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Technologies that cut manufacturing costs

13th October 2017

     

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By: Dereshin Pillay

The cost of production remains the biggest pressure point for local manufacturers, but there are technology-driven solutions to reduce costs, contends Dereshin Pillay

Local manufacturing firms continue to face blustering headwinds – from heightened global competition from the likes of China and India to sluggish demand and macroeconomic conditions, critical skills shortages and labour issues.

But technology can help relieve one of the most common ‘pain points’ we are seeing: the stubbornly high costs of production. By using the right digital tools, manufacturers can sustainably reduce their production costs, breathing new life into their margins and ensuring profitable operations.

There are three areas in which this can be achieved, namely raw material inventory and production planning, predictive maintenance and predictive analytics, and proof-of-concept prototypes.

Raw Material Inventory and Inventory Planning

By using digital tags like RFID, plant operators can gain greater visibility of materials, equipment, parts and other assets. Combining this with other datasets builds up a very rich picture of materials as they flow through a factory to eventually become finished products.

By knowing exactly where everything is, it becomes easier to plan production, as data is automatically piped into one’s manufacturing execution system or production life-cycle management system. This means faster logistics and greater throughput of products, as well as increased levels of uptime and productivity – ultimately driving input costs down.

Rapid advances around three-dimensional (3D) printing mean that certain parts and materials that are required urgently can be created on-site and at short notice, further enhancing the management of materials.

One of the leaders in this space is, in fact, General Electric. The manufacturing behemoth is reinventing itself with a variety of strategically connected tech- nologies, including lean manufacturing, additive manufacturing (also known as 3D printing) and advanced software analytics to enhance productivity. At Grove City, General Electric has used these technologies to reduce unplanned downtime by 10% to 20%, improve cycle time and reduce costs.

Predictive Maintenance and Predictive Analytics
With sensors gathering key data on each machine – from humidity, heat, wear and tear, usage times, oil levels and various other data points – we can start predicting when a machine is likely to fail or require servicing.

This principle, known as predictive maintenance, helps curtail the costs of managing industrial equipment and reduces unexpected downtime (as services, repairs and refurbishments can all be scheduled to avoid interrupting production lines).

With some analysts’ findings suggesting that downtime costs the average factory 5% to 20% of its productive capacity, predictive maintenance can be one of the most crucial weapons in the fight against billowing production costs.

But we can extend the principle of predictive maintenance to encompass predictive analytics across all factory operations. With predictive alerts flying in from all corners of the factory, it becomes possible to orchestrate the operations more dynamically, changing the daily plan according to fresh data that comes in from along the production line.

Proof-of-Concept Prototypes
In traditional manufacturing, creating a new prototype (for a particular product) was a lengthy and extremely expensive endeavour – particularly when the concept turned out to be the wrong one and never progressed into full-scale production.

But, with cutting-edge digital simulations, 3D representations and holograms, it has become possible to play around with various new prototype designs – testing them with users and getting a tangible feel.

By creating sophisticated prototypes in these new ways, the dramatic upfront costs of producing a single unit on the production line are greatly reduced. In this way, rapid prototyping and proof of concepts can cut out another layer of cost.

As traditional manufacturers evolve towards smarter and more digital production lines, it is not always easy to know where to invest first – where one will get the loudest bang for one’s buck.

By focusing on these three areas and then building from these foundations and gradually connecting other technologies, manufacturers can address the most pressing pain point (input costs) and set themselves well on the way to reducing the costs of production.

Pillay is head of Automotive and Manufacturing at information and communication technology outsourcing service provider T-Systems

Edited by Martin Zhuwakinyu
Creamer Media Senior Deputy Editor

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