03-Oct-2007
“WinMAGI ‘didn’t even blink’ when we threw additional demands at it”
Victorian Chemicals will celebrate its seventy-fifth anniversary in 2008. Its range of sophisticated agricultural and industrial chemicals has its origins in a small tanning and textiles company in Richmond, Melbourne. From these modest beginnings, through periods of enormous change, and after acquiring a state-of-the-art manufacturing plant, the company now boasts about twenty-five employees, and an annual turnover approaching $20m.
Their agricultural activities commenced with production of a fruit-drying oil used to produce sultanas and raisins. Licencing and sale of this product in the US opened up world horizons for sales, and spurred strong technical development of existing proprietary technology. Sales of a variety of products are now made to all continents (except Antarctica!). All of their agricultural and industrial products have been developed in the company’s laboratories in Melbourne; a significant proportion of those has been patented.
Production-mode is make-to-stock, the total product range requiring about a hundred raw materials – predominantly vegetable oils, fats and mineral oils, most of which are locally sourced. Production involves both chemical and physical procedures. Total annual output is around 8,000 tonnes, and in several of their markets, a Vicchem product is the leader.
When the company adopted WinMAGI as its ERP software program in the early ’90s, what General Manager, Peter Wrigley, most liked were its multi-functionality and low implementation overhead.
The company outgrew its first site, and required a move of premises. This was a progressive and multi-site exercise, and a number of major changes followed. For example –
* they had ‘new’ premises and production facilities
* manufacture-processing shifted from small- to comparatively large-scale production, and from simple to relatively sophisticated operating procedures
* training in production processes progressed from modest and broad to specialised and narrower
* storage of raw materials moved from minimal to bulk storage
* production planning and sales budgeting changed from informal, demand-based decisions to complex forecast-based
* production-planning evolved from minimal to high levels
. . . among many other things.
Through all of this progress, “we found that WinMAGI ‘didn’t even blink’ when we threw additional or changed demands at it”.
Significantly, whilst growth was about threefold over the period, increases in staff numbers was limited to about 25 percent. Vicchem believes the absence of a parallel rise in staff numbers was significantly attributable to the use of WinMAGI. Importantly, at the new plant, WinMAGI enabled optimised use of the new facilities, and much-improved production efficiencies. “Overall, these days, WinMAGI does everything the company requires”.
Currently, the majority of domestic orders comes from a few large buying groups which have hundreds of branches across Australia. EDI integration has become a crucial part of Vicchem’s domestic sales, in which ordering is automated using an integrated EDI facility. Notable is the paperless nature of order receipting, processing, and invoicing.
Through the changes required by the move to the new site and the shift to forecast-based production, Vicchem found that production planning remained a simple task. In particular, Vicchem has found excellent production control from WinMAGI’s advanced multiple-routing abilities and materials-handling instructions.
Key chemical and physical properties of all raw materials are tested. Apart from the obvious QC implications, these tests have become an important part of ranking different suppliers. In turn, the development of progressively more precise raw material specifications has led to refinement of purchasing practices, and to quality-optimisation of final product.
Vicchem exports in different currencies and different units of quantity. The company finds that issuing of quotes and invoices through WinMAGI is simple, and the documents are readily understood by the customer. Further, applying differential commission rates to overseas customers and for different products has been easily achieved. Similarly, preparation of documentation for the growing number of import transactions is simple.
Says Peter Wrigley, “Critical to our operations have been the security controls offered by WinMAGI. They have allowed us to control access to data according to department and management level.
“Among many other things, ISO 9001 accreditation requires cross-skill training of staff; the intuitive and easy use of WinMAGI has greatly streamlined this task. ISO accreditation also requires easy generation of written operational instructions; WinMAGI renders that job entirely routine.
“Overall, greatly increased control of many aspects of the business has been very welcome. In fact, WinMAGI has been a key tool in achieving our planned corporate evolution over a number of years. In the next couple of years, we look forward to installing an automatic batching system in which production requirements and process instructions will be freely interchanged between the plant and WinMAGI”.
And finally Peter adds, “WinMAGI’s flexibility in producing accounting reports, and the ease of producing sales reports for each of our six divisions – some, quite detailed – gets a very big ‘tick’”.