From the manufacturing company to Industry 4.0
Shorter product life cycles, greater product complexity, global competitive situations and an increased demand for customised products – production has now become an extremely complex area of business and the challenge is growing every year. In this area, too, companies must constantly adapt to changing market conditions and be able to react flexibly. This means they have to invest in new capabilities, acquire new technologies and implement new business models. In brief: they must become Industry 4.0 companies. One way to do this is to use the production data you collect, analyse it and implement the insights gained from it. However, this is not an easy task, especially if data and information are still collected and analysed in Excel spreadsheets.
That said, the digital transformation is now also influencing production, and it is the key to optimising production processes, product quality and the use of resources. Therefore, data-driven production is the order of the day.
What is Manufacturing Intelligence?
The main goal of production companies is to keep production costs as low as possible while at the same time ensuring the best possible quality of the products and the shortest possible production cycle. The operation of production machines, the supply chain and logistics must be optimally coordinated to achieve the desired results. To achieve this, decisions must be based on production data Business intelligence and data analysis are the necessary tools to effectively evaluate production data and identify optimisation potential. The terms Manufacturing Intelligence or Production Analytics are synonyms for the application of Business Intelligence in production.
>>Manufacturing Intelligence describes the collection, consolidation and analysis of production data in order to optimise production processes.<<
How is Manufacturing Intelligence applied?
Manufacturing is one of the areas where the most data is generated and collected. Analysing this data can help at all stages of your production – from the procurement of raw materials to the delivery of finished goods.
- Improving operational efficiency: With the help of your production data, you can see which processes are already running optimally, where downtime is occurring or where capacities are underutilised and thus in which processes changes are necessary. Business Intelligence software not only creates the necessary reports for you, but also links data from different areas with each other so that you can recognise dependencies, weak points and bottlenecks within the processes.
- Increasing productivity: The current productivity of a machine, an employee, a team or an entire department can help you find potential for improvement without compromising product quality at the same time. With a corresponding BI solution, you can track individual performance, identify weak points, make changes and check their successful implementation.
- Quality management: In manufacturing companies, quality assurance and testing are of utmost importance in order to be able to compete. If you already track quality throughout the production cycle and record data on defective products, you can use Manufacturing Intelligence to analyse this data and relate it to the manufacturing data. This allows you to identify weaknesses during production and improve, or ensure, product quality.
- Manage supply chain: Delays within the supply chain lead to interruptions or postponements in production and thus to losses, as finished products are delivered late or there may even be a production stoppage. Manufacturing intelligence gives you key insights into your supply chain data so you can choose reliable suppliers and partners or negotiate prices based on the data. In addition, you can use this data to plan your production precisely so that sufficient raw material is available at all times and the products are ready to be produced exactly when they are in demand.
- Optimise material usage: Too high or too low material stocks are a big problem for manufacturing companies. To avoid both, Business Intelligence can be used to determine optimal stock levels. In addition, you can track your stocks in real time and thus intervene at any time in the event of quality problems, for example.
- Optimise the value chain: Reports on resources used, costs of raw materials or production costs support you in improving the added value in your production and in making the right decisions – no matter whether it is a question of investments that need to be made, a change of supplier or a change in production steps. This is how you can increase the ROI of your business.
- Comply with regulations: Manufacturing companies also have to comply with various legal regulations, such as different safety standards designed to protect employees. Business intelligence can be used for process control to check compliance and make processes safer.
- Decisions in day-to-day business: Business Intelligence reports can also be actively used in day-to-day business to get a quick overview of production. The data is easily accessible and understandable. Thus, they can help to make daily decisions.
However, Manufacturing Intelligence can not only directly support production, but also provide important insights for the management of your company:
- Development of new products: Data from customers or markets provide you with information on where existing products can be improved and which new products are in demand. Data from production can also be used for further and new development, so that the serial production of new products can be optimised in advance.
- Make long-term decisions: The data collected from your production can be used to make long-term decisions aligned with your company’s goals, allowing you to make the most of your opportunities.
- Planning ahead: If you want to determine which products should be manufactured when, but also, for example, when the maintenance of a machine should take place, Manufacturing Intelligence helps you to determine the optimal time. This allows you to plan ahead at any time and avoid downtimes or failures of your machines.
- Predict demand: Business Intelligence can help you predict the demand for a product so that you can adjust your production, orders for raw materials or even your budget to the forecast.
- Price optimisation: Analyses that include production costs, for example, allow you to determine exactly how much a finished product should cost. This allows you to adjust pricing to suit your company’s circumstances.
- Alerts: An automatic alarm in case of exceeding or falling below various target or limit values can help in managing your production, for example, if a defined defect rate is exceeded or if the minimum material stock level is not reached.
Implementation and difficulties
Manufacturing companies accumulate large amounts of data, but often do not correlate it with other data or analyse it, as this can be time-consuming. In addition, it is not uncommon for data to be collected manually in Excel spreadsheets. Due to this unstructured data, no clear statements can be made, cause-effect relationships cannot be recognised and the great potential that lies in the data is not used. However, since most companies already use an ERP system in which a large part of the required production data is collected, it is easy to introduce a business intelligence system that uses and evaluates this data. In addition, data from other sources, such as Excel spreadsheets, can be integrated and made available. In this way, important key figures such as the performance of machines and personnel, operating and downtimes, production output, bottlenecks, reject rates, adherence to schedules and many more can be analysed in real time.
Manufacturing Intelligence helps you optimise the use of your resources, reduce costs, improve product quality, shorten product cycles and make the right decisions for the long term. To achieve this, modern businesses need business intelligence software that collects all the data, correlates it with each other and provides clear, simple analyses. Customisable dashboards give you exactly the information you need for your particular area or question at a glance. This helps you to make the right decisions at all times. In addition, early warning systems support you in intervening in time if problems arise.
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