Monthly Archives: October 2015

4 Tips for Understanding the Cost of an MES

Though it may seem counter-intuitive, cost is rarely reflective of benefit in a manufacturing software system.

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

Pricing of software can be… confusing. I understand why many customers become perplexed when comparing the price between MES.

With manufacturing, the cost of a product is the combination of materials, labor, production requirements and profit. A product with pricey materials and stringent regulations will cost more than a simple plastic part with no regulations. This makes sense.

Software pricing is different. In the past, companies hired software firms to develop an MES. Labor costs were calculated by the developers working on the project. With the advent of Off-the-Shelf (OTS) solutions, development costs are shared by the companies using the solution. Even sharing the cost, development can be expensive, especially for manufacturing software. Consider this; even building a relatively simple MES could take several years of work by a team of developers. Doubt this estimate? Just ask the companies that decide to build an in-house MES.

What Drives the Price of Manufacturing Software?

This will give you a starting point for price, but there are other factors to consider, including:

  • Service charges.

Almost every system will charge service fees. Configuration of the software might be a service and can vary widely between systems. Some companies have a plethora of modules to configure, increasing the cost. Other companies will tell you they are OTS, but require expensive customization.  When you have a system that is truly OTS, with little required customization or configuration, the price will be lower.

  • The age of the system.

Unlike a car, the cost of manufacturing software doesn’t decrease over time. It seems counter-intuitive, but an MES will get more expensive as it ages. Old code and technology is difficult to use, so a venerable MES built 15 – 20 years ago will give programmers a headache, and the company will pass that cost to you. You may think you are buying a safe, proven solution, but that old software is being asked to do things it was never designed to do.  That “classic” system will require a massive implementation team and exorbitant costs with little benefit to the end users.

  • Initial implementation costs.
Don't get buried by the cost of your overly complex MES. Illustration by www.colourbox.com

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

Some companies will charge implementation fees for uploading and preparing your work instructions by converting them to the templates or formats used in their software. This can be very expensive and disruptive. Systems that reuse your existing processes and work instructions, and allow a controlled, phased implementation will be much less expensive and disruptive. This is common in a “Big Bang” implementation when a company tries to do all phases of the project at once, driving up the initial cost with little benefit.  A phased approach, allowing the customer to implement at their own pace, will manage the overall cost of the software.

  • Support and training fees.

Complexity in software will increase cost, often adding both unnecessary functionality and training fees. This often happens in MES when you start combining different functionality, for example an MES and PLM, in a single solution. Additional training will be necessary for users to navigate the system. Other systems, especially older ones, add functionality with limited use with every new release, resulting in what they market as a “robust” product, but those older features have limited use on the modern shop floor. Over time, you’ll pay even more for the complexity in additional support just to keep the system running.

Matching Cost to Benefit in an MES             

When looking at the price of a software system, you need to keep in mind price is not always a reflection of your benefit. Paying millions for an MES does not mean you’ll get more benefit. In fact, many times the factors that lead a company to price their software have nothing to do with how it can help a potential customer.

This is why it is so important to consider the ROI for a software system before you buy. Break down the cost, and look at how you will use the software and your intended return.  Determine if the high-cost software system will deliver an equally large benefit in a short amount of time. Otherwise, you may be stuck with an expensive system that never matches the promises of the company that sold it to you.

Want to learn more, or see how you can seamlessly implement a paperless manufacturing solution in manageable phases? Then contact CIMx today for a free manufacturing analysis.

A Simple Measure of Partnerships and Software Systems

Like your software systems, the success of a partnership is measured by the overall benefit to everyone involved.

By David Oeters, Corporate Communications with CIMx Software

When partnerships, and software systems work in sync, everyone benefits. Illustration by www.colourbox.com

When partnerships, and software systems work in sync, everyone benefits. Illustration by http://www.colourbox.com

On Monday we announced a partnership with ITS (Information Technology Services), a high-end IT software and consulting company based in the United Arab Emirates (UAE).

We’re excited about this partnership. ITS is a great company with a knowledgeable staff.  Their customer-focus and reputation as a provider of industry-leading software solutions align with our business strategy at CIMx. This is all true, and provides a solid basis for our partnership, but that’s not the real reason for our excitement.

Partnerships remind me of software systems.  The key to a successful partnership, or software connectivity, is allowing each partner, or system, to do what they do best while ensuring those efforts works in synch. Success is measured by the benefits of the combined efforts. If one partner is forced to adapt to compensate for the deficiencies of the other partner, or if the combined efforts of all partners yield less than the efforts of the individual, you have a problem…

ITS knows their market. They are respected and have a tremendous rapport with their customers. CIMx understands manufacturing, technology and software. Our product, Quantum, applies software and technology tools to meet the critical needs of manufacturing. ITS provides a level of service and connection with customers in their market that CIMx can’t match since we are based in the United States. We work with ITS to deliver Quantum, an industry-leading MES (Manufacturing Execution System) and paperless manufacturing system. Quantum is a behavior-based, rather than a forms-based, software system minimizing the cost of implementation and service for ITS customers. ITS then provides the services and training their customers have come to expect

By letting each company focus on what they do best, the combined efforts of ITS and CIMx will produce greater returns for both businesses and their customers…

MES, ERP, and Partnerships

Business software systems should work together like a partnership, each part in sync delivering greater returns for your business. That said, don’t expect your ERP (Enterprise Resource Planning) system to deliver the functionality and benefits of a PLM (Product Lifecycle Management) or MES. The strength of the ERP is managing business data and automating back office functions of the business. The design of the ERP isn’t suited to collecting data on production, managing engineering design or supervising work and work instructions. Twisting your manufacturing processes or forcing one system to fulfill the functionality of another system is crippling your productivity with no real benefit.

It’s forcing one partner to adapt to compensate for the deficiencies of another partner. No one benefits, and ultimately you hurt the entire organization. When you have systems working with their strengths, everyone works better and more efficiently.

In the end, that’s what we all want with our partnerships (and our computer systems). It’s why we are so excited to be working with ITS.

5 Reasons You Need Real-Time Shop Floor Data Collection

A company relying on paper-based data collection isn’t giving their shop floor the tools they need to compete in the modern manufacturing market.

By David Oeters, Corporate Communications with CIMx Software

Are you getting the shop floor data you need? Illustration by www.colourbox.com

Are you getting the shop floor data you need? Illustration by http://www.colourbox.com

Consider this – operating a manufacturing company with paper-based build books and data collection is like trying to drive a car by looking backward, in the rear view mirror, instead of forwards.

The Problems with Paper

We look forward, and not back when we drive because it lets us react to changing conditions on the road. Looking backward will cause wrong turns and problems. You’ll hit a few things, get confused, end up driving much slower to avoid critical mistakes, and won’t see disaster until it happens. Along the way, you’ll miss opportunities and introduce more problems. You’ll reach your destination, but it won’t be the most relaxing or efficient journey …

… which actually does sound a lot like a shop floor still using paper. If you aren’t collecting real-time shop floor data:

  • You are always operating off dated information. Sure, in an emergency someone can run to the shop floor and answer a question, but how much disruption is that answer causing?
  • You create a vicious production cycle based on reacting to past production data. You get data weeks after a production cycle and plan a response. Then you wait for more data to see if the response brought improvement so you can plan another response and then wait again…
  • Simply gathering data is often more work than a benefit because the process can’t be automated. Since the data is historical and less valuable, some companies never bother to collect data, so the shop floor accepts problems and inefficiencies.

The Benefits of Real-Time Data Collection

Errors, quality escapes, avoidable problems and production missteps are all common for a manufacturer still using paper and relying on outdated data to manage production. Once a company begins using real-time production data, benefits quickly accumulate, including:

  1. Improve quality by identifying potential errors early, before they become more serious (and costly) problems;
  2. Increase customer responsiveness by changing the priority of an order when needed;
  3. Engage customers by responding more quickly to requests and answering questions immediately;
  4. Eliminate guesswork and empower management so they can make decisions with the most accurate information possible;
  5. Better respond to change on the shop floor by improving efficiency with data-driven process adjustments.

The Future of Manufacturing with MES and Paperless Manufacturing

With timely and accurate data, how much can you improve your shop floor? Image by www.colourbox.com

With timely and accurate data, how much can you improve your shop floor? Image by http://www.colourbox.com

Moving forward, companies using paper will find it increasingly difficult to survive against competitors that have already embraced data-based manufacturing.

For manufacturing, as much as we like to plan the future of our industry with technology, many companies still struggle with paper-based manufacturing. Take a look at the latest industry news, and it’s as if we’ve already forgotten manufacturers still printing build books every morning and collecting data on a spreadsheet to be collated later.

There is no reason to keep operating the shop floor with dated and inaccurate information, or to keep relying on paper.  There are MES out there, even ones that aren’t cloud-based, that can deliver an ROI in only a few months. With a phased implementation, you can install the system in a few weeks and start collecting real-time production data soon after.  In the following phases, you start implementing more advanced features of the system to match your exacting workflow needs.

Using a shop floor system is like wiping the confusion off the windshield of your shop floor, letting you drive production by looking ahead, rather than behind. Want to learn how quickly and easily it would be for you to start using data-driven manufacturing, then contact CIMx today for a free shop floor analysis. We’re always happy to answer questions.