When the COVID-19 pandemic hit, some of the challenges it posed to manufacturing and distribution were new. But, in truth, it’s more accurate to say that the pandemic exposed weaknesses that had existed years before the public health crisis exploded. I should know. I grew up in manufacturing. My family owned a manufacturing operation, so I experienced firsthand the challenges that mid-market manufacturers face.
For example, before the pandemic, companies could get by with analog machines, paper-based systems, and disconnected point solutions. The pandemic made that impossible. SYSPRO’s 2020 survey, The Inflection Point for the Factory of the Future, showed that only about one-third (38%) of manufacturers’ business systems had enabled them to meet the challenges posed by the COVID-19 pandemic. Similarly, a 2021 study from McKinsey showed that just 19% of companies that had adopted Industry 4.0 technologies were able to respond to the pandemic crisis, while 96% of those who had at least some use cases scaled across locations were able to do so.
In metal fabrication, for instance, the industry I know best, cost pressure is squeezing vendors, especially with metal prices continuing to rise. Margins are thin, so efficiency is an absolute necessity. Management has to make sure that machines are always available to maximize capacity. And scheduling must be precise and optimized — you want to use every available minute to ensure that machines are never sitting idle. Because any time a machine isn’t running, you’re losing money.
Inventory is another huge headache. You always want to have the appropriate amount of raw materials so you can deliver customers’ orders on time. But at the same time, if you’ve got excess inventory, that unnecessarily increases costs. In my experience, the manual systems used required regular inventory checks that took a lot of time and quickly became out of date. Ensuring we had enough, but not too much inventory was always a stressful guessing game.
What it all led to was inefficiencies in decision making: When you rely on manual systems, you can never have total confidence in the information you’re presented with as a decision-maker. Manufacturers need a single source of accurate information. Finance and production can’t be working off different data sets.
Automation is one of the keys to addressing all of these issues, but integration is just as important because management needs data to monitor these systems and continuously improve. Likewise, frontline managers need to have comprehensive visibility and control so they can prevent problems on the manufacturing floor such as bottlenecks, excessive scrap, overruns, downtime, and poor employee, or machine performance. To do this, information must not only be digital, but it must also be shareable between systems.
The need for a holistic view of the shop floor
At the moment, many manufacturers are automating some tasks and relying on people to manage the remaining processes, which often places a heavy demand on human resources. This automation may provide some benefits and increase efficiency, but typically these are point solutions that do not come together to provide a clear view of the entire operation.
Additionally, if the data from these automated processes are trapped in silos, they won’t be of much use. Manufacturing resources need to be deployed, coordinated and managed in such a way that they help the company do what it wants to do without wasting resources. This can only be accomplished through a holistic approach that fully automates the collection of data.
This is why a manufacturing operations management system (MOM) is such an exciting technology for the industry. This technology enables organizations to analyze and generate accurate schedules that take resources and constraints into account, including people, machines, tooling, and materials. In this way, manufacturers can ensure that they have products ready for customers on time in the most cost-effective way while also reducing production costs.
But the system doesn’t just automate and optimize scheduling. It also collects data and tracks performance to provide a 360˚ view of the production processes. Because legacy manual systems and disconnected point solutions can’t provide comprehensive visibility into the manufacturing process, manufacturers are left in the dark about the ultimate causes of issues or bottlenecks. MOM provides a single source of data, which, in turn, enables full visibility of production.
This real-time data can inform faster, more accurate decisions about capacity analysis, work-in-process (WIP), inventory, and advanced planning. Interdependencies within production become crystal clear and continuous improvement in manufacturing operations becomes far easier to implement. In turn, this high-level visibility enables management to monitor overall quality and regulatory compliance. As a result, manufacturers can reduce waste, optimize inventory, and reduce throughput time to raise efficiency, quality, and customer satisfaction.
The manufacturing industry has reached an inflection point, where digital transformation and the need to fast track to a smarter factory will be vital to remain competitive in the coming months. I invite you to learn more about the SYSPRO MOM solution which integrates effortlessly into the SYSPRO ERP platform. It’s the future of manufacturing, and it’s within your reach today.