Easy Solutions to Legacy Software for Manufacturing

Many companies cling to dusty, inefficient software, hindering production and holding back shop floor growth. In a few simple steps, you can move your shop floor to a sustainable, modern software solution.

By David Oeters, Corporate Communications with CIMx Software

Confidence Button Showing Assurance Belief And Boldness

Confidence Button Showing Assurance Belief And Boldness

Legacy software.

We’ve seen companies struggle with old, dusty, inefficient and unproductive software systems written years ago in an outdated software language, and kept on hardware that can’t even be replaced. IT resources are tasked with keeping the system working, but the best they can do is minimize outages. Many times, the system may be used for a single function – to create a single critical report or capture critical manufacturing data, and then all of production becomes beholden to the single, fragile and temperamental piece of software.

Still, the company believes they have no choice but to cling to the glitchy software program, keeping that critical function on software that could fail at any time. They’ve reasoned themselves into a corner.

This may have been true a few years ago, but today there are modern software tools that can not only quickly and easily replace the legacy software, but deliver measurable benefits. You can overcome the limitations of legacy software with confidence and move to a better, more cost-effective solution. The steps to the solution aren’t difficult, or expensive. Start with…

  • Retrieving the Data.

The first step is retrieving the data from the old system. This requires accessing the database, converting the data to a neutral file, then organizing and tagging the data. CIMx has database retrieval experts on staff, and we have the experience to not only complete the work, but finish it faster and with fewer errors or problems. The team will scan the data for errors and problems, ensuring it can safely be used on the new system.  Preparing the system can be done concurrently with retrieving the data, and it starts by…

  • Mapping the Processes.

Using a modern and adaptable MES or paperless manufacturing system, you can map the processes and functionality of the legacy system to the new software system. Many times, this will only require building a script or adding a function or operation to the MES. You should also prepare the database to accept the data you’ve retrieved and copied from the old software system, ensuring the data is correctly stored so it can be used in future operations. In most (if not all) cases this won’t require customization, but a simple configuration or use of an already existing process in the system, and then you’re ready to…

  • Move the Data.

Once you have the new MES or paperless manufacturing system prepared, move the data from the old software to the new. Please note, you shouldn’t remove the data from the old system, just copy it over. You’ll load the data, and then review it to ensure no mistakes or problems occurred in the transfer. Repairing the data will correct most problems, but you still want to…

  • Test the New Software.

Now that you have the data moved and the operations and functionality in place in the new software, it’s time to test. Run a series of test cases on the new system to ensure the processes and functionality are running correctly. Make adjustments if necessary. Once testing is done, you’re ready to…

  • Run the New Software.

It’s time to test the new software system in production. In the beginning, you will run the new software simultaneously with the old Legacy system. Each will perform the same operations in parallel. This will give you the assurance you have the functionality of the old software while you are running the new software live in production. During this time, you can see how effective the MES is in replacing the old Legacy system, and make adjustments as needed because eventually you will…

  • Replace the Legacy Software with New System.

After testing the new software and making any necessary adjustments, you can begin rolling over all the functionality of the legacy software to the new system. This may be as simple as having the team use the new software instead of the old. While having the two systems run parallel, you can easily move over to the new system in phases, starting with one production line or area before moving to another. The final goal should be having the entire plant running on the new software system. Then you can celebrate and shut the old software down completely.  While much of the schedule will be dependent on the data being retrieved, normally the process can be completed in weeks or, in a difficult case, two months if the MES has built-in integration and migration tools.

Is your old and dusty MES a disaster waiting to happen? Illustration by www.colourbox.com

Is your old and dusty MES a disaster waiting to happen? Illustration by http://www.colourbox.com

There are a number of advantages to this process, and to moving away from an old system to a new one. In addition to more uptime and stability, your data is now in a more secure database. Many times, this means it is easier to use in analytics. By putting it in an MES, you can also more easily link the functionality of the legacy software to the integrated production records. In addition, you have an integrated and complete manufacturing software solution with the MES. Production goes to a single system for all the information they need for operations.

When you consider how easy it is to deliver all the necessary digital functionality you need for the software in a single system, it’s an easy choice to phase out old software that can’t provide the functionality and efficiency you need. Want to learn more, or discuss how CIMx can help you replace your antiquated software? Leave us a message today for a free shop floor review of you software. We’re happy to help.

How You Can Get Real Value for Your MES

Time and technology have changed, but many software companies are still selling dated manufacturing solutions. Get more value from your MES with a few simple tips.

By David Oeters, Corporate Communications with CIMx Software

More money doesn't always mean a better solution. Illustration by www.colourbox.com

More money doesn’t always mean a better solution. Illustration by http://www.colourbox.com

We’ve gotten a lot of comments on our Two-Comma MES blog. Some agree the benefit of some MES may never justify an (extreme) two-comma cost. Others are quick to defend the high-cost, arguing a world-class manufacturing software system will have a world-class price. If you cut corners on your MES, and install a “cheap” software solution, you cut corners on productivity – the profit-driver for manufacturers.

There’s truth in both positions, and there isn’t an “optimal” price for manufacturing software. That said, times have changed, and the MES of the past no longer offer the value (even if slick marketing is hiding the creaking old code of some systems) they once did. We need to change how we approach the MES purchasing process.

Breaking Down the MES Budget

Assessing value starts with your budget. How much benefit can you buy for your budget? The IT budget is normally 1% to 3% of a company’s annual revenue.  For a $50,000,000 company, that would leave a budget of $500,000 to $1,500,000. From that budget, you need to pay for support, licenses, hardware, software, license fees and infrastructure costs. How much of that will be left for an MES? With the budget left, is there any way to financially justify the extreme cost some companies demand for their software?

In today’s fast-paced, technology-driven marketplace, it just doesn’t make sense to install a high-cost, system if you’re not getting flexibility. Systems like that are normally difficult to upgrade or adapt. Overly complex and over-engineered systems can’t handle the demands of modern manufacturing, even if the system looks modern, is it flexible and can it manage change? Will the effort and cost to maintain system efficiency represent a sunk cost that will quickly bury any initial benefit?

Tips for Finding Paperless Manufacturing Value

A powerful, effective and incredibly efficient MES doesn’t have to cost two-commas. It can be easy-to-use, easy-to-install, adaptable and flexible without a high cost. Here are a few tips for finding value in your search for an MES:

  • Don't get buried by the cost of your two comma MES. Illustration by www.colourbox.com

    Don’t get buried by the cost of your two comma MES. Illustration by http://www.colourbox.com

    Avoid the modules: Modules sound like a great option. Presented like a giant MES vending machine, you pick your feature, nothing more and nothing less, then it comes together magically. It doesn’t work that way. A “module” is often a separate app built by an entirely different company, which means configuration and integration costs. The more modules you add, the higher the cost. Companies offer a lower base cost, then drive profit on the “modules.” An integrated MES platform, with all features and functions built natively for the system, will deliver more functionality for a much LOWER cost.

  • Beware of forms-based systems: Companies that promise to “configure” a system for you specifically are likely using forms. They “make” it for you by mirroring your current processes through a form in their MES. They add to the initial cost of the MES a configuration “charge,” and know that any time you want to change the form, due to a process change or manufacturing need, you’ll go back to them. A forms-based system seems perfect at first, and then loses efficiency over time. A truly flexible, and lower-cost, option will use your current work instructions on a framework within the MES. Any work instruction or plan can be used in the software, delivering all the tools and functionality you want or need, in the format you want.
  • Flexible support options: Some companies, especially companies using an older software system, will hide the true cost with a confusing array of support options. There may be tiers of support, an entire configuration team you pay for, a base cost with an array of additional costs. It may seem like “comprehensive” support, but add it all up and the “support” will have destroyed your budget. Look for a solution provider who can offer a set cost for support expenses, or who is willing to offer a cost-not-to-exceed contract for work.
  • Utilize a phased implementation: With a phased implementation, you have greater control over the pace, focus and cost of a project. You select the features and functionality that offer the greatest return and put them in place first. Other systems, especially ones that require extensive configuration or messy integration of modules, will limit how you use and roll out the software. You’ll have a much higher initial cost, longer training, and often an open-ended implementation phase where expenses pile up. With a phased implementation and an integrated software system, the software is installed once and you turn on and use whatever you want whenever you are ready.

In the past, a 6 – 18 month installation and implementation period for an MES was standard. A multi-million, two-comma cost was to be expected. MES has grown up since then. The technology and market have changed, and manufacturers are benefiting with lower-cost systems that are adaptable, flexible, easy-to-use and –learn.

Don’t be suckered by flashy promises of a high-cost software company. Look for value in your manufacturing software solution, not two-commas.

Paperless Manufacturing and Procrastination

You may not realize it, but many companies procrastinate away profit and production. We offer easy-to-use tips for eliminating tech-procrastination.

By Lisa Kessler, Customer Relations with CIMx Software

Are you procrastinating away profit and productivity as you wait for a new software system? Illustration by www.colourbox.com

Are you procrastinating away profit and productivity as you wait for a new software system? Illustration by http://www.colourbox.com

In the book “Willpower: Rediscovering the Greatest Human Strength” by John Tierney and Roy Baumeister, Tierney and Baumeister discuss how to set realistic goals, monitor progress, pick your battles, and look beyond immediate challenges.  Studies show, by doing these things you will decrease stress and increase your personal energy and health.

As I was reading, I couldn’t help but think about how this applies to my job and how paperless manufacturing helps companies increase their own productivity. Of course, there is a whole chapter on procrastination and how it affects willpower. I have found procrastination to be a huge factor for companies considering, but not moving forward with a paperless manufacturing project. Companies know they need to do something, but discover it is much easier to do nothing, even as profit, success and productivity drain away.

Many procrastinators (including corporate and business procrastinators) overestimate the size of a task which can cause anxiety before the project even starts.  Therefore, potential solutions are put aside and expensive production errors continue as they have for years past. Companies ignore an easy solution out of ignorance, not because there is any real problem.

There are some simple tips you can use to avoid procrastination and move forward with a beneficial paperless project:

  • Focus on starting, not finishing – by doing this, you avoid getting overwhelmed. Decide what can be done right now, the finish line will come, but no one gets there in one stride.
  • Break things down into short tasks – implementing an MES system is a large investment, so it won’t happen overnight. There are several steps in the process, take them one step at a time. This is an advantage of a phased implementation.
  • Celebrate small advances – by doing this you avoid getting discouraged during the process. Each task completed is a step closer to shop floor success and more productive manufacturing.
  • Find others who support your cause – by doing this, you are creating a circle of support to help push the project forward, even on days when you may feel overwhelmed, your MES team can trudge on.
  • Don’t let budget hold you back – there may not be an active budget for a paperless initiative, but if you don’t get started on building your case there never will be. Gather the information you need, you may find budget once you show the powerful benefits MES can provide.
  • Create a benefit list – develop a list of MES functionality and how each feature will solve your shop floor problems. This will help you stay focused on the project and will be a huge selling point for your business case down the road.
  • Don’t give up – there are always setbacks during a big project. Don’t get discouraged.  If you need to, find a way to rework your goals in order to keep advancing. 

Getting started

Creating a list of questions regarding your shop floor inefficiencies is the first hurdle to overcoming procrastination.  What could we be doing better?  What are we going to do about it?  What challenges do we face?  How can we overcome them?  What can MES do for us?

After you answer these questions, research MES systems and see which systems can solve the problems you’ve identified in your manufacturing processes.   Bring your questions to us, we would love to help.  Our team can identify what you need, how to solve your critical production problems, and work out a rapid ROI. We’ll take you through each step in the process. Contact CIMx today for more information.

Is Your MES Sunk Cost Software?

Want to improve production, increase profit and implement more efficient operations? We borrow tips from one of the top poker players in the world (and a cognitive psychologist) to show how you can deliver better business results quickly and easily.

 By David Oeters, Corporate Communications with CIMx Software

Is your old and dusty MES a disaster waiting to happen? Illustration by www.colourbox.com

Is your old and dusty MES a disaster waiting to happen? Illustration by http://www.colourbox.com

The other day we celebrated my brother’s birthday with a trip to his favorite restaurant.  The plan was a quick lunch, a trip to the movies, and then ice cream. Problem was, a horde of hungry people decided to get lunch at the same time. The lobby and waiting area was packed. “It can’t be that bad,” we told ourselves. “Let’s just wait it out. We have time before the movie.”

So we waited. And waited. And then waited some more. My brother and Dad spent time designing miniature houses with napkins and chopsticks. My Mom did a crossword, while my wife and I tried to keep two kids under the age of 6 amused. We waited almost three hours before we got a table, and ended up missing the movie. We were even too tired to get ice cream.

Why did we wait? It was completely irrational to sit in the lobby on an uncomfortable bench for 3 hours when we could have found another restaurant with good food in less than 15 minutes! We could have saved three hours of our day, gone to the movies and enjoyed ice cream, but we didn’t. We waited….

How Sunk Costs Can Sink You

Annie Duke, a former professional poker player and current Decision Coach, calls this irrational behavior a Sunk Cost. “We have a strong bias to take into account resources already invested in our decisions about whether to move forward,” she explains. By making the decision to go to the restaurant, and investing time (even a little time) in waiting, we are less likely to change our minds and go somewhere else. Even at the cost of missing the movie (we all wanted to see) and not getting ice cream (which was absolutely crushing for the kids).

Resources (like time, money, effort, etc.) already spent are a sunk cost, because you can never get them back. It’s a decision-making error when you consider sunk costs in making present and future decisions. Past investment is resources gone, and they won’t magically come back if you keep investing more. Rationally, you must consider ONLY the future return in the decision-making process.

Consider this… if someone had told me we were going to wait THREE hours for a table before I got to the restaurant, I would have gone somewhere else. I would have gone somewhere else if you had told me I was going to wait 15 minutes! But, because I invested time (which is a Sunk Cost , because I can never get that time back), I kept waiting.

Manufacturing Software and Sunk Costs

Clinging to past decisions can hurt your business and siphon profit. Illustration by www.colourbox.com

Clinging to past decisions can hurt your business and siphon profit. Illustration by http://www.colourbox.com

It was a completely irrational decision to wait that long, because the cost of lunch went from $20, to $20 plus a missed movie, no ice cream, boredom and pain sitting on the bench, frustration keeping hyper kids amused, and three hours of my precious time I will NEVER get back. In my effort NOT to waste 15 minutes, I wasted three hours.

Unfortunately, we are all guilty of faulty, sunk cost decision-making. How many times do we stay in a long line, reluctant to move even though there is a shorter line nearby? As Duke explains, how many poker players keep pushing a poor hand (bluffing) because they already have money in the pot?

What about your MES? How many companies keep struggling with old, inefficient and costly manufacturing software because of a past investment in the system? If the MES isn’t (or can’t) adequately support current manufacturing processes, and the only viable solution is expensive customization and upgrades, then keeping your current system because it offers limited useful functionality is irrational.

Today, there are low-cost, modern manufacturing software systems that can be installed in less than a week. You can easily import your current work plans and have digital work instructions on your shop floor a few weeks later. These agile and flexible systems are intuitive, with on-site training completed in less than a day. With inexpensive infrastructure costs and minimal maintenance, they are clearly superior to the aging two comma systems some manufacturers struggle with. Sure, some may be more comfortable with the older system, but “comfort” shouldn’t be a critical factor in a business decision.

Minimizing MES Risk

I can understand the fear and risk that has long been associated with implementing a new manufacturing system. Many cling to old software because they know the limitations. Installing a new MES exposes them to unknown risks and potentially crippling costs.

In the past, those were legitimate fears. Today you can mitigate risk with a low-cost, no-risk pilot program in a single area. You can quickly see if the software will work and determine any potential weaknesses while forecasting the Total Cost of Ownership. With a scalable and flexible solution, you can quickly roll it out everywhere when you’re ready.

Put simply – moving on from an inadequate MES to one that meets your needs and actually supports your operation is significantly less risky than waiting and continuing to throw money away.

Add Discipline and Logic to Decisions

When you are faced with a computer system or manufacturing system that isn’t meeting your needs, don’t let sunk costs influence your decisions. Decide on the path forward based solely on present and future returns, and consider the cost of adapting the faulty current system you have against the cost of installing a new, modern and flexible system.

Want to know more, or see how much you can save with a new system? Contact CIMx today, we’re happy to help.

Do You Need a Two Comma MES?

Some companies throw money away for software that will never do what they need, not knowing a better solution is available without gutting your profits.

By Kristin McLane, President of CIMx Software

Are you looking for an MES that will deliver and ROI and improve manufacturing outcomes? Image by www.colourbox.com

Are you looking for an MES that will deliver and ROI and improve manufacturing outcomes? Image by http://www.colourbox.com

I love the show Silicon Valley on HBO. It’s raw, open and makes fun of the software industry. Even with the absurd situations and characters, I recognize a grain of truth. There are times I cringe – some humor is misplaced, the language can be foul, and there are inappropriate things happening all the time. Yet, even when the show seems to make no sense at all, (like, why you would be obsessed with sesame seeds on burgers from “The Bur-gur King”?) I recognize… something true. It’s this recognition of reality in absurdity that makes Silicon Valley so entertaining.

Take, for instance, the latest investor in Pied Piper. Russ Hanneman (some say he’s a take-off on Mark Cuban) is wealthy beyond measure for bringing “Radio to the Internet,” but is self-obsessed and has no concept of real life. There is a painting that hangs in his house – modern, Jackson Pollock-style work dominated by three large commas. Russ considers himself a three comma – the three commas found in a billion ($1,000,000,000). The third comma is the differentiator, separating the elite such as Russ from everyone else. At one point, he loses money on an investment and ends up with only $960 or $970 million. He becomes a mere two comma and is distraught beyond belief, thinking the world has ended.

The Two Comma MES

Don't get buried by the cost of your two comma MES. Illustration by www.colourbox.com

Don’t get buried by the cost of your two comma MES. Illustration by http://www.colourbox.com

It seems absurd to focus so heavily on the difference between a two comma and a three comma, but  many perceive manufacturing software solutions the same way. Some believe the only “viable” MES solution MUST cost two commas, and anything less won’t work. They believe their company needs a complex, wildly over-priced and over-developed piece of manufacturing software. It must be crafted specifically for their shop floor in incredibly specific and costly configurations yielding the “best” solution. Any software meeting these criteria must cost (at least) two commas or it’s just not good enough.

I know why they think that way. For many years, the industry built this vision of MES with complex integrations and layers and layers of modules, functions and intricate software widgets with multifarious forms and menus. It’s a vision partially based in reality. Fact is, not all MES vendors actually provide a MESA-style, comprehensive and complete system. Vendors that do subscribe to this comprehensive and complex model provide systems that take years to install and configure (which they call an “off-the-shelf” solution), and cost more than two commas ($1,000,000+) when they’re done.

Two commas?!? Think about the percentage of your overall revenue represented by those two commas. Can you throw away two commas without a clear vision of the return? If your total spend on infrastructure and software is going to be more than US$25M+ this year, then you may have the resources for a two comma MES. Otherwise, you may be spending too much. Consider what you actually need.

The Paperless Manufacturing Solution

More money doesn't always mean a better solution. Illustration by www.colourbox.com

More money doesn’t always mean a better solution. Illustration by http://www.colourbox.com

As the manufacturing software industry began embracing the two comma vision of MES, we introduced “paperless manufacturing.” Paperless manufacturing provides all the functionality and production control of MES, without the unnecessary complexity and “service”-driven escalation of price. If you want a digital shop floor with paperless operations, and need the ability to know what’s going on real-time in your operations with total connectivity to your internal business systems and processes, then paperless operations will deliver without the pain some MES software demands.

Paperless manufacturing focuses on supporting manufacturing operations with software tools – eliminating errors as operators access the information they need at their workstation, using the instructions, photos, drawings, videos and attachments you provide. The software gives you tools to create better instructions and deliver them efficiently, without having to create them in a costly and inefficient desktop template. Paperless operations increase efficiency, as the correct work instructions are prioritized and delivered directly to the operator. When problems come up, you can quickly make corrections before production issues cause scrap. Paperless manufacturing gives you manufacturing control, without forcing you to adjust your processes or creating other problems.

Sure, a two comma MES MIGHT be able to do all this, but justifying the cost with unnecessary complexity, a massive project team and software developed decades ago doesn’t make any sense to me. The focus of the project should be improving production, solving problems, and ensuring an ROI. When you buy an operations efficiency engine like an MES, you are investing in your business and should know what the return is. A two comma MES doesn’t provide a suitable return because the cost for functionality is so high. Unnecessary complexity not focused on productivity is a sunk cost for manufacturing.

A Manufacturing Solution that Makes Sense

We encourage customers to develop a strong ROI with an efficient path to their organizational goals. If the project doesn’t provide an adequate ROI, we suggest the prospect look for a different solution. Also, keep in mind the more complex the software, the heavier the burden on the organization to implement the system. The subsequent cost savings must make up for all the overhead carried by the additional complexity.

Improve your shop floor with a true MES, not a mess of modular functionality. Illustration from www.colourbox.com

Improve your shop floor with a true MES, not a mess of modular functionality. Illustration from http://www.colourbox.com

What’s worthwhile about two comma MES? Why do people buy it? Many times, I think companies fall into a Russ Hanneman mindset, and believe ONLY a two comma solution could possibly meet their needs. They never bother to investigate anything else, or they assume two comma solutions are more robust or sustainable (this is blatantly untrue). Corporately, they’ve settled on the solution, even if it doesn’t work perfectly. They’ve made their decision and expect everyone else to make it work.

Russ might claim that if you have two commas to spend, you shouldn’t have to ask the true cost (I’d argue Mark Cuban wouldn’t say the same). But in our experience, total cost of ownership is one of the predetermined deciding factors in MES selection, and traditional two comma MES vendors just can’t size projects accurately. To quote a customer, these systems are “painfully configurable,” and focused on increasing service costs.

And finally, back to Mark Cuban…even he doesn’t believe in perfection, he said in a recent interview, “Some people work so hard to get it absolutely right that they don’t have the bandwidth to do all the other things that go into making a business successful.” Does this same concept apply to your selection of an MES vendor?  Have you gotten so focused on building the perfect requirement list that you lose sight of the usability of the final product, and the cost and time you need to make it work?

The Curious Connection between Manufacturing and the 2015 Women’s World Cup

Just like the World Cup, competition is fierce between manufacturers, but with paperless manufacturing you’ll discover the competitive edge that will make you a winner in 2015. 

By Lisa Kessler, Customer Relations with CIMx Software

What manufacturing lessons can be learned from the World Cup? Image by www.colourbox.com

What manufacturing lessons can be learned from the World Cup? Image by http://www.colourbox.com

Even with all the scandal surrounding the FIFA 2015 Women’s World Cup, people are still excited for some amazing games. Who wouldn’t be? With 24 teams representing their countries in Canada, the roar of the crowds, the skills of the players, and of course the ultimate thrill of winning the coveted 2015 World Cup, this year looks to be a classic.

What a lot of fanatic soccer fans don’t realize is the amount of complex manufacturing that goes into the World Cup Tournament. From the $160 balls used every game, to the shoes, the uniforms, the goalie gloves, the shin guards, coaching gear, and all other equipment and accessories. Yep, all manufactured. Consider the complex electronics used to broadcast and record the games, to the cars, trucks, buses, boats and planes used to ship the teams and crowds to each venue. It’s a veritable case study of the importance of manufacturing.

Being a supplier of the World Cup requires world class manufacturing.  Does your shop floor have what it takes to produce world class products?   Not a soccer ball manufacturer?  Not a problem.  Just like other manufacturing companies, soccer balls go through many of the same processes on the shop floor, cutting, stitching, heating, molding, final assembly, and quality checks.

The first step in achieving world class manufacturing is controlling the flow of manufacturing information. Succeed there, and you’ll decrease errors and increase production and profits. World class manufacturers also control shop floor processes, otherwise you’ll never have the rigor and discipline necessary to compete. An MES provides this rigor, and becomes the platform on which your manufacturing is based. In addition to virtually eliminating paper on the shop floor, a good system will keep comprehensive records of all operations performed, giving you the data for analytics used for process improvement.

No matter what you manufacture, a successful MES should guarantee several things:

  • Adaptability – Easy to add, change or enhance functionality to meet changing needs.
  • System Connectivity – The seamless flow of information from MES to your current enterprise systems; including the ERP, PLM, Quality Management, and more.
  • Elimination of Errors – A checks and balance system ensuring all operators are using current work instructions, as well as built-in and automated tolerance checking to ensure product quality.
  • Real Time Production View – Tracking each order as it moves along your shop floor, allowing you to report to customers and quickly resolve issues.
  • Dynamic Work Instructions – Electronic work instructions offering strict revision control that can be migrated over from current systems or built directly in the MES system.
  • Procedural Enforcement – Ensures data collections, safety reviews, quality checks and more are completed prior to moving work forward, safeguarding against errors.

The right MES system will offer you the tools and platform for world class manufacturing for the right price.  It should automate many of the processes and tasks that hold your shop floor back, so you can manufacture the world class products your customers expect.

If you are losing valuable time and money, take a look at how your shop floor operates.  Chances are you need a game changer – a change that could make you the goal scoring winner.  If you are interested in learning more about MES and how it can benefit your shop floor contact us today.  We are happy to help and look forward to speaking with you.

Making Sense of the ROI for an MES

Many shop floors struggle to justify the cost of an MES, even as errors and inefficiencies that would be eliminated with a shop floor system drain profit and production from the company.

By David Oeters, Corporate Communications with CIMx Software

Here’s the problem for shop floor and operations managers looking to implement an MES or paperless manufacturing solution – many of the greatest benefits of a shop floor system offer soft savings, but management approves investment with an analysis of the hard savings from a capitol project.

The ROI Conundrum for MES

Many companies struggle to justify the expense of shop floor software, even as problems drain profit and production from the bottom line. Illustration by www.colourbox.com

Many companies struggle to justify the expense of shop floor software, even as problems drain profit and production from the bottom line. Illustration by http://www.colourbox.com

Consider this – you put in a modern MES, and you’ll have real-time production data that provides the foundation for continuous improvement. Shop floor production and control improve, errors and quality escapes are eliminated, and planners benefit from revision control and a library of approved work plans. Many Shop Floor Managers and Quality Engineers drool at the prospect of any ONE item in that list.

But, a business case isn’t built on “better,” but on hard numbers. Procurement and the CFO don’t care about, and may not even understand, revision control. How can the shop floor measure the benefit of real-time data and continuous improvement? How do you articulate the savings from fewer errors, when you struggle to consistently capture any data at all from your shop floor processes? For the CFO, “more data” is nice, but it doesn’t translate to a line item in the finances.

Truth is, there is a disconnect between the accepted way we measure ROI, and the needs of production operations and modern manufacturing. Typically, ROI requires a measurement of hard savings and direct benefit from a capital investment. Modern manufacturing seeks continuous improvement, agility and flexibility from an MES – all characteristics that are difficult to measure with hard data, and aren’t easily quantified with numbers.

The Problem for Manufacturing

In a way, accepted accounting techniques don’t adequately represent the true value of an MES – at least, not without a leap in logic or an adjustment in the techniques used. This doesn’t mean there is a problem with MES or standard accounting practices; it just means you are using the wrong tool to take the measurement. A good example might be using a ruler to measure temperature. The ruler offers hard data, just not the right data to measure a summer day.

This disconnect, while unfortunate, is often compounded by the reluctance of some companies to quantify and value the perceived benefit of the shop floor system. Rather than finding a way to communicate the need for better production control, and connect a shop floor tool like paperless manufacturing to company goals, they decide it is easier to make what they have work and ignore a potential long-term solution.

In the end, this problem costs manufacturers revenue and production every year. Scrap and waste accumulate for no reason other than the operations team hasn’t found a way to collaborate and communicate with the financial team.

Breaking Out of the Cycle

I’m not suggesting operations get a free pass when they seek money for a shop floor system. I suggest we need to adjust how we determine ROI when discussing MES. The shop floor needs to assign value to their investments early in the process, and collaborate early-on with internal partners as they select a software solution.

Building a business case and determining ROI shouldn’t cause a shop floor improvement project to crash and burn. Done right, it should help a company determine if the selected system is the right one, helping create an even better solution for the company.

Want to learn more, or see how you can better collaborate on an MES solution? Contact CIMx today for a free shop floor solution analysis. We’re always happy to help.