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Making a Difference: IT and telecom tools help manufacturers streamline operations

January 29, 2015
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Today, manufacturing enterprises are consistently aiming at higher quality products, increased product flexibility, lesser delivery time and improved profit margins. In order to meet these targets, the manufacturing enterprises, both large and small, are taking keen interest in adopting new IT solutions. These solutions enable them to streamline their operations and bring in flexibility to manage diverse functions. They also help them reduce inventory and production costs while making the supervision of daily operations easier. In addition, they allow the manufacturers to focus on their core competencies while leaving the management of non-core activities for their IT experts.

In the initial years of IT and telecom penetration in the manufacturing sector, technology was largely used for implementing process and control systems on the manufacturing floor in order to bring standardisation in daily operations. The industry then moved ahead in its IT exploitation efforts, with the implementation of applications and software in its operations for the smooth integration of the various stages of the manufacturing value chain. In most of the organisations, the entire value chain has been automated on an enterprise resource planning (ERP) system to allow for enterprise integrated functioning for internal operations, and extended enterprise integration for connecting with vendors and customers. In addition, the enterprises have deployed customer relationship management (CRM) solutions to standardise their business processes and enhance sales and marketing activities. A large number of manufacturers, especially in the automobile industry, have benefitted from the adoption of both ERP and CRM solutions by integrating all its independent product groups and streamlining their workflows together into one business activity. Further, with the adoption of supply chain management solutions, the companies have been able to automate their forecasting processes, resulting in fewer calculation errors. This has allowed them to go forward with constrained production planning and optimise their resource utilisation. By using integrated reporting solutions, these enterprises have been able to analyse their warehouse information through analytical tools. The transaction processing and management reporting requirements of their accounting and distribution divisions have led to the high adoption of business intelligence tools and management information system solutions in these companies.

These days, manufacturers need relevant and real-time data for making quick decisions on the quantity of raw material required for production, its processing, and synchronisation with the existing stock of inventories in warehouses. In order to fulfil these requirements, the manufacturing enterprises call for tailor-made solutions such as statistical process control modules, manufacturing execution systems and product lifecycle management systems.

In addition, several of them have been adopting mobility solutions such as scheduling, visibility, plant utilisation, throughput analytics and order tracking in their management functions. They are also investing in mobility applications such as audio and videoconferencing, web conferencing, Voice-over-Internet-Protocol, mobile email and corporate intranet. The enterprises that work on data-intensive applications are using the Integrated Services for Digital Network (ISDN) to transfer their data on high bandwidths. Of late, Ethernet has become a popular option amongst the enterprises to upgrade their networks from ISDN. For sharing information across offices, the manufacturing firms use very small aperture terminals (VSATs) as the connectivity medium. VSAT technology allows for round-the-clock connectivity between the corporate office and its remote sites, and its deployment has helped the organisations expand their offices and add new locations to their existing infrastructure. Further, for last mile connectivity, companies are using optic fibre cable, radio frequency and Wi-Fi technology.

Stressing the importance of IT and telecom, the present government announced the “Make in India” and “Digital India” initiatives, which primarily focus on the exposure to IT innovations in order to make India a manufacturing hub. With the help of IT, these initiatives aim to develop and integrate every link in the value chain, from the shop floor, its operations, back-end linkages, accounts, distribution and sales force to customers, partners and vendors.

The adoption of IT in the sector has not only evolved the manufacturing process but also the portfolio of the products offered to consumers. Given the significant role that telecom and IT play in enhancing productivity, manufacturing companies will continue to upgrade their existing networks and adopt new technologies.

tele.net takes a look at the telecom and IT requirements of various companies in the manufacturing segment and the solutions deployed by them to handle their business operations efficiently. The following questions were asked to the companies-

•  What are your company’s telecom and IT requirements?

•  What are the various data access and transfer technologies deployed by the company? What has been the service experience so far?

•  What are the key concerns faced by the company in their telecom/IT infrastructure? How are you planning to address the same?

•  Which applications have been deployed by the company? How have they helped in improving management and operational efficiencies?

•  What are some of the emerging technology trends in the manufacturing industry? What are your future plans regarding adopting the same?

The need of these manufacturing companies for streamlining their operations and improving the quality of their products through real-time process monitoring has led to greater IT adoption in their businesses. In this regard, most of the surveyed enterprises have upgraded their legacy communication set-up to establish a robust IT and telecom infrastructure. A study of the connectivity infrastructure of these companies suggests that network technologies such as internet protocol-virtual private networks, multiprotocol label switching (MPLS) and VSAT are being widely used. These technologies not only facilitate point-to-point wide area network (WAN) services, but also help transfer latency sensitive applications like voice and video with minimum loss. In order to connect to remote sites, the manufacturing companies have shifted their focus from the establishment of terrestrial networks like DSL and cable wires to satellite internet as the medium of connectivity. In addition, most of them are now using optic fibre cables (OFC) and a wireless set-up for last mile connectivity.

For example, IFB Industries uses 60 nodes for a bandwidth of 10 Mbps on its MPLS network and has also deployed OFC as its data access technology. Another manufacturing major Whirlpool India has a long fibre network, which consists of a mix of leased fibre from service providers, an OFC network, a wireless connection as well as an optical ground wire system.

Further, a number of manufacturing companies surveyed have implemented the unified communication (UC) set-up. These companies emphasise that business communications have undergone changes in the recent past and the UC system has helped them establish a communications network that can be used over their entire manufacturing value chain.

Service providers and vendors

Since the day-to-day businesses of the manufacturing companies are extremely demanding in nature, the emphasis is on reliability when it comes to opting for service providers. As part of the survey, it was seen that operators such as Bharat Sanchar Nigam Limited, Tata Teleservices Limited, Reliance Communications, Bharti Airtel, Tata Communications, Tulip and Sify Technologies were preferred over others, for providing WAN and last mile connectivity. While the choice of network provider depends on various parameters such as network availability and uptime, resolution time, and disaster recovery, the choice of partner for providing application services is dependent on factors such as level of experience, quality of service and post-deployment support. Further, if there is any breach of the service level agreement, most of the manufacturing companies penalise their providers in the form of an equivalent service credit.

Mobile and enterprise applications

The manufacturing companies surveyed are using a number of enterprise applications, the most common being ERP. These solutions help manufacturers overcome a number of operational challenges and provide benefits like reduced costs, streamlined processes and better business management. ERP software helps integrate all areas of business (materials and inventory, production, operations and sales, accounting and finance) into a single database, thereby facilitating decision making. Similarly, the systems, applications and products solution is also being used by manufacturers for the integration of data. The companies have to enter the data into the system only once and can then use it for various sub-system operations like raw material purchase, stock management, finance, accounting and invoicing, sales and customer ordering, and reporting. In addition to this, the companies have deployed solutions for CRM, inventory management and supply chain management.

Network redundancy and security

The manufacturing companies usually rely on security audits, operation control centres, and data archiving for backup and data recovery in the event of any data disaster. All the companies that were surveyed have prioritised securing their communication networks over everything else. A few platforms used by the firms for ensuring the security of business information are firewall, built-in server security, antivirus software and password protection. However, a few respondents have cited data security risk and loss of its confidentiality as some of the reasons for not using these services on a larger scale.

Key issues and concerns

Despite the huge expenditure on their IT and telecom infrastructure, most of the surveyed organisations are of the view that though they deploy the best-in-class services, the introduction of new and better technologies makes their existing set-up obsolete in no time. The manufacturing companies have concerns like increasing costs of updating the already deployed solutions and lack of trained IT staff to help in timely upgrading the systems. In addition, the companies are facing problems with regard to their telecom networks. They have cited downtime, security of data and latency as the major impediments for smooth running of their day-to-day operations.

The way forward

Although the share of IT and telecom in daily operations has increased over time, not many respondents feel confident about investing in technologies such as big data analytics, machine-to-machine and cloud computing. These companies have reasoned that since these technologies are complex in nature, the lack of specialised providers has held up their adoption.

Nevertheless, manufacturers are increasing their investments in IT and telecom infrastructure in order to meet their future growth targets. Most respondents are planning to expand or upgrade their IT infrastructure by investing in hardware and software applications. Some of them have already added more computers and laptops to help their workforce and the others are working on similar plans for the future.

Going forward, telecom will continue to play a key role in how companies respond to market conditions. In addition, the incentives provided by the government in the form of various initiatives will encourage them to invest more in their IT infrastructure in the near future.

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