We are already nearly a quarter of the way through the 21st century, and all around us we see countless technologies that make our lives easier. So how is it possible that so many manufacturing companies have missed the train when it comes to production management—and many of them have not even realized it yet? After all, most of these companies are perfectly capable of purchasing and using the latest technologies. Yet the most crucial area—production planning and control—is still being handled in the same way as 30 years ago.
Let us try to answer the question of why so many manufacturing companies still operate without digitalized production management. Why are paper forms still circulating in so many production halls, and why is planning still done on whiteboards? Why do so many companies fail to manage their core activity—production itself—more efficiently using MES and APS systems? Who is responsible?
Production managers? Sometimes
In some cases, production managers themselves can indeed become the proverbial bottleneck. After the implementation of an MES, it often turns out that OEE and other KPIs are in fact worse than what had been reported for years. Weak points become visible. Admitting these reserves requires courage, but addressing them is precisely where the main benefit of digitalization lies. What is needed, therefore, is brave and enlightened leadership.
ERP vendors? Partly yes
Anyone selling an ERP system naturally tries to convince customers that their solution can handle everything. Most ERP vendors, however, are well aware of what ERP systems can realistically achieve and where the limits of an ERP production module lie. ERP and MES are two separate but closely interconnected systems—this is the proper, systemic approach.
Are consultants and advisors a barrier? Usually not
Many external consultants are familiar with MES from their previous industry roles and recommend it to their clients. And the others? Some of them unjustly fear—out of lack of knowledge—that MES could deprive them of part of their livelihood. Yes, many things are done differently in MES-driven production, and consultants need to adapt their role accordingly. But those who put in the effort discover new opportunities. This is evident among our customers, who continue to identify additional savings year after year thanks to MES.
Effort required? Definitely yes
Yes, it takes work. Most changes require real effort, and the implementation of a better production management system is no exception. While it ultimately saves a great deal of work, it does not happen by itself. We understand that many people prefer peace of mind and avoid major initiatives if they do not feel compelled to act.
Fear? Yes, a brake on innovation
Of course, things can go wrong for many reasons. It is possible to draw inspiration from previous implementations, choose an experienced partner, communicate well within the company, manage the project properly, and thus minimize risks. Nevertheless, fear still plays a role. If I do nothing, nothing happens—nothing breaks…
Cost? The payback is very fast
For the digitalization of production management, a return on investment of 12–18 months is commonly cited—and our customers’ experience confirms this. By the way, MES can also be rented, which significantly reduces the initial investment.
Subsidies? It works without them too
Let us set aside the debate about whether subsidies help or harm the market. Some companies, once they decide they want an MES, want it immediately in order to benefit as soon as possible. They finance it from their own resources, or they apply for subsidies retrospectively. In my view, MES is a necessity even without subsidies—but I also understand companies that prefer to wait for subsidy approval. Subsidies certainly complicate and delay projects, but at the same time they help cover the costs. They are definitely not the main reason for the lag described above.
Education? Not the issue
Almost every week there is a conference on digitalization and Industry 4.0. The internet is full of information and case studies. So those who want to know, do know.
AI? Another reason to have high-quality data
AI is one of today’s major phenomena, and many people are waiting to see what happens—hoping for a miracle: “We’ll skip digitalization and Industry 4.0; AI will come and save us.” While AI can certainly help with many things, including manufacturing, one thing must be admitted: AI without data is completely useless. There is no skipping steps. First, you need to collect large volumes of high-quality data using MES, and only then can you build on it. Only after that can we realistically expect help from AI—certainly not the other way around.
Multinational parent companies? Sometimes they have a mind of their own
Yes, this is true—we have encountered it many times. Local management, often without an investment mandate, carefully selects an MES solution, everything is on track, the project goes for approval to headquarters—and that is where it ends. This issue is, of course, more complex, but it can certainly represent a major obstacle to innovation.
Bureaucracy and indecisiveness? Among the main obstacles
Let us be honest: many manufacturing companies are not particularly agile. Even when they know what they want—or even need (for example, having to implement MES to meet customer requirements or audit demands)—working with them can be, politely speaking, cumbersome. Endless approval cycles, revisiting already resolved questions, postponing decisions, changing requirements, unnecessarily complicating and prolonging the whole process. What can be achieved in one month in some companies takes six months elsewhere. Yes, there are examples of enlightened leadership where things run much more smoothly, but it is fair to say that bureaucracy and management indecision are among the main barriers to innovation.
Innovation requires work, courage, and faith in the outcome
It is clear that there are multiple reasons why the digitalization of production management can be challenging. Everyone understands that if I buy one robot, I save two operators—that is easy to grasp. Taking a more fundamental approach, however—improving not just one workstation but managing all machines and workstations more effectively at once—seems more complex. Yet this is not rocket science; in fact, it is quite simple. Still, many people are understandably afraid of it. It takes work, courage, and faith in the result.
Conclusion
I certainly do not want the above reflections on the barriers to the digitalization of production management to sound pessimistic. There are many manufacturing companies that have not fallen asleep at the wheel of digitalization, are developing successfully, and it is a pleasure to take potential customers to visit them as reference sites.
At the same time, it must be said that the “culprits” and barriers to innovation described above are real, and we encounter them in practice almost every day. I wish all companies that they will soon no longer be affected by them—otherwise, their position in the market will continue to become more difficult. Without the digitalization of key processes, it will be hard, and in most cases impossible, to maintain competitiveness.
Tomáš Hradský
CEO, PHARIS
This article was also published in the professional magaine IT Systems and on the SystemOnline website.
