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Maximum usage

Shops that take a software-based strategy to managing material remnants gain an advantage

In a perfect world, there’d be no material remnants. Every part would nest one next to the other, filling the sheet like a metal jigsaw puzzle – no skeletons, no waste, no oddly-shaped chunks to find a shelf for and keep track of for months or even years. Sadly, life isn’t perfect, and leftover sheet metal, plate, tube and beam are a fact of fabricating life. The dilemma is, what to do about it.

Global Shop Solutions customer Jones Metal in Mankato, Minn., is an OEM shop performing high-mix, low-volume work that relies on remnant use as a key aspect of maximizing raw material utilization.

Unfortunately, there’s no easy answer, no neat, one-size-fits-all solution. Speak to the experts and they list off several approaches that shops take to remnant management. The first and least efficient is the homegrown solution, which involves writing down material dimensions on a clipboard or recording them in Excel. More tech-savvy shops leverage a nesting package, many of which have integrated inventory tracking capabilities. The third approach relies on the company’s ERP system, quite possibly feeding it with remnant information from the nesting software.

A fourth group, although it appears to be an increasingly smaller one, includes shops that don’t bother, deciding it’s easier and cheaper to sell the remnants to a scrap dealer. Whether they’re right is up for debate, but from a sustainability perspective, it’s a difficult position to justify.

“Typically, raw material is the number one cost for fabricators, so most of them try to maximize its usage,” says Derek Weston, product marketing manager for CAD/CAM software and controls, Hypertherm Inc. “Further, we as a company do everything we can to educate our customers on ways to improve utilization as part of an ongoing sustainability initiative. It’s really not all that difficult, especially for anyone using a nesting system, and it’s also good for the planet.”

The challenge, he adds, is variability. Where some fabricators are high-mix, low-volume job shops, processing 18-gauge sheets of stainless one day and 1/2-in.-thick cold rolled plate the next, others bang out the same part week after week with nests so optimized that there’s little need for remnant management.

Whatever the case, Weston points to the company’s ProNest Plate Inventory module as a possible solution. It allows users to identify the most suitable full sheet or remnant to use for each nest, and when used with ProNest’s Data Sync module, can also exchange information with most ERP/MRP software systems or other “systems of record.”

Finding a remnant is faster and easier when its location, shape and dimensions are stored in a centralized database, such as that used by most nesting packages and ERP systems.

“This is one of the reasons we designed our nesting software with a flexible architecture, providing users with the tools they need for efficient material management,” Weston says. “It allows each shop to configure the system according to what works best for them –  whether they should prioritize remnant use over full-sized sheets, for example, with selection criteria that can include cost and aging factors to help maximize inventory turns. And once the job is done, the software also has rules for what size remnant to save, or whether and how to cut up the skeleton for recycling. It’s all very flexible.”

Robust management

SigmaTek Systems LLC offers similar capabilities, and MRP quality and project engineer Wayne Cathers agrees that there’s a great deal of variability in how shops go about making parts.

“You need software that’s smart enough and flexible enough to accommodate all these different manufacturing scenarios, but at the same time, doesn’t have to be micromanaged,” he says. “Also, that capability needs to exist throughout the entire workflow, starting with the quote process.”

To this end, the company has developed SigmaQuote. Together with SigmaNest, SigmaMRP, and a soon-to-be-launched scheduling module, the software suite serves to streamline as much of this workflow as possible.

“The nesting process should really start when you’re quoting the job,” Cathers says. “When it does, the quoting person can look at the available remnant inventory and make allocations against it. Alternatively, they might decide that cutting into a full sheet would make more sense, and charge the customer accordingly. Once the quote has been finalized and, hopefully accepted, all of those decisions flow through to the rest of the system.”

Remnant management goes far beyond optimized quoting and nesting, however. Cathers and Hypertherm’s Weston alike point to the many other benefits of system-based tracking of remnant inventory, including improved material traceability, more accurate job costing, faster inventory turns, increased productivity and better cash flow. In addition, operators no longer waste time digging through stock racks, and machines no longer sit idle while they do so.

“The most successful shops are the ones with an integrated system, so that employees have all of the necessary information at their fingertips,” Cathers says. “Robust remnant management is an integral part of that.”

Nesting software and remnant management should work together, giving users the ability to identify the most suitable full sheet or remnant to use for each nest while also employing the optimal nesting strategy, as shown in this example from Hypertherm.

The ERP way

So is a robust ERP system, notes Daniel Carranco, director of continuous improvement at Global Shop Solutions. Like most ERP experts, Carranco and his product owner counterpart Ashwin Dsouza are firmly aboard the integrated software train, and concede that some functions – nesting and, in some cases, remnant management among them – are best left in the hands of others.

“Whether to track remnants in the nesting software or the ERP/MRP system often comes down to the remnant shapes, their complexity and whether the dimensions are entered by the operator or input automatically via integration between the two systems,” Carranco says. “Some nesting systems have a great deal of built-in intelligence that might require some level of customization within the ERP software to replicate. In these instances, and assuming there’s good integration between the two, it’s probably best to let the ERP system manage full sheets and have the nesting software deal with the leftovers.”

That’s good advice, yet Dsouza is quick to point out that each situation is unique. Further, not every shop uses nesting software, increasing the need for operator due diligence when recording the dimensions, shapes and locations of material drops. This is why Global Shop Solutions and others recommend sitting down with everyone involved early on in the implementation to determine which software package (or person) is doing what, what information will be exchanged between the ERP software and any external systems, and if everyone agrees with the proposed solution.

In this example from SigmaTek Systems, full sheets and remnants, including the exact geometry of those remnants, can be managed within a single software package.

“Some manufacturers aren’t aware of what is possible and just know this part of their business can be better,” he says. “There is a lot to consider, even beyond any integration concerns. For instance, you need to determine the part numbering strategy, in other words whether to use ‘smart’ part numbers and serialization, where and how to apply this identification (laser cutters, for example, have marking capabilities), scanning and bar code considerations, storage locations, and so on.

“There’s also traceability,” he concludes. “If this is a requirement, we usually prefer to tie everything back to the ERP software and let the nesting do its own thing. But again, each shop is different, so all this needs to be fleshed out early on. Whatever the outcome, it’s increasingly important that shops have a software-based strategy for managing their remnants, for all of the reasons just outlined.”

Global Shop Solutions

Hypertherm Inc.

SigmaTek Systems LLC