Manufacturing’s Next Act Begins With Connectedness And Standardization

Klaus Berghoffer

Part 3 of the “Uncovering the Potential of Digital Investments” series

The evolution of manufacturing begins on the shop floor – and this reality couldn’t be more evident than it is today. Industry 4.0 technologies are driving unprecedented levels of product quality, manufacturing flexibility, plant productivity, and on-time delivery. The Internet of Things is allowing machines to self-predict potential malfunctions and trigger work orders. Visual sensing and connected tracking are enabling full product traceability and generating data-driven insights on performance.

The opportunities ahead mark an exciting time for manufacturing organizations. But the further away decision-makers are from the shop floor, the harder it is for them to appreciate and understand these bold changes and their impact on the overall business.

Recently, SAP’s Kishore Sasidhar, strategic industry architect, and Andy Nyman, principal architect, discussed with me the challenges of this disconnect between the top floor and the shop floor systems and the secret to overcoming them all.

Klaus: The gaps among manufacturing processes, connectivity, and insights are closing in as the shop floor continues to adopt ground-breaking technologies. Meanwhile, it’s hard to ignore that the rest of the company may be having a difficult time keeping up. Why is this happening?

Andy: Gathering, analyzing, and using data across the business is a considerable hurdle that many companies need to address. The shop floor gathers a great deal of information that has the potential to be useful across the value chain. But in many cases, there is a disconnect between manufacturing and the rest of the company. The data collected by manufacturing systems is structured, stored, labeled, measured, and communicated in a variety of ways. This information needs to be understood well and combined with business data to deliver the greatest value to the organization.

Kishore: Historically, information silos were quite common and oftentimes enforced due to various reasons such as organizational structure and growth and the kind of interaction with other parties. This is the most challenging issue facing organizations as they try to reinvent to stay relevant. To make effective decisions, businesses need a reliable and consistent way to process meaningful data collected from a multitude of technologies across the organization, which is not easy without the right central system.

Klaus: What are some of the best practices that are helping businesses overcome this obstacle efficiently and effectively?

Andy: Connected manufacturing, which is an Industry 4.0 best practice adopted widely in the industry, is driving the need for responsive delivery. Manufacturers need to react to customer needs. Design changes need to be implemented more quickly. Highly configured orders need to be processed and fulfilled without error and delay. And these challenges are just the start of what manufacturers are facing.  Connected manufacturing is critical in meeting these requirements because it goes beyond just integrating systems and sharing data.  Connected manufacturing is also about integrated business processes.

Kishore: A fully integrated production process from the top floor to the shop floor is key to removing information silos. This approach, in turn, allows users to interact with data and understand issues, such as macro market dynamics, more broadly, and influence outcomes, for example, a product variant with a lot size of one.

Klaus: Why is standardization critical when tackling the challenges of connected manufacturing, even if the company has a unique business model?

Kishore: The goal of standardization is to ensure quality, consistency, and efficiency when delivering products that customers want. But we can’t forget the endless variance that exists in the industry that differentiates one business from another. Very rarely do companies use technology and manage operations in precisely the same way. So when we talk about standardization, we’re focused on adopting a common set of processes used as an industry standard to connect users, systems, and things and ensure a seamless flow of meaningful data. This allows businesses to spend less time resolving system-integration and data-integrity challenges, and more on delivering value to their customers; interact with third-party technology providers more efficiently; and innovate with ease.

Andy: The more conventional the manufacturing ecosystem operates and engages the business, the lower the cost and risk of implementations. Standard processes, standard accelerators, and standard end-to-end solutions are powerful from this perspective. With a reference architecture and a standardized set of processes, companies can move through the early stages of technology deployment and realize improvements more quickly.

Get to know the preconfigured business processes, capabilities, and delivery approach that can help your top line and shop floor gain a mutual understanding of your business. Explore SAP Model Company for Connected Manufacturing.


Klaus Berghoffer

About Klaus Berghoffer

Klaus Berghoffer is a Marketing and Communication Senior with 31 years of working experience in the IT industry and a technical university background. Klaus has contributed to large IT companies as well as 15 years for startups in fast-growth markets. He brings a history of cultural diversity from living in different countries as well as diverse working experience from different fields.