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Process Industries Snapping Up Collaborative Production Management Software

Shifting focus from corporate business systems to manufacturing systems is helping drive fast market growth for CMP solutions, study says.

The market for Collaborative Production Management solutions for process manufacturing (CPM-P) is expected to grow at a compound annual growth rate of about 14 percent over the next five years, according to a recent study by ARC Advisory Group Inc., Dedham, Mass. The market was slightly greater than $1.9 billion in 2007 and is forecasted to exceed $3.6 billion in 2012, the study said.

CPM solutions are integrated software applications that provide process manufacturers with the means to plan and schedule, track and analyze, and direct and operate their procedures. Demand for CPM-P has been strong and accelerating over the past several years, and saw a big jump in 2007.

“The market grew by an unprecedented amount last year. Many factors contributed to the stellar growth, including continued economic success, the shifting of funds for corporate business systems to plant systems, greater integration and interoperability of systems, and the need for companies to improve real-time plant performance visibility,” said ARC Senior Analyst Tom Fiske, Ph.D., the principal author of the study, “Collaborative Production Management Systems for the Process Industries Worldwide Outlook.”

Focus shift

The emphasis of information technology (IT) investment is shifting from enterprise resource planning (ERP) systems to manufacturing systems. Historically, each plant would run autonomously and purchased production applications as part of a tactical point solution. However, with the proliferation of standard IT technology into operations and the increased importance and focus on manufacturing things are changing.

Many organizations are forming teams to facilitate collaboration between corporate IT and manufacturing automation groups. Even the chief information officer and other executives are getting more involved in the manufacturing IT decision-making process. Organizations are looking at the enterprise as a whole and making strategic purchasing decisions to roll out common applications across all of its facilities.

Part of the goal is to find common ways to solve widespread business challenges. Another part of the goal is to lower the total cost of ownership by decreasing deployment efforts and reducing the number of applications that need to be supported and maintained, ARC said. The necessity to find ways to make systems more similar and more standardized within the framework of their IT infrastructure is contributing to the high growth of CPM applications.

Compliance needs

Manufacturers are also turning to CPM to help meet compliance needs, ARC said. Companies in a variety of industries face a wide array of challenges, not the least of which is complying with the continually evolving and increasingly more stringent state, federal, and international environmental standards and regulations. The traditional approach of relegating the responsibility for compliance to a specific organization, group, or person for a specific regulation has proved to be insufficient and ineffective.

The industry is looking at all business and regulatory requirements together in order to develop a more comprehensive, cross-departmental, and enterprise-wide approach to building a common automation infrastructure, common business processes, and a company culture that will be robust, cost-effective, and sustainable enough to meet the growing demands of a global manufacturing and regulatory environment. In order to satisfy increasingly stricter regulations, companies are turning to their collaborative production management systems as a way to facilitate compliance while meeting business needs, ARC said.

ARC Advisory Group Inc.

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