Key points
Manufacturers need more than ERP to future-proof their growth and add value to their customers and partners. Industry leaders are rethinking the concept of “competitive advantage” driven by an accelerated digital push owing to, among other things, the pandemic. At the heart of this is applying intelligent ERP technologies to drive agility, automation, and intelligence across critical systems.
According to Gartner, 50% of factory work will be done remotely by 2024. Additionally, IDC predicts that by the end of this year, “20% of the top manufacturers will depend on a secure backbone of embedded intelligence, using IoT, blockchain, and cognitive, to automate large-scale processes and speed execution times by up to 25%”. However, these are pre-pandemic estimates and are sure to accelerate.
The fourth industrial revolution has ushered in an era where industrial automation in the manufacturing process drives increased demand for software systems that reduce time and cost. Intelligent technologies play a crucial role in enabling efficient, reliable, and secure procedures to support operational efficiency and reduce costs for organisations.
The pace of adoption and implementation will be a big difference between the leaders and laggards of the smart manufacturing market. The journey to a dynamic smart manufacturing ecosystem is heavily reliant on intelligent ERP automation. It helps to mitigate and maximise critical aspects in the process and people that contribute to future growth.
In a fiercely competitive manufacturing industry, those who lead (and want to continue to do so) must leverage technologies that offer predictive abilities to identify, adapt and respond to evolving complexities.
The key challenges of modern manufacturing:
Outdated ERP systems: Legacy ERP systems were transactional and recorded events that procedurally took place. While many manufacturers are still stuck with these conventional ERP systems, they are often on the journey of digital transformation or cloud migration. During this journey, it is crucial to keep complete visibility into that progress and ensure it does not impact business operations.
End-to-end visibility: The absence of complete visibility into the SAP landscape restricts consistent and accurate information. For manufacturers, the cost attached to the downtime or delayed action is very high. It severely impacts the manufacturer’s ability to optimise processes or get to the root of quality or lead time issues. Having a single and real-time view of your entire SAP world is an essential requirement for keeping the lights on and supporting the strategic modernisation of your ERP.
Personalisation issues: Manufacturing has typically transitioned from mass production to mass personalisation owing to consumer demands. It calls for greater flexibility from the manufacturer and requires ERP capabilities to support these processes.
Furthermore, it also calls for maximising in-house potential. However, the operations team usually spends most of the time firefighting. It is critical to provide them with strategic bandwidth to maximise their efforts on business value tasks. Strategic bandwidth is achievable through the automation of repetitive tasks and intelligent observation of your entire landscape.
Reactive approach: The current ERP systems are unable to predict and resolve issues. Often the teams swing into action only upon reporting the problem. It delays the response from concerned departments and hinders seamless operations. Manufacturers must bring their operations on a journey from reactive to proactive and, with intelligent management systems, on to a self-healing landscape.
These challenges have led to the increasing number of manufacturers looking to migrate the ERPs to the cloud and implement modernised landscape management platforms powered by AIOps. It offers a transition from transactional to predictive approach and helps manufacturers focus on innovation and business value agenda.
Benefits of a cloud-based ERP for manufacturers:
Overall integration: Cloud being the digital core of the company simplifies the integration of other organisational solutions. It helps extend the ERP capabilities and minimise operational risks.
Greater value: Cloud-based ERP eliminates the need to build and maintain an extensive IT infrastructure. The hefty upfront costs for physical infrastructure change to a subscription-based model- reducing operational costs.
State-of-the-art security: Cloud ERP offers next-gen protection for all kinds of data available within the systems. Data collected through ERP systems are available only to the authorised teams and encrypted at all times.
Enhanced agility: Manufacturers achieve greater agility through a cloud-based ERP. The easy access to critical data from anywhere to everyone means less time from insight to action. Manufacturers with existing cloud ERP capabilities have immensely benefited from remote access during the recent pandemic.
Scalability: Scaling cloud ERP with the manufacturer’s growth and requirement is somewhat effortless. Compared to the on-premise infrastructure, the cloud environment adapts, adjusts, and achieves the required change with ease.
While digital transformation is driving the migration of ERP environments to the cloud, there are still (and likely will always be) some on-premise environments. The hybrid reality is widespread among manufacturers today.
Optimisation and automation advance the seamless management of various landscapes by accelerating the journey to modern infrastructure.
Avantra’s recent survey with ASUG reveals that automation is the most sought-after technology that SAP customers plan to use in the next 12-months. Almost 59% of respondents were looking to stay ahead using automation and the power of predictability it offers.
Optimising SAP landscapes with automation delivers real-time insights, a centralised view into the entire landscape, or prediction capability to resolve the issues ahead of operational impact and offers success-critical business benefits to the manufacturers.
Business benefits of automation:
Time for strategic projects and innovation: Significantly reduces the daily manual effort for the operations team, creating hours of additional time per week to move the business forward. The saved time can be crucial to perform high-value tasks that contribute to business results.
Reduce Unplanned Business Outages: There is nothing more frustrating for manufacturers than to find their operations at a halt because of system issues. It is especially true when it was possible to detect the problem ahead of time.
Machines are the best at watching other machines and far more precise than humans. A modern operations platform like Avantra’s allows for unusual issues to be detected and highlighted before they cause downtime for the business. Real-time monitoring combined with alerting and automation is a hugely powerful tool to reduce unplanned business downtime.
Increased Security and Stability: Enterprise IT security is the ultimate game of cat and mouse where, in the majority of cases, the business is on the back foot to detect required updates, deploy patches and defend the core.
Modernised operations can constantly watch the landscape and help identify out-of-date software to enable a proactive and targeted approach. Rather than searching the landscape for affected systems, the automation platform points to the vulnerability and suggests the next steps.
From implementation to innovation, cloud or on-premise environments, AIOps and automation streamlines and fast-tracks the critical tasks, enhances decision-making, and quickly adjusts to changing criteria. It helps manufacturers to mitigate operational barriers and offers a scalable approach that prepares them for the future.
