Vertical integration in the smart factory: Combating layers of communication

Written by: Lee Sullivan | Published:

Manufacturers have long reaped the benefits of acquiring data from operational equipment, allowing machinery to communicate and improve the manufacturing process. Today, a study by Gartner suggests that manufacturers are keener than ever to begin vertically integrating enterprise and IT technologies, like enterprise resource planning (ERP) systems, sensors and the cloud, with traditional operational machinery. Here, Lee Sullivan, regional sales manager at COPA-DATA UK, explains the advantages and challenges of vertical integration in the smart factory.

IT and operational machinery have traditionally performed as separate silos, with differing protocols, standards and governance models — and often separate teams of employees managing their operation. So, what is the case for integrating the two?

Improving efficiency, reducing errors

There is no doubt that data from operational machinery and enterprise systems can both influence the performance of a manufacturer. ERP systems, for example, can make informed business decisions based on human resources information, while Manufacturing Execution Systems (MES) can manage the control and monitoring of a production line. However, these separate systems can often leave communication gaps to compensate for.

For example, if a number of machine operators have not turned up to work, the manufacturer may not be able to go ahead with production of a certain products. To make this change to production, the manufacturer would be required to manually obtain human resource data from the ERP system and input this data into the MES to change the planned production. This is a slow process, which drives down productivity and leaves room for error, so cross-referencing is often required.

Vertical integration describes pulling data from the field level and making it visible alongside operational data as contextualised information — taking the data traditionally kept in an ERP system and visualising it alongside data from the factory floor.

Using this model, the food manufacturer would have no need to manually withdraw data, as the information will be automatically shared across the network. What’s more, intelligent, vertically integrated software can automatically make changes to the production plan, based on staffing and human resource data drawn from the ERP system.

However, vertical integration does not only allow visualisation of data in a manufacturing facility. It can also provide opportunities for manufacturers to react to customer requests more quickly and provide the potential for new business models. This is when data from the field level can be turned into contextualised information.

Opportunities for customisation

Consider this as an example. At an automotive manufacturer, a request is made for a non-uniform version of a car. As opposed to the standard roof, the customer has requested a panoramic roof as a customisable feature.

Using a vertically integrated software model, planning can automatically check whether the stock to manufacture this roof is available by using the ERP system. If the inventory is not available, the software can automatically acquire data from the supply chain to identify when the materials will be on site, letting the customer know when manufacturing will be possible.

If the manufacturer does have the materials to fulfil the request, the order can be forwarded straight onto production. Using automated engineering, the software can generate the exact project to fulfil the specific roof request, setting the production line to begin manufacturing at the first available opportunity.

Acquiring data from the enterprise realm can also make for more effective batch production. Food, beverage and pharmaceutical manufacturers, for example, need to carefully align orders to ensure the correct amount of each raw material is ordered at the right time — enabling them to react quickly to market trends and demands.

Communication challenges

The case for integrating vertical enterprise data with traditional production data is clear, but it is not without its challenges. One of the reasons that these technologies have operated as separate silos until now is that they often use different networks and communication standards. What’s more, many manufacturers have several bespoke systems on site, some of which do not have a specific communication protocol.

When selecting software for a smart factory, manufacturers should opt for a system that is independent of any specific communication standard. COPA-DATA’s zenon, for example, has over 300 native communication protocols. But, in the most complicated manufacturing facilities, sometimes this isn’t enough.

COPA-DATA experienced this with one of its customers, who used several bespoke systems in its manufacturing facility. One of its system did not have a specific communication protocol, but the manufacturer believed that the data that it held was integral to improving efficiency at the plant. To combat this, COPA-DATA developed entirely new drivers in-house to obtain this data, without the need to bring in third-party systems.

As technology begins to bridge the gap between the islands of IT and operational systems, the advantages of vertical integration for efficiency and customisation are becoming even more obvious to manufacturers. While there are challenges in communication protocols, the technology is available to make this process easier.

Gartner’s study suggests that an increasing number of manufacturers are planning to invest in vertical integration. Don’t get left behind and use vertical integration to take advantage of your data.


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