Sep 08 2011

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Riding the Manufacturing Roller Coaster

Watching the world stock markets go up and down like a roller coaster in recent weeks made me think of manufacturing. (Well, everything makes me think of manufacturing … but, that’s another story.) Specifically, it made me think of how important manufacturing visibility is. Let me explain.

As manufacturing continues to be more global, major events like stock market swings and natural disasters have prompted executives to look for greater flexibility in their production operations so they can respond more rapidly to swings in demand caused by unexpected events, wherever they occur.

This is the idea behind the DAMASA concept of manufacturing. DAMASA stands for Design Anywhere, Make Anywhere, Source Anywhere (or service anywhere or sell anywhere…). It envisions a manufacturing enterprise being able to shift production processes across any plant with complete flexibility and speed while maintaining lean, efficient operations. This lets you quickly work around disruptions, such as a sudden cost increase on the other side of the world, a local supply chain disruption or a change in customer demand.

DAMASA is not a new idea. But, it is gaining attention. I have worked with several companies that are building this capability. Centralized planning and standardized, highly flexible business processes built on a platform-based manufacturing execution system is making it all possible.

But DAMASA also depends on something else. Many companies overlook manufacturing intelligence (MI), which provides the visibility and insight into process capability and performance. Let’s go back to the roller coaster ride of the stock market. You can see quite easily, minute by minute, how markets are fluctuating. You have perfect visibility into the cost of vital commodities such as oil and minerals all around the world. That’s why it feels like a roller coaster ride. You’re there for every second of it. This is referred to as market transparency.

Do you have the same level of visibility into your manufacturing?

Do you know exactly what Factory A is making in Region C and at what cost and quality? I don’t mean what is scheduled to be made there. And I don’t mean a graphical pie chart in an MI application that is nothing but an aggregation of inconsistent batch data with little value. I mean, can you see what is actually happening on any of your factory floors, now? Do you have transparency to your manufacturing operations?

For most companies, the answer is “No.” Ironically, it’s often harder to see inside your plant than outside it. Yet if you can’t see what your plants are actually doing, what current capacity, availability and stock levels are, how can you actually respond effectively to change? And, without that visibility, you could find yourself on your own scary roller coaster ride with no clear idea of where you are heading.

Jordan can be found on Google+

Permanent link to this article: http://www.apriso.com/blog/2011/09/riding-the-manufacturing-roller-coaster/

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