The manufacturing industry has been built upon innovation. Henry Ford not only invented the Ford automobile; he also invented “lean manufacturing” to reduce waste at his plants. Manufacturing doesn’t have huge profit margins, making manufacturing processes more susceptible to inefficient practices. To increase efficiencies and save money, manufacturing firms have begun embracing cloud computing, especially Software-as-a-Service (SaaS).
Mint Jutras, an enterprise-computing consulting firm, recently surveyed manufacturing and distribution firms on their use of cloud applications. The survey indicated that SaaS encompassed more than 20 percent of all software programs currently being utilized by these firms. In the next 10 years, this percentage is expected to be around 45 percent.
The driving force behind adoption of SaaS applications generally has to do with manufacturing’s short product lifecycles and the need to get products to market as quickly as possible. Plus, unlike traditional software programs, cloud computing can be adapted to a company’s precise needs.
Benefits of Cloud Computing for Manufacturing
Manufacturing is truly a global operation. Many firms have plants in markets like China and India, and this often means that U.S.-based IT personnel will have to fly over to the plant location to assist with setup. IT personnel need to verify that hardware infrastructure is properly set up. They must also ensure that the remote location is running the correct software versions so that these employees can communicate with other plants around the world.
This is a labor-intensive and costly process. IT personnel may have to stay weeks or months at the location, meaning manufacturing or distribution firms must pay for their travel costs. On the other hand, if you use a cloud-based environment, you can quickly deploy cloud-based infrastructure and applications in less than half the time it takes to deploy the on-site hardware. Cloud computing not only saves money on travel expenses, but also gets IT personnel back to doing what they need to: creating products to keep your firm ahead of the curve.
Cloud-based Enterprise Resource Planning (ERP) will also help free manufacturing firms from a single large ERP system. These systems are hard to scale for smaller projects. As cloud-based ERP systems become more commonplace, manufacturing firms will look to using two-tier ERP strategies as opposed to a single ERP system.
Getting More from Your Data
A lot of information is gathered these days from business intelligence (BI) and analytics, including determining what is and is not working. For manufacturing firms constantly trying to run as Lean as possible and maximize profits, they need to use this information to their advantage. Cloud computing helps glean useful information from this data.
Louis Columbus, in his article “10 ways cloud computing is revolutionizing manufacturing” in Cloud Tech, pointed out the following:
“For the many manufacturers who rely on build-to-order, configure-to-order and engineer-to-order strategies as a core part of their business models, using cloud-based platforms to capture knowledge and manage rules is accelerating. A key part of this area is mobility support for analytics, BI and rules engine reporting and analysis.”
As cloud service providers begin to see the value of apps specifically geared toward manufacturing firms, the number of SaaS app offerings will increase. This will in turn cause more manufacturing firms to turn toward cloud computing as a solution. FBN
Stephen Lucas is senior product manager, savvisdirect, at Savvis, a CenturyLink company.
Leave a Reply