Now more than ever, consumers are making more educated food and beverage choices. They want to know more about ingredients, where they are sourced from, while also demanding choice and personalisation. From packaging sizes to product variety and seasonal variations to celebrate every holiday from New Year’s Day to Easter – the demand for new and innovative products is on the rise.
The expectation is for consistent, high-quality products at reasonable prices – food quality and safety are paramount. Adding to this challenge is the need for speed as Consumer Packaged Goods (CPG) manufacturers continue to face increasing pressure to reduce their time to market.
Manufacturers must be more agile to be able to run multiple SKUs in their plants with quicker product changeovers. They also need to meet compliance requirements relating to food safety, personnel safety as well as environmental impact.
With the rising costs of ingredients, materials and energy, there is ever increasing pressure to improve yield and reduce waste through the manufacturing process. To address this, leading food and beverage manufacturers are leveraging digital transformation to remain competitive and realise new efficiencies in their operations.
The factory of the future plays a key role in successful food and beverage companies being able to remain competitive. It is smart, secure, connected and compliant and it can help you maximise ROI, optimise asset utilisation, achieve greater speed to market, as well as maintain quality and compliance throughout your operation.
This article discusses how you can identify the value from digital transformation within food and beverage manufacturing and explores the critical success factors for realising value in your operations.
The current state of play
In the food and beverage industry both globally and here in Australia and New Zealand, we have seen significant investment in automation and control systems on the plant floor in processing equipment and packaging machines. There will be continued investment and innovation in this area, however many food and beverage processors are still running critical functions around production, quality, and materials management with paper-based systems.
By relying on a paper-based system, spreadsheets or even an ERP system to track materials through your supply chain, your access to information is limited. These methods simply cannot deliver the granular, plant-floor information you need to make production decisions efficiently. To be successful, you need full track-and-trace capabilities and a single source of truth for contextual quality data.
Today, food and beverage manufacturers have the opportunity for further integration and automation of the data and workflows of operational support functions such as production management, quality management and reliability.
Manufacturing Execution Systems (MES) can provide key capabilities as their core functionality is centred on the supply chain and production management. The value of the system is its ability to effectively communicate with both the ERP and plant-level control systems in real time. It brings an order into production, orchestrates the manufacturing process, and tracks the order as it moves through the system. It can show you exactly where an order is in the process, track raw material consumption – and report back up to the ERP level.
Integrating your MES with the automation layer can do even more. The system leverages the smart technology on the plant floor to continuously monitor and act upon a wide range of key performance indicators (KPIs), including machine readiness – which encompasses cleaning, previous order completion and material delivery systems. This delivers better visibility to critical information so you can quickly assess and make smarter and faster production decisions with greater agility.
We are seeing many benefits from early adopters of these digital solutions in key areas including: a significant reduction in time to introduce new products; increases in workforce productivity; significant reductions in unscheduled downtime and reduction in the cost of quality.
If an organisation’s existing systems leverage an Internet of Things (IoT) platform, they can connect to these systems and leverage existing data. This information can then be delivered in the right context to stakeholders. Whether it is production management, quality management, reliability, or continuous improvement – these resources allow them to make better, more informed decisions faster to optimise operations.
What are the factors for success?
Digital transformation is an innovation and productivity accelerator, but it is also a complex endeavour. Today, only 16 percent of industrial organizations have embarked on enterprise-wide digital transformation programs. Most attempts result in false starts as companies struggle to turn investments into results. So how do you find success?
The successful path to digital transformation does not start with technology or data. It starts with a clear vision of the outcomes you want to achieve – and the problems you are trying to solve. It is critical to understand where the value is for your business and operations. This involves considering the following factors:
- What are your current operational challenges and what outcomes are you looking to achieve?
- What are your processes and product mix?
- What is the level of regulatory and import/export compliance?
- Your existing systems, technology, and workforce
We see methodologies such as design thinking often used at the stage of understanding where the specific value opportunities are in your operations. Once you understand what problems you want solve, how you might solve them and the value of solving them – the solutions can be prioritised based on the urgency and return on investment.
A strategic plan with a roadmap of incremental investments is also a key success factor. Digital transformation is not a one and done event, it is a journey that brings new capabilities to your operations and then continues to build on these capabilities. Many of the solutions are best suited to an agile implementation and rollout.
There is a vast amount of process and asset data generated each day by your automation systems as well as data collected in historians and other disparate databases. You can connect these systems and data sources by leveraging an IoT platform to deliver information and insights for people to make better decisions in their various roles in near real time. Many manufacturers think they need a greenfield project or new machines to start the digital transformation process. In fact, it is possible to realise the value from data-driven operations today with existing systems.
People is another important factor for success. Your team must have senior management sponsorship and leadership. To maximise the potential of your current or future digital transformation team, it is crucial to have people from IT, engineering and operations working alongside executive support. We also encourage you to leverage the experience of a trusted partner with experience in Operational Technology (OT) and your industry to augment your team.
Build your factory of the future today
As more CPG companies set their sights on transformative outcomes that require insights from across the enterprise – they are beginning to realise that it takes an ecosystem of partners to achieve their goals. Over the past few years, we have had the opportunity to work with many CPG companies that are looking for better ways to leverage their digital investments.
The factory of the future is smart, flexible, secure, connected, compliant and data-driven. It is possible today, maybe not in one step; however, I am excited to see how these enabling technologies and digital solutions contribute to the future growth and sustainability of the food and beverage industry in this region.
Learn more about how digital transformation can help you realise greater value to succeed and maximise agility in your operations.
Published December 28, 2021
