Advanced planning and scheduling in the production of transformers

Companies that manufacture transformers have productions that typically belong to the ETO (Engineer To Order). Producing on order therefore presents a criticality related to dating, necessary to be able to calculate and subsequently communicate the delivery dates of the finished product to the customer. Added to this is the need to achieve the highest possible level of service. In addition to these two critical issues, there is often a process WIP (Work In Progress) problem between the operation of creating the windings and the subsequent heat treatment of the same. When this happens, we try to balance production by moving people from the winding to the assembly bays of the active parts. It should be considered that in these cases the personnel involved in the creation of the windings are not fully efficient when assigned to the assembly bays of the active parts.

What are electrical transformers

The electrical transformer is a static machine that – as the name suggests – transforms the incoming current by modifying its voltage and intensity, without varying the electrical power.

Transformers have a very important function, because they allow the use of any type of appliance or electrical instrument. This is because the electrical energy that comes out of normal power outlets has a standard voltage of 230 V, while most electrical circuits in homes operate at much lower voltages. The transformers do not limit themselves to reducing current values, but distribute it with the most suitable voltage value, thus allowing the operation of electrical equipment. 


The critical issues of the production of electrical transformers

The Supply Chain in the transformer industry is very complex due to the characteristics of the product itself and the markets where the suppliers of the components operate, which have unique and different peculiarities compared to other sectors.

Low production volume: the transformer industry produces an average of 20,000 units per year, consequently the components market is also reduced and with a limited number of potential buyers.

Bespoke product: transformers are almost always a bespoke product and optimised according to the current cost of the various materials used. As a result, stocks are not maintained for many components, which are instead produced to order. This shortens delivery lead times and increases pressure on the Supply Chain, also increasing costs.

Small suppliers: For most components, especially low-value ones, the markets are local or regional. This limits the size of the businesses, which are usually small family businesses. This all involves a series of collateral problems, such as the lack of a solid management structure, dependence on a single person, risks related to succession, greater risks related to quality and delivery…

Demanding technical specifications: This creates relatively high barriers for potential new entrants and makes it more difficult and time-consuming for new suppliers to qualify for new supplies.

Customer-Dictated Component Suppliers: It is very common for transformer customers to accept only one manufacturer for a given component. This creates a monopoly, complicating things for buyers who don’t have supply flexibility.

Insufficient suppliers in some markets: Sourcing markets show different characteristics in different regions. Europe and China are two regions where there are many regional suppliers for most components. In contrast, North America, South America and Australia have few suppliers in each category and the level of competition is very low.

Powerful suppliers: Despite being small, some of the transformer component suppliers can be quite powerful. This may be due to the low level of competition, the pre-specifications of the end customer or the aforementioned insufficient number of suppliers. This does not allow transformer manufacturers to impose their requirements on suppliers.

Poor demand visibility: as mentioned, due to the customization of transformer production, before ordering the components you have to wait for the project to be completed. Once submitted to the customer for approval, it is quite common for changes to be requested. This results in poor demand visibility, leaving a rather short time for material sourcing.

Artisanal practices: the power transformer is still an artisanal product with little investment in the automation of its supply chain, expenses not justified by low volumes and its characteristic of being a tailor-made product. Many companies treat each transformer as a separate project and start the procurement process from scratch: they send requests for bids for each major component, collect bids from approved suppliers, manage negotiations, place purchase orders, wait for production time, and arrange for the individual shipment of each component. Essentially a long process.

Poor understanding of the concept of supply chain management: many companies do not have a department in charge of supply chain management with all the inconveniences that this entails. For example, without a manager authorizing the various decisions, there is no control over the flow of value through the chain.

Strong end customer: 70% of transformers are purchased by utilities, each with large purchase volumes.
These have the ability to dictate their own conditions to manufacturers, increasing pressure on the industry and limiting its flexibility.


Why take advantage of CyberPlan for the production of electrical transformers

Considering all the peculiarities of the electrical transformer sector, their production can greatly benefit from the production planning carried out thanks to APS software.  

Among the main benefits should certainly be mentioned the synchronization of the overall process and the reduction of delivery times. At the factory level, then, greater transparency and visibility on the status of the order and greater flexibility in the event of changes, thus also obtaining greater resource efficiency.


CyberPlan for the planning and scheduling of transformer production

CyberPlan is the best tool designed for the planning and scheduling of production processes in companies that manufacture transformers (or parts thereof). Thanks to numerous customer companies such as Siemens, ABB, SGB-Smith we have created a vertical that meets all the needs typical of the complex world of transformers.

If you want to know more about how you can manage bays and resources to achieve a high level of service by reducing WIP, download the guide below: you will find everything you need to improve your company’s performance.




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