The Business Case for MES

Aug. 2, 2008
In automation projects, it is common practice to define the expected advantages of the system. 
Sometimes, even a return on investment is calculated. For an ROI, you need to be able to estimate the costs and benefits in detail. This is especially difficult in manufacturing execution system (MES) projects that focus on the implementation of reporting and analysis functionality. Beforehand, you only know that the system is going to give you more insight, but you don’t know which insights. Therefore, it is hard to predict the amount of dollars savings.Companies that already use MES often cannot prove that the MES has led to specific improvements. They can list many advantages, but they are not sure that these were really brought about by implementing the MES. So, in short, up until now, we can only estimate the business case for MES on a very high level. Let’s take a look at some examples.Most MES projects focus on one or more of the following functional groups: production order planning and dispatching, recipe management, and reporting and analysis. In the first group. orders are received from the enterprise resource planning (ERP) system. They are planned in detail and then dispatched to the production lines. By computerizing this process, the organization becomes leaner. Unnecessary waiting times are avoided, as well as errors in transcribing data. If the company also implements an advanced planning and scheduling (APS) package, this can improve the efficiency. For a planner who has to do his work manually, or with Microsoft Excel, it is hardly possible to spend time comparing different potential plans. APS, however, can produce simulations by quickly calculating all options. Then the most efficient plan of combining orders, changeover times and cleaning can be chosen. This is very valuable for companies where the detailed plan must be adjusted very often, due to breakdowns or high priority orders.If the organization implements a recipe management module, then master data (such as material information used by ERP as well as by production) can be synchronized automatically. Especially at companies where recipes change often, this leads to advantages. The software can also automatically send product-related parameters to the process control layer. In that case, the operators no longer need to enter this information manually. They can instead focus on process monitoring and analysis, hopefully leading to improvements in quality, waste reduction and higher efficiency. In pharmaceutical companies where one operator enters the machine settings and a second operator has to validate this, automation of this process may even lead to full-time equivalent (FTE) staff reductions. Also, remote control becomes possible, meaning that operators are less exposed to dangerous situations, while the product is less in contact with contaminating substances.When an MES project focuses on data collection, reporting and analysis, companies gain insights into process improvement possibilities. Again, operators save time by avoiding data transcription. Contextual information is added to the data so that supervisors and plant managers have more real-time information. This may lead to improvements including more efficient use of assets, reduction of waste and shorter throughput times. Moreover, through this functionality, an automated interface with the ERP system can be made, sending back information about the actuals. This results in information in the ERP system that is more up to date and accurate. It reduces the risk of production stops due to lack of materials. The company may even be able to lower the safety stock levels.These are just a few examples of MES advantages. If your company has more detailed proof of savings in dollars and FTE’s then please share this information. The market needs it.Bianca Scholten, [email protected], is a Principal at IT integration firm Ordina Technical Automation, in The Netherlands, and a member of the ISA95 committee. The White Paper “IT or Engineering…Which of them should support MES?” is available at

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