Proposal

For The

Automation Project(Capstone)

Submitted By: Mark Forster

Keller School of Management

Fall Session B, 2006

Southern California

Irvine, CA/Graduate Program

Professor Jack Cochran Presiding

TABLE OF CONTEXTS

COVER LETTER……………………………………………………………………..…IV

EXECUTIVE SUMMARY……………………………………………………………...VI

A OVERVIEW OF PROPOSED SOLUTION………………………………………VII

B. PROPOSAL ………………………………………………………….…………15

2.0 Quality Assurance Agency………………………………..…………………...152.1 Current Situation…………………………………….……………………….152.2 Recommendation………………………………………………………….…15

2.2.1 Location……………………………………………………………….…152.2.2 Benefits……………………………………………………………....…..152.2.3 Risks………………………………………………………………….….162.2.4 Selection of Quality Assurance Agency……………….……………..….162.2.5 Time…………………………………………………………………..….162.2.6 Cost……………………………………………….…………………..….16

3.0 Equipment…………………………………………..………….……….……...173.1 Current Situation……………………………………………..……..…….….173.2 Recommendation………………………………………………..……….…..17

3.2.1 Location………………………………………….……….………….…..173.2.2 Benefits……………………………………….…………..……….……..173.2.3 Risks……………………….……………………………………………..183.2.4 Selection of New Equipment…………………………………………….183.2.5 Time………………………………………………………………..…….183.2.6 Cost……………………………………………………….….………..…18

3.2.6.1 Accounting Procedures………………….………….………..…..183.2.6.2 Recording Cost of Equipment 20…………………….………..….18

4.0 Selection of Association of Shareware Professionals (ASP)…………………..204.1 Current Situation………………………………………….………………….204.2 Recommendation…………………………………………………….………20

4.2.1 Location…………………………………………..……………………...204.2.2 Benefits……………………………………………………………….….204.2.3 Risks8A…………………………………………………….………….….214.2.4 Selection of ASP…………………………………………..……….…….224.2.5 Time…………………………………………………………..…….……224.2.6 Cost……………………………………………………………………....22

5.0 Application Software (Inventory Control)……………………………….…….235.1 Current Situation………………………………………………………..……235.2 Recommendation………………………………………………………..…...23

5.2.1 Benefits………………………………………………………….….……23

5.2.2 Risks8A…………………………………………………………….……..245.2.3 Selection of ASP………………….…………………………………..….245.2.4 Time………………………………………………………….…………..245.2.5 Cost………………………………………………………………………24

C. PROFILE……………………………………………………………….……….…251) AMREP……………………………………………………………….….262) FSI Forming System, Inc. …………………………………………….…303) 1EDISOURCE……………………………………………………….…..324) Advance ware………………………………………………………….…36

D. TECHNICAL SECTION………………………………………..…………………37E. HUMAN RESOURCES (Severance Pkg.)…………………………………..…….40F. ORGANIZATION STRUCTURE………………………………………….……...41G. TIME/COST SECTION…………………………………..……………………..…43

APPENDICESSOURCE AND REFERENCE………………………………………………….……….46

LIST OF ILLUSTRATIONS

Work Breakdown Structure (WBS)Responsibility MatrixRisk Breakdown Structure (RBS)Company Organization ChartGantt ChartScoring and Screening

LIST OF TABLES

Table 1-TS (Machine Requirement in the RFP)……………………………………..…..37Table 2-TS (Machine Specification Developed) ……….……………………………….37Table 3-TS (Specifications for Selecting a quality assurance agency)…………………..38Table 4-TS (Software Application Service ASP)………………………………………..39Table 5-TS (Application Software Inventory Control)…………………………………..39

November 18, 2006

Mr. Owen French, PresidentAutomotive Parts Inc.123 Maple StreetBuffalo, NY 14203

Dear Mr. French:

The proposal in front of you will not only strengthen API’s position in its served market but, over time, will leverage API’s ability to become a significant ingredient in its customers brands and products. This proposal will allow you to reposition the dynamic infrastructure you have worked so rigorously to build via a paradigm shift to the future generation of ingredient parts manufacturing. By utilizing the well-crafted, seasoned professionals under your direction and tutelage, the metamorphosis should be relatively inconspicuous while building a next generation, multi-faceted, highly productive manufacturing and subassembly automotive parts company.

This proposal outlines a multi-faceted approach that, once approved and implemented, will provide immediate returns and reduced operating risk. To achieve this, API will contract a third party to insure that all materials needed in the manufacturing process meet tolerances set forth by API. Then, for any reason that the material reaches the final random output check and is not within tolerance, the third party will be charged for the time and material, mitigating the need for wire gauge checking equipment and labor during manufacturing. The next branch of the project will be to purchase new manufacturing equipment that facilitates greater product quality, speed, efficiency, and the opportunity to embrace new markets. The new machinery will have less material waste, lower down time to change tooling that will reduce overtime, and provide longer run cycles before maintenance. In the two changes listed, API should be able to improve its bottom line almost immediately.

Other changes and improvements brought about by the project are significant and may require a much longer turnaround before the investment is realized. However, without the last elements being implemented the full capabilities of the new equipment can never be achieved.

The final two elements of the project address the benefits of outsourcing the data analysis to a company that will permit API to take advantage of technology that much larger and dynamic auto parts companies have without the cost or risk. By leveraging the power of the Internet, our current customers can place orders more conveniently, freeing the sales force team to be more robust.

Once the order is placed, the outsourced company will make sure all the appropriate departments have the correct information reducing input errors and the number of employees needed for data entry increasing throughput. The outsourced company will

also be responsible for forecasting and monitoring vendors for the best prices after which it will create the RFQ.

The information in the proposal is valid for thirty days. Mr. French and Mr. Ives are the only officers of the company authorized to make commitments presented in the proposal. Please insure that all documentation in reference to the proposal is labeled “Automation Project” including all electronic communications.

I am well aware of the urgency API has to embark on this project, and I am eagerly awaiting your thoughts and input regarding this proposal. If you are satisfied with the proposal, please proceed to endorse this document.

Sincerely,

Mark Forster PM.

President Vice PresidentOwen French Dick Ives

Executive Summary

The strategic project plan to reduce the costs that are associated with manufacturing wire form and wire springs is scheduled to launch Monday October 30, 2006 and is scheduled to conclude no later than Friday November 09, 2007 just over 13 months. The automation project will involve the purchase of new manufacturing equipment to increase productivity and quality. The plan will also address the business process flow from order entry to delivery. Part of the business process will be to mitigate as much risk as possible

while creating the greatest potential for this wire form and spring company.

The program team that has been assembled to execute the project is described in the organization structure section of this document and their responsibilities are depicted in the responsibility matrix chart. The work break down structure (WBS) chart illustrates the task that will be accomplished by the program team during the project. A further detailed analysis of the tasks and the areas of weakness are illustrated in the risk breakdown structure chart (RBS).

The budget for the automation project and all the necessary equipment to improve quality and manufacturing output fully operation is established at $2,500,000. The distribution of the budget is listed in the resources sheet and the resource usage charts.

OVERVIEW OF PROPOSED SOLUTIONProject Definition

Owen French, President of Automotive Parts Inc. (API) has issued an internal verbal RFP for the purpose of automating the manufacturing process of the companies wire form and spring products. The undertaking of this project is to be better able to compete in the target market through reducing the costs related to manufacturing. API must be able to match or beat companies who also serve this market in price as well as quality and service. Mr. Owen has determined that the automation project is a top priority not only for the company but also for him personally.

Scope of Work

This automation process will be approached from four different perspectives. First, API will contract with a third party quality assurance agency. The third party quality assurance agency will be in the vicinity of the manufacturing plant of the raw material supplier to witness manufacturing of the test sample or select samples from Production. Documentation concerning the manufacturing process is gathered by the inspector at this time. By having the quality assurance agency mitigate the risk of inconsistencies in the raw material, API can eliminate the need for wire gauge checking. The quality assurance agency will be responsible financially for insuring that all wire meets API’s specifications via a transfer contract between API and the suppliers of the raw material. By adding the quality assurance agent between the supplier and API, API can eliminate the need to check the gage of the wire during production. The main purpose of making this adjustment first is it requires the least amount of change internally to API with an immediate cost savings.The quality assurance agency will be an outsourced company to allow for greater control over product satisfaction. If for any reason API determines that there is no further need for inspection of the raw material then API can opt out of the service agreement with ninety days written notice from an officer of the company.

The second phase of the project involves implementing an Electronic Data Interchange (EDI) system. An EDI system is designed to allow a customer to order products more readily, and more transparently. By developing an Internet based ordering system, API will be more accessible to a global market and allow the traditional sales team to become more productive. By linking incoming orders with the customer’s files and being able to notify procurement as to the specific material a customer wants and simultaneously scheduling a production run for the product seamlessly, even more risk will be mitigated. Most EDI stand-alone applications are designed for high end users that can designate an IT manager for the application. However, currently there are a numerous amount of companies that offer the EDI application as a shareware platform. By outsourcing the application, API will have the computer capability of a major manufacture at a fraction of the cost and risk.

The EDI upgrade section of the project will be managed and operated through an outsourced company to allow for a more transparent and dynamic apparatus, with

minimal risk. If for any reason API determines that there is no further need for the EDI outsourced firm, then API can opt out of the service agreement by either financially fulfilling the reminder of the contract period or a percentage thereof. Any and all terminations of service agreement most be submitted in writing to the outsourced company from an officer of the company.

The third phase will be the purchasing of new wire form and wire spring machines. The new machines will be ordered at the time this project is approved, and during the time that the new machines are being acquired and being delivered, the two previous phases will be implemented. The intended plan is to not stop current manufacturing methods and install the new machines after the business day is over. Upon removing the older less efficient machines, they will either be sold for salvage or scrape and the value of the sale will be deducted from the new purchase price of the new equipment.

The fourth phase of the project is to install an Enterprise Resource Planning (ERP) process for integrating manufacturing with other systems in the company for the purpose of improving product design, controlling manufacturing cost, and planning resource allocation. Deliverables

At the completion of the automation project, API will reduce the over all cost of the manufacturing process. The four phases described in the Scope section of this document outlines an e-commerce sales, procurement, and inventory up grade that comply with SOX standards along with new wire form and wire spring machines that meet ISO 9000:2000,QS 9000 automotive standards. At the completion of the project, API will be more competitive and able to expand beyond their current target market increasing their stability and livelihood during economic slow down periods.

Acceptance Criteria

The determination for success of the project will be measured in reduced cost of manufacturing of the product, increased market share, better quality control, better customer service, and an increase in productivity of the over all company. As a company looking to venture into a more value-add market, the solution will be able to learn the ability to embrace any such product development.

Timeline

The duration of the project is expected to take thirteen months, however the cost reduction for the automation project is estimated to begin within the first quarter after the project has been approved.

Priority Task Duration1 To Select a quality assurance agency 1 Month  Sign service contract  2 To Select the new manufacturing equipment 11 Months  Order/Purchase    Install/Train  3 To Select a application software company 9 Months

  Sign service contract    Switch over  

Multiple phases of the project will be concurrent with one another but not anticipated to extend beyond the nine-month period in phase 3 of the project. Each phase of the project is scheduled to deliver the most cost reduction possible within its timeframe. After placing the order for the machines the quality assurance agent will contracted and the cost associated with wire checking will be reduced. Then the project is scheduled to implement a web based ordering system reducing the overhead associated with the manual order entry system. Each phase of the project is listed with a best and worst case of how long that phase will take.

Milestones

1. Placing the P.O for the quality assurance agency2. Hiring the quality assurance agency3. Requesting the P.O for the new machines4. Placing the P.O for the new machines5. Requesting the P.O. for the EDI service6. Ordering the EDI service7. Training on the new EDI system8. Switching the current order entry system and recorded keeping files over to the

EDI service9. Training for the new equipment10. Receiving the new machines11. Installing the new machines12. Pre-production run of the new equipment13. The first automated run14. Purchasing a new inventory control system15. Training on the new inventory control system16. Termination Of the Project

BudgetThe line items for this project are listed below in the journal

ITEMS Sheet #IN/OUT House Cost  

Quality Assurance Agency 1 OUT $128,000 ExpensedEquipment 2 IN $1,969,316 CapitalASP Service 3 OUT $156,598 ExpensedApplication Software 4 IN $13,499 ExpensedSeverance Pkg. x 13 5 IN 221,000 Expensed Good Well

Cost of the project $2,488,413 Budget $2,500,000 Estimated UNDER budget $11,587 Compensation and Payment

The compensation as it relates to this project is solely intrinsic. By successfully accomplishing and completing the objective and goals of the project the intent is to demonstrate the Project Manager’s capabilities for future projects. In that the Project Manager is an employee of API, the pre-negotiated salary for said employee will service as Terms and Conditions for payment for employment. For any reason that an employee of API would participate in or on the automation project, their compensation will be calculated by charging the hours worked against the project and subtracted from their department.

Communications Plan

The automation project’s Project Manager will need to communicate with internal and external factions throughout the project life cycle. All outgoing communication from the PM will be made through a repetitive system to fully document who, what, when and were got communicated. This is consistent with ISO, QS, and SOX business standards.

Internal Communications Electronic

All electronic messages including Email will have hard copies made of and placed in the project file under communications. The communication section of the file is divided into subjections labeled emails, PDF files, brochure, and general literature. Each subject will be arranged so that the most recent communication is on top. On the backside of the divider separating the subsection, will be an index of who and when added the last document.

Paper (Letters, Memos, Notes)All paper documents pertaining to this project will be kept in the project file under communications. The communication section of the file is divided into subjections labeled Letters, Memos, Notes, Brochure, and General Literature.

Each subject will be arranged so that the most recent communication is on top. On the backside of the divider separating the subsection, will be an index of whom and when added the last document.

Phone- Land Line and MobileCommunication via the telephone will not be recorded unless specifically requested by the caller. Telephone logs will be needed i.e. a copy of the phone bill will be adequate for tracking communication between the PM and API. The phone logs will be kept in the communication file labeled under Phone Logs and will be arranged so that the most recent communication is on top. On the backside of the divider separating the subsection, will be an index of whom and when added the last document.

External CommunicationsAll external communications between vendors, subcontractors, contractors, regulatory agencies, and property managers will abide by the previously stated policy for internal communications. The following bullet points are policies for handling documentation with external parties.

Legal DocumentsAny and all documents signed, obligating either party to provide goods or service is to be copied and placed in a sealed folder inside the project folder. This folder is not to be opened or reviewed for any reason without the signed and witnessed permission of the CFO or other officers of the company.

Project Manager’s Staff, Roles and Responsibilities

In the table below is an index of team members involved in the project; for a more detailed analysis refer to the Responsibility Matrix document. President Owen French Vice President- Dick IvesDirector of Operations -Joe Gallagher PM-Mark ForsterAccounting Department- Kenneth Lay Director of Sales- David CopenhaverProcurement Manager- Joe Hamamoto Human Resources Manager- Lisa PruittMachine Shop Foreman-Jeff Gordon IT Manager - Bill GatesLegal- Johnny Cochran Intern-Steve Prchal

Technical Specifications

MachinesThe minimum technical specification requested in the RFP and reconfirmed by the machine shop foremen are listed below for the purchase of new automation equipment.Table 1-TSQuantity

Production Machines

2 Electronic Wire Gauge Checkers5 Automated Wire Formers2 Robotic Welders

With the monetary resources needed to purchase the proper equipment to elevate the quality and productivity while reducing cost of manufacturing. The project manager collected data on the machines API’s competitors were using in addition to researching the Internet and trade magazines to develop a more comprehensive understanding of the feature on the equipment needed to achieve the company’s objectives. A list of the features is listed below.Table 2-TS. On-screen diagnostics shows alarm status and corrective action required O.D. control is a standard featureOn-screen display, monitoring individual servo motor loads with color-coded percentage factor and overload warning.

Continuous rotation mode insures high speed production capability

Memory: CPU program capacity of 99, floppy disc 99 14.9MB CD capacity

Continuous mode and discontinues mode programming are selectable

Conversational format simplifies programmingMicro Pulse Hand Wheel is used to run every motor either in manual Mode or Auto Mode for every set-up and programming

Cam angle and wire length displayed on monitor Heat Exchanger on the electronics chamber keeps controls clean

Safety Interlock Sensors are fitted to all sides Easy to read 12.1 color TFT-LCD saves spaceForward and reverse capability for all axes Wire DiameterBad spring program capability MAX. O.D.Computer storage of cam position available for future set-up MAX. Feeding SpeedRoller Bearing Slides below 2.0mm, gib slides above 2.0mm Footprint

Number Of AXES 2D and 3D wire formingTensile Strength < 300,000 psi 480 VACService Contract WarrantyRun Time Between Maintenance Time Needed to Change Tool CarrouselsAccessories Network InterfaceTraining Each of the items listed in table 2-TS will be the criterion used to determine the model and vendor of the machines needed for the success and feasibility of the automation project.

Quality Assurance

In addition to the new equipment that the RFP highlighted there was an overabundance of attention being spent on wire gauge checking. This process of checking wire is

responsible for overtime and delays in production. However, the elimination of the process is also not reasonable. Therefore API will implement a new policy and

procedure by which it will reduce wire gauge checking to a random inspection. API will align itself with a quality assurance agency via a service contract. By placing a third party in-between the suppler and API the agency will become legally responsible for

insuring that all the resources coming from the suppler are to specification. By transferring the risk to the agency, API will be able to liquidate damages such as time and

material that could not be claimed before. The specification for selecting a quality assurance agency are listed below in table 3-TS

Table 3-TSProcess Inspection

Find the root cause of the production defects detected during final inspectionVerify the execution of Corrective Action Report (CAR) by the suppliers inspection teamInspect poor quality linkages at different production stationsProduct and component quality inspection before assembly

Identify suppliers weaknesses in the production system that leas to defects Laboratory Testing

Use Customer on-site supplier test equipment for product testing evaluationUse Supplier's Factory laboratory and equipment for sample testing Use an external approved Test Laboratories for calibrated testing

Final InspectionA 100% Factory InspectionA Random InspectionLine InspectionOut of Box Inspection

InspectorsAccumulated work experience in previous production, quality, and technical work. Specialized in products in either electronics or automotive engineered products Reasonably good written and verbal English skillsKnow how to generate effective supplier/customer feedback

Application Software Service Provider

The application software for this part of the automation project is typical of most other software a company might purchase to leverage their capabilities against other business in the market. In conducting the research for API, it has been determined that a multitude of stable well backed and trusted software companies run applications for small and medium size business as a service. By outsourcing the application API does not have to hire a software specialist or keep current with new versions of the software. Below is a table that list the criteria needed to select an Application software company.

Table 4-TS

Increase your EDI order processing efficiencyAutomate the document flow between you and your customers Minimize problem resolution timeImprove communication with PO Acknowledgements and Advance Shipping Notices Translates incoming EDI and XML transactions into easy-to-read documents on your desktopProvides ability to turn around Purchase Orders into ASN's and InvoicesSends electronic documents on your desktop back to customers as EDI or XML transactions

Improve your "Order Cash" cycleSpeed customer matching of Invoices with Purchase Orders for faster paymentCorrect invoices before they age by receiving immediate notification from customers of invoices with problems Receive electronic, ACH deposits for faster payment of your invoices Collaborate with demand forecast information to reduce days of inventory coverage

Make your company less expensive to buy from Reduce your customers' Accounts Payable problem resolution timeStandardize your customers’ buying process with you Keep buyers and expeditors informed with Acknowledgements and Advance Shipping Notices Improve your customers' ability to utilize "faster pay" programs such as rebates

Make your company easier to do business withIncrease proactive customer sales and service activities without additional overhead Share more information with your customers – easily and electronically

TrainingInitial Training ClassNew Hire Training ClassCurrent Industry Seminar

Proposal

In the overview, section of the proposal an ambiguous concept was presented for consideration, and the more comprehensible plan is detailed in the following section of this document. By providing a clear understanding of the goals, objectives, time, resources, risk, and benefits, API’s executive members will be able to determine the extent of commitment they choose to enter into.

2. Quality Assurance Agency2.1 Current Situation

The current situation is that API has allocated $302,000 annually for wire gauge checking and eleven employees with full benefits and worker compensation benefits, that all affect the cost of manufacturing. In addition to the cost associated with wire gauge checking, the operation of checking the finished product as frequently and as thoroughly to maintain an acceptably product reduces the overall output of the production line, limiting the volume needed to reduce cost.

2.2 Recommendation

The recommendation to minimize the impact that wire gauge checking has on manufacturing demands a paradigm shift it the current procedures and policies of API. The shift referred to is to move the responsibility of checking the wire from an internal process to an external process. By outsourcing the wire checking procedure, the inbound material a.k.a wire will no longer need to be checked as frequently during or after manufacturing.

2.2.1 LocationThe quality assurance agent is physically located in the suppliers facility wherein the agent can examine every part of the assembly process of the supplier. By being able to by in direct contact with the wire throughout the process the agent will be able to conduct laboratory test, tensile strength test, and wire gauge thickness tolerance test before the product ever leaves the assembly center.

2.2.2 BenefitsThe benefits of hiring an third party to be responsible for the quality of the wire used in manufacturing can be realized in increased productivity, reducing the cost of manufacturing through not requiring as many employees in the process. An additional benefit that comes from hiring a third party quality assurance agency that API had no recourse for previously is that by transferring the responsibility, API can also transfer the financial fallout from delivering out of specification parts.

2.2.3 RisksThe identified risk associated with outsourcing a previously in-house procedure critical to the manufacturing process will be mitigated through legal contract agreement typical within the industry. Transference contract service as an insurance policy between the suppliers and the manufacturers and like with an insurance policy if a failure occurs the insurance company pays a claim to recover the cost of time and materials lost. By having the quality assurance agency under contract allows API the flexibility to determine the length service and the satisfaction of that service.Additional project risks associated with the shift in procedure can be seen in the document titled “Risk Breakdown Structure”

2.2.4 Selection of Quality Assurance Agency In evaluating the best-qualified candidates for the quality assurance agency contract a list of requirements was developed using the Project Manager’s and Machine Shop Foreman’s experience. The list of criteria by which every RFQ was evaluated can be found in the Technical Specification section of this proposal. After the RFQ’s had been condensed to the final two agencies a final evaluation comparing the two agencies against each other. That screening process outcome is available in the document titled Scoring and Screening QAA. Beyond determining the two best agencies, each agency submitted a company profile and the agency that was chosen had their profile added to this proposal. The profile is located in the section titled “PROFILES”

2.2.5 TimeThe two time factors for consideration are how long will it take to implement this element and the other is how soon can API expect to see a cost reduction in manufacturing. The length of time need from once the PFQ is responded to till the service agreement is signed will take eight weeks. The cost reduction could be recognized at the end of the first quart of business after the service agreement is signed. A detailed breakdown of all the activities involved in executing this section of the project are available in the Gantt chart under WBS 2.0.

2.2.6 Cost The preliminary costs associated with the service are estimation based on the full capabilities of a quality assurance agency with no long-term agreement. However, the preliminary budget for the service is set at $128,000 annually and can be paid in quarterly deductions. The immediate cost savings from the current situation creates a $174,000 saving. A detailed cost analysis of this element can be found in document titled QAA Budget

3. Equipment3.1 Current Situation

The current situation is that API’s manufacturing process requires thirty-one (31) employees at an annual cost of $1,348,000, to operate five antiquated machines that require maintenance and repairs that are all out of pocket expenses. In addition to repair cost the older machines do not meet the federal guideline for being energy efficient, consequently creating higher then need be electrical cost. Furthermore, the company’s current policy allows for a three-shift work schedule, two of which are during the highest cost of production periods of the workday.

3.2 RecommendationThe equipment recommendation for reducing the cost associated with manufacturing is to replace the existing equipment with new greener energy, highly versatile, and significantly more efficient equipment. Then buy implementing the new equipment API can implement a new policy change that will have the majority of the manufacturing process conducted between the hours of 11PM EST. and 6AM EST. this is the off peak hours for the electric company offering a five percent cost saving on the electric bill. By changing the equipment, the number of employees need to operate that equipment, and when those employees work API can take full advantage of every cost savings benefit leaving nothing on the table. 3.2.1 Location

The location of the new equipment will be installed in the machine shop portion of the building in tandem with the existing machinery for a period of transition. However, the manner in which the equipment is situated well be altered. After reviewing the floor plan layouts of assembly lines in Japan, China, and the Philippines it has been determined that by placing the new equipment in a horse shoe shape with the open end facing the shipping and receiving area. An increase in productivity and performance can be reached. The horseshoe shape allows for fewer employees to operate more equipment.

3.2.2 Benefits The benefits gained in purchasing the new equipment will be an increase in productivity, a greater product offering potential, low operating cost, longer run times between maintenance periods, and an extended warranty period to eliminate the replacement cost of broken or worn-out parts. In addition service contracts are available that are so compressive that if a machine can not be repaired with in 24hrs a new machine will be brought in and setup.

3.2.3 RisksThe known risks for purchasing new equipment are illustrated in the Risk Break Down Structure. However, to reduce or mitigate the risk associated with many of those items is a matter of changing policy and procedures within the company that require no financial commitment but offer a return or cost savings.

3.2.4 Selection of New EquipmentWith the monetary resources needed to purchase the proper equipment to elevate the quality and productivity while reducing cost of manufacturing. The project manager collected data on the machines API’s competitors were using in addition to researching the Internet and trade magazines to develop a more comprehensive understanding of the feature on the equipment needed to achieve the company’s objectives. Each of the items listed in the document titled Technical Specification table 2-TS will be the criteria used to determine the model and vendor of the machines needed for the success and feasibility of the automation project.

3.2.5 TimeThe length of time need from once the RFQ is responded to till the equipment is installed and functioning will take 107 weeks. A detailed schedule of all the activities involved in executing this section of the project are available in the Gantt chart under WBS 3.0.

3.2.6 Cost The overall budget for this section of the project is set at $1,735,712 and a detailed listing of how the money will be allocated is listed in the document titled “New Equipment Budget”

3.2.6.1 Accounting ProceduresThe Minimum Accepted Rate of Return (MARR) at which to determine whether to proceed with the project has been set at 5% in accordance with the industrial standard of net profit.

The Company’s policy for deprecating equipment is to deprecate the cost evenly over a ten-year period of time.

3.2.6.2 Recording Cost of Equipment20

RECORDING COST OF EQUIPMENTThe accounting office must establish the cost of newly acquired inventorial equipment on a monthly basis, following notification by the Equipment Management

Department that the equipment was received in good condition. The cost of each item is based on the invoice price (see Section III.B., Costing Equipment). Under no circumstances should the cost be established any later than the 25th day of the second month following receipt of the equipment. The only exception allowed is for equipment purchase orders fully or partially on hand at June 30 which, for fiscal closing purposes, should be included in the annual equipment inventory register for the fiscal year in which the equipment was received.

ACCOUNTING FOR LATE COSTSIf additional costs are incurred subsequent to the recording of the initial acquisition costs for items of inventorial equipment, such costs must be added to the initial cost of those items.

RECONCILING COST OF EQUIPMENTFor each item of inventorial equipment, the costs recorded in the Inventorial Equipment Register are reconciled, on a monthly basis, with the amounts paid for the equipment as reflected in the General Ledger.In addition, the cost of equipment acquired from the storehouse or constructed by the physical plant department is listed and reconciled to the expenditures reported in the General Ledger. At fiscal year-end, the amounts reported on the University's financial reports for each item of inventorial equipment must equal the amounts reported in the Annual Equipment Inventory Register. If there is a discrepancy between the cost recorded in the Inventorial Equipment Register and the cost recorded in the General Ledger, the amount reported in the Inventorial Equipment Register may be adjusted to agree with the amount in the General Ledger, provided the discrepancy is significant in the judgment of the accounting officer.

COSTING EQUIPMENTThe unit cost entered into the equipment inventory system consists of costs for the following:1. Major items of equipment (less any discounts taken) ;2. Accessories needed to make the equipment usable;3. Installation, excluding costs for reassembling equipment dismantled

for shipment;4. Freight, provided the amount was included in the invoice for major

items of equipment. Also, freight charges may be included as a cost element where the charges represent a significant cost factor in the acquisition of the equipment, even if the charges are billed separately from that equipment.

5. Taxes (sales, excise, use, duty); and6. Insurance costs to cover the equipment while in transit.

RECONCILING EQUIPMENT ACQUISITIONSThe monthly Reconciliation of Value Recorded and AmountPaid for Equipment report (EQ 080) is used to reconcile equipment acquisitions. The report is a comparative listing, in purchase order sequence, of all object-coded9XXX entries recorded in the General Ledger and the corresponding equipment cost data recorded in the

4.0 Selection of Association of Shareware Professionals (ASP)4.1 Current Situation

The current situation as it relates to a digital infrastructure wherein customers, vendors, and departments are seamlessly linked to create a dynamic throughput has never been addressed in the API Company.

4.2 Recommendation

The recommendation for API is to outsource an electronic data interchange (EDI) system wherein API can leverage the capabilities of a tremendously complex and costly stand-alone program. The purpose of the EDI system is to avoid and prevent additional human intervention in reading and processing information between trading partners by establishing a standard communication throughput method. By allowing customers to order directly from the manufacturer and the manufacturer to order supplies directly from the most competitive supply channels a greater profit can be achieved.

The process and qualification for selecting an EDI service provider were developed by the IT manager in conjunction with the PM to create a RFQ wherein the applicants would be reduced to the final two candidates. The list of qualifications are listed in the document titled “Technical Specifications” table TS-4

4.2.1 LocationThe server resides in the ASP hosting facility. API receives the resources of ASP’s primary hosting facility. Optionally, provisions can be made to facilitate fail over to ASP’s secondary hosting facility. The advantage once again is that the maintenance, upgrades, monitoring, and report generating are all handled offsite. Reducing the risk and increasing the benefits of a high end software package.

4.2.2 BenefitsThose companies that have made the most extensive use of EDI have found that even though the quantifiable benefits are significant, it is the strategic benefits of electronic reengineering that really are the most valuable to the organization.

These strategic benefits include: The quality and speed of service to customer is improved. The organization's competitive edge is enhanced and operating costs are

reduced throughout the organization.

Trading partner relationships are strengthened by helping them reduce costs while offering improved customer response.

Timely marketing information creates improved sales forecasting and business planning.

Employee energies are focused upon more productive business activities, which yield higher profits and improved staff moral as a result of job enrichment.

4.2.3 Risks8A

* Inherent RiskThe vulnerability of an EDI system is high because the failure of the system in any of its three stages - initiation, transmission, and destination - will corrupt transactions.

* Unauthorized Intruder Accessing InformationIn EDI, inter-organizational communication takes place over the network. Public networks used for sending and receiving transactions may be tapped to intercept transactions. Thus, information is susceptible to interception not only at origination and destination nodes, but also during electronic transmission. Access controls designed to defend against unauthorized initiation of transactions include passwords, dial-back mechanisms, user identification, storage lockout, and different levels of access. Control activities to foil interception during transmission include routing messages through a secured medium, encryption, traffic padding, and confidential electronic envelopes.

* Loss of Data IntegrityCorruption of data may occur as a result of erroneous input, poor communication lines, deliberate modification, or malfunction of hardware or software. The public networks over which documents are sent among trading partners are generally not protected, and documents can be read or altered by anyone who has access to the network.Controls for data integrity ensure that contents of the message have not been altered. These controls include notarization mechanisms, acknowledgment protocols, computerized audit trails, digital signatures, and edit checks.

* Lack of Transaction CompletenessThe transactions sent over the communication media are sometimes lost during transmission. If an acknowledgment from the receiver is not received within an agreed-upon time period, then the transaction is presumed to be lost and is retransmitted.

In such circumstances, the transaction may appear twice at the destination. The risk is that the EDI system may not be able to detect missing, mis-sequenced, or duplicated transactions. Batch totals, sequential numbering, acknowledgment control, and one-for-one checking against the control file are among the control mechanisms that can be used to reduce the inherent risks due to lack of transaction completeness.

*Unavailability of the EDI SystemHuman actions, logical reasons, and/or environmental factors may cause the EDI system to become unavailable. Employees' unintentional mistakes, such as deletion of data and lack of proper compliance with roles and procedures, generally cause the unavailability of EDI systems; but natural disasters, vandalism, criminal attacks, strikes, or lockouts may also be culprits.

The communication network is an integral part of EDI, which means that viruses and hacking may also occur. In addition, viruses may spread through the transactions and programs traveling among the trading partners. Off-site backup, redundant arrays of integrated disks (RAID), disk mirroring, fault tolerance, and anti-virus packages can be used to minimize the unavailability of an EDI system.

4.2.4 Selection of ASPIn determining the specification for creating the RFQ the PM, IT, COO, and the VP had been consulted for information as to what they needed to make their jobs more productive. The list from which the RFQ’s had been evaluated by and reduced to the final two candidates is list in the document titled “Technical Specifications” table TS-4

4.2.5 Time The length of time need from once the RFQ is responded to till the ASP service provider is fully implemented and tested will take 52 weeks A detailed schedule of all the activities involved in executing this section of the project are available in the Gantt chart under WBS 6.0.

4.2.6 Cost The cost of the ASP service to provide and maintain includes software upgrades, IT equipment at the far and near ends of the network, installation of that equipment, and training on the new system for six employees for a cost of $156,598. A breakdown of the disbursement of resources can be located in the document titled “ASP Budget”

5. Application Software (Inventory Control)5.1 Current Situation

API currently is not using any type of inventory control system outside of physical counts once a year. The annual inventory accounts for an approximately 36% version in inventory that requires an additional six months to investigate and may or may not ever be ratified.

5.2 RecommendationThe recommendation for increasing the accuracy and dependability of the inventory is to acquire a inventory control system. A system that would allow API to offer their channels an (JIT) Just In Time inventory flexibility. Many of the well known and well establish software products currently on the market like ASP and Profit 21 are very expensive and require a full time programming staff to handle errors. The middle ground would be to develop arrangements with API’s suppliers to produce and ship enough material to last thirty days, and then delay invoicing the shipment till the product is used. Then API could purchase an inventory control system off the self and upgrade to the more elaborate programs later.

5.2.1 BenefitsThe benefits to better monitoring the inventory control are straightforward better knowledge of what API has the faster the cycle time reducing the loss income due to the channels turning to suppliers that have the product on hand or can get it in short order. The benefit of arranging for API’s supplier to produce and ship product will most likely be realized during the extreme bad weather conditions of the northeast cost. By allow them to ship the product they can be assured that that product will be sold and API is not required to account for the product till they need it. Other benefits of JIT software are:

Streamlined data entry Create item kits/matrix Manage inventory by your own rules Reduced paper work Faster order fills More productive staff Unlimited roles and permissions Single point system administration Streamlined data entry Better time management Better customer service More productive staff

5.2.2 RisksJIT inventory control is a software application that resides on a Computer and if that computer fails, all the data could be lost. However to mitigate that risk backup systems can reduce the likelihood of total lose. Risks are also realized in the transfer of data from one system to another and to reduce that risk a spot check inventory can be arranged weekly.

5.2.3 Selection of Application SoftwareThe process and requirements for selecting an application software for improving inventory control were developed by the IT manager in conjunction with the PM to create the criteria for purchasing off the shelf software. The list of requirements are listed in the document titled “Technical Specifications” table TS-5

5.2.4 Time The time required to select purchase and install the application software will only take two months. The training will be done on site under live fire; acclamation is not expected to take more then six months.

5.2.5 Cost The cost of the application software can be located in the cost section of this document subtitled “Application Software Budget” Sheet 5

PROFILE

Quality Assurance Agency

About Our Work

AMREP IN QUALITY MANAGEMENTAMREP is an unexpected creation of the IBM International Procurement Office. We gained supplier control methods and techniques from working with their offices throughout Asia. In 1983 AMREP created the AMREP Quality Management Centre (AQMC) and worked with Dr. Joseph Juran and the Juran Institute in re-introducing Juran’s concepts on TQM and Quality Control. Dr. Joseph Juran with Edward Deming were the 20th century gurus of quality management. AMREP trained many suppliers, including Texas Instruments, Shell, Esso, on the use of Quality Improvement Teams, Quality Analysis and Quality Planning. In 1990 AQMC started ISO 9000 training and certification of auditors. AMREP’s current Quality Auditors are certified to TQM methods, SPC techniques, ISO 9000 and FDA regulations. They are also trainers.

GLOBAL ORGANIZATIONAL SETUPIn 1981 AMREP Vendor Inspection Services became the first and only company to begin supplier source inspection work on Asian suppliers for IBM.

In 1983 AMREP created the AMREP Quality Management Centre (AQMC) and worked with Dr. Joseph Juran and the Juran Institute in re-introducing Juran’s concepts on TQM and Quality Control to Asian suppliers. Dr. Joseph Juran is one of the 20th century gurus of quality management.

In 1990 AMREP started ISO 9000 training, certification of auditors and consulted Asian suppliers on ISO 9000 QMS implementation.

By 1995 AMREP concentrated only on Supplier Quality Management Services to International Procurement Offices and major US corporations sourcing from Asia.

By 1998, AMREP International Network covered key Asian countries and Mexico, and in other countries where suppliers had originated or had transplanted itself to another country.

Today AMREP has a multinational mix of over 150 employees located in different countries that specialized in Supplier Source Inspection, Quality Management and Supplier Procurement Management.

AMREP has a low employee turnover. AMREP is operated on an employee-ownership inducement policy.

MOST COMMON SUPPLIER PROBLEMSWhen a customer decides to use AMREP it is because he has a purchase contract with a supplier and it is too late to cancel the order, change the supplier or get the supplier to fix the problem before or after delivery. Here are some of the supplier headaches for customers. AMREP can only solve some supplier problems if the customer does execute its preventive plan.> Read More

ANTI-CORRUPTION BARRIERAMREP only serves its customers well if AMREP Supplier Quality and Technical Specialists do value added jobs for our customers. Most suppliers are co-operative. Some suppliers are keen to use AMREP as independent inspectors to help improve their product quality. Some are willing to give money to other inspection companies and their inspectors to overlook quality problems in order not to delay shipment to their customers.

EFFECTIVE OUTSOURCED SUPPLIER MANAGEMENT Many companies have moved into strategic outsourcing with its primary focus on manufacturing suppliers in China. Strategic outsourcing as is understood in the US includes:

a. Identifying potential suppliers b. Requesting Quotations c. Analyzing preliminary expenses d. Negotiating contracts e. Monitoring and Improving Suppliers.

ANNOUNCEMENTSKM Consulting located in Saudi Arabia is now the Licensed Associate of AMREP Global Supplier Management Services. AMREP-SKM will provide traders, buyers and businesses in the Middle East with the service capabilities to identify suppliers, qualify the suppliers’ production and work capabilities, and check on the supplier product quality. Pre-shipment and Pre-Delivery Inspection of consumer product are done by AMREP Buyinspect. Technical inspections are operated by AMREP VENDOR INSPECTION Services.

Contact : Jimmy John, SKM Consulting on jimmy@SkmConsult.com or Gabriel Suarez at gsuarez@amrepinspect.com

Supplier Inspection in USA, Quality Inspection Services - AMREP USA

AMREP NORTH AMERICA (ANA) has a core quality and engineering team with over 500 specialist associates located in different parts of the USA to support customer requirements on Supplier Inspection, Supplier Managment and Quality Inspection. Some of these customers that have used AMREP within the USA include:

Cubic Qualcomm Nortel Sharper Image Lucent Technologies Universal Electronics International

ANA undertakes supplier audits, process improvements and WIP inspections using ANA time based associates deployed at remote locations. ANA technical and manpower resources help customers to reduce time and manpower costs by using ANA associates on short-term projects.

ANA has three main marketing and operations office specializing in quality inspection and supplier inspection services.

AMREP EAST, Fort LauderdaleAMREP Las Vegas, Nevada, AMREP WEST, San Diego California.

Looking for Quality Inspection or Supplier Inspection Services in other countries?

China Supplier Inspection India Supplier InspectionJapan Quality Inspection Malaysia Quality InspectionMexico Supplier Inspection Philippines Quality InspectionSingapore Quality Inspection South Korea Quality InspectionTaiwan Supplier Inspection Thailand Supplier InspectionUSA Quality Inspection

ClientsThis is a display of some the type of customers we service.

IBM DELL AT&T MAXTOR PHILIPS INFOCUS EMERSON IOMEGA HEWLETT

PACKARD PLANTRONICS RADIO SHACK WESTERN

DIGITAL LEXMARK NEW YORK

AIRBRAKES LUCENT

TECHNOLOGIES

SUN MICROSYSTEMS

CREATIVE TECHNOLOGIES

SCHUMACHER ELECTRIC

HANDSPRING SYMBOL

TECHNOLOGIES SYNAPTICS MOTOROLA ITT ELECTRO

OPTICAL INVENSYS BAYER

DIAGNOSTIC

KV PHARMACEUTICALS

HEXCEL CORPORATION

ROCKWELL ROVER CALLAWAY

GOLF HOME DEPOT DIGIDESIGN PHOTON

DYNAMICS SONY SOLECTRON FLEXTRONICS

EVEREADY BATTERIES

Forming Systems Inc. specializes in spring making, spring grinding, wire forming machinery, and spring testing equipment.

Forming Systems, Inc. is dedicated to providing spring making and wire forming customers with the best possible production solutions. FSI offers HTC spring machinery for spring coiler or spring former applications, plus HSI spring making production accessories such as inline conveyor ovens for stress relieving, spiral ovens, box ovens, part collectors, and payoff reels.

FSI also provides TBE wire forming machinery, Whitelegg wire bending machinery, and Jaykase CNC tabletop benders for wire and strip materials. Spring testers from Spring Analysis Systems, Inc. (SAS) include compression spring testers, torsion spring testers, extension spring testers, spring fatigue testers, and deflection spring testing.

Forming Systems, Inc. specializes in providing production solutions for spring making and wire forming customers. If you require spring machinery, 2D wire bending machinery, 3D wire forming machinery plus production accessories such as inline conveyor ovens for stress relieving , spiral ovens, box ovens, part collectors, payoff reels, or spring testers, FSI can provide the answer.

Markets Served:Spring MakingSpring Testing & AnalysisSpring SettingSpring GrindingSpring Automation (high volume)Wire Bending – 2DWire Forming – 3DWire Forming & WeldingWire Form Automation (2D or 3D)Ring CoilingRing Coiling & Welding

CONTACT US For more information about any of our products, please feel free to contact us:Toll Free: 877.727.FORMPhone: 269.679.3557Fax: 269.679.3567E-mail: info@formingsystemsinc.com

Forming Systems Inc., for all your needs in spring making and wire forming machinery and spring testing equipment.

Vendor’s To Forming Systems, Inc.

Recent Announcements

High Speed Wire PayoffHSI has introduced two new high-speed wire payoff systems for small wire diameters. The new VR-80 offers high-speed spool payout of material for wire diameters up to 0.031" (0.8mm) and weight capacity of 180 lb (80 kg). Dancer arm and motor brake ensure smooth operation at high speed. The VR-80 is ideal for products such as garter springs. Also new is the AR-100 offering the same features, but designed for high speed payoff from coil materials up to 0.063" (1.6mm) and weight capacity of 220 lb (100 kg). Available exclusively from Forming Systems, Inc.

When you hear "X12", do you think of a prototype space vehicle, or your second language? Does the word "VAN" make you think of something other than a shag carpet and bubble windows? If so, then 1 EDI Source is looking for you.

The former Silk Mill, on the west bank of the Cuyahoga River, is the home of 1 EDI Source, Inc.  Located adjacent to the Riveredge Park and the Cuyahoga River, this 1837 landmark building has come back to life.

The multi-storied building, originally intended to serve as a silk mill (hence the name) never lived up to its proposed purpose because the mulberry trees necessary for feeding the silk worms did not thrive in this climate.  Following that use, the building served as both a cotton and an alpaca mill, a machine shop and as a dress factory, a furniture factory, a torque-converter factory, and a box factory.

1 EDI's renovation of the building was undertaken with a sensitivity to the structure’s historic significance by maintaining many of the original construction features such as exposed beams, high ceilings, wooden floors and original masonry components.  The unique setting and design components of the Silk Mill offer a one-of-a-kind work environment.

Purpose 1 EDI Source, Inc. was established to provide affordable EDI solutions and expert EDI advice to companies of all sizes.

1 EDI Source is made up of an expert team of technicians, programmers, and consultants, all of whom work together to ensure that your EDI solution fills your needs.

1 EDI Source boasts thousands of clients - ranging from the independently owned, single-person operation to international corporations where reliable EDI is crucial to the operation of the business. Whatever your goal is in regard to EDI, we can help you achieve it.

Looking for an inexpensive set-up, one that can be operated and maintained by non-technical people? We can help you with that.

Does your company require a detailed technical analysis? If your goal is to integrate EDI functionality into a sophisticated environment, we're ready to help.

We usually find that companies such as yours are asked to implement EDI with inadequate information. There are many avenues to investigate, and we are often told that EDI vendors don't take into consideration your company's individual needs.

Selecting the right product is the starting point of the relationship that we want to build with you. We are staffed with a unique team of people who will offer you a no-nonsense approach to service. And with the majority of our employees on site, we have the ability to interact and communicate. Your needs are discussed among a team of experts who strive to deliver quick and exceptional responses. Your questions will be met with clear and knowledgeable answers by highly trained technicians.

In addition, the variety of EDI experiences held by each team member adds to our ability to access your needs and overcome your obstacles. If your needs require a custom solution, we have the capability to create it.

Manufacturers recognize that, without a viable EDI solution, they risk losing business. Prior to becoming a vendor, a company is frequently asked details about its EDI, such as the EDI ID, VAN, and ability to exchange specific transactions. In many instances, even test POs must be received using EDI. 1 EDI Source has successfully enabled manufacturers of all sizes to meet vendor requirements. With the ability to exchange EDI transactions, suppliers have a greater chance of attracting new business.

EDI is vital for any business to grow, and retailers understand the extent of its use. All facets of the retail industry-including hardware, clothing, and grocery stores, to name just a few-recognize the need to open the EDI lines of communication in order to communicate with manufacturers, warehouses, and transportation carriers. EDI involves more than purchase orders and invoices; it includes advance ship notices, shipping schedules, and routing and carrier instructions.

ProductFast, simple, cost-effective. WebSource makes EDI compliance a snap WebSource is the turn-key solution for companies who are not interested in setting up an in-house EDI operation, with the trained staff that would normally be required. The WebSource product becomes a proxy which communicates with the trading partner(s) on your behalf. Using a friendly web interface, EDI transactions can be recieved, edited and sent as easily as an e-mail.

WebSource receives EDI data from your trading partner, and converts it into a friendly display for your review. Sending data to your partner is as simple as filling out a form, and clicking send. WebSource seamlessly transforms your data into EDI and transmits it to your partner. Sophisticated features like form pre-population, carton packing, and UCC-128 label printing save you time, and money.

Features Streamilines data-entry by pre-populating outbound forms using data from the

inbound form (i.e. Invoices can be pre-populated with data from the associated Purchase Order). This is known as a "Turnaround".

All transaction types are supported, including those based on HIPAA, X12, EDIFACT, VICS, and UCS to name a few.

Data-entry errors are reduced by setting default values, using drop-down lists, and automatic form calculations.

Transaction forms are completely customizable. New transactions can be created by receipt of data from a trading partner, the

turnaround of trading partner data, data-entry, or uploading a file. Supports all shipping methods, including standard carton and pick & pack. Integrated UCC-128 label-printing capability, including the generation of UCC-

128 numbers. Role-based permissions model allows a very high degree of customization of

user rights. For example: The front-office receives a purchase order and is only permitted to turn it around into a purchase order acknowledgement or an invoice. Meanwhile, someone in the warehouse is able to turn that same purchase order into UCC-128 shipping labels.

No EDI staff required No software required No training required No EDI knowledge required No maintenance or support

contracts No EDI system management No VAN charges Fast implementation High-speed document transfer Integrates into accounting system Custom reports available Carbon copies

Automotive Parts Inc.

Recent News Articles

Press Release Source: 1 EDI Source, Inc

1 EDI Source, Inc. Introduces 'EDI SmartXchange for Suppliers' to the Supply Chain Professionals at U Connect 07, The GS1 US Community Event for StandardsTuesday November 14, 1:43 pm ET

CLEVELAND, Nov. 14 /PRNewswire/ -- 1 EDI Source, Inc., a leading provider of Electronic Data Interchange (EDI) Software and Consulting Solutions, today announced their participation at U Connect 07, The GS1 US Community Event for Standards AND the introduction of their niche supplier product, EDI SmartXchange for Suppliers. The 2007 U Connect Conference for the supply chain standards industry will be held June 4th - 7th in Orlando, Florida.

EDI SmartXchange for Suppliers has been designed specifically for 2nd and 3rd tier suppliers. This will allow companies to enable suppliers of all sizes with EDI capabilities. These suppliers would not have been able to achieve EDI compliance on their own, due to cost or technology barriers.

EDI SmartXchange for Suppliers provides a web-based interface to non-EDI compliant suppliers. EDI SmartXchange for Suppliers acts as a gateway, accepting outbound EDI data from an EDI system and sending EDI data back to it. The EDI enabling of non-EDI compliant suppliers happens transparently.

EDI SmartXchange for Suppliers supports any type of EDI transaction set including purchase orders, invoices, advance ship notices, shipping schedules, routing documents, carrier instructions, etc.

1 EDI Source, Inc. manages all hardware/software requirements, tests and implements relationships, and handles the day-to-day operations of the EDI SmartXchange for Suppliers helpdesk.

Steven Zabel, Vice President of Marketing for 1 EDI Source, Inc. stated, "We are excited about U Connect 2007 and the opportunity to introduce EDI SmartXchange for Suppliers to the supply chain professionals that will be in attendance. EDI SmartXchange for Suppliers makes it possible for suppliers of ALL sizes to achieve 100% EDI compliance quickly and efficiently."

About 1 EDI Source, Inc.

1 EDI Source, Inc. provides affordable EDI solutions and expert EDI advice to companies of all sizes. An expert team of employees consisting of technicians, programmers, and consultants work together to ensure each EDI solution is a success. 1 EDI Source boasts thousands of clients ranging from the independently owned, single-person operation to international corporations where reliable EDI is crucial to the operation of their business.

Automotive Parts Inc.

About Advance Ware Solutions Inc.

 

We could try to impress you with executive biographies, mission statements and all that other Fortune 500 style bafflegab. But, if you're like us you've seen it all before and quite frankly find it just plain boring. So, we'll tell you the important stuff - the stuff you want to know and should know before you buy into any software system.

 

Business Model: Develop easy to use affordable software for inventory and order management                 incorporating features of tier one warehouse management applications.Objective: Automate supply chain transactions, improve workflow and maximize user profitsFuture: Add accounting modules to create ERP that delivers market leading ROI

Years In Business: 8Locations: New York &  TorontoDevelopment Team: full time - not contract or sub contractTotal Users: 3000 +Support: direct - Mon - Fri                  9 AM to 5 PM EST Release Schedule: new version every 12 - 16 months                                    incremental updates - monthly Target Market: small to medium sized distributors, wholesalers, resellers, web retailers, light manufacturers & assemblers

Technology PartnersIntuit:  Premier Members of Intuit Developer Network (rated '5 Stars' by QuickBooks Solutions Marketplace)Microsoft: .Net 'Gold Certified' application - read Microsoft's' AdvancePro case study hereAdvancePro uses Microsoft's SQL database  Crystal Reports: AdvancePro incorporates Crystal Reports for Visual Studio .NET Thawte: SuperCert from Thawte allows use of 128-bit browser independent encryption Authorizenet & VeriSign:AdvancePro incorporates both of these automated payment processing, e-commerce merchant service providers services 

Automotive Parts Inc.

Technical Specifications

MachinesThe minimum technical specification requested in the RFP and reconfirmed by the machine shop foremen are listed below for the purchase of new automation equipment.Table 1-TSQuantity

Production Machines

2 Electronic Wire Gauge Checkers5 Automated Wire Formers2 Robotic Welders

With the monetary resources needed to purchase the proper equipment to elevate the quality and productivity while reducing cost of manufacturing. The project manager collected data on the machines API’s competitors were using in addition to researching the Internet and trade magazines to develop a more comprehensive understanding of the feature on the equipment needed to achieve the company’s objectives. A list of the features is listed below.Table 2-TS. On-screen diagnostics shows alarm status and corrective action required O.D. control is a standard featureOn-screen display, monitoring individual servo motor loads with color-coded percentage factor and overload warning.

Continuous rotation mode insures high speed production capability

Memory: CPU program capacity of 99, floppy disc 99 14.9MB CD capacity

Continuous mode and discontinues mode programming are selectable

Conversational format simplifies programmingMicro Pulse Hand Wheel is used to run every motor either in manual Mode or Auto Mode for every set-up and programming

Cam angle and wire length displayed on monitor Heat Exchanger on the electronics chamber keeps controls clean

Safety Interlock Sensors are fitted to all sides Easy to read 12.1 color TFT-LCD saves spaceForward and reverse capability for all axes Wire DiameterBad spring program capability MAX. O.D.Computer storage of cam position available for future set-up MAX. Feeding SpeedRoller Bearing Slides below 2.0mm, gib slides above 2.0mm Footprint

Number Of AXES 2D and 3D wire formingTensile Strength < 300,000 psi 480 VACService Contract WarrantyRun Time Between Maintenance Time Needed to Change Tool CarrouselsAccessories Network InterfaceEach of the items listed in table 2-TS will be the criteria used to determine the model and vendor of the machines needed for the success and feasibility of the automation project.

Automotive Parts Inc.

Quality Assurance

In addition to the new equipment that the RFP highlighted there was an overabundance of attention being spent on wire gauge checking. This process of checking wire is

responsible for overtime and delays in production. However, the elimination of the process is also not reasonable. Therefore API will implement a new policy and

procedure by which it will reduce wire gauge checking to a random inspection. API will align itself with a quality assurance agency via a service contract. By placing a third party in-between the suppler and API the agency will become legally responsible for

insuring that all the resources coming from the suppler are to specification. By transferring the risk to the agency, API will be able to liquidate damages such as time and

material that could not be claimed before. The specification for selecting a quality assurance agency are listed below in table 3-TS

Table 3-TSProcess Inspection

Find the root cause of the production defects detected during final inspectionVerify the execution of Corrective Action Report (CAR) by the suppliers inspection teamInspect poor quality linkages at different production stationsProduct and component quality inspection before assemblyIdentify suppliers weaknesses in the production system that leas to defects

Laboratory TestingUse Customer on-site supplier test equipment for product testing evaluationUse Supplier's Factory laboratory and equipment for sample testing Use an external approved Test Laboratories for calibrated testing

Final InspectionA 100% Factory InspectionA Random InspectionLine InspectionOut of Box Inspection

InspectorsAccumulated work experience in previous production, quality, and technical work. Specialized in products in either electronics or automotive engineered products Reasonably good written and verbal English skillsKnow how to generate effective supplier/customer feedback

ASP Service Provider

The application software for this part of the automation project is typical of most other software a company might purchase to leverage their capabilities against other business in the market. In conducting the research for API, it has been determined that a multitude of stable well backed and trusted software companies run applications for small and

Automotive Parts Inc.

medium size business as a service. By outsourcing the application API does not have to hire a software specialist or keep current with new versions of the software. Below is a table that list the criteria needed to select a Application software company.

Table 4-TS Increase your EDI order processing efficiency

Automate the document flow between you and your customers Minimize problem resolution timeImprove communication with PO Acknowledgements and Advance Shipping Notices Translates incoming EDI and XML transactions into easy-to-read documents on your desktopProvides ability to turn around Purchase Orders into ASN's and InvoicesSends electronic documents on your desktop back to customers as EDI or XML transactions

Improve your "Order Cash" cycleSpeed customer matching of Invoices with Purchase Orders for faster paymentCorrect invoices before they age by receiving immediate notification from customers of invoices with problems Receive electronic, ACH deposits for faster payment of your invoices Collaborate with demand forecast information to reduce days of inventory coverage

Make your company less expensive to buy from Reduce your customers' Accounts Payable problem resolution timeStandardize your customers’ buying process with you Keep buyers and expeditors informed with Acknowledgements and Advance Shipping Notices Improve your customers' ability to utilize "faster pay" programs such as rebates

Make your company easier to do business withIncrease proactive customer sales and service activities without additional overhead Share more information with your customers – easily and electronically

TrainingInitial Training ClassNew Hire Training ClassCurrent Industry Seminar

Application Software (Inventory Control)TS-5Manage Product Pricing:Manage Product DetailsManage Warehousing Functions: Open Architecture Tech SupportIntegrateBar code CapableIRR Capable

Automotive Parts Inc.

Automotive Parts Inc.

HUMAN RESOURCES

Severance Package- API values the hard work and dedication of its employees and is willing to make every effort to keep it’s assets employed with the company. However, during this change API will no longer need the abilities of a number of current employees. API feels that no employee that has devoted their energy to build the company should be laid off without the opportunity to locate and start a new job. This is the reason API has seen fit to allocate a portion of the budget for severance package for each employee being let go. And with good intentions that the employees who remain behind will see the gesture of goodwill to those being let go.A full breakdown of the severance package budget is in the cost and time section of this document sheet 5 Along with the severance package the state of NY will offer unemployment benefits for up to six additional months. In that API would like to make this transition as smooth as possible it has been determined that full access to employee medical benefits will also be available for six month or until new employment start which ever occurs first.

Automotive Parts Inc.

Organization Structure

President - (Owen French)Reports to the board of directors, stockholder, and Investors.The CEO/President is the singular organizational position that is primarily responsible to carry out the strategic plans and policies as established by the board of directors.

Vice President- (Dick Ives)Reports to the PresidentProvides strategic vision and leadership to the production, warehousing and distribution areas Responsibilities include: Employee safety, product quality, budgeting, expenses, inventory and labor, cost reductions through optimizing overhead, improving efficiencies and yield optimization, employee retention, customer satisfaction. Oversees all manufacturing activities within the organization. Sets policies, procedures, and manufacturing standards.

Director of Operations- (Joe Gallagher)Reports to the President

Manage, direct, and implement operations strategies and objectives to ensure the achievement of division's goals. Focuses for short-term goals are on-time delivery, cost of sales, quality and gross margin, and human resources. Focuses for long-term goals are the formulation, planning, and implementation of strategies.

Project Manager-(Mark Forster)Reports to the Vice President and President of API and insures that the project is aligned with the goals and objectives of the company. The responsibilities of the Project Manager may expand and narrow as the project evolves, the list of items that follow are indicative of the position.

Creates and executes project work plans and revises as appropriate to meet changing needs and requirements.

Identifies resources needed and assigns individual responsibilities. Manages day-to-day operational aspects of a project and scope. Reviews deliverables prepared by team before passing to client. Effectively applies our methodology and enforces project standards. Prepares for engagement reviews and quality assurance procedures. Minimizes our exposure and risk on project. Ensures project documents are complete, current, and stored appropriately.

Chief Financial Officer- (Kenneth Lay)Reports to Stockholders and the PresidentDirects financial activities of organization. Prepares or directs the preparation of financial statements, forecasts, and budgets. May manage accounting department and advise management of desired operational adjustments based on changes in tax code.

Automotive Parts Inc.

Director of Sales-(David Copenhaver)Reports to the Vice President, and works with senior sales and marketing executives, the Director of Sales and Marketing will create specific strategies and objectives to grow top-line sales for assigned operations in the Group. The Director leads the National Account Managers, a team of sales representatives, and sales administrators to implement the strategic vision and successfully meet sales goals.

Senior Procurement Officer-(Joe Hamamoto)Reports to the Vice President of Finance and Administration/Chief Financial Officer. In collaboration with the procurement team, is directly responsible for establishing, contributing to and continually improving an efficient and cost-effective process designed to assist Institution staff in their procurement of goods and services through an on-line integrated procurement process of Accounts Payable, Purchasing and Receiving, in compliance with Institution policies and government regulations.

Human Resources Manager- (Lisa Pruitt)Explains company and governmental policies. Gathers information concerning employee attitudes, morale, and efficiency. Meets with management to discuss actions to improve workplace atmosphere.

Machine Shop Foreman- (Jeff Gordon)Responsible for effective planning, coordinating and directing all of establishments manufacturing activities. Determines applicable policies relating to production function. Responsible for engineering, cost and quality control, and for the safety and welfare of workers.

Information Technologies Manager-(William Gates)The information technology manager is the person in the district who oversees all aspects of managing and processing information. IT managers are usually the go-to person for technology-related issues and the decisions that drive technology programs.

Legal Affairs Officer-(Johnny Cochran Esq.)Will provide legal advice, conduct law suite on behalf of API, witness and notarize all binding contracts.

In the Responsibility Matrix, (Table RAM) there is a clear definition of what each team member’s role is in the project. The Responsibility Matrix is used to illustrate the connection between work that needs to be done and the project team members.

The infrastructure of API is currently resilient enough as to be able to accommodate the projects additional workload. By outsourcing significant parts of the project and reducing the current workloads on the existing staff, managers will be better able to divide their resources to assist on the project.

Automotive Parts Inc.

COST AND TIME

In this section of the proposal there are the journal netries for the project and the project schedule.

CONCLUSION

Automotive Parts Inc.

APPENDIX

Automotive Parts Inc.

SOURCE AND REFERENCE

Electric Company

1. U.S. Power 8555 Main Street, Buffalo, NY 14221 Ph. 1-716-631-1517 Fax 716-631-1519 Contact person Linda Beck: Website-http://www.energypartnersusa.com/faq.html

New York State Tax Rate

2. New York State Controller’s April 11, 2006 Combined State and local sales tax rates in New York range from 7 to 9.5 percent — among the highest sales taxes rates in the nation, according to a research report on local government sales tax issued today by New York State Comptroller Alan. G. Hevesi. Office Press Office: (518) 474-4015 http://www.osc.state.ny.us/press/releases/apr06/041106.htm

Machine Companies

3. WAFIOS Machinery Corporation 27 Northeast Industrial Rd. Branford CT 06405 Phone: 203-481-5555 Fax:   203-481-9854 Email: sales@wafios.com Website: http://www.wafios.com/index.html

4. Forming Systems, Inc. P.O. Box 694 Schoolcraft, MI 49087 U.S.A. Phone: 269.679.3557 Fax: 269.679.3567 E-mail: info@formingsystemsinc.com Website: http://www.formingsystemsinc.com/default.htm

5. ThomasNet - welcome to the premier industrial Wire Forms: Automotive resource. A wide variety of manufacturers, distributors and service companies are featured in our extensive vertical directory to allow ease sourcing and research for Wire Forms: Automotive. Website: http://www.thomasnet.com/products/wire-forms-automotive-96142831-1.html

Quality Assurance Agency

6. AMREP Philadelphia, USA Nick Linter: +1 215 680 3072AMREP NORTH AMERICA (ANA) has a core quality and engineering team with over 500 specialist associates located in different parts of the USA to support customer requirements on Supplier Inspection, Supplier Management, and Quality Inspection. Website: http://www.amrepinspect.com/north_america.htm

7. Intertek Technical Inspection 3741 Red Bluff Rd. Pasadena, TX. 77503 Ph: 1-713-475-2082 Fax:1-713-472-5932 Website: http://www.intertek-ti.com/services/vendorinspection/?lang=en Email: info.houston.fts@intertek.com

Automotive Parts Inc.

Association of Shareware Professionals Service Providers (ASP)(OUT SOURCED)

8. 1 EDI Source, Inc. was established to provide affordable EDI solutions and expert EDI advice to companies of all sizes.1 EDI SOURCE Inc. 145 S. River St. Kent, OH 44240 USA Ph.1.877.334.1334Fax 1.330.676.9098 Email sales@1edisource.com Website: http://www.1edisource.com/?gclid=CMuojtbKyYgCFRVeYQod5m5XDA

8.A Riskhttp://www.findarticles.com/p/articles/mi_m4153/is_n1_v53/ai_18202727

9. Covalent Works 14515 Briarhills Parkway Suite212 Houston, Texas77077Website: http://www.covalentworks.com/about-edi.asp

Application Software Inventory Control

10. Microsoft.Inc. www.microsoft.com11. Advanceware http://www.advanceware.net/default.asp

Industrial Resources for Intellectual Input

Robert P. Forster Director of International Operation for P.R. Mallory Indpls, IN. Ph. 949-212-4690

Robert Neville VP of NKD Neville Keller & DiGregory www.nkdinc.com ph.317-558-1550

Kosei Ito Fuji Fine Wire- Owner, Okazaki City, Japan

Rod DeFord- Sales Manager Elektrisola  126 High St.Boscawen N.H. 03303 USA Tel: +1-603-796-2114 Fax: +1-603-796-2119Email: sales@elektrisola-usa.com    Website: http://www.elektrisola.com

Accounting Policy20. www.ucop.edu ……………… p-415-2.pdf