Faced with dynamic market changes and competitive threats, manufacturers are broadening their focus from execution within a single facility or factory, to orchestrating execution across the entire global manufacturing network. Given the inherent complexity of such networks, the leaders of these companies are taking a new approach to manufacturing information technology (IT), which we describe as the “Manufacturing Operations Management (MOM) Platform.”
In recent Aberdeen research, it was shown that the cornerstone of this new approach is interoperability. Best-in-Class manufacturers are more likely than both the Industry Average and Laggards to be investing in real-time interoperability between manufacturing systems and the other technologies they have adopted, including enterprise resource planning (ERP), product lifecycle management (PLM) and supply chain management (SCM).
This interoperability allows the Best-in-Class to more easily create real-time visibility and automated workflows to manage execution. It also allows Best-in-Class manufacturers to deliver the entire range of functionality needed on the shop floor, which is generally broader than the original definition of MES, or really what any one application should be able to deliver. Finally, and perhaps most importantly, real-time interoperability allows organizations to more effectively connect manufacturing to other business processes in the organization.
For example, in industries such as aerospace and defense, which is very design intensive, PLM and MOM interoperability allows organizations to improve designs from a manufacturability and quality perspective. It also allows for more efficient processing of engineering change orders, and ultimately reduces the time to volume of new products.
In industries that are distribution intensive, such as consumer packaged goods, SCM and MOM interoperability allows manufacturers to more effectively manage the delivery process. This type of interoperability allows manufacturers to more easily match manufacturing to demand, especially in production settings affected by seasonality or other demand volatilities. In this case, it can also help organizations reduce inventory throughout the supply chain by providing system-wide optimization with visibility to repercussions upstream and downstream.
The second major differentiator of Best-in-Class manufacturers’ approach to a MOM Platform is deploying across multiple facilities. As manufacturing systems are beginning to interoperate with other enterprise systems, they themselves are now being viewed as enterprise systems. Subsequently, Best-in-Class manufacturers more effectively deploy MOM across a larger share of their manufacturing footprint (approximately 70 percent more of the footprint, on average), do it quicker (approximately three months, on average), and not surprisingly, more closely deliver against the original scope of the project (approximately 10 percent more functionality, on average).
Interestingly, thought leaders having been talking about multi-site deployments and real-time interoperability between manufacturing and enterprise systems for almost a decade, but not until recently have organizations been able to create such an environment in a cost-effective way. To help achieve this cost effectiveness, Best-in-Class organizations are more likely to leverage a number of IT tools and open standards.
To summarize, a MOM Platform is more than a single software application or set of functionalities and workflows. It involves the use of IT tools and best practices, conformance to standards, interoperability across the entire manufacturing technology stack and more. Characteristics of an effective architecture for a Manufacturing Operations Management Platform include such things as broad functionality spanning all manufacturing areas that focuses on collaboration among product development and engineering, procurement and distribution. It will contain real-time interoperability and use IT tools such as business process management and standards such as ANSI/ISA95 promulgated by the American National Standards Institute and International Society of Automation. A road map should be put in place for consolidating plant-level systems to a single MOM solution extending across the manufacturing network.
Matthew Littlefield, email@example.com, is Senior Research Analyst with the Aberdeen Group Inc., in Boston.