Keywords: Manufacturing Excellence, Tata Consultancy Services (TCS), Owens Corning, Manufacturing Operations Management (MOM).
Competitive pressures from globalization drive manufacturing companies to achieve excellence. Manufacturing excellence requires continuous improvement of the core manufacturing value chains including supply chain, product lifecycle, manufacturing, and enterprise management. ARC Advisory Group recently participated in a webcast, "Reaching Manufacturing Excellence," that highlighted the challenges manufacturers face as they strive to achieve excellence. The webcast presented a strategic approach for identifying and implementing opportunities for improvement and a real-world case study involving a major global manufacturer.
Globalization's Impact on Manufacturing
Ralph Rio, Research Director at ARC Advisory Group, kicked off the webcast by sharing insights into the major challenges today's faced by global manufacturing operations. Ralph highlighted that one major challenges plant managers face is getting C-suite support. The metrics that C-level executives really care about are in the corporate P&L statement and balance sheet. They face tremendous pressure to improve the financial metrics and enhance shareholder value. To garner and maintain executive support, he emphasized that plant managers must link plant-level improvements to executive goals. For example:
Higher equipment uptime provides capacity for production scheduling and on-time shipments that increase both customer satisfaction and revenue
Improved product lifecycle management enables manufacturers to introduce new products faster, leading to earlier market leadership and higher revenues
Improved inventory management for the supply chain conserves cash, reduces borrowing, and improves the balance sheet
Improved maintenance extend asset longevity, reducing the need for capital outlays which also reduces borrowing and conserves cash
Recent technological advances enable companies to more easily compete on a global basis. This has accelerated market dynamics and intensified competition. For example, in a global market, companies need to provide a greater variety of products targeted at local preferences and with attributes and packaging that conform to local regulations. Global competition also drives companies to respond faster to issues, reduce lead times, improve inventory management, and control costs better. To survive in a global environment, manufacturers must adapt quickly and achieve manufacturing excellence.
Manufacturing operations management (MOM) solutions (also commonly referred to as manufacturing execution systems, or MES) help manufacturers connect plant floor production systems to business systems and leverage information more effectively along all three domains of ARC's collaborative manufacturing management (CMM) model. Four rapidly emerging technologies – cloud, mobile, social, and analytics - offer capabilities to re-engineer and optimize these value streams and business processes to reduce delay, accelerate response, and lower costs.
These technologies span several disciplines and implementation requires a wide variety of technical skills with extensive project management. Global service providers (GSPs) can provide companies with limited internal resources access to the needed skills at the appropriate times. ARC believes that when choosing a partner, manufacturing organizations should consider a service provider with demonstrated expertise in all three technology disciplines: corporate IT, manufacturing IT, and control engineering; ideally in industries and applications similar to their own.
Excellence Across and Beyond Plant Boundaries
Next in the webcast, Shirish Kulkarni, Head of Manufacturing Excellence at Tata Consultancy Services (TCS), elaborated on similar trends in manufacturing industry and how the company delivers business value through TCS' Manufacturing Excellence Group. Globalization, intense competition, and high customer expectations, push organizations to be flexible, integrated, lean, standardized, proactive, and replicable.
Manufacturing organizations have come to realize that integrating plant operations with enterprise business systems provide the visibility needed for success. According to Mr. Kulkarni, TCS leverages its knowledge and industry expertise to help its clients achieve excellence across and beyond plant boundaries. TCS provides process frameworks, point-to-point, or enterprise solutions that enable the manufacturers to pick and choose the mode of engagement to ensure their path towards manufacturing excellence.
He explained that the TCS Manufacturing Excellence Group focuses on extended value chain, demand and supply, cost of operations, sustainability, interplant collaboration, and globalization. The group's offerings and solutions help manufacturing organization improve business processes at each step across manufacturing levels and beyond. The group leverages its industry best practices and frameworks to help clients develop their manufacturing strategy and define the roadmap to manufacturing excellence. This enables clients to standardize processes across multiple plants and manage quality and inventory across the manufacturing value chain. Through "voice of the customer" and other offerings, companies can incorporate their customers' opinions and inputs back into design, manufacturing, and upstream processes. He further explained that bridging the gap between manufacturing and enterprise level, TCS's services can help manufacturing organizations have role-based access and visibility across the value chain to help companies achieve manufacturing excellence. The group also caters to the next-generation needs of the manufacturers in areas such as mobility, cloud, social media, and big data.
TCS used a similar approach to help Owens Corning carve out the road map for the company's manufacturing center of excellence.
Journey toward Manufacturing Center of Excellence
In the final presentation of the webcast, Mike Pietro, Global Process Leader at Owens Corning, provided a real-world case study, describing how TCS helped Owens Corning achieve manufacturing excellence. Owens Corning, a fortune 500 company, produces residential and commercial building material, glass fiber reinforcements, and engineering materials for composite systems. Operating in 28 countries, the company earned $5 billion in revenue in 2011.
With operation spread across the globe, Owens Corning strived to achieve effective collaboration across various entities and regions. The company needed to meet plant-level expectations, while simultaneously driving improvements up the enterprise level. With more than 750 application instances with 10 different languages, the company realized it needed a service provider with a variety of technical skills and global presence.
Owens Corning, with support from TCS, created a well-defined roadmap for application support, development, and rationalization. A manufacturing center of excellence (MCoE) was established to bring improvements across five areas: support & maintenance, enhancements, service desk, common services, and governance. The application support included improvements to functions, performance, and reliability. Common support across all internal resources lowered total cost of ownership.
With TCS assuming day-to-day support for the existing applications, Owens Corning was able to free-up its resources to work on higher value-added activities. This helped it decrease the time required to resolve issues from more than three days, to less than eight hours. The company also achieved 99.91 percent system availability.
Manufacturing organizations need to carefully assess the as-is situation of the organization and identify applications and processes that can be improved with today's rapidly emerging technologies. Using a service provider with access to a broad array of skills and industry best practices and proven expertise in industries and applications similar to its own can help organizations reach their vision more quickly and effectively. A well-developed manufacturing excellence strategy enables manufacturing organizations meet their top-line and bottom-line objectives.
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