PSI Blog

Thrive in the Digital Age: The Three Musketeers for Metal Service Centers

16 Sep 2020 - Industry 4.0, Logistics, Production

©urfinguss/iStock & creativica/shutterstock; edited by PSI Metals

The merit of all things lies in their difficulty – and in their versatility! In order to be competitive in today's fast-moving world, you have to be an allrounder: you need to offer your customers high-quality products, closely monitor your costs and ensure stable production processes. Especially service centers need to be diverse and offer a broad palette of services and products. They have to find ways to deliver the performance promises that keep their customers viable and generate returns that guarantee the companies' investment in people, equipment and inventory. Many metals service centers, however, depend on ineffective systems that are not specific to their industry. This is where solutions from PSI can help.  

Service centers face the business challenge of pre-purchasing raw materials such as parent coils, plates, sections and bundles of bars/rods with the right cross-sectional size and volume, enabling to supply their customers on time but with maximum yield and a minimum of remnants and aging inventory. They add value to the raw materials by processing them according to the order, by cutting, slitting, punching, coating and grinding/polishing. Apart from that, service centers can also serve as distributers where mill products in bulk can be transferred by rail to the center before being shipped by truck to individual customers.

The 3-in-1 Approach

©urfinguss/iStock; edited by PSI Metals

PSI solutions apply the same technology to the entire service center supply chain. With their “3-in-1” approach, they provide metal service centers with a digital platform that contains all information on demand with all digitized data that can be used for data analysis, ensuring transparency and visibility across the entire supply chain.

How You Can Benefit:

  • Horizontal visibility through entire supply chain from iron and steel making through mills services centers and distribution networks
  • One database for all mills and service centers in the supply chain updated in real-time eliminates manual effort to survey current status of inventory and demand to support KPI reporting or logistics planning
  • Demand-driven supply chain planning ensures the right product in the right volume at the right place and at the right time to ensure maximum customer service
  • Optimal combination of small orders onto parent coils to maximize yield during slitting and blanking
  • Optimization of distribution network based on customer location, service center location, logistics options and costs

With their 3-in-1 approach, three PSI products in particular offer new possibilities for metal service centers by meeting their unique and individual needs: PSImetals in the area of production planning, PSIpenta in the area of business processes and PSIglobal with everything around logistics. 

Optimizing Planning Processes With PSImetals

Creating Cutting Plans for Slitting Lines with PSImetals Coil Combiner

PSImetals Coil Combiner allows service centers to achieve maximum yield when cutting small order volumes of differing widths and coil weights/lengths from a parent coil.

The feature supports several modes of operation:

  • Execution mode: Combines orders of the same grade and gauge onto parent coils or remnants of same grade in order to maximize the overall yield
  • Procurement mode: Calculates the optimum widths and weight for each grade based on forecast for finished product such as sheets, slit strips, blanks, circles etc. that can be made in advance of receiving customer orders to minimize sales lead time and maximize stock turnover and yield

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Calculating Optimal Material Flow with PSImetals Master Planner

©WavebreakMediaMicro/Adobe Stock; edited by PSI Metals

PSImetals Master Planner can be used at a metal service center for capacity planning, subcontract planning and toll processing to automatically receive current inventories on a daily basis or on demand in order to identify where there are shortages or surpluses inventory. 

With PSImetals Master Planner the users are able to:

  • plan and balance flow of material to meet forecast, scheduled and committed demand for all Service Centres for the next weeks and supply chain constraints daily or on an event basis
  • plan supply routes based on production, storage, logistics capacity at individual production lines or stock yards
  • plan transportation between plants and to the customer
  • evaluate what products/routes should include subcontracts to offload capacity

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Holistic View on All Kinds of Demands With PSImetals Demand Manager

PSImetals Demand Manager provides a single database for storing all types of demand including forecast, customer schedules, inventory buffers, customer orders, etc. The users in a metal service centre can define demand fulfilment modes and stock decoupling points together with appropriate inventory level for each customer demand: PSImetals Demand Manager allows them to define minimum inventory levels and replenishment lot sizes.

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Optimizing Business Processes With PSIpenta

PSIpenta is the ideal enhancement for service centers when more extensive requirements are placed on any business processes. The order management can cover the complete order processing from sales (sales planning, delivery dates, availability and conditions) to the shipping of the products.

Counting Costs With PSIpenta Cost Accounting

What does an order really mean for manufacturing companies such as service centers? Especially for manufacturing companies PSIpenta offers cost accounting and enables them to precisely classify operational developments in the form of direct cost-oriented cost unit accounting. Costs and revenues can thus be planned exactly. 

PSIpenta Cost Accounting offers its users following benefits:

  • Cost center accounting especially for production: actual, standard or flexible planned cost accounting and determination of cost rates
  • Cost element and cost unit accounting of differentiated assessment and overhead procedures
  • Planning calculations and target value determinations 
  • Differentiated reference value formation and activity allocation
  • Internal accounting for services and orders

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Planning Sales With PSIpenta Sales Planning

Service centers depend on reliable figures from purchasing to sales. As a solid basis for a company-wide planning of all relevant resources, sales planning is an important tool of the ERP system for the control of service centers. Future capacity utilization can be conveniently forecasted with sales planning for any desired time and scope. Bottlenecks in materials or capacities can thus be easily identified and problems solved before they become critical.

PSIpenta Sales Planning offers following benefits:

  • Sales planning for individual products or product groups 
  • View for each customer, customer group or sales area
  • Early detection of bottlenecks
  • Support in the planning of material, capacities, sales and contribution margins

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Monitoring the Factory With 3D Visualization

Process monitoring in manufacturing and logistics has been a trend for some time, but is now becoming widely accepted – especially in the environment of Industry 4.0 solutions. Compared to dashboards that provide abstract numbers, the advantage of a factory monitor is immediately apparent: In the visual reference to the real production environment, concrete key figures can be recorded more quickly and classified more easily by the user.

PSIpenta Factory Monitor offers following benefits in production:

  • Detection of occurring errors in real time
  • Early warning system: error prevention before error correction
  • Early intervention reduces production downtimes and increases productivity
  • Increased transparency and faster decision-making
  • Better understanding of key figures that can be recorded in the overall context of the real environment
  • More user comfort: Monitoring and control of the production is done from one user interface
Smart Planning - Which way does an order go in the factory? ©PSI Automotive & Industry

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Optimizing Logistical Processes With PSIglobal

PSIglobal offers following benefits to metals service centers:

  • Reduced costs by achieving the best tender costs
  • Reduced transportation and warehousing costs
  • Improved network efficiency through optimized route times and distances
  • Visualization of locations improves transparency and adds clarity to the supply chain
  • Identification of complex logistics relationships for enhanced network analysis
  • Highlight transportation bottlenecks and proactively prevent future inefficiencies
  • Generating improved logistical insights and increase the value of your existing data
  • Analysis of multi-sourcing strategies/risk management
  • Assessment of the impact of transport restrictions (lack of capacity, closed national borders, longer transit times) or increased freight rates on the logistics network and analysis of alternative shipping options
  • Analysis of the impact of different packaging strategies and dismantling degrees on the total costs
PSIglobal Location Allocation ©PSI Logistics

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Let’s Go On A Journey. Together!

Never be afraid of opportunities, always be on the lookout for adventures. PSImetals, PSIpenta and PSIglobal with their individual focus contribute as a standalone solution or as a package to a stable and effective production in metals service centers. So let’s go on a journey together! Contact us for more info! 

What is your opinion on this topic?

Raffael Binder

Director Marketing PSI Metals GmbH

After taking over the marketing department of PSI Metals in 2015 Raffael Binder immediately positioned the company within the frame of Industry 4.0. So it is no wonder that in our blog he covers such topics as digitalization, KPIs and Artificial Intelligence (AI). Raffael’s interests range from science (fiction) and history to sports and all facets of communication.

+43 732 670 670-61
rbinder@psi.de