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Bill Kelly
"Inventory reductions and improved vendor managed inventory has increased customer acceptance and appreciation at U. S. Steel."
  -Bill Kelly, U. S. Steel General Manager of Business Process Reengineering

United States Steel Corporation
U.S. Steel strives for continuous improvement in all processes, costs, and most important customer service. In an effort to improve customer satisfaction, U.S. Steel reengineered their order fulfillment process in which i2's Factory Planner and UEC IT's Toolkit for Metals were integrated to optimize planning and scheduling.

The way U.S. Steel conducted business changed in 1995 as the company shifted from a transactional order process to one more focused on contract orders. The new process placed greater emphasis on supply chains and developed finite capacity plans to better direct the new vendor managed inventory requirements brought on by the increasing contract orders. U.S. Steel also replaced the old infrastructure with a more modern one designed to easily integrate U.S. Steel's "back-office systems" to future eCommerce intiatives.

Business Dilemma
Prior to the order process change in 1995, U.S. Steel knew it would need to build inventory levels to meet just-in-time promised delivery dates. However, they also realized that by mechanizing the supply chain planning process, inventories could be reduced and manual work could be significantly decreased, making the new processes less costly and easier to manage.

"Without a mechanized supply chain, we would have to buffer our variability with inventory to keep customers happy. The new system would afford us an advantage by making our system more efficient, while our customers would receive the superior customer service they expect from us," said Bill Kelly, former U.S. Steel General Manager of Business Process Reengineering.

U.S. Steel's main challenge was to implement a system that would reduce inventory costs and cycle times, and allow it to manage inventory more efficiently to ensure the success of the growing contract business.

Strategies for Success
U.S. Steel chose to partner with i2 Technologies because of its good supply chain planning toolset and vision for the future.

As the project progessed, U.S. Steel realized an expert systems integrator with a keen understanding of the Metals Industry would be essential to the implementation. For this reason, U.S. Steel chose UEC IT to assist in the project.

"We decided that UEC IT, with its fundamental knowledge of the Metals Industry and implementation expertise, would ensure an efficient and cost-effective implementation. More so than even a big six consulting firm," said Bill Kelly.

Tools for Success
U.S. Steel recognized the additional functionality and enhancements UEC IT would add to i2's Factory Planner were invaluable. UEC IT used the expertise developed at U.S. Steel, along with i2's solutions to create Metals Tookit for i2's Master Planner and Factory Planner products. The Toolkits would enable metal producers worldwide to optimize their return on investment from i2's solutions.

Implementation Issues
Although U.S. Steel recognized the value of i2's products, the company knew that UEC IT's development and integration expertise would be key to the project success.

UEC IT's Factory Planner and Master Planner Toolkits for Metals represent one piece in the project's success. Another key element was UEC IT's ability to link i2's tools with U.S. Steel's legacy systems and its new order fulfillment system. This enabled U.S. Steel to automate the process of handing data to and from the Factory Planner. Full optimization would not have been possible otherwise.

Success:
U.S. Steel is now realizing the return on investment they anticipated from the project. "Out inventories have decreased enough at one plant to pay for the entire project," says Kelly. "U.S. Steel has seen continuous improvements in inventory reduction in both in-process and finished goods."

U.S. Steel is also using their supply chain solutions as a foundation for their eCommerce initiatives." We've connected the total solution to U.S. Steel's Extranet environment to give our customers complete visibility of our supply chain on the internet," says Kelly.