On target


The military industry has not been isolated from the world for a long time, and Arsenal – Kazanlak are ahead of many Bulgarian public companies when it comes to business management systems.

The non-specialist public rarely has the opportunity to look beyond the gates of a military industry enterprise. And although Arsenal now also produces a number of products outside its historically conditioned company profile, because of tradition, an aura of mystery inevitably surrounds the company. The specificity of the production determines the restraint with which our communication with Ing. Yordan Yordanov – Director of Process Management at Arsenal AD takes place.

However, the conversation begins with a fact that we all guessed. Due to the delicate sphere of its activity, the enterprise has to meet a number of more specific requirements, in line with industrial standards and Bulgaria’s position on the world political map. The company has established a quality management system for the ‘Design and manufacture, supply and service of milling machines, column milling machines, CNC milling machines, machining centres, aggregate and special machines to customer specification and complete attachments’. This is done in accordance with ISO 9001 requirements. Arsenal also has a Quality Management System for the development and manufacture of weapons, ammunition and their components in accordance with the requirements of NATO Publication – AQAP 2110.

The limit of internal possibilities

The most natural way to ensure compliance with various quality management systems is to have a software system to manage the business and in particular the processes in production. Until 2008, the company managed the latter using a system called TANGRA. This is Arsenal’s own development, which includes modules for managing technical production preparation, ordering, limiting and reporting. The system is centralised. All documents are routed to one unit for processing.

Up to a certain point, this solution proved to be sufficient, but the limit of the possibilities was reached several years ago. ‘The significant expansion of the company’s product range and the imperative to react quickly and adequately to market demands have necessitated the need for up-to-date information in real time. The development of modern technologies for data processing and transmission provided opportunities for realization (of such a project, ed.)’, explains to ENTERPRISE Eng. Yordanov. For this reason, Arsenal’s management decided to switch to a more complex and advanced business management system. Thus, in a period extending from 2007 to the beginning of 2008, the company’s specialists became familiar with the ERP systems offered on the Bulgarian market. The company relied on presentations, conversations and on-site observations for its research. ‘The main requirement was the real applicability in the field of mechanical engineering, the possibility of adapting to own processes, the reliability of the technology and guaranteed adequate support,’ continues Eng. Yordanov.

Large-scale implementation

Eventually, after a lengthy and careful process of selecting a solution that would manage their production in the future, Arsenal settled on the Bulgarian business management system Technoclass – a platform that has proven itself among a large number of customers at home and abroad, especially in the industrial sector. The system is, of course, implemented directly by the developer company – L-Class.

“The implementation took place according to a jointly developed plan. The plan envisaged a module-by-module implementation and related tasks and an experimental start-up at one plant,” the Director of Process Management at Arsenal gives a retrospective of the implementation process. To support the implementation process, a training room with 12 computerised workstations was set up to run a demo version of the system. All employees working in the system are admitted after passing the exam to work in the tasks relevant to their job. The training and the exam are carried out by the respective methodologist – assistant of the ERP department or IT department. Large scale training is also required because of the scope of the system. Since it covers an enormous variety of activities, its daily peak often reaches 500 concurrent users.

The first real-time warehouse management tasks have been running since the autumn of 2008. Currently, the company has all the main tasks of the ERP modules online.

From needle to thread

The new management software system covers all technological processes and related business processes that are regulated in the company’s quality management system. This includes the operations related to metal casting, forging, heat treatment, welding, plastic processing of metals, cold working of metals by cutting on universal and CNC machines. It also includes chemical processes for mining and processing of explosives, production of parts from various types of plastics, assembly of machine tools and armaments, warehousing of materials and finished products. ‘All the processes quoted are managed by the Technoclass system adapted to our needs,’ confirms Yordan Yordanov. At the same time, ‘all technologies and nomenclatures from the TANGRA system were successfully transferred and borrowed into Technoclass’.

The ERP platform also becomes part of a more complex programming environment. For the provision of personnel management processes and customer handling, the system is successfully linked to the existing Siebel CRM, Omex Enterprise and OET system. Poselda is Arsenal’s own development for time and attendance, leave, absence and rostering, linked to a portal system and an electronic absence reporting system in each workshop.

‘We consider the use of Oracle for database management to be of utmost importance for the reliability of the ERP and CRM systems,’ the manager specifically stresses.

However, the work does not end there. ‘We are evolving. There is a constant need to develop new tasks or to modify them at our request in order to improve already implemented ones’, continues Eng. Yordanov.

‘Strongly positive’

We asked Yordan Yordanov if we can talk about returns, considering that the ERP system has been running long enough in the enterprise to date. According to the manager, however, it is difficult to quantify the financial effect of the system’s operation. Nevertheless, he believes that the overall effect of the implementation ‘is definitely positive’.

‘Each resource is known where it is currently, in what condition and what has been ordered for it. A lot of time is saved. The system imposes strict discipline and a high technical culture, which is of utmost importance,’ continues Yordanov. He also points out that he would recommend this solution and this implementer to companies similar to the one he works for, ‘Technoclass is definitely a good system. Even better is the team of specialists at L-Class, who provide us with reliable assistance. I think Technoclass is the right solution for any company related to material production.’ What better assessment of the performance of a business management software system than to hear a satisfied customer publicly expressing their confidence?

About the company

Arsenal JSC – Kazanlak is a large multifunctional infrastructure enterprise. The company occupies a leading position in the national economy and has rich traditions in the development, production, trade and engineering of military and civil products.

The history of Arsenal AD can be traced back to the very beginning of the Third Bulgarian State. In 1878 the first military factory was established in the country to service the newly created Bulgarian army. Initially the factory was located in the town of Ruse, and in early 1891 it was moved to Sofia. In 1924, by Decree No. 1 of Tsar Boris III, the enterprise was moved to Kazanlak under the name of the State Military Factory. Today the company is a large manufacturer of military and special products, hunting and sporting weapons and ammunition for them, carbide inserts and tools, universal milling machines, CNC machine tools, castings, stampings, etc. And over 135 years after the start, it takes more than skill to make a good product to maintain a position like this.

Publication in. ‘Green Book’ magazine