Tillamook

Tillamook Case Study

Over 1.6 million pounds of milk is delivered daily to the Tillamook factory in Tillamook, Oregon. The award-winning, farmer-owned dairy co-op collects the milk from over 100 family farms of all sizes across Tillamook County; a county where cows outnumber people. With the abundant water sources – five rivers flowing into Tillamook Bay, and minutes away from the ocean – as well as the rainy climate of the Pacific Northwest region of the U.S., these ideal dairy farming conditions have supported the company’s 100 year history of making some of the highest quality cheese products in the world.

The 160,000 pounds of cheese manufactured each day by the 650-employee company is sold throughout the Western U.S. in all major grocery stores and at wholesalers such as Costco. Nearly 10% of the nation’s aged cheese is housed on premise at Tillamook, where all dairy products maintain the highest standards, starting with hormone free cows ensuring rBST-free dairy products for its customers. One million cheese-lovers visit the Tillamook factory each year to see how 20 pounds of milk is turned into a two-pound Baby Loaf of Tillamook cheese, and to sample some of the 28 flavors of Tillamook ice cream at the dairy!

Time for Change

After a number of years on a highly customized Epicor system – Tillamook was running Epicor for financials, purchasing and sales; and Wonderware, an industrial automation software solution, on the shop floor – the CEO put together a cross-functional team to identify inefficiencies across business processes. The teams findings were that business processes were fine, but better systems were sorely needed.

Thus Tillamook began the search for a new ERP solution to more effectively run their business. “Our system was so heavily customized that we couldn’t even take advantage of patches and version upgrades,” comments Dan Dodge, Senior Director of IT at Tillamook. “It would have been like a brand new implementation. So instead, we went back to the drawing board to see what else was out there on the market.”

Ultimately, Tillamook evaluated SAP, Infor, Lawson, Ross, Microsoft Dynamics AX and NAV. “Right away we excluded Oracle from the search because we had people who had been through Oracle implementations and their experience was that they were painful and expensive,” says Dan. “We evaluated SAP because other co-ops were running SAP and they had a milk module. We looked at it, but it was way out of our price range.”

As a Microsoft shop with limited tech support, Tillamook wanted a system that ran on Microsoft SQL Server so that they didn’t have to build separate infrastructure for a new system. They also needed a low-cost system that was flexible enough to accommodate their unique features such as milk costing. Finally, they needed to be able to deploy the system more deeply into the company. Where before Epicor was running financials, sales and purchasing, and Wonderware housed inventory information – costing was done out of Wonderware on spreadsheets – Tillamook knew that they needed a system that could encompass all aspects of their business for the greatest organizational efficiency.

Additionally, Tillamook needed a reliable system, as they run 24×7 operations at their two manufacturing sites in Oregon, where they manufacture multiple product lines and varieties. Downtime for any reason is a loss of production capacity – not an option!

Microsoft Dynamics NAV

Tillamook selected Microsoft Dynamics NAV over the competition for several reasons. “We chose NAV because of the cost of deployment and because it was a Microsoft product,” states Dan. “With SQL and all of the Microsoft products we already had, we could leverage the seamless integration.”

In comparing several tier 1 and tier 2 products side-by-side, Tillamook got the needed functionality for less with NAV. “It was a nice product that had the capabilities that fit our business. In weighing the option of going with AX or NAV, it was obvious to us that NAV had all the functionality, while AX had the technology. Our need was more for the functionality than anything else. And cost-wise, there was a 2.5x cost to implement AX.”

“You can do almost anything with NAV,” comments Tillamook Enterprise IT Product Manager Dave Wiser. “Its capabilities are endless. Users can get in, on a certain level, and make their own changes, with permissions. It’s a really nice, flexible system.”

“We replaced Wonderware with NAV because in packaging because it’s just the right place for NAV,” explains Dan. “We’ve integrated it with Wonderware, the software that runs the automated processes of the tanks and machines, to capture production volume. We manage all of the master data in NAV and then Wonderware has a view into the BOM, items and how much inventory is available. This data from NAV is presented to the operator through Wonderware’s screen right there on the shop floor.”

The Implementation

Tillamook, capitalizing from lessons learned previously, developed an implementation plan that would allow for small wins along the way. “With NAV being a less complex product, and with the way it’s organized, it’s pretty easy to roll out in stages,” comments Dan. “We made our implementation successful by delivering value every week. We went through development, testing and training in a particular area, and when it was approved, we would leave it in production for a week and only then would it be fully released. This added level of rigor made a huge difference. It was a much better option for us than not delivering value for over a year and then dealing with a huge, entirely new system all at once.”

Rolling NAV out this way made user adoption a smooth process at Tillamook. “NAV is easy to learn,” says Dave. “It’s fairly intuitive. You can sit for a couple of hours with the application and know where you are going and how to use it. With Epicor and others, you spend a lot of time trying to remember how to do x, y, z.”

“We are looking to implement even more NAV functionality soon,” states Dan. “We’re working on advanced warehousing with directed pick to be added to the system, as well as bringing all aspects of business processes into NAV to manage the growing complexity of our operation with packing and co-packaging going on in multiple locations. We need to be able to track what goes in to finished goods for consumption and creation. Right now that is done in Excel, but we’re going to bring that into NAV.”

Partnering with SCS

Microsoft referred SCS to Tillamook, due to SCS’s depth of experience in the food industry, and cheese manufacturing in particular. In addition to unleashing more of NAV’s MRP capabilities to assist in scheduling purchases and production, SCS – a Navision Reseller for over 15 years – worked with Tillamook on projects such as:

• Extending EDI capabilities, including integration with an external transportation management system.
• Extending automated processing capabilities, creating new logic to integrate NAV with Wonderware, their Automated Storage and Retrieval System (ASRS), and their marketing system.
• Supporting Tillamook report writers in creating their own custom SQL reports.

“Our engagement with SCS has proven them to be a real tight partner. [SCS Senior Developer] Matt Reeves is like a member our team! We have had great assistance from him, Rakesh Patel and Simon Kimani, plus other developers. They were all great working through this project. And Don Saito [SCS VP of Quality Assurance] has really helped us out architecturally. We had a lot of questions and being able to learn best practices from SCS was a great help to us. It was like having fresh thought on our business processes.”

“SCS was extremely responsive,” adds Dave. “Maybe a little too responsive! It’s hard for us to keep up with their work, getting things tested and all….but it’s a good problem to have!”