Robinson Laser quotes a price, processes an order, and queues it for production--within minutes
October 4, 2010
Robinson Laser recently sold its steel assets to Cargill and, as of 2010 is focusing entirely on the laser cutting of flat parts. To optimize operations, the organization essentially has automated its estimating process, from quick price checks to full- fledged request-for-quotes and order through a Web browser.
Robinson Laser is a testament to the power of the database. Admittedly, something as dry as a software database isn’t the first thing that comes to mind when you walk onto the floor of this East Chicago, Ind., sheet metal cutting shop and see an almost intimidating level of laser cutting power. The multi-plant organization has about 40 laser cutting centers (see Figure 1). Feeding that expanse of cutting equipment, though, is a computerized system driven by a comprehensive database. Considering what that database has accomplished, the subject may not be dry after all.
Robinson has its roots in the steel business under the name Robinson Steel, founded in 1986. The company built a name for itself by using a modified temper mill with corrective leveling to produce high-quality sheet and plate, a process the company called RPS® (Robinson Proc-essing System) Continuous Cold Reduction. In 1997 a division of the company began laser cutting flat blanks (see Figure 2), an arrangement that continued until this year, when the company divested its steel assets to Cargill, changed its name to Robinson Laser, and became a stand-alone laser cutting company.
“We repositioned ourselves as a laser cutting company instead of a division of a steel company,” said Paul Labriola, Robinson’s CEO.
Robinson still has a long-term exclusive supplier relationship with Cargill; the two organizations operated under a joint-venture agreement since 2007. But as of this year, Robinson has formally left the steel business to focus entirely on the laser cutting of flat parts.
The company thrives on fast processing. A bundle of sheets is placed next to one of the shop’s TRUMPF lasers, which use Lift-Master suction cup systems to move material to and from the cutting tables. As material is being loaded, another sheet is being cut. Once the cutting cycle completes, the tables switch out quickly, and cutting starts again. Beam-off time is minimal.
But over the past decade, managers at Robinson realized something: Modern machine tool technology has streamlined fabrication; the challenge now comes from everything before beam-on time—and this includes the processing of customer information. This is where software and that not-so-dry database technology come into play.
Robinson has some seriously high production capacity. A job that may take eight hours on a stand-alone laser takes one hour with materials and programs spread among eight machines. But to truly take advantage of this capacity, managers knew they had to somehow ensure jobs are routed for maximum efficiency.
When Robinson Steel started offering laser cutting in 1997, it initiated a nesting system that automatically aggregates demand from various customers, placing small orders or portions of orders on various sheets fed to various laser cutting systems, all in an effort to optimize material utilization. In the ensuing years, the company introduced real-time production sequencing. All lasers are networked, and work is distributed to each laser as required to meet delivery dates.
As Labriola explained, the nesting initiative increased material utilization, while real-time production sequencing increased laser utilization. A small order can be squeezed onto a larger nest to optimize material, while a larger order can be spread among 10 machines to speed processing time.
After establishing these internal systems, Robinson introduced RPS QuickLink, which gives customers Web access to manage and monitor their orders and material requirements, including bills of lading, quality control reports, advanced shipping notice, and part status. “This is constantly updated so people can see where their material is in the production process,” Labriola explained.
Finally, this summer the company introduced a Web-based tool called RPS PriceCheck. Complementing the company’s existing online quoting system, RPS RealTime, Price Check allows an engineer to upload a drawing and receive instant pricing based on current metal market conditions.
All of these systems are based on a SQL relational database, and the company does use off-the-shelf nesting programs and other elements. But the online systems weaving it all together were developed in-house. They are designed to be a continuous monitor of production and front-end operations, Labriola explained, so that a part is placed on a machine at exactly the right place and time to fulfill an order as quickly as possible.
“If you look at something continuously, you can do that,” he said. “Everything is driven by on-time delivery.”
Weather forecasting is a rough analogy. Ten-day forecasts are based on probability calculations that predict a certain weather pattern will occur on a certain day. If forecasters simply made one calculation—one forecast 10 days out and never changed it—the forecast likely wouldn’t be very accurate. That’s why forecasts are continually updated. A forecast three days out has a greater probability of being accurate; two days out, even better; several hours out, even better.
The same can be said of Robinson’s online systems. The software continuously looks at all the variables—steel prices, available inventory, new orders, material and machine utilization—and updates the schedule until the last possible moment before production.
Using PriceCheck, the customer uploads a DXF file to the Web browser-based system, which in turn produces a CAD-based drawing of the flat blank desired (see Figure 3). At the same time, the software looks for deficiencies in the drawing. If a drawing has open geometries, Robinson’s software catches the error, closes the geometry, and shows the drawing change in red on the screen for the customer’s approval.
The system creates a one-piece price, a small package price, and a nested production price. A one-piece price is, as the name suggests, a quoted price for producing one piece. A small package price shows a price for the lowest quantity of parts that can be shipped cost-effectively. For parts of certain sizes and weights, the small package price could be for enough parts to fit in a box delivered by UPS or the post office. Then comes a quote for one nest of parts, or however many parts a single production sheet could yield.
“Price and volume go together, as one would expect them to move,” Labriola said. The higher the volume, the lower the per-piece price.
All this is just a first step. In fact, engineers need not even log in. Anonymously, they can upload a part and receive a quoted price, which can change with the metal market. This past July, for example, someone could have uploaded a part at the beginning of the month to get a price, then see the same part at the end of the month and get a lower price, because the price of steel declined.
If a customer checks a price for a part without logging in, “as soon as you turn your browser to another Web site, your part information disappears,” Labriola said, adding that users do have the option to create online accounts, log on, create a custom catalog of parts, and save items for the next time they log on (see Figure 4).
The purpose of the system is to give people pricing information to take some kind of action. They can change a design; combine components; or choose different material grades, gauges, or volumes. If an engineer can combine components or simplify blank design (fewer holes, for instance), the price likely will go down because there will be less laser cutting. In essence, the system allows people to ask“what ifs” and see how they affect the cost of laser cutting.
The system also helps bring manufacturing cost considerations to the designer’s desktop. A designer can submit a blank without a hole, get a price, then submit a blank with a hole and get another price. The difference between those prices is, essentially, the cost of manufacturing that hole. As Labriola explained, “As a design engineer, you can immediately make a decision: ‘Do I need a laser-cut hole, or is there a more economical way of making this?’”
Consider a contract fabricator that specializes in plate and usually uses its plasma cutting table to produce blanks. But what if a tight-tolerance, thinner-gauge job comes in the door? Does the shop cut the sheet with the plasma and finish it to within tolerances with secondary proc-esses, or does the shop outsource to a laser shop? PriceCheck will give a price for laser cutting the components, and with this information engineers can weigh the options. Will laser cutting and eliminating secondary processes reduce overall costs, or is plasma cutting with secondary processing still more cost-effective?
Engineers also can use the system to determine the best time to order parts as it relates to steel market pricing trends and their own operations: Are they better off ordering 400 all at once or 100 parts at a time over the next several months?
“These questions can now be answered in the context of current market prices,” Labriola said.
He emphasized, however, that PriceCheck does not give a true acquisition cost. That comes when a customer logs in and chooses to send specific parts as an official request for quote using a service called RPS RealTime.
Consider an engineer who’s making a wagon that happens to require four parts of different gauges. He’s logged on to Robinson Laser’s site and has created a catalog of four parts. To submit an RFQ, he enters Robinson’s RealTime service. He indicates which parts he’d like an official quote on and the quantities desired. Again, as the volume grows, the per-piece cost drops, but now the volume is tied to an entire order, not just one part. Increasing the volume of one part decreases the price of all line items. So for the wagon, doubling the volume of one part will decrease per-piece price for all parts.
Labriola put it this way: “They’re all traveling in the same group, so whether we’re looking at half-inch high-strength steel or 10-gauge sheet, if you’re looking at one piece of 10-gauge and 100 pieces of half-inch material, as you increase the quantity of half-inch, the 10-gauge price drops as well.”
The system does something unusual for RFQs: It shows a price immediately. Working online, customers can adjust volumes to get the price they need to move forward. The user hits “submit,” which moves the RFQ to the next phase: delivery date confirmation.
Here is where the front-end sales system ties to the operating side. Factors such as machine capacity, scheduling, and material availability are taken into account. If the material required is available and in a position to meet the requested delivery date, the quote and price are confirmed, and the customer has seven days to place the order before the quote expires.
Clicking Order triggers several events. A few days may have passed since the customer initially received the quote, and like the weather outside, shop conditions may have changed. The system always works off current data. So as soon as the customer clicks Order, it ensures shop conditions still allow for that originally requested delivery date.
There are several reasons that the original delivery date may not be possible to meet. Say a customer’s RFQ is accepted for a delivery date four days from when the initial quote was issued. The customer holds that quote for seven days and hits Order. The system immediately realizes the discrepancy (Robinson can’t meet a delivery date that’s in the past) and proposes a new delivery date.
The system also checks laser cutting machine utilization and material availability, and determines whether the order still can be produced, packaged, and delivered when promised. If all variables check out, the system tells the customer that all systems are good to go. If there are any issues with the due date, the software then proposes an alternative due date, which the customer can then accept or decline.
Put another way, all promised delivery dates are confirmed based on shop conditions at the moment of order acceptance. Say a customer receives an accepted quote and waits five days to submit an order. In the meantime a large order comes in and changes capacity conditions on the floor. When the customer finally hits Order, the system may propose a delivery date based on those new capacity conditions in the shop.
Of course, such an online system would be dangerous if Robinson didn’t have reasonable assurance that customers submitting orders could pay for the completed work. For this reason, Robinson has a process that reviews the credit lines of new clients. Once approved, though, customers can take full advantage of Robinson’s online system. Conceivably, they can check current prices, receive a quote, and accept an order within about 10 minutes. And by the end of the year, Robinson plans to be able to accept credit and debit cards for orders.
Meeting Fluctuating Demand
Before PriceCheck, Robinson usually turned a quote around within a day, sometimes two if there were questions about drawings. The new system addresses drawing issues automatically. The system checks drawings for errors such as open geometries before sending parts on to the RFQ system.
It also helps solve a problem that’s become all too common since the recession: the collapse of consistent demand. During the downturn, when uncertainty reigned, many customers resubmitted RFQs over and over: say, first for 20 parts, then five, then 40, and so on. Once customers finally placed orders, they needed them within days. Quick turnaround wasn’t a problem, but the final order came only after Robinson had put hours into answering a lot of RFQs that didn’t materialize into actual sales. Today customers can log on to Robinson’s Web-based system and have most pricing questions answered with no human intervention.
Moreover, being tied to quoted prices for long periods didn’t work well in a volatile metals market. Labriola recalled that at one point during the downturn, “we saw steel prices drop 70 percent. It was amazing. So how were we going to deal with this? We knew our front-end automation was lacking. People didn’t make decisions in weeks, months, or quarters. They had to make decisions now.”
Prepared for the Upturn
The chief executive conceded that not all of Robinson’s 40 lasers are running these days, and production usually runs over just one shift. The company employs 100 and is now recovering from some seriously painful times. At the trough of the downturn, business was down about 60 percent.
“Because we concentrate in hot-rolled material, any type of heavy industry that was down, well, we participated in that,” Labriola said. “It was quite a ride. But we’re participating in this modest upturn as well.
“In order to compete, we believe you need to become incredibly good at one thing,” he continued. “For us, that’s laser cutting flat parts.”