Part 1: Global manufacturing is
here. And everywhere.
The move to global manufacturing
is no longer a matter of the future.
It is now a stark reality for
enterprises. Companies are shifting
their supply chains and moving
manufacturing plants – and
moving them again – to seize
advantages in costs or to drive
faster production.
This has put an enormous
strain on engineering and
manufacturing. And it puts
pressure on business executives to
know what their shifting
operations are actually doing –
how they're performing, where
they can be improved, where
opportunities exist to reduce costs
or accelerate time to market.
Only a few years ago, business
agility meant the ability to make
rapid adjustments about product
direction or quality standards –
using a relatively stable
engineering, manufacturing and
distribution base.
Now, business agility means
moving fluidly through a global
manufacturing and market space
to ramp up new products in an
ever-shortening development
cycle. And the once-solid
manufacturing base has become a
constantly changing sea of supply
chain alternatives.
Obviously, in such an
environment, executives need
visibility into real-time production
information to make decisions, as
well as the ability to take action
quickly anywhere in the supply
chain. Yet increasingly, companies
are realising they have neither.
Why ‘visibility’ approaches
haven't worked
Some companies have approached
the challenge by gathering data
from plants, establishing data
warehouses, cleaning their data,
and compiling 'standard' KPIs that
are presented in graphical
dashboards. The result looks like
real enterprise information, but can
be disastrously misleading.
Data is often inaccurate,
unsynchronised, or out of date. Or,
in many cases, all three.
Thus, the executive may be
viewing KPIs in thrilling graphical
detail, but that data is often wrong.
Says one consultant for ERP in Lean
and Six Sigma manufacturing: "I've
been going into multibillion dollar
companies since 1994 and only
about 70 per cent of the inventory
balances I see are accurate." ("Lies
your ERP system tells you," by Alan
S Brown,Mechanical Engineering,
March 2006.)
The problem, say analysts, is a
disconnect between ERP and the
various factory floors that are
distributed across countries and
continents. ERP was designed for
financial management. It was never
intended to watch over and drive
the thousands of minute details
that make up manufacturing
operations – and that are
supposed to add up to the Key
Performance Indicators that
executives are trying to track
and manage.
What's more,many MES
systems date from a different
technology era. Companies may
have multiple homegrown systems
or customised packages. "As a
result," reports the Aberdeen
Group, "many companies have a
hodgepodge of systems and
technologies in their plants which
are costly to maintain and difficult
....CONTD
