Founded in 1955 as Daehan Heavy Machinery Industry Co Ltd, SeAH Besteel is a specialized steel company that manufactures special steel, large forged products, and automobile parts for the automobile and machinery industries. With a focus on the high-end specialty steel market overseas, SeAH Besteel is aiming for further growth and development through the large-scale forging business used in nuclear power generation, chemical plants and large-scale industrial machinery. The company operates with a focus on being a "Reliable company" and "Principle-oriented company" with the goal of achieving better customer value through thorough customer-centric management, and aims to become a global leading specialty steel company.
Project Background & Goals
SeAh Besteel recognized the need for an advanced and comprehensive integrated sales and production SCM system that is tailored for high-mix low-volume production methods. This system needed to be agile and flexible enough to handle rapidly changing customer orders and demand fluctuations. Prior to the implementation of the SCM system, SeAh Besteel faced several challenges in its sales and production departments. These challenges included low delivery date compliance, difficulties in allocating resources to specific processes, and an inability to quickly and efficiently integrate changes to production plans.
To address these issues, SeAh Besteel set out to achieve four key objectives through the construction of its new SCM system. These objectives included:
- Shortening the lead time for customer service by streamlining communication and information sharing between sales and production departments.
- Reducing the planned lead time by automating and digitizing production planning processes.
- Optimizing production planning by factory, taking into account the entire process, and allocating resources effectively.
- Decreasing inventory costs, increasing equipment availability, and minimizing employee replacements.
Through the implementation of these objectives, SeAh Besteel was able to improve its delivery date compliance rate, increase production efficiency, and enhance its overall customer service capabilities. The company's advanced SCM system has enabled it to quickly and effectively respond to changes in customer demand, and to better compete in the highly dynamic and ever-changing steel market.
Return on Investments
SeAH Besteel's implementation of an SCP (Supply Chain Planning) system has greatly improved the efficiency of collaboration between internal and external entities of the company, resulting in a significant increase in the manufacturing migration rate by about 90% and the shipping migration rate by about 80%. This has led to a drastic improvement in the on-time delivery rate, which has risen by about 90% compared to the past. This has in turn enabled SeAH Besteel to reduce the number of days in stock of raw materials by about 7 days and the number of days in stock of products by about 5 days. Additionally, this system has allowed for more efficient utilization of resources in the supply chain, reducing unnecessary waste and enabling more flexible responses to customers' urgent orders and order changes. Furthermore, it has enabled stable production planning, and improved on-time delivery rate which enables the creation of daily production planning cycles, resulting in a better customer experience.