Efficient manufacturing – why the future’s ‘green’

For customers in today’s competitive global landscape, efficiency equates to cost savings at the bottom line. And while statutory regulation has been perceived as an onerous overhead by many in the manufacturing world, the rising cost of raw materials makes compliance a strategic and tactical necessity that pays off when it comes to lowering operational costs.

Rakesh Kumar, Global Industry Product Director Manufacturing Industry, Microsoft Business Solutions, explores the drivers for green manufacturing and takes a look at how today’s ERP solutions make it possible for manufacturers to mix and match production methods to achieve maximum waste avoidance and manage environmental accounting across the entire supply chain. He also examines how ERP enables the real-time collaboration that’s essential to ensuring operations can ‘reduce, recycle, recover, reuse and renew’ with ease.

The journey to green manufacturing

No other sector of the economy comes close to manufacturing in terms of generating environmental pollution and/or industrial waste.  And with the world’s eyes increasingly focused on the issue of corporate environmental responsibility, the industry’s scrutiny of its own manufacturing practices is now at an all-time high.

Increased government regulation, greater awareness of environmental concerns and a strong preference from customers to adopt more environmentally- friendly products are adding additional pressures on today’s manufacturers to make investments in ensuring their products as well as manufacturing operations more ‘green’.

With the sharp increases in global energy as well as raw materials costs, most manufacturers are, however, also finding that going ‘green’ not only helps them to meet environmental requirements and create a positive image with their customers, but that these investments are also providing a positive ROI through improved lower power consumption and reduced waste generation, thereby providing a valuable competitive weapon.

The green manufacturing challenge

In essence, green manufacturing methodologies  integrate product and process design issues with issues of manufacturing, planning and control in such a way that manufacturers are able to produce the same end item (or sometimes an even better product) with ‘greener’ materials, using more efficient production techniques while minimizing generation of environmental waste. A key challenge facing many companies, however, is how to integrate the process of continuous environmental management into the core of their business strategy. A broad spectrum of these challenges ranges from plant floor to the enterprise level, because achieving an operational balance between customer offerings, costs, supply chain management, environmental sustainability and compliance depends on the ability to gain a holistic view of the entire – and in some instances extended – manufacturing operations –especially when a significant part of them are being outsourced in today’s economy.

This overall and integrated view is now possible, thanks to the user-friendly underlying technology which today’s ERP solutions provide.

Going lean through the ‘5Rs’ - Reduce, Reuse, Recycle, Recover and Renew.

Today’s business solutions platforms deliver extraordinary real time information visibility and enable collaboration across extended enterprise.

Leading manufacturers on their green journey are leveraging these cutting-edge business solutions in redesigning their processes through the ‘5R’ concepts of Reduce, Reuse, Recycle, Recover and Renew and implementing lean manufacturing practices across their enterprise. . From sequence control to the creation of direct process links between sales, production and fulfillment,  business solutions  platforms are enabling these manufacturers to  streamline transactions, increase accuracy, and speed order cycles while making it possible to exchange common electronic documents with ease across their customers as well as suppliers.

Using a variety of collaboration and communication tools alongside tailored performance and process information from across the organization, process improvement now can be ‘built in’ to the operation.

And by automating processes, presenting complex data in easy-to-access views, and improving communication across functional and organizational boundaries, manufacturing organizations are able to accelerate the implementation of lean techniques to reduce cost, minimize waste and drive profitability.

Automated compliance monitoring and green controls

Manufacturers are under increasing pressure to measure, manage and report on their environmental footprint. As a result green supply chain programs are the order of the day, with organizations asking upstream partners to document and share their environmental impact data.

But regardless of whether manufacturers choose to green their supply chain to document their environmental credentials, satisfy customer requirements or comply with government regulations, the depth and breadth of information required to track an environmental ‘footprint’ is considerable.

This includes evaluating not only carbon footprint but monitoring other environmental impacts – such as discharge to waterways, landfills, emissions and the impact of logistics and transportation within the supply chain itself – as well as obtaining accurate information on the chemical content of products purchased by the organization. What’s more, a fast changing regulatory landscape means manufacturers are being asked to track the entire product lifecycle – including the impact at end of life.

Today’s business  solutions incorporate environmental dashboards and associated data cubes to capture this data in real time at the asset and facility level, together with reporting analytics to direct management decisions. Automating the entire process significantly reduces the cost and complexity of data collection, making it possible for manufacturers to evaluate every aspect of their operations - from the manufacturing process itself through to the transportation used to ship finished product.

Alongside ensuring organizational compliance with laws, regulations, policies and business rules, and the ability to apply country-specific market localization requirements, this powerful capability delivers future proofing to cope with fast changing regulatory requirements.

Implementation of new data collection requirements across the supply chain is simplified, while ‘what if’ modeling makes it possible to assess the impact of any proposed regulatory change. It also means manufacturers can integrate the environmental cost of production into the end price of products.

Efficient, green manufacturing

Environmentally benign manufacturing is one of the industry’s greatest strategic challenges, not just from an engineering perspective but from a business and marketing standpoint too.

Growing consumer demand for a new generation of environmentally friendly products, plus the growth in environmental regulations means manufacturers face the twin challenge of analyzing performance and compliance while pursuing strategies to reduce waste through lean methodologies.

Today’s business solutions platforms are designed to support flexibility in meeting customer’s changing demands – which can range from product specifications/ configurations to the quantities ordered or the locations where ordered materials need to be delivered. The modern business solutions platforms help manufacturers in meeting these requirements by supporting multiple manufacturing modes - including make-to-order, make-to-stock, configure-to-order, engineer-to-order and JIT manufacturing and materials control .

The benefits of getting it right are significant, and include successfully building brand reputation and market share, to introducing innovative techniques that reduce cost alongside environmental impact.

And what’s more, these systems support powerful lean capabilities and dramatically facilitate the compilation and analysis of environmental impact across the supply chain. Enabling organizations to make real-time decisions about how they work and how this impacts on the environment while cutting through the cost of complexity of working to a green agenda.

Microsoft Dynamics AX