No time to reminisce, only time to change

HEADNOTE

This special issue of MCS celebrates 10 years of publishing - but what matters is what you do this year and next. Here are some thoughts and predictions

Happy New Year to all our readers, and welcome to this

special 10th anniversary issue of 'Manufacturing Computer Solutions'. You'll find the following pages packed with analysis of many of the major events and developments we've witnessed over the last decade. It's not just about reminiscence: we hope we're providing yardsticks against which to reassess your IT, and perhaps refine plans for 2005.

Speaking of which, reading the runes at the close of 2004, IBM's decision to exit PC manufacturing, with its sale of the business to Chinese Lenovo, was kind of salutary. As was train maker Bombardier's decision to axe 2,200 jobs. EU enterprise and industry commissioner Guenther Verbeugen has already added his voice to the many warning that Asia is a very serious threat.

So, much of our effort this year needs to be on better using our existing IT, while examining and implementing modern add-ons and services becoming available. The goal must be to harness these to deal with the threat and, where necessary, to enhance our ability to work with low cost economies to our advantage.

That doesn't just mean cost-cutting, or even initiatives to improve responsiveness on the factory floor, important though those remain. It means harnessing modern IT with lean and flow thinking across all departments, whole businesses and our supply chains, internal and external, to become more demand-driven, innovative and customer focused where we can win.

We cannot rely solely on good news like the MoD's 160m Christmas present for BAE Systems' Hawk trainer jet, or the 4.3bn order for Eurofighter. For UK manufacturing to deliver on the promise of good stats from the EEF, PKF SME Index and Capgemini and CIPS (the Chartered Institute of Purchasing and Supply) at the close of 2004, we need positive action.

That said, here are some observations that might influence your thinking. For a start, consolidation at the top end of ERP system vendors (note Oracle now owns PeopleSoft, page 7) means there's little choice left - and with switching too painful to contemplate, chances are ERP prices for the big boys will remain high. Only SME manufacturers will be laughing, as too many vendors chase the only lucrative markets left.

So three points. First, it's worth investigating third party maintenance and support providers as a way of cutting big system costs. second, do some due diligence on your chosen system suppliers because their future might be uncertain. And third, watch Microsoft here: it can't be long before the giant makes another move.

Better also start thinking about web services and the services orientated architecture (SOA) for internal and external integration and re-using legacy systems. Analyst AMR calls the emerging IT landscape 'applistructure', and it may lead to innovative composite applications that, for example, work with your ERP but do the demand-driven bit better, cheaper and faster. But these might come from specialists - maybe in India, or maybe from the current oversupply of EAI (enterprise application integration) middleware companies.

Not a problem perhaps, and no doubt your ERP providers will get on top of that. But if their all-important service revenues are being nibbled at by third parties and offshore start-ups, while re-emerging ASPs (application service providers) for both ERP and PLM (product lifecycle management) systems also take market share, they could become vulnerable. Look at what's happening with Arena in PLM in the US: if the figures and technology cire to be believed, users are getting PLM functionality at a fraction of conventional pricing. One to watch.

Three other areas are worth particular attention: supply chain systems, the role of RFID and developments with so-called 'digital manufacturing' systems.

First, supply chain IT - and analyst ARC reckons 'Robust Planning' is the next innovation, going beyond optimisation and collaboration systems (advanced planning and scheduling, event management and so on) to manage risk in real time. It will be about building in protection intelligently against potential supplier and production problems, probably using agent technology. Another one to watch.

As for RFID, most of the talk has been around retail supply chains, and that still needs attention. But look to active and passive tag systems for tightening up both asset management and production, as well as supply chain material movements. 2005 needs to be about pilots, following your business case analysis.

And finally simulation and programming systems: the big boys are in charge now - UGS with Tecnomatix, and Dassault with Delmia. And note the interest in the latter from automation giants Schneider and Omron. Prices will come down and these hitherto aerospace and automotive sector tools will help the winners make real lean improvements throughout manufacturing.

IMAGE PHOTOGRAPH 1AUTHOR_AFFILIATION

Brian Tinham Editor

Brian Tinham

BSc CEng MlnstMC

Editor