South Africans are beginning to realise that our local producers will never outdo their competitors by using clever marketing strategies, reduced quality or cheaper inputs. The pressure is on for company stakeholders not only to maintain a competitive business but to gain a competitive edge over the competition.
Manufacturing execution systems (MES) are being implemented in manufacturing businesses, all over the world, to gain a competitive edge. Typically MES solutions are associated with improvement initiatives such as LEAN, Six Sigma, overall equipment effectiveness (OEE) and total quality management (TQM) among others. By lifting the veil and achieving greater visibility into the plant floor and individual production lines, manufacturers gain valuable information on root cause disturbances and production slowdowns, which when identified and corrected the results are massive gains in productivity and quality.
Other factors include increasing the visibility of product and work flow throughout the enterprise to optimise labour - every company's most precious and often most expensive resource. A recent AMR Research report notes that a typical MES solution paid for itself on traditional cost reduction measures within six to 24 months of going live. There are many examples where companies received a payback in less than six months and some as soon as a few weeks after installing an MES solution.
In addition to improving production performance and quality, many manufacturers are turning to MES solutions as a means to increase production to meet stakeholder and market demand without having to invest in new machinery and plants ie, getting more out of their current set-up by improving their overall equipment effectiveness (OEE).
Although many manufacturers are under considerable pressure to implement a solution right away, it is important to properly evaluate an MES solution and apply a methodology to the evaluation process to ensure the MES solution selected correctly meets the specific needs of the enterprise.
Why are you implementing an MES solution?
This question must be addressed before starting the implementation. MES solutions fit perfectly with today's continuous improvement strategies like Six Sigma, Lean, overall equipment effectiveness, total quality management and others. These improvement strategies all require the ability to gather realtime, accurate and visible measurements of a process in order to create improvement initiatives. In fact, a recent AMR Research report states, "At a fraction of the cost and time of an ERP initiative, an MES platform provides visibility into accurate, high-velocity information about current production performance."
With any continuous improvement strategy, management must first decide what process will be improved, the metrics for measuring improvement and the key performance indicators (KPIs) that will indicate a successful strategy. If management decides to reduce downtime, the KPI will be different from that used to determine quality. Therefore, it is crucial to determine before evaluating software packages which improvements will have the greatest impact on the company/plant and how initiatives will be measured.
Management buy-in
Because MES systems may change the way companies operate, senior management must be on board throughout the evaluation, selection and implementation process, as it requires measurements and metrics that can make workers believe their individual performance is being measured. Therefore, it is imperative that senior management set the tone and send out the correct message that the continuous improvement initiative is about improving process, not judging individuals.
A pilot versus a complete rollout
While a full roll out may appear quicker, it involves more effort and organisational risk than a pilot. It is important to remember that expanding the MES solution to other production lines and plants will be much faster and less expensive after a successful pilot.
Choosing the pilot location
When selecting the area for an MES pilot, several characteristics need examining:
1. What location best represents the other locations for the planned rollout?
2. What location has the most progressive personnel who welcome new ideas?
3. What production area will involve the least cost for implementing the system?
Championing the pilot to all participants
Attention now turns to the workers who will be affected by the pilot. Communication is crucial because some workers may feel burdened by the new system or fear it will measure individual performance. It is very important to create a communication plan that motivates the people impacted by the pilot.
The operations team will be the first group impacted by the pilot and any technical issues must be resolved quickly to maintain operator confidence and interaction with the system.
Other groups that need to be considered are:
* IT/MIS department.
* Maintenance department.
* Engineering department.
* Quality/continuous improvement department.
Defining the pilot
With all the necessary departments involved, the first meeting should gather each department's objectives and goals. For example, the maintenance department may have a goal of reducing downtime by 10%. Not all the goals need to be financial in nature. Manufacturers who leverage the visibility an MES solution can provide to the executive/corporate level often see much higher returns than those that use it simply for local cost reduction measures.
The next step is to create a specification outlining the pilot's goals, the current set-up and the company requirements. This outline will be the foundation for the solution evaluation process.
Selecting a solution provider
The specification will be the main document used for evaluating different solutions. It is important a solution provider understands the manufacturer's goals as well as provides the right software. MES solutions are complex, and manufacturers will usually achieve better results when they select a solution provider instead of software alone. A complete solution provider is advantageous because the provider:
* Provides the practical experience, professional services, and technology necessary to deliver the correct solution.
* Creates a solution that fits the company's needs instead of just selling software licences.
* Provides services when needed to ensure optimal configuration
* Provides training to show plant personnel how to maintain and expand the system at later stages.
* Provides support after the sale in case of unplanned changes/issues.
* Provides periodic support to continuously improve the depth and breadth of system interaction that results in increased benefit to the enterprise.
* Ensures the system can be expanded to the full enterprise without significant redevelopment.
* Ensures a low total cost of ownership (TCO).
* Ensures goals are met or exceeded.
* Evaluating TCO and making sure goals are met can be challenging.
The last question comes down to the relationship with the solution provider. Whether choosing a large or a small company, the solution provider should understand the company's specific needs.
Implementing the pilot project
How the project is run is just as important as how the project is specified. In general there are four major phases of the project and typical durations for each phase:
1. Detailed definition - 40% of the pilot schedule
2. Configuration - 25% of the pilot schedule
3. Installation - 15% of the pilot schedule
4. Optimisation - 20% of the pilot schedule
5. Rollout plans - After a successful pilot
All four phases are critical to the success of the pilot, and require a high level of agreement and interaction to work properly.
Phase 1: Detailed definition
The detailed definition phase involves the project team comprised of people from the MES solution provider and the user meeting to scope out the project.
* Review technical details.
* Functional requirements specification document (FRS).
* Internal review and customer acceptance.
Phase 2: Configuration of the pilot
The configuration of the pilot is the primary responsibility of the MES solution provider; however, it should be an open process where the end user has periodic reviews and regular status updates.
* Software configuration.
* Internal review.
* Testing and customer acceptance.
After finishing the complete system test against the FRS, the next step is to perform a factory acceptance test (FAT). The FAT demonstrates to the end user the system is complete and ready for installation. This is a critical step for customer review and acceptance and where problems that could impact the success of the implementation need to be evaluated. The customer should include the operations staff that will use the system. This ensures operational issues are identified prior to installation. Only after everyone on the project team is convinced the project is ready for installation should the next phase of the project begin.
Phase 3: Installing the solution
The pilot implementation occurs when the entire project team performs all required tasks on the WBS, the operators are using the system and management is seeing benefits. Typically this part of the pilot has the following components:
Site commissioning and customer acceptance
While site commissioning can be the shortest duration phase of the project, it is by far the most critical. Typically during this phase, the users begin operating the system. Other items that should be covered during this phase of the project:
* Operator training.
* Administrative and programming training.
* User training on data analysis.
* Customer review of information.
Once the system is operational, all training and final acceptance testing should be done on the system to remedy any final issues.
Optimisation
MES projects, just like process improvement initiatives, are continual. MES solutions offer even bigger returns when they are used to drive continuous improvement, not just for once-off cost reduction measures.
The initial implementation may need optimisation and fine tuning. This fine tuning should be done in conjunction with the MES solution provider because it has the best understanding of how to analyse and optimise the solution.
This part of the project needs to be viewed more as a long-term transition to rollout. The MES solution provider should do an extended handoff to help the users understand how to interpret the data and how to modify the system to meet their future needs.
The final phase - rollout
Rollout is really the final phase of the pilot. Much of the experience gained during the pilot will facilitate the rollout. For example, significant knowledge should have been gained during the optimisation phase to determine the optimal time and location(s) for the rollout. Crucial information gathered should have been documented to make a best practices document. During the rollout, the MES solution provider's project manager may use these practices to replicate prior successes or make adjustments to accommodate any challenges recognised during the implementation phase. These lessons directly correlate to time and costs savings in the rollout.
There is no right or wrong time to rollout; the pilot's function is to determine how to best perform the rollout. Managing the pilot as a process will yield operational visibility into the plant's operations. Proper management of the MES solution pilot is key to achieving the benefits of an MES solution. The pilot's success is largely a result of good coordination between the solution provider and the end users in which the solution provider is a partner not merely a vendor. When the team comprised of members of the solution vendor and the end user determines the rollout is ready to begin, they can then deem the pilot a success.
For more information contaact Deon Engelbrecht, Citect, 011 699 6600, [email protected]
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