Nordson DAGE exports over 90% of its product outside of Europe. Bondtester products have many hundreds of potential configuration possibilities. X-ray systems are predominantly standard with fewer custom configurations. New systems are typically shipped 2-4 weeks from receipt of order. Given the hundreds of individual components in each product, sub-assemblies are built to forecast with final systems being assembled to order. The Chinese facility also happens to be the company’s biggest supplier, providing primarily low intellectual property components and sub-assemblies, with high intellectual property components being sourced in the UK, which is also where all final assembly and product testing takes place. In addition to manufacturing each product type, Nordson DAGE also services and supports its products in all geographic areas, with this representing a growing part of the business.
The electronics industry is renowned for its insistence on speed, be it developing and getting a product to market or the actual delivery of the finished product. As President of Nordson DAGE, Phil Vere understands this better than most and he explains the main challenges the company faces in this demanding sector. “Holding down inventory while managing our supply chain and keeping it tight has a direct bearing on the shortness of our delivery times.” He continues, “Because of the fast moving nature of the industry, we must also be continually innovating both our hardware and software. And because we operate in every market with over half our regional staff being in front of customers, we have all the complexity of being a global company while being smaller than many typical global enterprises.” As a significant proportion of business is done in emerging regions, another challenge is the need for forecast accuracy. While no single customer represents over 5% of total sales, this again emphasises the need to have tight processes throughout the entire company.
For the past 15 years, Nordson DAGE had been relying on an earlier version of the EFACS ERP system based in its UK facility. China had its own basic, spreadsheet-based system which could not link with the UK. During this time the company saw considerable growth and had to react to the increasing demands of the electronics sector. This was especially seen in the Chinese facility which had originally been supplying 100% to Nordson DAGE but now increasingly was supplying to other companies/divisions within the Nordson Corporation. This need, combined with the growing requirement to tighten up the supply chain by having the UK and Chinese facilities linked by a common ERP system put increasing pressure on the existing systems, as Satyam Sachania, ERP Systems Administrator explains, “In China, the existing system was simply unable to cope despite many spreadsheet-based workarounds. The UK EFACS system had also become so highly customised over the years that it was clear we had to move to a new system.”
A decision was therefore taken in 2010 to look for a replacement system that would be hosted in Ohio, USA and implemented first in the UK and then in China, linking both facilities to each other via a true multilingual solution. In addition to this, any system chosen would also have to be able to link with SAP ERP used by the rest of the group for corporate accounting and reporting. Instead of treating this as an upgrade of EFACS, the company investigated a number of other systems which would meet its strict criteria, according to a cost benefit analysis. As Sachania notes, “We decided to go back to basics and use this exercise as a means to re-evaluate all of the relevant processes in the business and then invest in the most appropriate ERP system.”