Bridging the gap between plant floor and enterprise systems

Of the 150 companies surveyed in North America and Western Europe, 61% are either currently planning on linking the two disparate environments, or actively investing in it today.

“The disconnect between plant floor and enterprise systems is something that's developed over the last 30 years however there's now a renewed push to close the gap,” says Adam Jura, Manufacturing Technology Analyst and author of the study. “A focus on production metrics and manufacturing agility means that manufacturers need better communications between the two system environments. As a result, we're seeing significant expenditure on both traditional manufacturing execution systems (MES), as well as newer manufacturing intelligence solutions. In so doing, companies hope to improve their scheduling, supply-chain interactions and performance monitoring capabilities.”

Billions to be spent MES software and services by 2012

Traditional MES seeks to close the gap between plant floor and enterprise systems with a bidirectional flow of data and information. For many manufacturers MES is the essential link that provides key information from the plant floor for line of business staff, while at the same time pushes work orders down to employees on the ground.

Datamonitor estimates that by 2012, the worldwide market for traditional MES software and services will reach US$2.5bn in the manufacturing industry.

This represents strong growth on 2006 revenues of US$950m, however does exclude newer manufacturing intelligence solutions that focus on solely pulling data up from the plant floor.

Large enterprises will form the bulk of the investment in traditional MES solutions as they seek to drive better information across multiple facilities and lower total costs. The Datamonitor MES forecast model also assesses the investment in MES within sixteen individual manufacturing industries. Currently, the pharmaceutical, food and beverage, and chemical markets are leading the way, although discrete industries are expected to see an upwards swing in 2009.

“Traditional MES technology is evolving to include greater manufacturing intelligence functionality so for many manufacturing companies, the justification to invest is being established more easily. As this functionality improves, traditional MES solutions will be able to better support a wider range of business processes and drive more efficient and agile production across an extended enterprise. It's for this reason that we're seeing increased adoption of MES technology,” says Jura.

Fragmented MES market has no clear leader

According to Datamonitor, the MES technology market is still highly fragmented with a number of smaller vendors still operating. The closely linked nature of MES technology to individual industry processes means that it's been hard to build an overarching product. At the same time, the amount of services work required for MES implementations and maintenance has created a higher demand for local solution providers.

Datamonitor believes that mergers and acquisitions will continue to be a feature of the MES solutions space over the short-, mid-, and long-term as MES technology vendors muscle for industry functionality, services capabilities and greater overall scale. Those MES vendors focusing on industries facing increasing regulation will prove to be the most attractive targets for larger companies as end-users (i.e. manufacturing firms) are forced to invest.

“The traditional MES market is one of the more interesting markets to look at in terms of how it is unfolding. On one hand, there's a large number of smaller vendors still active in this space, while on the other hand, the emerging threat of manufacturing intelligence-only solutions is forcing vendors to develop additional functionality. As such, the winners in this market over the next few years will be heavily influenced by acquisition strategy, functionality development and services capabilities,” Jura concludes.