Jan Burian (Head of IDC Manufacturing Insights EMEA)

Hard experience has shown hat, to ensure lasting benefit, process change must be anchored by digital technology.

The Importance of Underpinning Processes with Digital Technology

Let’s examine the case of a railcar wheel manufacturer that was suffering from unstable demand. This had led to a situation in which the WIP (Work in Progress) was overwhelming the shop floor. Wheels had piled up inside and outside the production building. There were almost no aisles or safety corridors. A lack of planning had led to production bottlenecks. Excess inventory was accumulating, tying up working capital.

After analysing the situation, my team designed a new planning production schedule and shop floor management process, underpinned by an add-on scheduling tool. The planners presented the scheduling tool to top management, explaining it was a key weapon to tame the WIP chaos and boost productivity.

I returned to the factory a year later to witness the tangible results. You can imagine my surprise when I saw that nothing had changed. Indeed, the situation had worsened.

There were several reasons for this. The COO had left the company, as had the head of the planning department. Work instructions still did not reflect the integration of digital technology. Planning was still being performed with Excel macros. The robust process we designed had been dismantled, tiny piece by tiny piece.

What had gone wrong? As I see it, the main mistake was that relevant digital technology was not used to underpin the new production planning, scheduling, and management. The managers and workers had the freedom to continue their old habits and procedures. The necessity of anchoring new processes with digital technology and automation had been ignored.

Since then, my team thinks constantly of how to underpin processes with digital technology and automation. We focus on the integration of seamless, end-to-end data that flows horizontally and vertically through integrated enterprise resource planning, product life-cycle management, and manufacturing execution systems.

How to Anchor Processes and Digital Technology

These were the lessons I learned:

  • Never rely on processes that are not anchored in digital tools or solutions.
  • Always strive for the secure, seamless, and touchless flow of data between OT and enterprise IT systems.
  • ERP could be considered a heart and brain of the common enterprise IT landscape; thus leverage ERP as cornerstone when building a digitally underpinned process
  • Automation and AI remove complexity from the process, streamline data, and bring standardization to the organization’s edge.
  • Digital Transformation (DX) managers and C-suite members must understand that value comes from the scalability and agility of digital technology.
  • DX should never bring more silos into the organization — no matter how digitalized these silos may be.

 

If you want to learn more about this topic or have any questions, please contact Jan Burian, or head over to https://uk.idc.com and drop your details in the form on the top right.

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