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SYNAPSIS O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION ra 2000 OSI Software Users’ SYNAPSIS O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION ra 2000 OSI Software Users’ Conference San Francisco, California April, 3 rd – 5 th POLIMERI EUROPA AN ENICHEM | UNION CARBIDE VENTURE 2000 OSI Software Users’ Conference

SYNAPSIS O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION ra Taking SAP to the SYNAPSIS O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION ra Taking SAP to the Factory Floor One Year of Success Ing. Carlo Volpones, POLIMERI EUROPA Dott. Massimo Galli, SYNAPSIS 2000 OSI Software Users’ Conference

POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SYNAPSIS Agenda • • O ra Company POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SYNAPSIS Agenda • • O ra Company and Program Opera Overview Taking SAP to the Factory Floor One Year of Success First Release Follow-ups Solutions End-Users Participation Standardization Conclusion 2000 OSI Software Users’ Conference

SYNAPSIS O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION ra Company and Program Opera SYNAPSIS O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION ra Company and Program Opera Overview 2000 OSI Software Users’ Conference Thursday, 09 March 2000

SYNAPSIS O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Polimeri Europa s. r. l. SYNAPSIS O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Polimeri Europa s. r. l. ra • Formed in April, 1995, Polimeri Europa is a 50: 50 Enichem/Union Carbide venture for the development, production, marketing, and sale of polyethylene and olefins in the European market. Year 1999 • Sales Revenue 1. 6 Billion USD • Total Capacity 1, 600 700 Polyethylene kty Ethylene kty • Employees 1, 571 2000 OSI Software Users’ Conference

O ra Polimeri Europa Principal Manufacturing Facilities POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION O ra Polimeri Europa Principal Manufacturing Facilities POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SYNAPSIS Oberhausen Dunkerque ® ® l Eschborn Milan l ® Ferrara Brindisi ® ® Priolo ®® Gela Ragusa 2000 OSI Software Users’ Conference

SYNAPSIS O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION O ra ra 2000 OSI SYNAPSIS O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION O ra ra 2000 OSI Software Users’ Conference

SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Program Opera Objectives O ra • SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Program Opera Objectives O ra • Create Business Value by: • improve customer service • improve efficiency and effectiveness of company operations • improve flexibility and response time to satisfy emerging business needs • Using a Program Approach that incorporates: • business process redesign • implementation of a core information system (SAP) and integrated scientific systems (RTDB) • training and personnel development 2000 OSI Software Users’ Conference

O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SYNAPSIS Program Scope q Process ra O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SYNAPSIS Program Scope q Process ra q Geography Application Solution q Germany SAP R/3 Standard 3. 1 Executive Fulfill Demand Balance Supply & Demand Service Customer Business Infrastructure Create Demand FI QM PS TR WM SD IM PP-PI EIS CO/CCA PM HR AA SD SHP MM LC France Italy Scientific Systems and Niche Applications RTDB LIMS SCM Transportation 2000 OSI Software Users’ Conference

POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SYNAPSIS O ra Taking SAP to the POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SYNAPSIS O ra Taking SAP to the Factory Floor 2000 OSI Software Users’ Conference Thursday, 09 March 2000

O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SYNAPSIS Management Challenge ra Assessment of O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SYNAPSIS Management Challenge ra Assessment of Current Situation (Starting Point Fall 1996) • Work Processes – Complex, Not Well Integrated Across Functions Or Locations. – Real Time Information Not Available For Rapid Decision Making. – Require High Levels Of Personal Experience. – Require Significant Duplication Of Effort And Reentry Of Data. 2000 OSI Software Users’ Conference

POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SYNAPSIS Technology Challenge O ra Assessment of POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SYNAPSIS Technology Challenge O ra Assessment of Current Situation (Starting Point Fall 1996) • Systems – Slow Response Time and Some Information Not Accurate or Up to Date. – Little Integration of Applications Between Plant Sites and French and German Affiliates. – Very Difficult to Modify Applications to Meet Emerging New Needs. – Limited Access and Experience with Process Control and Data Collection Applications. 2000 OSI Software Users’ Conference

SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Company Key Decisions O ra • SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Company Key Decisions O ra • Implement common work processes throughout Polimeri Europa. • Utilize integrated business software (SAP) installed without modifications (standard). • Use of a Managing General Contractor (Ernst & Young) to deliver project results. • Implement the project as rapidly as possible to minimize business risk. • Use standard scientific applications at all sites with certified SAP interfaces. 2000 OSI Software Users’ Conference

O Overall Considerations for the Implementation SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION O Overall Considerations for the Implementation SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION ra • No duplication of SAP - scientific system data input activities in the Control Room during normal shift operations. • Warehouse inventory data must be available real time and updated automatically. • Production Planning is compiled at headquarters with detail execution at the plants. • Plant operators have one and only one interface for data input. • Standard solution through the different DCS vendors. 2000 OSI Software Users’ Conference Thursday, 09 March 2000

SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SAP Configuration Design Parameters O ra SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SAP Configuration Design Parameters O ra • In SAP plants are modeled as batch units. • For costing purposes, batches of finished product are aggregated into production campaigns. • A plant production campaign is represented in SAP as a Production Order. • Plants are represented in a simplified form in SAP as macro operations. • A plant production cycle is divided in logical SAP Phases. 2000 OSI Software Users’ Conference Thursday, 09 March 2000

SYNAPSIS O ra Framework Used in Developing the Integrated POLIMERICARBIDE VENTURE EUROPA AN ENICHEM SYNAPSIS O ra Framework Used in Developing the Integrated POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Manufacturing Solution Model • Production managed as campaigns: materials consumed and resources utilized for each finished product. • Economic analysis (cost summaries, and efficiency analysis versus plan) by single campaign and by unit line (on a monthly basis). • Verification of material and resource availability relative to production orders. • Advancement of production interfaced with RTDB. • Available to Promise (ATP) updated in real time. • Raw material to finished product lot testing traceability. • Finished product lot to lot test traceability. 2000 OSI Software Users’ Conference

POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SYNAPSIS Production Advancement Tracking Using the PI POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SYNAPSIS Production Advancement Tracking Using the PI - SAP Integrated Application Solution Information from RTDB : RTDB Phase Closure SAP PP-PI O ra • Finished lot Product to test • Quantity of Finished product transferred to Silos • Quantity of Raw materials by lot consumed • Quantity of Raw materials non lot consumed Finished Product lot to test transfers Consumption (actual and std. ) raw material (by lot and non) WM SAP FI SAP MM Production Campaign Cost Reports QM Production Campaign Lot Traceability Reports 2000 OSI Software Users’ Conference

SYNAPSIS O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION ra One Year of Success SYNAPSIS O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION ra One Year of Success 2000 OSI Software Users’ Conference Thursday, 09 March 2000

SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Project Deliveries O ra 2000 OSI SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Project Deliveries O ra 2000 OSI Software Users’ Conference Thursday, 09 March 2000

SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Delivery Complexity O ra (Resource Networks SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Delivery Complexity O ra (Resource Networks Implemented) 2000 OSI Software Users’ Conference Thursday, 09 March 2000

SYNAPSIS O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION ra First Release Follow-ups 2000 SYNAPSIS O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION ra First Release Follow-ups 2000 OSI Software Users’ Conference Thursday, 09 March 2000

POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SYNAPSIS • One month of user comments POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SYNAPSIS • One month of user comments O ra • Program director’s statement: NEVER TO BE LATE • Risk factors: – Detailed Plant Model not necessary to SAP – Hardware Architecture (same server for more plants) – Difficult Correlation between Plant Information and SAP Configuration 2000 OSI Software Users’ Conference Thursday, 09 March 2000

SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION O ra Solutions 2000 OSI Software SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION O ra Solutions 2000 OSI Software Users’ Conference Thursday, 09 March 2000

POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SYNAPSIS Significant End-users Participation O ra – POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SYNAPSIS Significant End-users Participation O ra – plant model – business needs definition – information gathering Standardization – plant model – information gathering – architecture HW/SW 2000 OSI Software Users’ Conference Thursday, 09 March 2000

SYNAPSIS O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION ra End-users Participation 2000 OSI SYNAPSIS O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION ra End-users Participation 2000 OSI Software Users’ Conference Thursday, 09 March 2000

SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Plant Model O ra • Participation SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Plant Model O ra • Participation of 1 st plant end-users to the knowledge transfer to new end-users • The 1 st plant details were not applicable to the next plants: from detailed model to general model • All the next plants to be implemented were managed in a similar way 2000 OSI Software Users’ Conference Thursday, 09 March 2000

SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Business Needs Definition O ra • SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Business Needs Definition O ra • The 1 st plant requirements were common to all the next plants • Real-time material consumption • Quality assurance requires finished product / raw materials relationship • Warehouse allocation transferred to SAP • Product quality classification 2000 OSI Software Users’ Conference Thursday, 09 March 2000

SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Information gathering O ra • Specific SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Information gathering O ra • Specific training on relationship between business and process database configurations • Technologist + IT personnel: SAP recipes • Technologist + Process experts: plant process data 2000 OSI Software Users’ Conference Thursday, 09 March 2000

SYNAPSIS O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION ra Standardization 2000 OSI Software SYNAPSIS O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION ra Standardization 2000 OSI Software Users’ Conference Thursday, 09 March 2000

O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SYNAPSIS Plant model ra Identification of O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SYNAPSIS Plant model ra Identification of a general model • Applicable to all plants • Giving answer to the business needs Ø 2 -phases (real-time/transactional) plant model 2000 OSI Software Users’ Conference Thursday, 09 March 2000

O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SYNAPSIS Plant model Reaction ra Composition O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SYNAPSIS Plant model Reaction ra Composition Reaction Real-time Discretization of continuous process into orders and batches Composition Transactional Composition of reactor batches into finished product batches 2000 OSI Software Users’ Conference

SYNAPSIS SAP Process Order Information PLANT_SUITE POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Plant SYNAPSIS SAP Process Order Information PLANT_SUITE POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Plant model O ra Process Information PI Reaction Phase 2000 OSI Software Users’ Conference Thursday, 09 March 2000

SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Plant model O ra Selection of SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Plant model O ra Selection of reactor batches Declaration of quality and storage location Composition. Phase 2000 OSI Software Users’ Conference Thursday, 09 March 2000

POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SYNAPSIS Plant model Order data O ra POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SYNAPSIS Plant model Order data O ra Finished product batches Reactor batches Production history 2000 OSI Software Users’ Conference Thursday, 09 March 2000

SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Information gathering O ra • Collect SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Information gathering O ra • Collect information from different sources (business and process) according to the identified plant model • Use this information to configure the infrastructure components Ø Standard Data model: to collect and organize information for plant description Ø Configuration process: to configure PI and PS-RLINK starting from the retrieved data 2000 OSI Software Users’ Conference Thursday, 09 March 2000

SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Information gathering O ra Data sources SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Information gathering O ra Data sources Process Data: - Campaign signal - Phase signals - Measuring Instruments SAP Data: - Plant and resources/phases names - Bill of materials: code, description - List of storage locations 2000 OSI Software Users’ Conference Thursday, 09 March 2000

SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Information gathering O ra Infrastructure components SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Information gathering O ra Infrastructure components • PI 3. 2 Real time data historian • PS-RLINK PI system gateway to SAP R/3 PP-PI module • PI-Process. Book Graphical representations and PIBatch. View management of: - Process data (PI) - Process Order (SAP Recipe) 2000 OSI Software Users’ Conference Thursday, 09 March 2000

SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Information gathering O ra Configuration process SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION Information gathering O ra Configuration process PI Process data Plant - Support Tags - Batch Subsys: Units, Aliases - Totalizers - Performance Equations Description PS-RLINK SAP data - Plant structure - Materials codes and tags - Add-in: Storage location list 2000 OSI Software Users’ Conference Thursday, 09 March 2000

SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION System architecture O ra • New SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION System architecture O ra • New installations should not affect operations on the existing ones • Improve Availability • Easier Maintenance operations Ø Modularity: same configuration for each site Ø Clustering: 2 Clustered CPUs running PI and PS-RLINK logical servers 2000 OSI Software Users’ Conference Thursday, 09 March 2000

POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SYNAPSIS System architecture PI Process. Book O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION SYNAPSIS System architecture PI Process. Book O ra Interface Server Modularity PI Process. Book Plant. Suite RLINK Polimeri WAN PI Server DCS SITE 1 Milan Head Office PI Process. Book Interface Server SAP Plant. Suite RLINK SITE n PI Server DCS 2000 OSI Software Users’ Conference

SYNAPSIS O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION System architecture ra Clustering Physical SYNAPSIS O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION System architecture ra Clustering Physical View PI Process. Book Interface Server Cluster Node 1 Node 2 DCS Shared Disks Array 2000 OSI Software Users’ Conference

SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION System architecture O ra Clustering • SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION System architecture O ra Clustering • Logical servers defined as Cluster groups • Services, disks and IP addresses • “Cold” failover Cluster Node 1 Node 2 PI Logical Server PS-RLINK Logical Server 2000 OSI Software Users’ Conference

SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION O ra Conclusions 2000 OSI Software SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION O ra Conclusions 2000 OSI Software Users’ Conference Thursday, 09 March 2000

SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION O ra • • Program objectives SYNAPSIS POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION O ra • • Program objectives reached on time Solution reliability Easy on-going systems administration Consolidation of one-model to be improved in the next years • Billed costs vs. Measured costs (gap “soluzione bunker”) 2000 OSI Software Users’ Conference Thursday, 09 March 2000

SYNAPSIS O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION What they said about Opera. SYNAPSIS O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION What they said about Opera. . . - Citations ra … despite heavy investment in the latest manufacturing process technology, in 1996 Polimeri management was not able to maximize the efficiency of its manufacturing operations. Real-time information about the process and finished product was simply not available at the business management level. Significant duplication of effort and re-entry of data existed across the plant. Moreover, there was heavy dependence on a few highly experienced individuals … … in 1999, Polimeri Europa achieved full integration of its SAP planning system and its real-time plant operation systems. Achieving cultural integration, however, was the major challenge … … Polimeri's experience confirms that enterprises in the process industries can extend the operational effectiveness of their business-driven ERP systems by installing automated interfaces to the manufacturing world of process control systems and laboratory information systems … … beyond the technology implementation, real success requires absolute teamwork across the cultural divide of IT and manufacturing. . . “CIO Update: Taking SAP to the Factory Floor” - Gartner Group - July 1999 2000 OSI Software Users’ Conference

SYNAPSIS O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION O ra ra 2000 OSI SYNAPSIS O POLIMERICARBIDE VENTURE EUROPA AN ENICHEM | UNION O ra ra 2000 OSI Software Users’ Conference