WHITE PAPER

Agility for competitiveness: Transforming

manufacturing operations for business agility

Authored by:

Michael Schwarz
MES/MOM Software Product Marketing Senior Manager,

Executive summary:
The COVID-19 pandemic brought unprecedented changes to every industrial sector. Supply
chain disruptions, fluctuating costs, and new consumer purchasing habits fueled a dramatic
need for increased agility and resilience in the consumer product manufacturing industries.
Consumers increasingly shifted from patronizing brick-and-mortar stores to embracing
e-commerce and digital channels. This shift to e-commerce, though underway for the past
15 years, greatly accelerated over the course of the pandemic. According to a recent study
by McKinsey & Company, e-commerce sales rose “by about 35% year over year, and online
penetration remains about 30% higher than pre-COVID-19 levels.” As buyers’ habits changed
and they recognized the added convenience of at-home ordering, consumer expectations
shifted accordingly–a shift that industry experts forecast to be permanent henceforth.
Introduction

To date, manufacturers continue to face ongoing To seize business growth opportunities and maintain
supply chain disruptions, including workforce-related competitiveness, manufacturers must incorporate
disruptions, which continue to impact manufacturers’ robust digital platforms and toolsets to optimize their
ability to run production plants at full capacity. At the manufacturing value chain. Manufacturers must:
same time, companies must adapt to pre-existing
challenges, like a retiring workforce, shortage of skilled y Enable cross-functional supply chain visibility and
workers, and the sustainability drivers which are pushing collaboration to create production plans which are
energy, emission, and waste reduction. Designing feasible to execute.
operations for a circular economy, too, is on the horizon. y Deploy advanced production planning and
scheduling methods to optimize plant schedules for
As such, manufacturing strategies have to adapt to the
throughput and on-time delivery and to adapt to
post-pandemic future. Former predictable consumption
more frequent change.
patterns and stable networks allowed businesses to
tightly adhere to a plan for product quality, quantity, y Digitize and standardize best practices, key
and timing–all optimized to keep the cost of production performance indicators (KPIs), and reporting across
as low as possible. During the pandemic, supply chains their distributed network of plants.
optimized for cost efficiency and manufacturing plants y Leverage operational data with predictive and
optimized for steady-state Overall Equipment Efficiency prescriptive artificial intelligence (AI) for continuous
(OEE) were unable to respond with resilience to supply productivity, asset reliability, and eco-sustainability
disruption and booming online sales and the attendant optimization.
service expectations.
y Create a digital thread that contextualizes
According to a 2021 report conducted by the World information across the supply chain to provide the
Economic Forum, 56% of the 3,000 CEOs surveyed listed visibility, transparency, and traceability consumers
agility and flexibility as their top strategic priorities. and regulators demand.

The digital transformation of manufacturing operations y Establish new KPIs to measure and improve the
is a critical foundation to deliver the operational speed and agility of their supply chains.
efficiency and flexibility improvements, as well as
the end-to-end supply chain visibility manufacturing
enterprises need in a post-pandemic marketplace. Watch this webinar to learn how to
prepare manufacturing operations for
growth, profitability, and sustainability in a
post-pandemic future.

02 Agility for competitiveness: Transforming

manufacturing operations for business agility
The multi-site operations digital transformation challenge

Consumer product manufacturers’ large, distributed Digital twins bolster agility by enabling complete
networks require industry-specific digital strategies and visibility into plant operations, resources, and assets
tools that allow companies to leverage synergies and and creating a much-needed dimension of what the
facilitate accelerated deployment across their multiple plant network is capable of delivering. The ability to
plants simultaneously. To be successful, multi-site run “what if” scenarios means manufacturers can
digital transformation strategies require a corporate, determine the best outcomes virtually.
centralized “Center of Excellence” approach to identify
Manufacturing execution systems continue to play a
the best practices and supporting technologies, which
central role in this. These systems become part of a
can be standardized and quickly rolled out in parallel
plant’s living digital twin, which applications can use
across multiple sites.
to blend human work tasks with automated activity
Digital twin technology provides real-time situational in the execution of standardized processes. Digital
awareness and lays the data foundation for more twins enable a transformation not only in how work is
advanced capabilities, like artificial intelligence (AI), performed but also in how workers collaborate.
machine learning, and predictive quality, process, and
asset performance. By abstracting production sites in a
standardized digital twin of the plant, manufacturers can
transform operations consistently across many sites with
varying practices for similar operational activities.

Danone
Danone Specialized Nutrition (Danone) realized its digital manufacturing vision to increase efficiency and
flexibility. With AVEVA™ Manufacturing Execution System, the Danone team developed a core model, or
template, that provides 20 standard MES functions for deployment across manufacturing sites. Because it
used AVEVA’s scalable solutions, the standardized template was easy to roll out across Danone’s 25 remaining
sites and accelerated continuous improvement. In this video, Sebastien Boissier, Danone’s Specialized Nutrition
Digital Manufacturing Director, explains how the company used AVEVA solutions for success.

03 Agility for competitiveness: Transforming

manufacturing operations for business agility
Optimizing planning and execution through digital technology

The optimization and integration of both business Improving the plant-to-supply-chain link gives
planning and manufacturing execution are equally businesses more options to respond to demand or
crucial for creating an agile, demand-driven business, disruption by looking holistically across the value
but without real-time visibility into plant resources and chain. Manufacturing operations must be continuously
capacity, manufacturers cannot ensure an operational optimized to minimize losses and flexibility tradeoffs
plan is feasible to execute. Manufacturers must use and to adapt to sustainability mandates and the new
digital tools to optimize production scheduling to circular economy present.
accommodate more real-time, demand-oriented
Comprehensive digital execution solutions, such as
operational planning cycles and improve flexibility to
the AVEVA Manufacturing Execution System, are
pivot in the case of re-planning critical orders.
vital for aligning people, equipment, and operational
Production schedule optimization is the critical link processes with advanced digital technologies for
between operational planning and the realities of the efficient and compliant work execution, data capturing,
plant floor to deliver business-critical orders, on time and and continuous improvement. As operational efficiency
in full, at the lowest possible cost. Advanced planning improves, so too does an operation’s ability to change
and scheduling capabilities allow for the optimization course swiftly in the face of disruption.
of the production schedule around business drivers, like
customer service and demand, as well as operational
imperatives like material, equipment, and labor availability.

Borg Manufacturing
AVEVA helped Borg Manufacturing (Borg) accelerate its transformation to sustainable manufacturing
operations by increasing flexibility on products while keeping its next-day-delivery pledge. Borg
Manufacturing integrated its automation with AVEVA Manufacturing Execution System to address the
unsustainable manual stock-picking processes and manual reporting that hindered access to key data
metrics. The solution helped to increase batch flexibility on products while accelerating high-quality,
consistent production. Borg Manufacturing achieved improved line efficiency by 400%, increasing from
2,000 items picked per 12-hour shift to 6,000 items in four hours, and reduced wastage in warehouse
production from 5% to 2%, and it provided a sustainable model for standardization, which enabled Borg to
accelerate sustainable manufacturing across multiple sites.

Learn more about Borg’s path to success in this success story.

04 Agility for competitiveness: Transforming

manufacturing operations for business agility
People empowerment and collaboration

While cross-functional visibility into key performance A digital thread – a single, contextualized, real-time
indicators, data and applications is imperative, without source of operational data – ensures everyone has the
skilled workers and people collaboration for turning same information at the same time, which allows multi-
information into better and more aligned planning and disciplinary teams to collaborate on projects seamlessly,
execution decisions, the impact will be limited. Paper-based thereby improving efficiency and agility in tandem.
processes and limited access to information, training, and
As the manufacturing industry faces an impending
knowledge transfer are obstacles to responsiveness and
shortage of skilled workers, a problem the pandemic
agility that digital tools can readily overcome.
has only exacerbated, digital tools ensure that
Technological advances in big data and predictive institutional knowledge can be retained. By digitalizing
analytics, business process management, mobile work processes, manufacturers can connect workers to
applications, and augmented reality are enabling instructions and easily collect data in a forms interface
manufacturers to empower operators and decision- integrated with the manufacturing execution system.
makers to make sense of operational data.
This ensures execution goes according to scheduled
Newer platform and integration technologies like cloud, product, work process, and quality specifications.
IoT, IIoT, and smart and edge devices are driving down the And, because institutional knowledge is collected in a
cost of digital transformation in the manufacturing sector. digital repository, resolutions to previous problems are
stored. Likewise, operations can use these problems
Digital transformation incentivizes curiosity and spurs and resolutions for training and building a skilled and
innovation, as it makes information more readily empowered workforce for the challenges of tomorrow.
accessible to workers by connecting them to plant
processes, real-time data, and one another.

05 Agility for competitiveness: Transforming

manufacturing operations for business agility
The future of manufacturing execution

As manufacturers begin to deploy advanced digital, By leveraging operational data with predictive and
improved operational efficiency and agility create prescriptive AI, manufacturers can gain continuous
a positive feedback loop, allowing them to further optimization to minimize losses and flexibility tradeoffs.
accelerate their digital transformations. Concepts AI-based analytics synthesize plant data to uncover
like the digital twin and the digital transformation of the optimal operating conditions at any given time, then
work are increasingly becoming the tools to improve replicate the best outcomes by conveying the exact
operational efficiency and drive the needed business settings to use for efficient, reliable, and sustainable
outcomes at manufacturers’ plants. operations. As companies progress through their
digital transformations, higher tiers of digital maturity
When manufacturing operations employ automated unlock greater benefits, such as predictive analytics
tools to analyze sensor-collected data, especially when capabilities, which reduce unnecessary maintenance
coupled with the industrial internet of things (IIoT), and unplanned downtime as well as quality losses
they reduce the cost of compliance and consumer and waste of resources. In today’s demand-driven
safety risks by tracking the transformation of products marketplace, reliable and predictable operational
from raw materials to finished goods. Digital solutions performance can be the difference between a resilient,
contextualize information to evaluate yield, quality, agile stance and falling short of customer expectations.
resource utilization, and waste for both transparency
and continuous improvement.

Henkel
Henkel Laundry & Home Care (Henkel) built a digital backbone using AVEVA Manufacturing Execution System
and AVEVA System Platform to meet its sustainability and efficiency goals. When it implemented AVEVA’s
tools, Henkel improved supply-chain resource efficiency on the production side by 5-6% annually.

Watch the video to learn more about Henkel’s success.

06 Agility for competitiveness: Transforming

manufacturing operations for business agility
The path ahead

In the post-pandemic era of industry, consumer product

manufacturers’ success will be defined by their ability
to remain agile and resilient in the face of change and About the author
unforeseen disruptions. The increased ubiquity of Michael Schwarz is the Product Marketing Senior Manager
for manufacturing execution software at AVEVA. With
e-commerce means faster production cycles and higher
over 25 years of industry software sales and marketing
customer expectations are likely; not only do consumers
experience he is passioned about how technology helps
now expect convenient purchasing and prompt delivery, to solve problems and can improve quality of life. Michael
but they expect full transparency into delivery times, holds a graduate degree in electrical engineering from the
the origin of products and raw materials, and the Bergische Universität Wuppertal, Germany.
environmental impact of sourcing, making, and shipping.

Digital transformation turns disruption into

opportunity. According to the World Economic
Forum, manufacturing companies leveraging digital For more information on how AVEVA can help
technologies to transform their operations end to end, to optimize your manufacturing value chain,
have reduced costs by 5-30%, increased productivity visit the AVEVA Manufacturing Operations
by 5-40%, and have achieved substantial agility and Management webpage
sustainability improvements. Producers who do not or to talk with one of our experts please
embrace digital technology could fall behind, whereas contact us at aveva.com/en/contact
those who begin their digital transformations early will
sharpen their competitive edge.

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