Intouch Monitoring Blog // What is the Real ROI of a Production Monitoring System?

Return on investment, or ROI is a key performance indicator (KPI) that’s used by businesses to determine the likely profitability of an expenditure. But it’s also used to measure the ongoing success over time and takes the guesswork out of future business decisions. In this blog, Intouch Monitoring explores the benefits of a production monitoring system and helps you determine if it’s the right fit for your business.

Let’s face it, knowing you’re getting a great return on any investment you make is essential to financial success. In today’s volatile environment, businesses are focused on being stable and lean, whilst continuing to deliver to their customers. Production monitoring systems enable you to be more cost-optimised, with a sharper focus on your equipment utilisation and your people. Uncovering hidden capacity and optimising processes across your production is what it’s all about.

Is production monitoring worth investing in?

A production monitoring system can be a valuable investment for your plastics production operation. But is the real ROI worth it?

Maintaining a production operation that is both efficient and profitable is a challenge that production managers face every day. To make the best possible decisions, it’s necessary to have accurate and timely information about what’s happening on the shop floor.

Implementing a production monitoring system can be one way to achieve this goal, but is it worth the investment? Or you’re already convinced but have been asked to justify the ROI of a production monitoring system. After all, such systems can be expensive and some can take time to implement, which is also an opportunity cost – so it’s not always easy to see how they will pay off in the long run! So what happens when you invest in one?

What is a production monitoring system?

In short, it’s software that connects to your machines and tracks what your machines are doing. It provides real-time information.

But it isn’t just information, it’s curated information presented in a way that makes it easy for you to make immediate and informed decisions that will keep your factory running as close to 100% OEE as possible.

What does this mean to you?

Significant cost savings as you get alerted to downtime as soon as it happens which leads to a reduced loss of wasted time, labour costs, materials, and energy usage.

Scheduling and Planning

Usually, with a production monitoring system, there is an option of having a scheduling and planning module. It works very well together with production monitoring.

Planning work orders can help you decide when jobs should be scheduled and can be easily re-arranged as new jobs are raised.

So what is the advantage of having a scheduling system?

It means more productivity because you are making the most out of your production time available whilst still meeting your delivery deadlines. Without a live scheduler, businesses can waste a lot of resources leaving unnecessary gaps between jobs.

OEE Reporting and Analytics

Overall Equipment Effectiveness (OEE) is a lean manufacturing tool and universal best practice to monitor, evaluate and improve the efficiency of your production processes. When you improve your OEE you improve most of your other critical manufacturing KPIs. Some systems come with a reporting and analytics module which is invaluable and will help you calculate your OEE.

Accurate reports that give you access to data so you can analyse your production. It will show you what has happened; and why some machines, jobs or teams perform better than others. More importantly, enables you to take action, and make changes and adjustments that all contribute to improved performance.

Understanding what’s working well and why is just as important as what’s not working so well. To achieve that you need reports that make it crystal clear what changes should be made.

What is the realistic production efficiency improvement you can achieve?

Users of production monitoring software will see increases of at least 6%, and often 20% and up to 30%.

How it’s achieved:

• Real-time monitoring so that you and everyone know what is happening on your shop floor and can take action when needed immediately.
• Downtime alerts so you can fix things as soon as they happen before you waste time and resources and lose production capacity.
• OEE reports that let you analyse your production, flagging up areas that need improvement.
• Agile schedulers that let you plan your production for maximum capacity and allow for last-minute jobs to be added whilst still delivering on time.

Cost savings and your ROI

As you can see, some significant efficiencies can be achieved through using production monitoring software. And there are several other areas where you can expect to see savings across your business.

1. Improvements in machine utilisation

Production monitoring gives you high visibility, 24/7. This allows you to react to stoppages quickly. A survey of Intouch Monitoring users reported an average machine utilisation increase of 6% after implementing a real-time monitoring system.

Factories that operate 24/7 can see their utilisation increase from 75% to 79.5% which translates to a gain of 394 hours per machine every year. For a factory with 23 machines, that’s 9,062 extra production hours for the factory; an extra machine!

2. Improvements in planning and scheduling efficiency

Drag and drop planning tools that are easy to use, typically save 50% of your planning resource, compared to more manual and time-consuming methods such as Excel.

Real-time feedback to the production plan enables the shop floor to be prepared for up-and-coming changes. You can make changes that reduce the impact on your scheduling more efficiently. This maximises the efficiency of machine changeovers and setup.

3. The power of data – data you can trust in real-time

Collecting, consolidating, and cleaning data to gain meaningful and actionable insights is time-consuming. You will reduce the labour time spent collecting production data manually and remove the need for operators to fill in paperwork manually, this data will then be collated by a supervisor and then perhaps an administrator enters the data into a database or spreadsheet. By removing manual processes from your data collection, you’ll have data you can trust, in a fraction of the time, enabling you. to react and take appropriate action, faster.

As well as removing all this labour-intensive activity, data from a monitoring system is real-time. It should be straightforward to estimate how many man-hours are spent carrying out these activities in your business, and then apply an hourly rate to this to see how much time and money can be saved.

All the accurately collected data can then be used to drive improvements:

• Help decide where investment is required
• Where to focus attention
• What is working well, and what is not

Try Intouch’s ROI calculator to see what a 6% increase in efficiency would mean to your business.

Time investment

Many businesses might be put off implementing a production monitoring system due to their perception of the amount of time that’s needed. Let’s face it, time is valuable too, and there’s an opportunity cost to spending time learning a new system.

With so many orders coming in and a packed production schedule, it can feel like there’s not enough time and resources for everyone who needs training on how to use your new system – but don’t worry! Not all production monitoring systems are created equal, and at Intouch, we recognise the need to minimise the time investment, whilst ensuring maximum value to your business.

Systems only take a few weeks to set up and once the system is set up, time savings are significant too. Excellent investment with huge potential savings and significant ROI.

All in all, a production monitoring system is an excellent investment for your business. It offers many advantages in terms of increased efficiency and cost savings. If you would like to learn more about how a production monitoring system can benefit your business, please book a demo with one of our product experts.