Any debate on the role of IT in process manufacturing must take into account the importance of a manufacturing execution system (MES). Yet, in practice, when questioned, many business managers in these companies simply do not know what their MES strategy is.
The same companies may have a well charted IT roadmap which includes complex elements such as supply chain and enterprise resource planning (ERP); yet they seem to bury their heads in the sand when it comes to putting this strategy into the context of execution systems.
In manufacturing, the role of operations management is mainly concerned with short-term plant operations. Operations managers are experts at tactical problem-solving to keep the plants running as designed, come what may.
They know that if the plants are not performing efficiently, no matter how sophisticated their business IT systems are, they will quickly go out of business.
Operations managers need good computer systems that include process control, data historians, quality control, laboratory management, detailed scheduling, product tracking, SHE-Q (safety, health environment and quality), maintenance management, etc. From a CIO level, these systems need to be orchestrated to work with business systems such as ERP, customer relationship management (CRM) and supply chain management.
For a manufacturing company, systems that support engineering, day-to-day operations, SHE-Q, quality management and materials tracking can have a fundamental impact on the efficiency of the plants, and hence the profitability of a business.
Why is it then that the average CIO or IT department has limited influence in selecting and supporting MESs?
The reasons lie partly as a result of the skills available in the industry. Larger, traditional IT organisations that service a multitude of industries typically focus on the technology itself and some generic business applications such as ERP. These IT providers are characterised by good network skills, desktop support capabilities, back-office administration and disaster management systems, to name a few.
Truly innovative process manufacturing companies have seen gaps in their MES systems and have intelligently used computer technologies to overcome inefficiencies and deliver measurable business value.
Gavin Halse, MD, ApplyIT
Skills and competencies that encourage an understanding of generic IT are relatively abundant as colleges and universities offer recognised courses in IT concepts such as ERP and CRM. On the other hand, the wider IT community perceives MES as being highly specialised and belonging to the engineering domain. The result is that there are few people that truly understand the impact of MES in the broader context of a business strategy.
There is enormous opportunity for a manufacturing company to extract returns on its IT investment by integrating operational systems into business systems. The potential impact on the bottom line of doing this is arguably more significant than many of the so-called innovations paraded by ERP vendors in the past few years. Truly innovative process manufacturing companies have seen gaps in their MES systems and have intelligently used computer technologies to overcome inefficiencies and deliver measurable business value.
Challenge the CIO
How should business management respond to this opportunity? By routinely challenging the CIO or IT manager for the MES strategy, business management can ensure the overall IT needs of the business are adequately considered. Combining the process control and IT disciplines under a common line manager, or under the CIO, will also ensure the departments collaborate and innovate where it most matters.
In this regard, be wary of promises made by big, all-powerful ERP vendors to eventually cover the functionality needed at the MES and plant level: it simply won`t happen in this lifetime.
Finally, business management should recognise that notwithstanding glossy catalogues of global competencies, traditional IT providers cannot easily unlock the full potential of MES. If this competence is not available in-house, there are smaller niche companies that can work with the CIO to unlock the potential value in this area. As the IT industry innovates, traditional IT and MES technologies will converge even further.
New opportunities are being created all the time to squeeze even more business value out of manufacturing plants. One thing is certain: competitors will also see this opportunity, so the choice is yours as to what priority you make it in your own business. The manufacturing manager who understands IT convergence to mean watching videos on a cellphone has surely already missed the boat.
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