MANUFACTURING

EXECUTION SYSTEM
BUILDING BLOCK OF A
FUTURE READY FACTORY
Manufacturing industries across the globe have leveraged technology over the years to meet customer
expectations, out-perform competition, simplify operations and build new products and services, resulting in
enhanced stakeholder confidence. With technologies evolving at a rapid pace, and numerous Industry 4.0 tools
available for adoption, building the right ‘digital transformation roadmap’ is critical to the success of the
digitalization journey. Some of the questions on the mind of every CIO envisaging a digital transformation for
their organization are - where to start, which technologies to adopt first, and which business or manufacturing
process to begin with. And these are the questions that this article attempts to answer while presenting a
real-world approach on starting a Digital Factory journey.

Across the globe, manufacturing industry has made at least some progress in the last decade on adopting better
technology in their manufacturing processes. This has led to improvement in efficiency and productivity, as well
as cost reduction. A few countries and sectors have been early adopters of new technology and have reaped
benefits of their decision, while others have moved up the curve by a few notches, if not more. To the extent that
this technology can create value for the organization and can justify the investment, these companies are
implementing the newer technologies. Technology implementation in the past has been more opportunistic and
customer-driven, without being clearly guided by a well-defined strategy or a roadmap at large! A digital
transformation roadmap, considering the technological requirements, interdependencies and constraints, as
well as linkages to business challenges and goals will help organizations maximize return on their investments.

FUTURE READY FACTORY

As we move ahead to discuss how Manufacturing Execution System (MES) enables building a future-ready
factory, let’s look at a generally accepted description of what a future-ready factory would look like. A future
ready factory will be ‘Digital Ready’ and ‘Smart’ to be significantly autonomous, connected both horizontally and
vertically, leveraging tools and technologies of Industry 4.0 to deliver high levels of efficiency, productivity, speed
of delivery, quality, and cost competitiveness, which would not have been possible otherwise. Leveraging
Artificial Intelligence and Data Analytics tools, these factories will rely on real time, insightful inputs for faster
and more acute decision making. Going a step further, using machine learning technology, highly automated
equipment and processes will be autonomous and reliable in these factories. A future-ready factory will offer a
very high level of flexibility and mass customization opportunity that will shorten order to delivery lead time,
allowing for the supply chain to be lean, responsive and reliable.

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MES ENABLING DIGITAL
TRANSFORMATION JOURNEY
Building a Digital Factory is a high priority agenda for most CEOs across the globe. As per McKinsey Digital
Manufacturing Global Expert Survey 2018, nearly 70 percent respondents on average say that “Digital
Manufacturing” is a top priority. Investments in implementation of newer technologies and processes is
increasing every year and is expected to accelerate with every passing day. As per market research reports, the
MES market has grown at a CAGR of 11% in the past five years and is expected to grow at a similar pace for
coming five years as well. As companies move in this direction, many have understood the relevance and
importance of a “Manufacturing Execution System”, while many others still underestimate the benefits that an
MES system can bring to an organization.

In our understanding and experience, MES is one of the many building blocks of a Digital Factory. While an ERP
system along with an SRM and CRM helps horizontal integration of the value chain, an MES helps largely in the
vertical integration of an organization. Data in the current world is considered as one of the most precious
resources and rightly so. If available at the right time, in the right format, it can bring in multiple insights that will
help shop floor associates and managers take necessary actions and improve plant performance.

There is a lot of buzz about the power of Big Data, Analytics, Artificial Intelligence, Machine Learning, etc.
However, what we tend to miss often is that the success of these tools is highly dependent on availability of real
time and accurate data. MES helps achieve this, along with many other objectives of a shop floor digitization
program. For a Digital Factory, end-to-end connectivity is also a critical element to ensure seamless information
flow (in both directions) to guarantee the shortest response time to an incident or trend on the shop floor. MES
is an effective tool to connect machines on the shop floor (for data collection) to advanced analytics platforms
for real time data analysis and providing insights for necessary and timely action.

Running analytics on the integrated

data for feedback and process control
ANALYTICS

Enterprise level control and visibility

ERP, PLM

Integration of process & machinery

data into a common platform ( Man,
MES | IIOT Machine, Method & Material

Automation of processes
AS
S C A DA , OPC, D and machinery using
PLC, IT systems and
electronics

AC HINES
M E NT&M
EQU I P
MES implementation can help end-to-end integration across processes on the shop floor, starting from material
receipt to dispatch, stores & warehouse management, Inventory Management, Production operation
management, Quality Management, Maintenance Management. Most MES solutions provide reporting and a
dashboard module for KPI tracking at the equipment, section, and plant level. MES can seamlessly connect with
other IT applications across the organization for data exchange to eliminate duplicate data entry requirements
and provide performance tracking capability across the enterprise.

Key Application Areas

Production Quality Warehouse

Deliver manufacturing excellence Unify quality across manufacturing Extend manufacturing excellence
to one plant floor or many - across operations for a comprehensive, to the warehouse with a unified
the globe enterprise approach to qualtiy solution that synchronizes
management to achieve sustained material with production
manufacturing excellence

Maintenance Time & Labor Reports & Dashboards

Synchronize maintenance Coordinate labor with all plant Achieve real-time enterprise
management with production and acticities to drive productivity manufacturing intelligence to
quality across plant activities for and manufacturing excellence improve visibility, synchronization
greater equipment uptime, manufacturing, and control
productivity and excellence
BENEFITS OF MES IMPLEMENTATION
In our experience, if the solution is properly designed and deployed, MES implementation helps improve critical
operational KPIs such as productivity, first pass yield, quality rate, efficiency, cost of conversion, etc., to enhance
overall customer satisfaction and business performance. ITC Infotech has helped Global CPG customers
improve performance on KPIs that matter the most to their businesses. For a CPG company, machine efficiency
improved by 6% after MES implementation and the inventory carrying cost reduced by 4% per factory. Similarly,
we have improved first pass quality by 3% for a Global Heavy Machinery customer across its 6 factories. Another
MES implementation at a 2-wheeler manufacturer led to the integration of suppliers for critical parts traceability
without impacting takt time for assembly.

Using the MES platform, large enterprises have standardized similar processes across multiple manufacturing
plants operating in different geographies. While this has helped in process standardization, it has also resulted
in improved consistency, efficiency, and compliance. Pharmaceutical customers use MES to ensure data
integrity and effective investigation of deviations, to be compliant with the global regulatory requirements. CAPA
management is one of the features in the MES that helps manage workflow for an effective investigation and
Root Cause Analysis followed by an effective Corrective and Preventive Action (CAPA) implementation.

One of the other key benefits of an MES implementation is the enhancement in the traceability and genealogy
across the supply chain. In case of a quality deviation, product recall or batch control, this in-built feature of MES
helps easy and speedy data retrieval and reduces the investigation time significantly.

The world is moving towards sustainable development and Green Factory is the new norm. Paperless factory is
one of the many attributes that define a Green Factory. While MES enables shop floor digitization, it is one of the
key drivers of a paperless factory since most of the data, information and reports travels digitally across the
organization.

CONCLUSION
For organizations planning a digital transformation journey, the steppingstone will be to develop a digital
transformation roadmap that will enable business growth. Defining short-term and long-term goals of
technology adoption, the benefits expected at the business, customer, and operational level will be an integral
part of the roadmap development process. Deploying tools and technologies that will ensure real time data
collection and analysis, vertical and horizontal integration across the organization will form the initial steps of
the digitalization journey. Once the integration process is completed, deploying analytical solutions for
actionable insights should be the next step, followed by the use of Artificial Intelligence and Machine Learning
technology for an autonomous operation. Technology implementation should also be utilized as an opportunity
to standardize systems across the global operations. MES has helped achieve this objective for many of the
global enterprises.

For a global CPG company, ITC Infotech has implemented MES for process standardization, compliance
enhancement to global operating standards,efficiency and productivity improvement, better visibility of KPIs at
the shop floor and many other benefits. Their ambitious plan to create a global template and rollout in 65
manufacturing plants in various parts of the globe has been successful and very rewarding. This is one of the
few organizations that has leveraged the full potential of an MES implementation.

The next article will detail out the approach, challenges and benefits of ITC Infotech’s MES implementation in
this organization. Stay connected!
AUTHOR PROFILE
Nitin Kalothia is an Associate Partner in the Business Consulting Group of ITC
Infotech. In his current role, he works closely with Manufacturing Execution System
team in bringing a consulting approach to MES solution design and implementation.
He has over 17 years of total work experience in operation excellence and technology
consulting. Nitin has been instrumental in driving manufacturing transformation
through use of Technology and Lean Manufacturing Principles. He has also developed
and deployed Smart Factory Framework for manufacturing organizations.

About ITC Infotech

ITC Infotech is a leading global technology services and solutions provider, led by Business and Technology Consulting.ITC Infotech provides
business-friendly solutions to help clients succeed and be future-ready, by seamlessly bringing together digital expertise, strong industry specific
alliances and the unique ability to leverage deep domain expertise from ITC Group businesses. The company provides technology solutions and
services to enterprises across industries such as Banking & Financial Services, Healthcare, Manufacturing, Consumer Goods, Travel and Hospitality,
through a combination of traditional and newer business models, as a long-term sustainable partner.

ITC Infotech is a fully-owned subsidiary of ITC Ltd, one of India’s foremost private sector companies and a leading multi-business conglomerate.

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