The manufacturing industry wants to predict the future
74 percent companies from the manufacturing sector believe that with the increase in revenues, digital transformation is or will be in the business strategy in the coming years - according to NTT DATA Business Solutions 'Challenges on the way to the factory of the future' report presented at this year's SAP Manufacturing Day. What is the condition of the Polish manufacturing sector in terms of smart modernization and in what directions is digitization heading? For Amica, which has been working on SAP tools for over a quarter of a century, the next steps are to increase sales and optimize the use of available production capacity and deliveries of goods.
Traditional planning models are no longer effective. The turbulent environment forces companies to look for strategic development paths. One of the key challenges is the integration of the business model with the technology as well as improvements in data analysis, forecasting and production scheduling. As noted during SAP Manufacturing Day, Adam Adamczyk, Head of Digital Supply Chain at SAP CEE, “currently most enterprises re-schedule or replicate production at least once during a shift. Meanwhile, in order to make the right business decisions, you need to track the flow of products and components within the warehouse management in real time and react to the situation based on the availability of your resources.”
Data and process consistency is crucial today - 84 percent. of production heads as well as digitization and IT managers from the manufacturing industry see big data as a basic element of the concept of the factory of the future. However, it is not so much about collecting them as the ability to draw conclusions and predict future actions. Integrated business forecasting enabling the free exchange of information between users has become Amica's goal. To support the processes of demand and supply planning (S&OP), the company, with 10 foreign companies, 15 product groups and present on 24 sales markets, reached for the SAP IBP cloud solution. The main goals of the implementation were: increasing sales realized, among others, by improving the process of forecasting and allocating production capacity, achieving transparency of individual production stages and their results, and synchronization of planning operations throughout the group.
"Our concept was to combine the production plan with the sales plan. However, the goal was not to save time, but to optimize in the area of resources. Our previous S&OP process conducted in Excel seemed to be structured and consistent, but when we went into details, i.e. at the level of a single production line or shift, we saw information gaps. As a result, long-term forecasts were ineffective. Amica needed a solution that could simulate the future," explains Robert Stobiński, Chief Digital Officer at Amica Group.
In the case of Amica, it was critical to level the production in such a way as to generate inventory on the one hand, and on the other hand, that the reserves held would not increase the operating costs, and thus did not negatively affect the financial results. The integration of SAP Analytics Cloud and IBP S&OP tools allows for multidimensional planning in real time and the study of various scenarios in terms of logistics and finance in order to optimize the results. The key in this case, however, is not to forecast future results with pharmacy accuracy, but to learn about trends in supply and demand and to respond to market needs.
"Transparency of the supply chain at all levels of planning today is a determinant of business success. Thanks to advanced computational algorithms, companies from the manufacturing industry can control production and demand indicators, identify market trends and finally, in advance, model potential operating scenarios, minimizing risks. With great respect, we are observing further implementations at Amica, which we have been supporting for over 25 years in the digital transformation process. This time, thanks to the redefinition of the S&OP process, the company can respond agile to market changes, optimizing the way in which it produces and delivers its products," explains Dorota Zaremba, vice-president of the management board of SAP Polska.
The organizer of the Manufacturing Day event was SAP Polska, and the partners: NTT DATA Business Solutions, LeverX, Deloitte, Hycom and IPOPEMA.