Most process manufacturers have already implemented enterprise resource planning (ERP) and other business systems, and they now realize they can gain additional value through better integration of plant and enterprise systems. Enterprise systems’ primary focus is on demand forecasting, production planning, and material sourcing and tracking. Unfortunately, however, most plants today still operate as standalone entities focused primarily on real-time process control. Business systems have little influence on the plant other than gross target shifts and reporting. This gap between enterprise and plant systems reduces asset effectiveness due to overly conservative planning from uncertainty in process capability and asset availability. This results in wasted resources, surplus inventory, and lost business opportunities.
Today, the emphasis of information technology (IT) investment is shifting from ERP systems to manufacturing production systems. Organizations are looking at the enterprise as a whole and making strategic purchasing decisions to roll out common CPM applications across all facilities. Organizations can achieve significant benefits through economies of scale, utilizing IT resources more efficiently, aligning IT with business needs better, reducing implementation costs, lowering support and maintenance costs, and improving integration to create greater information visibility across the enterprise.
When organizations begin to align processes and strategies, technology, and people across the enterprise, CPM becomes indispensable. By using standards, the same strategic focus and best practices can be used in all processes and across manufacturing facilities globally.
With integrated systems, employees can make better decisions based on more complete and real-time information. They can analyze data, identify problems, and identify and quantify results rapidly in terms of the potential business impact. In other words, using CPM, companies can integrate applications, business benefits, and strategies with actions using real-time information.
Collaborative production systems can help users achieve significant savings through better collaboration between plants, use of standards and best practices, improved knowledge management, improved workflow and process controls, and faster time to market for new or old products. CPM solutions improve information flow from the raw material to the manufacturer to the business system and to the supply chain. Best of all, the benefits are sustainable.
CPM has three main functional areas: plan, operate and inform.
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The “plan” segment consists of functions such as short-term production planning, plant simulation and modeling, and scheduling. The plan functions determine what products to make, when to make them, and what equipment to use.
The “operate” segment emanates from the need to continuously find new and better ways to control process equipment, execute production and operate plants more efficiently. This segment includes such functions as dispatching, electronic work instructions, resource management and workflow management.
The purpose of the “inform” category is to gather, store, organize and communicate data and information. It includes data collection, performance analysis, reporting, and role-based key performance indicator (KPI) visibility.
At a fundamental level, CPM helps users cut costs, improve quality and efficiency, and drive innovation to get products to market quicker. In addition, CPM helps users to collaborate and improve real-time performance management initiatives, which in turn improves asset effectiveness and profitability. The latest CPM innovations can help manufacturers improve visibility into operations, provide better links to business objectives, and permit increased agility to respond to volatile market conditions. These features help companies optimize production activities and synchronize supply chains based on real customer requirements.
Tom Fiske, [email protected], is a senior analyst and Janice Abel, [email protected], is principal consultant at ARC Advisory Group, Dedham, Mass. ARC’s report, “Collaborative Production Management for Process Industries,” covers these issues. It was released in April 2011.
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