Tomororw's classics demand new systems

'Very encouraging' is perhaps the best way to describe our manufacturing economy. The EEF – which, for political correctness and branding, now describes itself as 'the manufacturers' organisation', not the 'Engineering Employers Federation' – in its first 'engineering' outlook survey of 2004 speaks of the best prospects for our sector in fully seven years. Indeed its forecast is for engineering growth at 3.4% in 2004 and 4% in 2005; manufacturing, 2.4% and 2.6% respectively. Likewise, the CBI ('voice of business') has raised its forecast for growth, now predicting an average 3% this year, falling back to 2.8% in 2005. CBI chief economist Ian McCafferty says: "The economy should grow robustly this year and next, as exports benefit from gathering momentum in the global recovery." Good news, but as EEF director general Martin Temple says: "[Business] investment is still conspicuous by its absence... If manufacturers are to make the productivity improvements necessary to reap the full rewards of the upturn in global demand, it must be underpinned by a significant upturn in investment." Just so. As one door opens, another closes. The opportunity for growth finally presents itself and, because we've had to become so lean (hopefully in both senses) and have relied so heavily on self-financing, we can't respond. Or at least not as vigorously as we'd like. But we do have budgets, tight as they are. The issue is how to get the best out of them and maximise on the growth window – ideally also building for sustainable growth. Which is precisely where business, engineering and manufacturing IT come in – and specifically this issue of Manufacturing Computer Solutions. We have sought advice from advocates and participants from across our sectors on what boils down to the central issue for all of us: how to do more with less? Or more accurately, how to do much more by spending a little on the IT investment we've already made – and thus transforming as many key processes, operations, departments and revenue opportunities as possible? And equally, what are the cost/benefits, implications and realistic timescales? In this IT Strategy issue you will find guidance from our senior manufacturing peers across the broad swathe of industries, sectors and company sizes, along with observations and future-gazing from the IT and service provider communities. Some have also taken the opportunity to sponsor editorial on specific initiatives and IT that we agree justify special examination for their potential to transform business and operations. Manufacturing users we asked mostly to outline their own business and IT strategies, looking in some detail at their existing and planned projects in light of their business drivers, existing IT, manufacturing realities, position in their supply chains and so on. Meanwhile, we harnessed figures from among the software and services vendors strictly to put the case for today's and tomorrow's most powerful business initiatives and technologies in terms of both cost reduction and underpinning growth through competitive advantage. We challenged them to prioritise potential investments, given business, engineering, manufacturing and existing IT context for the next 24 months. Your agenda; your priorities The output is presented as per our regular categories. We start with manufacturing and supply chain management (ERP, SCM etc, page 6), then move on to CAD/CAM and product lifecycle management (PLM, page 28), before the IT and network infrastructure (page 38). Then we examine manufacturing business strategy and associated issues (page 48), before finally covering initiatives, approaches, systems and software tools for plant and factory controls, automation and manufacturing execution (MES, page 58). The result is an issue from which you can expect to establish your own agenda and some priorities, understanding the potential impact and time frames of emerging technologies. Our goal is to enable you to put this journal down knowing what business benefits to expect, and what tools, technologies and approaches are here or just around the corner: everything that should be influencing your management team. That said, there are some points worth emphasising. In no particular order, but first it's salutary to note the Computing Suppliers Federation (CSF) releasing figures from a study indicating that almost half (42%) of UK business' management don't understand IM (apparently 'information management'). One aspect of IM, document management, was described variously as 'version control', 'word processing', 'records creation'... When it came to 'enterprise content management' (ECM), more than half of respondents refused even to guess its meaning. While the CSF interpreted its findings as a "shocking" lack of understanding, the truth is that too many in IT still persist with acronym-talk, expecting the wide world to notice and care about the definitions they conjure up. Being succinct is good; being unintelligible is not; being self-serving is transparent. The lesson of IT in manufacturing is 'use appropriate language and you shall be understood; don't and you won't'. In that context, next consider CRM – customer relationship management – which, partly due to hype and hijacking, and partly to the number of potential interpretations, is misunderstood, even discredited. David Waldron, former IT controller at Williams plc (which owned Chubb, Kidde etc), now MD of product configurator tools developer DataDialogs, professes himself disappointed. "The cost is in maintaining relationships with existing [not new] customers, because it needs to be at several levels – deeply technical, so customers can see CAD images, technical documentation and so on, and interact." His point: if manufacturers are supposed to get more 'customer facing', CRM should provide a complete conduit across engineering, production and service, not just sales and marketing. Dr Ian Howells, VP of marketing for integration big boy SeeBeyond, says we need to think of CRM not as packaged applications, but an enabling set of end-to-end processes and applications. His view: it's largely about connecting people and systems so that you and your partners get a better crack at selling everything you can to existing and potential customers because you all have pertinent and live information. Sounds a lot like extended ERP, doesn't it! He majors on the 'service-orientated architecture' (more jargon I know, but see page 38) as the way to achieve it, but CRM, which started life as little more than a marketing database, is now almost anything you want it to be. The bottom line: don't be lured into thinking you need one acronym or another. Software vendors worth listening to are those that listen to you, add ideas, and offer systems to deal with your immediate issues, and a road map to a future you both agree needs addressing and will yield business benefits. Third, IT outsourcing, which can sound compelling, and is if you get it right (page 38), needs careful attention. If you get it wrong, as David Lloyd, group systems manager at body panel manufacturer Stadco, says: "You run the risk of losing a seriously important core competence." He outsources PC and server maintenance, but "to an organisation that we expect to help us improve." And that protects the infrastructure at that level. "But," he continues, "we don't outsource the PC help desk. If we're getting unhappy users we want to know about that." And for anything closer to the heart of your business, best advice is be circumspect – unless perhaps you're attractive enough for the likes of IBM to take on responsibility for your IT people, and deliver the best of both worlds. Fourth, a word on CAD/CAM and unashamedly PLM (which says what it is on the tin). Nick Miller, head of manufacturing engineering at Menard Engineering (TWR as was), is excellent value here. He maintains that although IT vendors keep churning out more and better digital systems for improving the speed, accuracy, concurrency and fit-for-purpose of your engineering design and manufacturing engineering, the problem remains one of data administration. "Data conversion, different formats and maintaining all that across the various programs we need to run is very time consuming. We need to move towards getting one source of data, and working natively so that everything is integrated and we don't end up with, say, three versions of the truth running on three different applications." He refers, for example, to tolerance visualisation applications, increasingly on the agenda as companies cut back on physical models. "Looking at digital mock-ups shows the nominal condition, but we need to know what happens at interfaces with engineering tolerance. We've been trialling visualisation software, but all the data has to be converted, and there are times when it isn't worth the effort." Absolutely, but he also agrees that PLM (page 28), which even three years ago was only for the large and complex, today is increasingly useful for smaller organisations. Benefits include support for concurrent and collaborative engineering using web technologies to make that easy – and engineering BoMs, CAD data, change management, history and structure all under a single repository. Again, the outstanding issue remains standards, with too few applications 'talking' to one another natively. So watch that, but don't dismiss PLM: it's a set of tools capable of transforming your engineering internally across departments, and externally with partners and suppliers. Similarly, 3D CAD. And finally, MRO (maintenance, repair and operations) and its obverse, your after-market: the technology is here to turn both of these around – to strip time and costs out of the former, to improve revenue generation of the latter, and to upgrade the efficiency of both. Not only can web catalogues match MRO parts against multiple attributes, dimensions, CAD drawings, technical documentation etc (and hold associations with CAD and MRP data and other products, making parts easier to find) – but systems are there to integrate purchasing (to reduce those costs), and optimise service personnel. Where do you stop? Integration, consolidation, building out your ERP systems (or similar) with value-adding modules like business intelligence, shop floor data collection, production management, advanced planning and scheduling (APS), web-based supply chain systems… There is a lot to go at. Use this IT Strategy issue to help you determine your priorities. And then keep coming back: forthcoming copies of the journal will investigate everything from RFID to wireless technologies. Remember, while classic cars of the '60s are beautiful to behold, we can't afford to be designing and building them like that any more, or running our businesses like that any more. Today, there are far better, faster, more productive, lower cost ways.