Operations
Drawing on feedback received from more than 150 global end-users, SAP has been closely synchronizing the plant floor and business processes supported by its software, toward the goal of minimizing information latency. Specifically, SAP is developing enhancements for several existing functionalities including lean manufacturing, six sigma, compliant manufacturing (based on 21 CFR Part 11 stipulations*), performance management and radio frequency identification (RFID) adoption for the shop floor. Embedded in mySAP ERP, these capabilities will provide customers with an integrated platform that tightly links manufacturing and enterprise business processes.

Announced in May 2004, SAPs role-based manufacturing intelligence dashboards are currently being implemented in pilot projects for first customers. Leveraging the SAP NetWeaver platform to consolidate information from different sources, the portal-based user interfaces are designed to promote interoperability and enable production personnel to make better-qualified decisions. The initial set of roles focuses on those of the plant manager, production supervisor, maintenance supervisor and quality supervisor.

SAP Shop Floor Partner Program Aims to Create Manufacturing Ecosystem
The SAP shop floor partner program is an extension of the successful Powered by SAP NetWeaver initiative and is aimed at creating a manufacturing ecosystem that reduces integration costs for connecting the shop floor to enterprise solutions. SAP is encouraging solution providers to adopt SAP NetWeaver as their technology development platform and thereby provide interoperable manufacturing processes to their customers. Four companies TechniData AG, NRX, Lighthammer and Vendavo are already certified, 14 others are actively engaged in the certification process and several others are in the stage of initial discussions. SAP also intends to conduct specific workshops with these partners to outline its adaptive manufacturing strategy and together build a manufacturing ecosystem that enables efficient manufacturing processes.

SAP Drives Adoption of S95 Standards
In its drive to support the adoption of S95 standards, SAP also recently brought together a group of global end-users, application providers and thought leaders to work on a common standards prioritization program and jointly identify a development roadmap. More than 30 participants from 12 customers and 12 solution providers took part in this workshop to discuss the ISA S95 roadmap for interoperability. Based on the response, SAP aims to develop additional capabilities that will be embedded as part of the exchange infrastructure within SAP NetWeaver. This embedded functionality is planned for availability in 2005 and is expected to drive a major reduction in TCO by cutting back integration costs.

Value for Leading Manufacturers in Multiple Industries
SAPs manufacturing solution is already delivering significant value to leading manufacturers in both process and discrete sectors.

We set out to build world-class business processes in both manufacturing operations and across our supply chain, said Paul Martin, vice president and CIO of Rexam, the largest aluminum can manufacturer in the world. Thanks to SAPs manufacturing solutions, data that used to reside in our employees heads is now captured through SAP screens on shop floor. Now, the only thing employees have to do is manage exceptions.

We want to drive decision-making to the plant floor, said Lori Schock, global supply manager, Dow Corning. By implementing manufacturing intelligence dashboards throughout our manufacturing facilities, plant personnel will be provided role-specific information, alerts and KPIs for them to make right-time decisions. In addition, our Line Management will also have the visibility and information by which to make important cost-effective decisions throughout the supply chainits really a win-win situation any way you look at it! With SAPs recent leadership in driving S-95 standard adoption, the integration SAP provides with our MES and automation layers will enable real-time access to the information while minimizing our interfacing costs with consistent messaging between these systems. This all leads to lower total cost of ownership.

With more than 12,000 customers worldwide currently leveraging its existing manufacturing software capabilitiesincluding manufacturing planning and execution, quality management, maintenance management and environmental health and safetySAP is one of the largest integrated manufacturing applications solution providers in the world.

Real World Awareness is now the key driver for truly adaptive manufacturing, said Claus Heinrich, executive board member, SAP AG. The major bottleneck to creating a real world aware manufacturing ecosystem is the inability of disparate applications to sense information from people, IT systems and physical objects and then respond accordingly to prevailing business conditions, based on this real-time information. SAP is successfully addressing these needs by delivering solutions to fulfill the vision of Adaptive Manufacturing

* FDA 21 CFR Part 11 is a specific regulation that deals with the use of electronic records and signatures in manufacturing processes regulated by the FDA. The primary factor contributing to the need for tighter federal regulations in the medical and pharmaceutical industries has been the substantial proliferation of pharmaceutical products in recent years. This proliferation has increased the volume of products that the FDA has had to review and hence necessitated the standards set forth in FDA 21 CFR Part 11.

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