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  • Writer's pictureMatthew Barber

Can MES Improve Your Bottom Line?

The Role of MES in Manufacturing

Manufacturing Execution Systems (MES) are continuing to gain popularity as manufacturers realise the value they bring. This value can often be indirect, but there is no getting away from the fact that an MES can have a direct positive impact on your bottom line.


I've covered MES at length in other blog posts, but here I want to focus directly on the financial benefits of implementing MES. Return on Investment (ROI) is challenging to calculate accurately (especially up front), but hopefully this helps shine a light on some areas where MES generates higher profitability for manufacturers.


As a quick refresher to avoid you bouncing to another article...


The primary role of an MES is to manage and control the execution of all manufacturing operations in the factory. It does this by tracking, controlling, and documenting the transformation of raw materials into finished goods. This real-time data provides valuable insights that can be used to make informed decisions about production processes. MES covers all operational departments: Production, Quality, Inventory/Logistics, and Maintenance.


MES bridges the gap between the plant floor and the business applications (like ERP), providing a holistic view of production. This allows for better planning, scheduling, and control of manufacturing operations, leading to increased efficiency and productivity.


How MES Improves Your Bottom Line

Now that we understand the role of MES in manufacturing, let's look at how it directly impacts your bottom line.


Improved Efficiency

By improving efficiency and productivity, MES reduces the cost of production. This is achieved through better planning and scheduling, reduced downtime, and elimination of waste (I'll cover these in more detail below). The result is a significant reduction in operational costs, directly improving the bottom line.


Real-Time Visibility of Issues

One of the key benefits of MES is its ability to collect and analyse data in real-time. This allows for immediate identification and correction of problems, preventing costly delays and waste.


Increased OEE

By streamlining processes, providing better visibility into operations, and empowering workers with necessary information and worker instructions, MES can increase overall productivity, leading to higher output with the same or fewer resources.


Downtime is often the single biggest contributor to OEE, so getting a handle on this improves efficiency and boosts profitability.


Imagine how valuable just a 1% improvement in your OEE would be for your business.

Continuous Improvement

You can't improve something unless you measure it, and MES records all the relevant data for continuous improvement activities, in real-time.


By identifying inefficiencies and bottlenecks, businesses can make necessary adjustments to their processes, leading to increased productivity and reduced costs. Some manufacturers implement Kaizen to further aid continuous improvement activities.


Improve Quality Control

MES plays a crucial role in quality control. It ensures that all products meet the required standards and specifications. This not only reduces the risk of defective products but also ensures compliance with industry regulations.


Improved quality control leads to increased customer satisfaction, and reduced waste. Delivering high-quality products consistently means businesses can build a strong reputation in the market, leading to increased sales and profitability.


Reduced Waste and Rework

Waste can be reduced in many ways.


MES can help limit overproduction and reduce waste, cutting unnecessary costs associated with excess inventory and inefficient production practices.


Waste can be reduced through higher quality products, reducing the scrap created. MES can help drive operators to reduce waste through better worker instructions, and process validation preventing operators from doing the wrong thing.


Rework is also costly, MES helps improve the First-Time-Through-Quality (FTTQ) figure.


Reduced Inventory Costs

MES helps in reducing inventory costs. By providing real-time visibility into the manufacturing process, it allows for better inventory management and reduced Work In Progress (WIP) inventory.


This means less money tied up in inventory, reducing carrying costs and improving cash flow.


Optimised Scheduling

MES helps in better planning and scheduling of production activities, reducing idle time, optimising machine utilisation, and facilitating just-in-time production. This optimised scheduling helps to lower costs associated with overtime or underutilisation of resources. Usually MES would provide relevant data to a 3rd party finite capacity scheduler to achieve this.


Compliance and Regulatory Costs

MES assists in maintaining compliance with industry regulations and standards, reducing the risk of non-compliance fines or penalties, which can negatively impact the bottom line.


Conclusion

MES plays a crucial role in modern manufacturing. By providing real-time visibility into the manufacturing process, it enables businesses to optimise their operations, improve product quality, and reduce costs. The result is a significant improvement in the bottom line, making MES a worthwhile investment for any manufacturing business.


So, if you're looking to improve your bottom line, it's time to consider implementing an MES in your manufacturing operations. The benefits are clear, and the potential for increased profitability is significant.

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