Over the past decade we have seen many IT acronyms and models for manufacturing businesses, such as S88, SCOR and CIM. The most recent of these is the evolution of the S95 standard, which is receiving increasing attention from the software giants.
The sceptics would point out that the IT hype cycle is by now an established science and that it accurately describes the progression of technology innovation up the peak of inflated expectations, down into the trough of disillusionment. So is S95 just another hyped up iteration in the ever-changing language of IT, and just how seriously should CIOs and IT managers in manufacturing companies regard this evolving standard?
Fortunately, despite the turbulent IT environment, most manufacturing businesses are built on stable and predictable fundamentals. In order to be successful, manufacturing companies need flexible and responsive systems that allow them to analyse and support operational decisions throughout the supply chain. Moreover, it is argued that to stay competitive, these companies need to be able to respond correctly to both push and pull supply chain demand. Well-designed systems therefore need to provide decision-makers with near real-time visibility into production capability. This has been possible in the past without S95, so what is the driver for a new standard?
Pragmatic IT managers will realise that vendors and consultants are looking hard for the "next big thing" that will differentiate themselves and their products. This is a natural consequence of the power of marketing; but much of the resultant hype needs to be treated with liberal pinches of salt. For example, one vendor`s "best practice" approach could be interpreted by another vendor as evidence of a rigid, inflexible approach. While vendors must understandably create demand for new versions of their software, manufacturing companies need to keep their eyes on what is really important in a manufacturing supply chain.
What is the real benefit?
S95 is unlikely to be the silver bullet that on its own solves the complex supply chain challenges of the future.
Gavin Halse, MD, ApplyIT
As we know, most manufacturing plants are physical in nature and fairly difficult to change, unlike their virtual representation in the IT world. Plants are usually complex configurations of continuous, batch and discrete processes. While it may be technically feasible to rapidly reconfigure the new over-hyped "SOA-enabled, object-oriented, XML-compatible business object" to take into account a new production line, the question remains: how often do businesses build new production lines?
After realising that the engineering design, procurement, construction and commissioning activities can take months, if not years, it may be seen as somewhat irrelevant that the reconfiguration of the PLC or SCADA system can take minutes instead of a couple of days. So what is the real benefit of these flexible architectures and evolving standards?
The answer is to understand where the business dynamics are at work in your manufacturing business; and ensure your scarce IT resources are applied to those areas where constant change is characteristic of the process, and where you have an element of control in the process. Poor operational decisions in these areas usually rapidly lead to loss of revenue or profit. Recognising that production plants themselves are relatively static, it may therefore not make sense to rip out established process control systems yet just to obtain S95 compliance (even if that were possible). However, elements of a supply chain may need to be responsive; so, for example, sales order processing, inventory management, production planning and scheduling solutions could benefit from well-designed IT systems, and it would be prudent to examine S95 carefully for the benefits that can be achieved in these areas.
Software is evolving to higher and higher levels of abstraction, and it is possible to see how maturing service-based architectures and standards such as S95 will play an important role in business systems of the future. While the language of IT will constantly seem to introduce new ideas, many of these ideas are actually based on fundamental concepts that have been around for decades.
When completed by the standards body, S95 will most likely be a valuable framework for communications between the supply chain and the plant; and importantly it will allow vendors to design their products to be compatible with each other and with external software systems. This will certainly make things easier in future, but S95 is unlikely to be the silver bullet that on its own solves the complex supply chain challenges of the future.
Still, it is another important piece in the complex puzzle that makes the job of manufacturing CIO or IT manager so interesting!
* Gavin Halse is MD of ApplyIT
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