Taking Stock of Industry 4.0’s Impact on Manufacturing and Distribution.
Guest Post by Ultra Consultants
Read time: 3 min.
This is the era of Industry 4.0 – a term commonly considered as the 4th industrial revolution.
It’s a time of industry disruption as organizations keep pace with advances in automation, big data, cloud computing and connected machines.
Industry 4.0 is built on the foundation of data and analytics.
And to harness the power of data, ERP systems have emerged as the technology backbone that drives the analytics to enable companies to compete and thrive.
What’s the Role of ERP?
As we meet with manufacturing and distribution project teams, ERP plays a key role in driving the success of emerging technologies as part of Industry 4.0.
From smart machines, sensors and the devices necessary to capture data from equipment and processes, to sophisticated business intelligence, it is key for enterprise systems to store and analyze data from multiple locations and processes. ERP is the platform to analyze data sets across multiple sources and to track actionable data so it is available anywhere, anytime. That insight is then used to discover correlations, cause and effects and predictive indicators.
ERP serves as “one source of the truth” tracking business processes across the enterprise. Aligning real-time data from inventory, purchasing, quality, material costs, production, planning and forecasting must be in real-time alignment. There must be a seamless flow of data which is being continuously re-evaluated and measured to optimize the entire enterprise.
Think of the role of ERP in Industry 4.0 as an enabler– optimizing processes to shorten production cycles, improve the speed of delivery, trace the product throughout its lifecycle, manage the extended enterprise and forecast with greater accuracy than ever before.
Transparency of information has always been a hallmark of effective enterprise technology. By transparency we mean the ability of enterprise systems to make data not only accessible but to also provide context that improves decision making.
Information transparency improves decision-making by making data easier to access and analyze.
As an example, we see evidence that forecasting – always an inexact, time consuming and imperfect process – can be eliminated by communicating point-of-sale inventory information directly to the manufacturer. This transparent exchange of information allows the manufacturer to transition from the make-to-stock production model to the more profitable make-to-order model. The manufacturer can then focus on only producing the in-demand products, reducing the need for slow moving inventory.
Increasing Customer – Centricity
Another key impact of Industry 4.0 is an ever-increasing focus on customers and experience.
Customers in all markets are demanding better, more personal experiences and services. Even in complex industrial manufacturing, there is room for improving customer experience and customer service.
Consider a recent example we’ve recently come across of a complex manufacturer producing industrial equipment. The final units now include dozens of sensors – monitoring all aspects of the equipment and its operating environment. The producer can access this data and provide their customer, the user, information proactively. They can suggest how to improve performance, schedule maintenance and even plan for improved production specifications in the future.
Industry 4.0 and ERP – Get Educated
If your company isn’t currently taking stock of data preparation and information transparency to support Industry 4.0, it’s time to rethink priorities.
We’re pleased to partner with Terillium on an upcoming educational webinar that offers more to consider when it comes to Industry 4.0’s impact on manufacturing and distribution.
To learn more, join a webinar about Industry 4.0 impact on manufacturing and distribution taking place August 15. Register to attend and receive an archived recording of the event for on demand viewing.
About Ultra Consultants
Ultra Consultants is an independent consulting firm serving the manufacturing and distribution industries throughout North America. Since 1994, Ultra has delivered enterprise technology expertise and process management to drive business performance improvement. www.ultraconsultants.com.