In recent years the manufacturing sectors of industry have seen considerable upheaval as they have sought efficiency gains in order to compete at with first lower cost labour markets, and then with the freshly installed more advanced production facilities from new entrants to the market elsewhere in the world. To simple efficiency has been added responsiveness, as 'time to market' has been recognised as a vital ingredient for success, and the major manufacturers have driven down the cycle time from concept to market. The best known example is the automotive sector, where the time from concept to market has been reduced from almost ten years to, in some cases, eighteen months - and still shortening.
However, until recently, apart from some far-sighted companies that also had the muscle to make their suppliers fit in with their vision, the majority of manufacturing companies were optimising their own operation without regard to the others with whom they inter-worked. At most they might optimise their interfaces with customers and suppliers through such concepts as just-in-time delivery. If distribution of complexity were considered, it was typically in the context of driving it out of one's own organisation into one's suppliers, without regard to the overall effect.
More recently, there has been an emerging realisation that in order to achieve greater responsiveness and efficiency, companies must optimise their operation in the context of optimisation of the whole supply chain, rather than in isolation. The prospects for individual corporate success are much enhanced if the whole supply chain is more responsive to market requirements and specific customer needs, and more efficient in delivering against those needs. There is little point in strengthening and polishing just one cog in a machine.
This requires integration of information and manufacturing systems, and indeed organisational systems integration, both within and across enterprises. But there are many unresolved questions concerning the way in which organisations should approach integration.
Larger organisations, from chemical companies to national health-care organisations, are repeatedly restructuring, often shedding 'non-core' business in the process. What kind of integration between their parts and with their suppliers should they adopt, so as to facilitate efficient interworking while avoiding being constrained unduly by those 'outside' the core organisation?
Smaller suppliers, on the other hand, are expected to comply with the supply chain requirements of their major customers, not all pulling in the same direction. Moreover they require affordable IT support both to manage their own operation and to allow them to integrate with a multiplicity of major customers and their own, perhaps smaller, suppliers. (see FT article)
Also, as with all new developments, there is a lag between the trail-blazing activities of the few, and wide scale adoption by the majority. It is important to understand the barriers to integration, especially those experienced by the SME, with a view to determining how these barriers might be removed, or at least lowered - whether through research, technology transfer activities, or the availability of appropriate tools.
In order to understand better the nature of changes in manufacturing industry, the implications for systems integration, the implications for organisations within industry, and what government might do to facilitate an appropriate response by industry, a workshop was convened by ideo ltd. Technical and organisational support was provided by Dr. Ip-Shing Fan, CIM Institute, Cranfield University; Prof. Bart MacCarthy, Manufacturing Engineering & Operations Management, University of Nottingham; Dr. Duncan McFarlane, Engineering Department, Cambridge University; and Prof. Ian Ritchey, Engineering Design Centre, University of Newcastle. Financial support was provided by DTI and EPSRC. We are indebted to all participants for their contributions.
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