Leading US Power Generator Saves Millions with Mobile Wireless Solution for Tracking & Unifying Inventory
Published: June 2003
Download Millions saved with Mobile Wireless Solution for Tracking & Unifying Inventory in the original PDF format.
Situation
Solution Overview
- Microsoft Certified Partner
- DataSplice LLC
- Industry
- Energy; Utilities
- Situation
- Calpine, the largest independent power generator in the US with $7 billion in annual sales, needed to reduce its multi-million dollar costs for stocking spare parts.
- Solution
- Calpine implemented the DataSplice® Enterprise Mobility solution to standardize and centralize parts management across its 86 plants, so that they could share an inventory.
- Microsoft Software
- Microsoft® Windows® 2000 Server
Microsoft Visual Studio® 6.0 - Other Software
- DataSplice® Mobile Enterprise Suite
MAXIMO® software
PeopleSoft - Benefits
-
- By eliminating redundancies, Calpine has cut $1,000,000 in equipment costs for each new plant and up to $100,000 for each existing plant.
- With tighter controls on inventory, Calpine has cut its shrinkage rate in half, which is saving an additional $50,000 per year per plant.
- By reducing manual processes, Calpine calculates that it is gaining 920 labor hours per year, which saves another $23,000 per plant.
- All totaled, Calpine expects to save roughly $10 million by the end of 2004.
How do you get a competitive edge in the power industry? Since electrical power is a commodity, one of the best ways to increase your profit margin is to lower the costs of ongoing operations and plant maintenance.
When Calpine hired Scott Schilling as Warehouse Inventory Manager, he saw a prime opportunity to do just that. Across a fleet of 65 natural gas fired and 19 geothermal electricity-generating power plants, he found that each site was stocking and managing its own inventory of spare parts. For an electrical generator, this doesn't mean just nuts and bolts - some parts, such as pumps and motors, cost in excess of $50,000. Plants were carrying as much as $1 million in duplicate common parts.
Calpine was implementing MAXIMO software from MRO Software Inc. as an enterprise asset management (EAM) solution, but a number of efficiency gaps remained. Each plant had to be added to the system and standards had to be developed and implemented to describe and label parts, so they could "talk" to each other. Within the warehouses, numerous different items were stored within a single bin, which made locating parts difficult. And the inventory was not being tracked in real time - when technicians needed to store or retrieve a part, they had to get a printed ticket, record the transaction manually, and then enter it at a work station. This manual process created delays and opportunities for costly errors.
"Transcription error was a big thing," remarks Schilling. "Slips could sit for days before being entered."
With years of experience honing inventory processes within the Automotive Aftermarket industry, Schilling knew that there was much to be gained by unifying and streamlining parts management across Calpine's multiple plants. So, he initiated a Warehouse Standardization Program that would support sharing a parts inventory fleet-wide.
To effectively share parts, however, Calpine needed to be sure they could get reliable, up-to-the-minute information on the exact status of each item. Were a plant to go down, they could not afford to fumble around looking for the necessary part and then discover that it had gone to another plant two days before. Schilling saw that Calpine needed a way to track the whereabouts of all parts in real time.
Solution: Mobilizing Inventory Management
Schilling went looking for a system that would allow Calpine warehouse staff to digitally scan in data directly from a part, enter transactional information on the spot, and have that information flow automatically into a centralized data system. After looking at the available options, Schilling chose the mobile inventory management solution from DataSplice, a Microsoft Certified Partner. DataSplice provides a thin-client solution that forms a bridge between enterprise data systems and mobile devices. "DataSplice had exactly what we were looking for, and offered the best value for the price," comments Schilling.
"Our warehouse technicians have been very excited about the ease of functionality and time savings. They see the value immediately."
Scott SchillingWarehouse Inventory Manager
Calpine Corporation
Next, Calpine needed to choose the hardware for its mobile solution. On the advice of DataSplice, Calpine chose the Intermec wireless access points and the Intermec 750 ruggedized hand held device with built-in barcode scanning, running on a Microsoft� Windows� Powered Pocket PC 2002. "The Intermec units offered industrial strength quality - it's guaranteed to survive a six-foot drop onto concrete - and great features for the cost," says David Cunningham, Business Development Manager for DataSplice.
The Pocket PC running the Windows operating system provided a number of advantages. "Other handheld operating systems don't come close to the functionality," says DataSplice Lead Software Engineer Matt Kunze. "Pocket PC gives us higher performance and a familiar development environment. It allows our applications running on both Windows and handhelds to share a single source that compiles to separate targets. That saves us significantly in development effort."
On the user side, Scott Schilling appreciated the convenience of using the Pocket PC platform. "I was able to load the DataSplice solution right onto my Compaq iPAQ. Those of us who don't need all the industrial-strength features can run the program on our regular PDAs. That saves us from having to invest in additional handheld devices."
Architecture
DataSplice Mobile Enterprise Suite is a thin client server solution that runs on Windows 2000 Server and interoperates with any ODBC compliant database. The Suite includes a "bolt-on" application that reproduces the business rules of the master application database. DataSplice extracts the data directly from the backend database and sends it to the handheld devices, which read the information, edit it, and send it back to the master database.
"Some mobile applications run on top of the master application and have to be fully integrated, which is very time consuming," says Cunningham. "By emulating the master app and interacting only with the backend, DataSplice cuts implementation time from months to days."
In Calpine's case, DataSplice is also developing the process of drawing data from a PeopleSoft inventory application. Both the PeopleSoft and MAXIMO software applications at Calpine use a backend of Oracle Enterprise 7.3.4, which Calpine is currently upgrading to Oracle 8i.
When the time comes to reprovision the handhelds with new software, there will no need to call in the devices physically and perform an active sync. DataSplice provides an application called DataSplice® Windmill that provisions the clients remotely. Built on the Microsoft .NET Framework and running on Microsoft Internet Information Server, Windmill uses a Web service to provide information about the available software packages for the mobile devices.
Implementation
One of the advantages of the DataSplice Mobile Enterprise Suite is its speed and ease of implementation. The first step for Calpine was to install a central server running Windows 2000 Server and the DataSplice Mobile Enterprise Suite. The server was connected to each plant via a TCP/IP Internet connection.
Once the central server is up and running, installing the mobile inventory system at each location requires just a few steps:
- Each plant is equipped with an Intermec 802-11b wireless transmitter, which takes just a few hours to install.
- Setting up views according to the needs of the client takes a matter of days. "In some other, older systems, when you want to change a data view you have to do a lot of custom configuration within the database, which can take months," says Cunningham. "We have made it a simple process, almost like a check-box approach, which allows you to change views without touching code."
- Using DataSplice's administrative client, a system administrator sets up user permissions within a matter of hours using basic database commands.
- Inventory technicians are equipped with handheld devices with connectivity to wireless printers that provide on-site barcode labeling. According to Schilling, training staff on the devices takes just a few hours. "Our warehouse technicians have been very excited about the ease of functionality and time savings," he says. "They see the value immediately."
While implementing the DataSplice mobile inventory system is relatively simple, physically reorganizing the parts themselves is another task for Calpine. An Inventory Tech Team needs to barcode label all bin locations, then print labels for each inventory item, and move it to its unique bin location. This process takes two weeks. Once a plant is up and running, incoming parts are automatically assigned to a single bin having the appropriate space.
In six months, Calpine has implemented the DataSplice mobile inventory management solution in 11 plants. By the end of 2004, the company plans to have at least 30 plants - roughly one third of its fleet - using the new system.
In addition, Calpine is currently piloting the DataSplice Routes and Rounds module, using the same Intermec 750 bar code scanners. Routes and Rounds imports several fields from MAXIMO software's Equipment (Condition Monitoring) and Routes applications, and combines them into three views within Pocket PC 2002. Bar-coded ID tags are set up throughout the plant, and operators use the Intermec handheld Pocket PC to take direct readings. The handheld then synchronizes with MAXIMO software and transfers the data. After being populated in the database, these readings are archived and may be retrieved in the future to troubleshoot process problems, generate PD work orders, and meet OSHA log-taking requirements.
"This represents a big improvement over storing hardcopies in file cabinets for seven years," remarks Schilling.
Benefits: $10 Million in Savings in Two Years
For More Information
- About DataSplice
- 414 E. Oak Street
Fort Collins, CO 80524
Tel: (800) 377-1974
Fax: (970) 484 0965
E-mail: datasplice@datasplice.com
Web site: www.DataSplice.com - Partner Information
- DataSplice® LLC produces software that enables data sets to be extracted from corporate databases and distributed over wireless networks to field service personnel using hand held PCs. The DataSplice® Mobile Enterprise Suite was completed in 2002 and marketed to Fortune 500 companies. Applications include work order management and bar code driven inventory management. Product features are rapid implementation, ease of configuration and 1,000-device capacity, delivering high ROI. Forty companies have adopted the system.
- About Microsoft
- .NET Enterprise Servers are a comprehensive family of
Microsoft server applications for quickly building, deploying and managing
integrated, Web-based solutions. Designed to deliver mission-critical
performance, .NET Enterprise Servers are built from the ground up for
interoperability using public Internet standards such as XML.
For more information about Microsoft products or services, call the Microsoft Sales Information Center at (800) 426-9400. In Canada, call the Microsoft Canada information Centre at (800) 563-9048. Outside the 50 United States and Canada, please contact your local Microsoft subsidiary.
For more information about Microsoft solutions, visit www.microsoft.com/casestudies.
In less than a year, Calpine is already seeing the payoff from its Warehouse Standardization Program and fleet-wide MAXIMO software implementation, in a number of ways:
- Lowered Equipment Carrying Costs: By reducing the number of parts it is holding and enabling a fleet wide parts sharing program, Calpine is seeing savings of up to $100,000 for each existing plant. For each new plant that goes up, the cost of stocking parts has been reduced by $1,000,000, reflecting an immediate savings to Calpine.
- Reduced Shrinkage: Real-time automated inventory control has enabled Calpine to cut in half the amount of equipment that goes unaccounted for. This is adding up to savings of up to $50,000 per year per plant.
- Increased Productivity: By eliminating many manual processes, the solution is saving Calpine staff considerable time-on-task. Schilling has calculated that between the tasks of issuing parts-to-work orders, monthly cycle counts, inventory reconciliation, annual physical inventory, returning parts and locating parts, each plant will save 920 labor hours a year. At a conservative assumption of $25 per hour, that adds up to another $23,000 dollars in annual savings per site.
- Cost Savings: With four new plants going up in 2004 and at least 15 existing plants adopting the system in that time, Calpine expects to save an estimated $10 million by the end of next year.
Scott Schilling is proud of the outcome. "This project proved the financial benefits of mobile computing," he concludes. "It required solid products from Microsoft and Intermec, intelligent software and technical support from DataSplice, and clear vision from the Calpine management team. We now have an installed infrastructure that will support new operational applications to enhance Calpine's status as the most efficient and reliable energy generator in the industry."
© 2003 Microsoft Corporation. All rights reserved.
This case study is for informational purposes only.
MICROSOFT MAKES NO WARRANTIES, EXPRESS OR IMPLIED, IN THIS SUMMARY. The information contained in this document represents the current view of Microsoft Corporation on the issues discussed as of the date of publication.
Microsoft, Visual Studio, Windows and the Windows logo are either registered trademarks or trademarks of Microsoft Corporation in the United States and/or other countries/regions. MAXIMO is the registered trademark of MRO Software Inc. The names of actual companies and products mentioned herein may be the trademarks of their respective owners.
Microsoft Corporation - One Microsoft WayRedmond, WA 98052-6399
USA
