Quest for value – maximising ROI for MES

Posted on 19 Feb 2014 by The Manufacturer

How do you maximise the ROI of an investment in a Manufacturing Execution System?
Fraser Thomson, automation and Manufacturing Execution Systems consultant at Cimlogic, outlines the questions to ask.

According to some estimates, the global market for Manufacturing Execution Systems (MES) is growing at almost 14% a year, and will reach $8.9 billion by 2016.

Undeniably, such figures underscore the growing importance that is being placed by manufacturers on addressing what is increasingly seen as manufacturing’s missing link – the gap between a company’s production plans, and the means of bringing those plans to fruition.

For as the name implies the role of an MES is to do just that: take a customer order at the ERP level, and translate it into manufacturing instructions on the factory floor, thereby turning aspiration into deliverable reality.

But more than that, and just as importantly, MES acts as a system of record, capturing a wealth of data about what happens on the factory floor, and transforming it into productivity-boosting dashboards, charts, and performance metrics.

But the stark reality is that an investment in MES isn’t a one-way bet. MES implementations can, and do, fail. MES implementations can, and do, underperform on expectations. And MES implementations can, and do, become less and less relevant to a business’s current requirements.

“MES implementations can, and do, fail. So how is a manufacturer to avoid such an outcome?”

Put another way, you don’t have to look too far to find MES implementations that are seemingly functional, yet which are delivering little of value. In such situations, the usual problem is that the MES capability in question was bought and implemented to meet what were seen as the MES requirements at the time. Turn the clock forward a couple of years or so, and that initial MES requirement has been overtaken by events and business change.

So how is a manufacturer to avoid such an outcome? What steps can they take to ensure that their particular MES implementation is counted as an undoubted MES success? And one with an ROI that has been maximised? Cimlogic recently-published its free-to-download guide entitled 20 tips when selecting an MES system and integrator. It’s a guide which seeks to demystify the process, and answer such questions.

Simply put, it urges manufacturers to carefully consider three aspects of a proposed MES implementation. First, the product itself. Second, how the business’s own requirement
roadmap matches the vendor’s technology and development roadmap. And third, the proposed implementation and implementation partner.

Let’s look at each in turn.

Product-specific issues

When considering product-specific issues, manufacturers will have two broad areas of concern. One is to do with the product’s breadth, structure and antecedents. The other relates to their own immediate requirements, and how the proposed product meets those requirements.

When considering a product’s breadth, structure and antecedents, for instance, manufacturers will want to know who owns the product, where it came from, and how it got to where it is today.

Is it a single system, developed from the ground up, or is it a series of different systems, perhaps from originally different vendors which have now merged together?

And to meet its own specific requirements, what exactly does a manufacturer have to buy?An entire system? A single module? Or multiple modules? How is integration with other systems – ERP and quality, for instance – to be achieved? What are the hardware requirements, what are the fault tolerance requirements for this hardware, and should such hardware be virtual or on-premise?

Finally, turning to the product’s vendor, manufacturers will want to be assured that the vendor is financially stable and creditworthy, has security and other policies that are acceptable to them, and offers acceptable maintenance and upgrade practices. What’s more, in our view it’s always wise to choose a vendor for whom MES is a core line of business, not an afterthought.

Where are we heading?

As consumers, most of us buy products that match with our existing needs. With their long life spans, enterprise applications are different, and especially so in the case of manufacturers venturing into MES for the first time.

“It’s always wise to choose a vendor for whom MES is a core line of business, not an afterthought”

A manufacturer might start with modest requirements – electronic batch records, for instance – but find in two years’ time that they would like to add an Overall Equipment Effectiveness (OEE) capability, and a quality capability.

It’s obviously bad news if your chosen MES doesn’t offer those capabilities. But it’s even worse news if the vendor’s technology roadmap makes it clear that the vendor has no intention of offering that capability—ever. Likewise, the same goes for a hosted, cloud-based Software as a Service offering, support for mobile devices such as tablets, and SMS alerts.

In short, take a long, hard look at your own likely requirements roadmap, and an even harder look at the relevant vendor’s roadmap. Are the requirements you need on offer? And what are the upgrade costs?

Implementation issues

Finally, a manufacturer needs to think about how they want their new MES system implemented. How well-equipped with implementation staff is your proposed vendor or implementation partner? How well qualified are they? What experience do they have? How much post implementation support will you get, and how will it be charged?

More fundamentally, what sort of implementation do you want? Quick and inexpensive, or protracted and detailed? And what implementation methodology will be used?

Consider, too, the approaches that will be taken to testing.

Will there be a small scale ‘conference room pilot’? Will other forms of simulation play a role? How is the switchover to be managed, and how is the integration with ERP to be handled?

Bottom line

In many cases, the answers to such questions, ranging from the product itself, to the vendor’s technology road map, and the approach taken to integration, will be straightforward. In other cases, less so, and in still further cases, the answers will be disturbing enough to prompt either a more searching dialogue, or a decision to look elsewhere.

But that is what maximising the ROI of an MES implementation is all about: asking the right questions, and making sure that you get the right answers.

To get more guidance on what questions to ask in order to safeguard ROI on an MES investment – and to learn how to interpret and evaluate the answers – download Cimlogic’s free guide, 20 tips when selecting an MES system and integrator at