Johannesburg, 04 May 2017
Manufacturing production in South Africa shrank 3.6% year-on-year in February of 2017, which was the biggest drop since July of 2014. One way to boost productivity and output is to use IT innovation to achieve more efficient use of resources and improved profitability. Seamless data sharing can fine-tune operations for increased efficiency. This is even more essential now that the industrial Internet of things (IIOT) is revolutionising manufacturing by leveraging intelligent, connected devices and machines.
Since enterprise resource planning (ERP) systems contain information regarding customer demand, and manufacturing execution systems (MES) control how products are built, integrating the two worlds enables organisations to increase operational efficiency and to become more flexible and more responsive to dynamic and customised demands, says Kerry Hope, Business Development Manager at Magic Software South Africa.
In addition, real-time information exchange between the business layer and the production layer can increase overall equipment efficiency (OEE), reduce cycle times, and provide management with greater visibility for improved decision-making.
Here are several examples that illustrate the benefits of integrating ERP and MES systems:
1. More accurate production quantities - demand changes that are recorded in ERP systems can be fed into manufacturing schedules to ensure quantities of products manufactured are more closely aligned with demand for leaner and more efficient manufacturing.
2. Lower inventories - by integrating ERP and manufacturing data for more accurate demand forecasts, companies can reduce inventories by avoiding overproduction. Excess inventory - whether as raw materials, work in progress, or finished goods - ties up cash in the business that can be put to better use elsewhere.
3. Lower cost of supplies - integrating ERP with MES enables manufacturers to reorder from suppliers before inventory falls below a predetermined level. Avoiding rush orders not only minimises the possibility of delays, it also prevents any additional charges that are incurred by ordering materials at the last minute and by requesting expedited orders.
4. Increased agility - better system integration supports more efficient execution of change orders. New manufacturing processes that impact production times and expenses need to be shared immediately with enterprise systems so any pricing or product delivery information can be updated. Likewise, any product changes requested by customers need to be transferred to production systems as soon as possible to avoid delays in fulfilling orders.
5. Faster response to quality issues - if there is a quality issue on the floor, real-time notification to the business systems will enable the necessary corrective action as soon as possible. If defective material is detected, it can be removed from inventory and returned to the supplier. The manufacturer saves money by eliminating scrap due to defective raw material and also reduces exposure to recalls and potential liability issues.
Manufacturers' MES and ERP systems are often built by different software vendors and speak different languages. A code-free integration platform that automates the technical data transformations and provides a visual drag-and-drop interface to orchestrate the needed connectivity can greatly speed up and simplify connectivity between these systems. Integration platforms help ensure a free flow of information to achieve leaner, more efficient and effective manufacturing.
As manufacturing processes continue to become more complex with IIOT, having the ability to track all of the related product data from design to delivery is essential to optimising manufacturing efficiency. South Africa has an opportunity to draw on enterprise integration and IT innovation to become a globally competitive manufacturing hub.
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