A New Decade--IT Sets Sights on Manufacturing

Feb. 7, 2010
In what seems an inevitable response to demands for greater regulatory compliance and security, manufacturers are increasingly turning to their chief information officers (CIOs) to establish more effective reporting and governance for their plants. 
But that’s proven to be a difficult and often frustrating evolution. Meaningful collaboration between manufacturing and information technology (IT) can transform the way we create value through productivity gains, cost reductions, best practices and Continuous Improvement initiatives. Without a clear understanding of the dynamics that have rendered past attempts ineffective, we are destined to make the same mistakes. This is not a simple transformation, but one that is absolutely essential to the future of a strong manufacturing sector in North America.Manufacturers generally concur that their IT investments in the past decade, though predominantly spent on the business side of their operations, have generated some measure of security, governance and payback. As those investments move into a steady state, a picture is emerging of what their investments have achieved and where there are still significant gaps. There is an almost universal consensus that IT’s investments were essential to the business, but the plants have paid and continue to pay a heavy price for their role. They have been compelled to change workflows and processes to comply with the “golden standard” that corporate had created.Minimal plant presenceOn the other hand, despite the fact that manufacturing operations is the largest single value-added component as a function of total sales value, IT’s presence and investment in the plants has in most cases been minimal. In fact, the historical disparities between manufacturing’s modus operandi and IT’s has led many organizations to the point where both sides have reached an unwritten agreement to avoid each other’s domain wherever possible. IT’s strengths come from its long term, lifecycle view of the initiatives it drives, its development and adherence to standards, and its focus on implementation and process rigor.Manufacturing, on the other hand, focused on meeting production demands at all costs, is characterized by a tendency to “build it” and “fix it” at the lowest possible cost and with speed as the imperative, making standardization a cost-prohibitive, elusive goal, and process rigor a luxury. As demand for technology on the plant floor grows, plants have learned to avoid involving IT except where it is absolutely necessary, developing instead “shadow IT” capabilities.Despite the diversity and the distinctive worldviews of these organizations, it is clear that collaboration and convergence between manufacturing and IT is no longer an option. Whether it’s a disruption in the supply chain, a significant change in demand, a security threat in a plant, a product recall or a dramatic downturn in the economy, the lack of IT infrastructure, visibility and meaningful decision support in the plants severely impedes the organization’s ability to respond with the agility and strategic insight that, ironically, is available for most other parts of the organization. Maintaining the status quo is not an option either. The risks represented in the vast number of unsecured “shadow IT” systems on the plant floor represents a very real threat—one that has to be addressed immediately.As with any other significant shift in organizational responsibility, the risk and the opportunities need to be clearly understood. The role of MESA (for Manufacturing Enterprise Solutions Association) is to confront these types of issues head on and facilitate the dialogue necessary to help bring about this transformation. Our conference in Dearborn, Mich., the week of June 21 will be focused on these and similar opportunities. Plan to attend the conference to share and/or learn about how manufacturers from every industry are dealing with these challenges, not just to survive, but to thrive.John Dyck, [email protected], is Chairman of MESA International (www.mesa.org), an association of users and suppliers promoting use of Manufacturing Enterprise Solutions.

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