Despite the fact that most managers, supervisors, and executives in Polish manufacturing companies are familiar with the term “Fourth Industrial Revolution,” only 6% of them are implementing Industry 4.0, according to Astor’s report, “Industry 4.0: The Revolution is Here. What Do You Know About It?” However, the trend is on the rise, and more Polish companies are taking steps toward Industry 4.0.
The main reason manufacturing companies decide to purchase and implement a Manufacturing Execution System (MES) is the desire to reduce production costs while increasing efficiency. Like any other investment, this one is expected to bring a return as quickly as possible. This section outlines the areas of a company that are impacted by the implementation of an MES system.
Research conducted by MESA shows that after implementing an MES system, the following improvements can be expected:
- A reduction in the production cycle time by up to 45%,
- A 75% reduction in data entry time, due to the automatic transfer of data to the ERP system,
- A reduction in the capital used for production orders by more than 25%,
- At least 50% less administrative work between shifts,
- A reduction in the time to launch a new production task by more than 35%,
- Improved production quality through a reduction in defective products.
According to studies, the return on investment typically occurs about 14 months after the full implementation of the system.
Considering the improvements listed above, additional areas of enhancement may include:
- Energy consumption – an average reduction of 8%,
- Incorrect data in the ERP system – an average reduction of 66%,
- Defective products – an average reduction of 15%,
- Elimination of paper-based document circulation – an average reduction of 61%.
In the following part of this article, I’d like to explain the reasons behind these improvements.
Reduction of defective products
The MES system allows for the recording of parameters throughout the entire production process and quality control at every stage, which is crucial given today’s customer demands. In a MESA study, respondents admitted that after implementing an MES system, the number of defective products decreased by an average of 15% .
Data entry into the ERP system
The most significant improvement is usually seen in data entry time. Many manufacturing companies still use paper-based production reports. Apart from the need to consume paper and archive these reports, this method also consumes time, which is often the most valuable resource. Lost time cannot be recovered. Data from these reports must be manually entered into the ERP system. There is a risk that the person entering the data might make a mistake, and discrepancies in the ERP system can lead to numerous negative consequences. In companies using MES systems integrated with ERP, production data is transmitted directly to the ERP system in real-time, minimizing errors, saving time, and reducing paper usage.
Reduction of paper-based document circulation
On the subject of paper usage, depending on the company’s size, costs related to printing production documents can run into tens of thousands annually. Companies using an MES system manage documents such as workstation instructions, complaints, technical drawings, process sheets, and more within the system. Additionally, in the SCADA-MES system, it is possible to include MP4 format files. A MESA study found that over 60% of respondents confirmed the possibility of reducing paper-based document circulation by more than half after implementing an MES system .
Faster production order execution
The productivity of production workers also improves. They are aware that they are not being directly controlled by a person, but by the system. Machine operators, thanks to the integrated MES system, receive all the necessary information for completing production orders electronically, in real-time, leading to more organized production and fewer mistakes. Employees also have access to all necessary documents, such as technical documentation, in electronic form. The time used across multiple areas improves significantly after MES implementation. One such area is administrative processing of orders. Drastic time reduction is possible thanks to the two-way communication between the MES and ERP systems. All data is transmitted automatically, without human intervention. Respondents in the aforementioned MESA study indicated that cycle times can be shortened after implementing an MES system. Additionally, time spent on transport, storage, and waiting for materials may also decrease .
Although MES is primarily a system for improving production, it also enhances customer service quality. This is an indirect and not easily measurable effect. It pertains to reliable delivery times and information about the progress of orders, which can be crucial for customers .
There are likely many other areas that will see improvement. MES is an indispensable tool in continuous improvement and the implementation of Lean Manufacturing strategies.
The best example that an investment in a SCADA-MES system pays off comes from the testimonials of our clients. One of them is Major, located in Tychy, Poland. This client clearly states, “Currently, with a machine park of 137 machines, we cannot imagine managing production without the Aplixcom SCADA-MES system.”
Another example is the statement from the COO of Borg-Automotive: “We can confirm that the investment in Aplixcom SCADA-MES was definitely a good decision. We have gained extensive knowledge about the production area, and thanks to this, we are confident in achieving a return on investment in specific sectors.”
Case studies from the implementations at these companies are available on our website.
In Summary
We often conduct ROI calculations with potential clients using a dedicated calculator. This allows management teams to easily estimate the return on investment in the Aplixcom SCADA-MES system.
Are you curious about how the ROI calculation would look for your company?
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References
[1] Heiko Meyer, Manufacturing Execution Systems (MES): Optimal Design, Planning, and Deployment, McGraw-Hill Education, United States, 2009
[2] Joanna Oleskow-Szlapka, Informatyczne systemy planowania i sterowania produkcją, Politechnika Poznańska, 2012
