Article
6 min read
Optimisation - As a possible means to improve our efficiency, competitiveness and financial performance, it should not be underestimated!
As managers, we are responsible for ensuring the continued, profitable operation of our company, while steadily maintaining and continuously increasing its value and goodwill. What can we do if key performance indicators show that our company's profitability is deteriorating? How do we handle it when we are unable to make the major investments - expansions and developments - required to maintain or improve our company's position in a highly volatile or evolving market environment?
The good news is that there are still opportunities to identify and exploit the reserves and inner potential of the available production environment to maintain or even increase competitiveness. By continuously implementing minor, targeted improvements and transformations, we can draw near and converge to the best performance we can achieve from the given circumstances - our assets, organisational structure, staffing, and processes.
This is based on a solid foundation provided by widespread digitisation. In digitised processes, we can significantly improve our performance through cyclical optimisation based on data collection and analysis. Optimisation can take many forms in a company. In our view, companies with well-developed measurement systems and feedback processes can be the most successful in terms of optimisation and produce sustainable, well-controlled improvements. This is the basis of the Stratis approach and the solutions we offer.
International surveys show that digitisation and the application of IoT-enabled solutions can accomplish sizeable savings and remarkable increases in production output. "The companies involved could record the following benefits:
30-50% reduction in machine downtime,
15-30% improvement in work productivity,
10-30 % increase in throughput,
10-20% reduction in quality costs.
The breakthroughs listed below, manifested across the entire value chain, eventually cause effects that are perhaps even more important, though harder to measure: greater flexibility to meet customer needs, faster time to market, and better integration within the supply chain."*
Now, to get a true picture of the extent of the reserves in your company's operations and to set realistic targets for unlocking them, you need to know exactly what your company's processes and the details behind the key performance indicators are.
To do this, you need relevant, sufficiently accurate and factual information, which can be provided as a result of "direct measurement and data collection + analysis". The information thus generated is a fundamental prerequisite for real situation awareness and an obvious aid to decisions on interventions.
There are several areas in which a company can improve efficiency; implementation must be ruled based on a cost-benefit analysis and the timeframe of priority ranking. The comparison of the different scenarios can be done with sufficient accuracy by modelling them from factual data-based information in order to assess their likely effectiveness.
In general, the return on investment for optimisation is not always perceived as clear as for larger investments, so we are in an easier position to do this if we have detailed data on the processes and environment of the operational area, including historical temporal sets going back in time. However, measuring a large number of parameters, collecting and storing large amounts of data can actually be quite costly.
It is therefore worth planning ahead to design our measurement and data collection systems around the 'necessary and sufficiency principle' in our business processes, so that we get the opportunity to both run detailed analyses related to the optimisation objective and understand the root causes in a given case.
Of course, it is also worthwhile to collect a wide range of measurement data already available in an operational environment with appropriate sampling, as based on complex correlations this can provide the basis for discovering yet new reserves carried in processes and identifying the inherent returns. The solutions we offer support optimisation, whether it involves an information-based decision support system or data-driven automation. Both are based on advances in digitisation.
We help our partners to do exactly this. In a competitive market, the advantage increasingly lies in information "richness", including the creation and smart use of our information assets. If we can make our investment and interference decisions on a much more stable information basis than our market competitors, and thus consciously focus our attention and cost management on improving efficiency, our indicators suitable for benchmarking and the company's performance, this in itself can contribute significantly to our competitive edge.
