Because of the potential benefits, companies have made significant investments in improving work in progress (WIP) inventory in order to boost performance. A new ebook from LNS Research examines why improvements in this area are often elusive.
Most companies begin with a narrow, focused approach to WIP, but end up struggling because narrow technology solutions like inventory management and optimization typically focus only on the flow of WIP. According to LNS, “With such a limited approach, when there are issues with maintenance, customer orders, suppliers, quality, production, or more, the plant is ill-equipped to deal with these dynamics effectively.”
A more broad approach is necessary, then, to implement a comprehensive solution. Manufacturing execution systems (MES)s have to ability to go beyond just inventory management and optimization and offer a comprehensive approach to optimizing WIP and effectively managing operations. As opposed to narrow inventory management or tracking applications, these more adopted applications like quality management, or planning, scheduling, and dispatch, span a much broader set of processes in complex discrete manufacturing environments. As each application is examined more deeply it becomes apparent how this broader approach drives more benefits in WIP performance than inventory tracking or optimization alone.
Top software applications used by companies to effectively manage their manufacturing operations such quality management, planning, scheduling, dispatching, and production execution all reduce WIP levels and increase WIP velocity.
LNS reports, “Based on this new research, narrowly focused WIP inventory management and optimization applications have not been shown to be effective in improving performance. Instead, complex discrete manufacturers will be better served by taking a comprehensive approach to MES solutions that are more broadly focused on improving multiple areas of their manufacturing operations — including WIP.”
A great place to start is with the three most broadly adopted application areas:
“The effective, integrated combination of the above applications has been directly linked to companies being more effective at managing their production operations at the plant, business unit, and enterprise levels,” the report states.