Manufacturers are obsessed with shop floor productivity, and they are aligning their budgets and spending accordingly. This was one of the key insights to emerge from a Decision Analyst survey of 150 North American manufacturers, which was sponsored by IQMS and conducted in February 2019. In fact, 76 percent of the participating manufacturers say improving shop floor productivity is the most valuable growth strategy they have today.
With a focus on the shop floor, real-time monitoring is proving critical. Among all manufacturers in the survey, 81 percent say that real-time monitoring is making contributions to their business, and 72 percent define real-time monitoring as essential for streamlining and making inventory reconciliation accurate. In particular, 87 percent of plastics and process-based manufacturers say real-time monitoring is essential to their operations. The highest adoption is among companies investing in new or upgraded smart machinery; 100 percent of these manufacturers currently have real-time monitoring in place or are in the final stages of implementing it across their production centers. Meanwhile, 33 percent of the respondents say they are upgrading or replacing their ERP system primarily to achieve real-time monitoring production center wide.
A primary differentiator among manufacturers growing 10 percent a year or faster is their ability to orchestrate analytics, business intelligence (BI) and quality management systems using real-time monitoring’s data streams to understand their business. The rest of this article looks at how these high-performing companies are taking advantage of real-time monitoring to drive their smart manufacturing initiatives and gain both competitive and time-to-market advantages over others in their industry.
No. 1 - Improve Productivity
The fastest growing manufacturers rely on real-time monitoring to find new insights into how they can improve and accelerate shop floor productivity and excel in delivering on customer demands at the same time. One of the most valuable takeaways from the survey is how real-time monitoring is emerging as a primary growth catalyst for smart manufacturing. The more accurate and higher quality the data captured, the faster manufacturers are achieving lights-out shifts across their plants. Among manufacturers surveyed, 53 percent are seeing improved production efficiency as measured by order-cycle times from real-time monitoring, and 47 percent are achieving accuracy improvements. All of the manufacturers who have adopted real-time monitoring are providing order statuses to their customers today, further improving customer loyalty and repurchase rates.
No. 2 - Optimize Smart Machinery
Among survey participants, 41 percent are investing in equipment upgrades while an additional 41 percent of manufacturers are purchasing smart, connected machinery, the success of which is directly related to the accuracy of their real-time monitoring. Of the many potential strategies manufacturers can pursue to improve shop floor productivity, each is only as good as the data captured, aggregated and analyzed. In follow-up site visits with several of the fastest growing manufacturers surveyed, tours of their plant floors demonstrate that the era of smart, connected machines is here. Many can self-diagnose and self-correct errors, evaluate quality levels in real-time including producing statistical process control (SPC) charts, and provide yield data stream in real time via application programming interfaces (APIs).
No. 3 - Capitalize on Quality Management Systems (QMS)
Of the manufacturers surveyed, 33 percent are investing in new QMS solutions this year, and they’re relying on real-time monitoring to get the most out of their new software. QMS is the number one technology being adopted by manufacturers this year. Real-time monitoring provides the data streams these QMS need to provide new insights into reducing the cost of poor quality, improving yield rates, and attaining higher perfect order performance. Among survey participants, 38 percent are specifically adopting real-time monitoring to further strengthen their quality control.
No. 4 - Improve Supplier Quality Consistency
Inconsistent supplier quality and a lack of consistent deliveries are considered major growth barriers by 34 percent of manufacturers—second only to the perennial labor shortage affecting all manufacturers (58 percent). The majority of survey respondents are turning to real-time monitoring to overcome this challenge. For instance, one manufacturer interviewed said that real-time monitoring has helped to reduce supplier reject rates from 30 percent to less than 2 percent in just four months. By turning around reject rates so quickly, this specific manufacturer was able to continue growing by attracting new distributors throughout Europe. Without real-time monitoring, the company’s growth plans would have come to a screeching halt.
No. 5 - Enable Track-and-Trace
According to the survey, track-and-trace is experiencing solid growth across discrete and process manufacturing, particularly as plastics manufacturers rely on real-time monitoring to further improve on this area. From the fundamentals of track-and-trace to more sophisticated queries and analysis extending to the lot level, this is an area that manufacturers are prioritizing for further investment in 2019. Today, 26 percent rely on real-time monitoring to enable track-and-trace, and survey responses suggest that this figure will grow to 43 percent within 18 months.
No. 6 - Streamline Audits
The more regulated the industry, the more real-time monitoring gets prioritized for automating and streamlining customer, regulatory, and internal quality management audits. Across all manufacturers, 13 percent report that real-time monitoring’s greatest benefit is streamlining and automating audits. However, the use of real-time monitoring for audits soars to 92 percent for medical products manufacturers and 79 percent for the aerospace and defense (A&D) cohort of manufacturing respondents. The greater the audit complexity and need to stay in constant compliance with federal regulatory requirements, the more important real-time monitoring becomes.
No. 7 - Prolong the Life of Production Assets
In the survey, 12 percent of all manufacturers rely on real-time monitoring to prolong the life of production assets, with the fastest growing companies using analytics, BI and machine learning to predict preventative maintenance schedules more effectively. The more complex the production process, the greater the reliance is on real-time monitoring to reduce the incidence of production downtime due to equipment failures. High-volume plastics extrusion manufacturers lead all other groups of respondents, with 38 percent using real-time monitoring to ensure machinery reliability.
By applying the seven real-time monitoring practices of the high-performing manufacturers surveyed by Decision Analyst, companies can begin to realize the cost efficiencies, time-to-market advantages, and competitive gains enabled by smart manufacturing.
Louis Columbus is principal of IQMS/Dassault Systemes.