Corning Synchronizes Global Supply Chains with PeopleSoft

by Scott A. Danish

July 25, 2003

Corning Incorporated must strike a balancebetween central cohesiveness and decentralized business operations. Since 1995, PeopleSoft integrated systems have helped attain thatbalance.

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The Customer

Industry: Advanced Technology Manufacturing
Geographics: Headquartered in Corning, NY, with business units, research,
production, and distribution sites in 34 countries
Revenue: 2001 revenues $6.3 billion
Employees: Approximately 32,000
PeopleSoft Products: Supply Chain Planning, Manufacturing, Customer Fulfillment
Management, Supplier Relationship Management, Financials, Human Resources

Business Challenge

Corning’s 12 business units must plan, execute, and compete successfully and
autonomously, while sharing the direction and ambitious global focus of the
entire organization. Corning enterprise systems need to support corporate-level
management and provide centralized services, while enabling supply chain process
excellence in its diverse decentralized units.

PeopleSoft Solution

Corning’s ongoing relationship with PeopleSoft, which began in 1995, has included
over 20 installations of PeopleSoft applications throughout the company. PeopleSoft
Financials, Human Resources, and Procurement systems anchor the centralized
functions within Corning, while PeopleSoft Supply Chain Planning, Manufacturing,
and Customer Fulfillment Management solutions are deployed as required throughout
the decentralized production units.


Business Benefits

With a strong information foundation based on PeopleSoft Pure Internet Architecture™,
Corning and its component businesses have the tools to grow and expand into
domestic and global markets. A unified, robust data standard helps the disparate
business units stay aligned and responsive to overall company direction. Better
supply chain processes, and better-informed business strategy, help production
units minimize costs, maximize asset effectiveness, promise and deliver orders
reliably, and attract and retain customers. E-procurement and integrated procurement
transactions lower the costs and improve the reliability of materials management.
Overall, real time data access and analysis promote higher performance and better
strategic decisions throughout the company and its business units.

“The supply chain technology Holy Grail for Corning is to provide our diverse
business units the ability to achieve process excellence, while minimizing complexity
across the whole organization. That’s the sweet spot we’re hitting with PeopleSoft.”
— Rick Beers, Director of Supply Chain Technology

Real-Time High Performance

“High performance at Corning means agility,” explains Rick Beers, Director
of Supply Chain Technology. “That requires real-time data and interoperability
among applications. We need to react quickly to opportunities or problems in
our supply chains — to see snags coming and plan accordingly, or adjust
production levels in response to demand.”

For example, Corning Specialty Materials, which manufactures semiconductor,
photonic, and technical materials, aimed to improve collaboration among the
14 worldwide factory, sales, and research sites making and marketing its multiple
product lines. The solution was to integrate PeopleSoft Manufacturing, Customer
Fulfillment Management, and Supply Chain Planning solutions with Corning’s Camstar
Manufacturing Execution System (a PeopleSoft business partner), enabling an
optimized, real-time “virtual factory.”

“We’ve got very high-tech, customized products,” says Doug Anderson, CIO of
Corning Specialty Materials. “We’re constantly working on yield and cycle times.
As we go up and down the roller coaster of sales forecasts, we need the ability
to ramp up in time to meet the unexpected demand. We put a lot of work into
figuring out how much manufacturing capacity we need to have online, and when
and to which plants we’ll commit that capacity. That’s been a very manual-intensive
process. By having this improved information infrastructure in place, our reaction
time will improve significantly.”

Corning Synchronizes Global Supply Chains with PeopleSoft What’s more important
in pursuit of business excellence: strong central leadership or effective decentralized
empowerment? Why not both? Like many large, multidivision, multinational enterprises,
Corning Incorporated must strike a balance between central cohesiveness and
decentralized business operations. Corning’s 12 business units plan and execute
their production, sales, and distribution operations autonomously, while sharing
the direction and global focus of the entire organization. Since 1995, PeopleSoft
integrated systems have helped attain that balance.

“The supply chain technology Holy Grail for Corning is to provide our diverse
business units the ability to achieve process excellence,” says Corning’s Rick
Beers, Director of Supply Chain Technology, “while minimizing complexity across
the whole organization. That’s the sweet spot we’re hitting with PeopleSoft.”

An Enterprise that Does it All

Corning, a venerable upstate New York
manufacturer, has evolved from producing glass and cookware in decades past
to creating advanced technology products such as optical fiber, cable systems,
photonic components and devices, LCD glass for oat panel displays, precision
lenses, emissions control products and life sciences products. Corning’s footprint
extends over multiple business, research, production, and distribution sites
in 34 countries. The company employs approximately 32,000 worldwide, and 2001
revenues reached $6.3 billion.

Each business unit manages its own planning, order management, production,
and other supply chain operations. Corning incorporates the activities of an
OEM, a supplier, a customer service organization, a sales organization, and
a technology innovator — all supported by PeopleSoft technology. Further,
Corning has ambitious plans to expand its production and market presence around
the world, and to optimize truly global supply chains within its businesses.

Compatible Visions, Close Fits

From 1995 through second quarter 2002, Corning has deployed 21 installations
of PeopleSoft HR, Finance, Procurement, and Supply Chain Management applications
throughout the company. The impetus for this far-reaching adoption of unified
enterprise systems arose from a sweeping 1994 corporate reorganization, in which
a major

IT overhaul was identified as a key enabler. PeopleSoft was chosen as Corning’s
principal ERP vendor for its range and quality of applications, functional fit,
modular and adaptable design, complementary vision of future directions, and
compatible corporate culture.

“Corning’s long term vision was to broadly deploy systems from a single vendor
into a decentralized business environment,” says Suzee Woods, Corning’s Director,
Application Services, “and to establish a standard transaction and data platform
for the entire company. This had to be accomplished, however, in a flexible
way that enabled us to deliver process excellence and business value across
widely diverse business processes.”

Supply Chain Process Excellence

Prior to initiating a PeopleSoft Supply Chain Management implementation, Corning’s
Supply Chain Technology Strategy group, led by Rick Beers, carries out an extensive
analysis of each business unit in consultation with process owners. The aim
of the strategy team is to acquire a deep understanding of the business’s supply
chain processes, a blueprint for process improvements, and a ot/gap analysis
with PeopleSoft SCM applications. The latter stages of the deployment focus
on optimization — the collaborative processes, one-tuned workflow, planning
refinements, strategic analysis and e-business initiatives that wring maximum
benefits from newly-established process excellence.

“PeopleSoft’s modularity is very important,” says Beers, “because we tailor
the approach to the needs and resource capabilities of each business. We’re
establishing supply chain process excellence in a way that gives each business
value. For example, the customer base is shifting for one of our units, so their
top priority is to focus on order and inventory management. Another business’s
pressures are capacity related, but their customer base is stable. They have
to make more optimal use of their resources, so they’re focusing on planning.
Another unit has zeroed in on improving the sales process. And PeopleSoft can
support each of those areas of focus and still be part of the common data platform.”

A Culture of Information Leading to Supply Chain Transformation

The expanding presence of PeopleSoft throughout Corning is having an effect
on Corning’s business culture. “It all comes down to having the right information
at the right place at the right time. At Corning, we’re starting to use real-time
information as a natural extension of ourselves, to make the strategic supply
chain decisions that save time and money, enhance customer satisfaction, and
improve operations.”

“If you consider the huge, and still growing PeopleSoft presence throughout
Corning and the challenges of globalization, shared services, and all those
individual supply chains, we’ve got some fun ahead of us. We’re completing the
heavy lifting in getting PeopleSoft implemented throughout this company. End
to end interoperability, inside and outside of the four walls, is the next challenge,
and a great opportunity. With this capability, the Real Time Enterprise can
become a reality.”

Beers concludes: “The early promise of ERP, and Supply Chain Technology in
particular, was to transform the business through end-to-end process design
enabled by integrated product and information flows. Somehow, between then and
now, much of the attention became focused on the technology itself. Technical
wizardry became the end game and the focus on process excellence became blurred.
The story of Corning and PeopleSoft is a different one. Supply Chain transformation
has been the goal all along, and it is being achieved.”

“We’re constantly working on yield and cycle times. We need the ability
to ramp up in time to meet unexpected demand, so we put a lot of work into figuring
out how much manufacturing capacity we need to have online. By having this improved
information infrastructure in place, our reaction time will improve significantly.”
— Doug Anderson, CIO of Corning Specialty Materials.

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