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Agilon automates BE Group’s procurement routines and improves delivery reliability
BE Group, a steel supplier and production service company, automated its warehouses with the Konecranes Agilon® material handling system. Manual memory-based order processes are now a thing of the past, similarly to situations where a part essential for production is missing. Accurate data about purchased volumes of supplies and spare parts, as well as their prices, is now available 24/7 across unit boundaries.
Transparency in procurement adds a backbone to purchases, and supervisors do not need to spend time on routines. The improved controllability of stocks increases machine availability and therefore delivery reliability. Procurement is now under control.
BE Group operates in Finland, Sweden, Estonia, Latvia, Lithuania, and Poland. Annually, it delivers 340,000 tonnes of customized, standardized and pre-processed steel products to some 10,000 customers, all of whom expect 24-hour deliveries.
Delivery reliability must be first-rate, and no production interruptions due to missing spare parts can be afforded.
Delivery reliability must be first-rate, and no production interruptions due to missing spare parts can be afforded. In the company’s three Finnish production units in Lahti, Lapua and Turku, there were 15 people used to purchase production supplies and spare parts in addition to their own work. The same supplies had many overlapping procurement channels.
BE Group aims high: it wants to be the most professional, successful, and appreciated steel service company in the markets. Its climb to the top is supported by the Agilon warehouse automation.
The right hand did not know what the left hand was doing, says Production Director Ilkka Kontkanen.
“Procurement was carried out routinely, and price data was incomplete. It was difficult to monitor annual purchasing volumes, and cost levels were inaccurate. The right hand did not know what the left hand was doing,” says Production Director Ilkka Kontkanen. Supervisors’ time was tied to manual and memory-based order processes. Costs were difficult and partly impossible to compare. New suppliers came in uncontrollably, and the number of transactions was high, employing other parts of the organization.
The use of supplies and spare parts in units was uncontrolled, balance monitoring was incomplete, and items were not monitored at all. This lead to production interruptions due to the machine breakage being unforeseeably long, and the procurement of spare parts often being like “fishing” after equipment had already broken down. The maintenance of 50 different production machines and the management of spare parts was difficult and unplanned.
Even a minute a day wasted on routines that could be controlled through a system is a minute too much.
“Only vague information, if even that, existed about infrequently required spare parts. For few people, looking for and procuring supplies took up the majority of their working hours. If supplies are needed every day or every week, what is the point of ordering them separately? Even a minute a day wasted on routines that could be controlled through a system is a minute too much,” Kontkanen says in emphasis.
“The Agilon solution offered what we needed: a warehouse automation without being committed to a single supplier”
BE Group deployed the Konecranes Agilon material handling system in all its three units in Finland during 2021.
“I already had experience in Agilon from one of my previous positions. We did not actually even consider any other system, because this solution offered what we needed, and no-one else could offer a similar level of warehouse automation without being committed to a single supplier. Furthermore, we do not tie ourselves to this, as the contract is based on the service principle,” Kontkanen says.
Why do something many times over if you can automate it through Agilon?
Items were imported into the new automated warehouse by product area and machine. Now, there are nearly 2,000 items. Decentralized procurement responsibilities maintain flexibility, as every supervisor is responsible for their own area.
“The first system deployment in Lahti took three months from scratch, which is really fast. New ideas were created during deployment regarding the possible uses of alarms and balance monitoring. We aimed at the principles of acceptable laziness and getting things fixed in one go. In other words, why do something many times over if you can automate it through Agilon?”
The plan is to integrate Agilon into the company’s maintenance and enterprise resource planning system through upcoming software updates.
Procurement under control, increased machine availability
Automated material handling has met all the expectations set for it. Accurate data about purchased volumes of supplies and spare parts, as well as their prices, is now available 24/7 across unit boundaries.
Procurement is less restricted compared with large supplier-linked systems and also simpler when it comes to smaller suppliers.
“Decentralized procurement no longer relies on what different people can remember, and there are no longer situations where a part essential for production does not exist. The feeling of control is a big thing. Transparency in procurement process adds a backbone to purchases, and supervisors do not need to spend time on routines,” says Kontkanen. Responsibilities for the order process have also been distributed to the operator level, which increases flexibility.
There are now fewer transactions and suppliers. Procurement is less restricted compared with large supplier-linked systems and also simpler when it comes to smaller suppliers. External warehouse management through Agilon also enables the management of larger articles.
The improved controllability of stocks has had a significant impact on machine availability and therefore on delivery reliability.
The improved controllability of stocks has had a significant impact on machine availability and therefore on delivery reliability. “The deployment of Agilon has had an outright impact on the risk of production interruptions. Whenever we can add equipment parts into the system, spare parts management improves. We have already experienced cases where we have been able to avoid production interruptions of several days, because everything is better under control,” Kontkanen says.
Kontkanen also appreciates the system’s reliability.
Kontkanen also appreciates the system’s reliability. “There really have not been many problems, and remote support has helped with any minor issues. The access point is equipped with an emergency stop button with the remote support’s telephone number printed next to it. Schedules have been set well beforehand for any server updates and other pre-defined maintenance visits.”
For more information, please contact:
Jarkko Hemmi, Agilon Sales Manager, Northern Finland
BE Group automates replenishment routines and empowers its employees webinar
BE Group automates replenishment routines using Agilon warehouse automation. The procurement processes became clearer and more effective, empowering employees. Welcome to the watch the webinar recording. Our guest is BE Group Production Director Ilkka Kontkanen.
Date: 15th September 2021