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A senior business consultant from IFS, a global enterprise applications company, presented April 23 to a Joint Panel Meeting of the National Shipbuilding Research Program (NSRP) in Seattle, stressing that while government mandates are forcing naval shipbuilders to invest in lean processes and technologies, commercial shipbuilders are increasingly implementing similar technologies.
The meeting of shipbuilders from around North America included a tour of IFS customer Todd Pacific Shipyards, which hosted the event.
According to IFS Business Software consultant Denis Lofthouse, who works with defense contractors, naval shipbuilders are faced with government requirements for earned value management (EVM) reporting and performance-based logistics (PBL) contracting. EVM allows a shipbuilder to develop detailed reports on the degree of completion they have achieved on a specific government project, while PBL is a method of buying an asset along with the necessary support to keep it operational. While these measures are not required of commercial shipbuilders, more and more of them are adopting advanced project management and asset management tools on their own accord for the competitive advantages they offer in the market.
Lofthouse said in his presentation that all shipbuilders can benefit from business systems that are integrated top-to-bottom, allowing for real-time program management and visibility of the financial side of the project. Government agencies require visibility into the details of projects that contractors are executing because they want to ensure that work is progressing as it should, and that is really something every customer wants. Commercial shipyards often complete more projects than naval shipyards, and with the right technology project history can be used to generate more competitive and accurate estimates. Even shipbuilders doing cost-plus work, which pushes a lot of the risk for cost management back onto the customer, can use this technology to deliver on their promises. Regardless of the business model involved, leaner financial and project centric management delivers greater predictability, more customer satisfaction, and repeat business.
Lofthouse stresses that for commercial shipbuilders, implementing lean technology can be a lot easier than it is for naval shipyards.
“The project and business management needs of commercial and naval shipyards are similar,” Lofthouse said. “But as a commercial shipyard moves onto a modern enterprise software application, the way that software is implemented is not as stringent and regimented when it comes to the cost breakdown structure. This gives management the freedom to specify how they want to look at and manage their business. They can easily implement program management across multiple hulls and drive real efficiencies across their business.”
IFS provides ERP solutions which enable organizations to respond quickly to market changes. The solutions allow resources to be used in a more agile way to achieve better business performance and competitive advantage.
Founded in 1983, IFS has 2,600 employees worldwide. With IFS Applications, now in its seventh generation, IFS has pioneered component-based ERP software. The component architecture provides solutions that are easier to implement, run and upgrade. IFS Applications is available in 54 countries in 22 languages.