Product individualization forces business reengineering

Product individualization forces business reengineering

Trend scouters have been talking about a move towards the individualization of products for over a decade now. But now it seems that the time of seeing through a millstone has past. The automotive industry has proven this by expanding its portfolio into every little niche what can be impressively observed at last International Motor Show (IAA) in Frankfurt/Germany. So, how should manufacturing look like in a world where prodcut individualization is becoming more and more popular? A background discussion with SAP about pushing engineering closer to fabrication processes.

By Sebastian Grimm, Editorial Writer of economic-engineering.de

Significant logistical challenges are faced by product providers. At a product launch, for example, it is not really obvious what will be the blockbuster or which of the equipment options offered will be the customers’ favourites. And if shoppers grab a product off the shelf, the provider must respond quickly by making sure the shelf is refilled.
Challenging too is that more and more customers are turning away from buying actual products in favour of renting product-related services. For instance, they no longer want to buy a machine, but they are very interested in what the machine produces. In other words: many business models are changing, like in last example where the provider becomes the operator of a machine or even of a plant.

New PLM thinking

So, what’s expected from manufacturers nowadays is a more holistic beginning-to-end offering and a high level of agility in delivering related services. Of course, this means that a company’s functions — research and development, manufacturing, asset management, sustainability, and services — have to be integrated much more closely today to meet these kinds of customer demands. In discussion with our editors, Thomas Ohnemus, Vice President of Solution Marketing for Idea to Performance with SAP (our picture), addresses a bigger picture, highlighting the impact on business processes. “Sure, the trend towards product individualization is leading to an incredibly high proportion of variance in company portfolios. But because you might be able to improve customer satisfaction and, after a certain time, get a better idea of which products are trendy and how many of them to stock, it’s worth investing in business reengineering,” says Mr Ohnemus, hinting at the interaction between the necessary adaptation of products and the engineering change processes because feedback loops affect basic product configuration. This information should be transferred to fabrication as efficiently as possible.

Faster from idea to revenue

Mr Ohnemus points out the added value of the SAP’s new idea-to-performance portfolio: “It embraces an integrated solution offering that enables three key things: intelligent process execution, resourceful operations, and intuitive user experiences.” The idea-to-performance bundle provides an insight into big volumes of data created from information technology and operational technology

  • creates seamless, more agile processes by bringing this insight into integrated solutions for research and development, manufacturing, sustainability, and asset management
  • facilitates rapid adoption of solutions by providing 3D visualization, mobile, and social media capabilities.

“And, of course, across all of these areas, we are leveraging the power of SAP HANA to help companies gain insights from the massive amount of data coming in from their enterprise and shop floor systems and to take action based on these insights,” Mr Ohnemus emphasizes, adding: “There is a lot of potential in the predictive capabilities of SAP HANA to streamline service in manufacturing, especially as machine-to-machine connectivity takes off.”

Business model transformation

The idea-to-performance portfolio is all about enabling business model transformation. That means that this portfolio enables and supports a much closer, more horizontal integration with suppliers, which also allows manufacturers to get much closer to customers, helping them gain an understanding of their individual and specific needs. “The goal is to tightly interlink engineering with manufacturing,” Mr Ohnemus explains.
This context fits in well with the SAP Enterprise Visualization offering. The 3D visualization capabilities can be used when the product is being designed and also when it’s being built. For example, if it’s a product that must be assembled on site, the 3D images can be used to get the product up and running more efficiently. And when the product requires servicing later, the 3D images will assist in the service process as well. By providing all stakeholders along the product lifecycle with access to the same visualizations, you not only improve TCO, you also give people much greater ability and opportunity to collaborate.
Mr Ohnemus wraps up our discussion: “Basically, the idea-to-performance portfolio provides companies with the flexibility to integrate all the different parts of the value chain, from the ideation of a product, to its design, its manufacturing, and even to its aftermarket service.” With increased pressure of time and efficiency, ensuring the integration of these processes and the data flow among stakeholders is a very important part of making the manufacturing process more efficient. By approaching it in a more holistic way, all the stakeholders along the value chain can work more closely together to achieve their goal.

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