9 minute read 20 Nov 2020
Worker with digital tablet in underground seed tunnel

What manufacturers can do to speed up decision-making

By EY Americas

Multidisciplinary professional services organization

9 minute read 20 Nov 2020

Can control towers solve the visibility issue most manufacturers face?

In brief
  • Most manufacturers can’t see what’s happening across their business in real time — a prerequisite to taking the right action.
  • Forward-looking companies have begun taking steps toward the visibility problem by implementing a control tower.
  • Sophisticated control towers speed decision making and provides visibility into aspects of operations that are critical to resilience.

Since the COVID-19 crisis began, manufacturers have been getting a first-hand look at the value of being able to make quick, informed decisions. And for many, it was a real wake-up call to see how they struggled to rapidly determine what actions to take as disruption unfolded all around them. In essence, the pandemic has been a true stress test, highlighting the long-standing challenges they have been facing in understanding demand signals and in managing their end-to-end supply chains (to respond optimally to changes in demand).

The key culprit is, and has always been, lack of visibility. Most manufacturers simply can’t, at a detailed level, see what’s happening across their business in real time — a prerequisite to taking the right action. Some forward-looking companies have begun taking steps toward fixing the problem by implementing a control tower, based on Microsoft technologies, that enables them to aggregate and visualize key data. But to date, those efforts haven’t borne the kind of fruit companies have been hoping for — either because the solution wasn’t implemented correctly or because it’s simply not being used well enough. Even manufacturers with highly mature control towers would likely admit they still have work to do in that regard.

The fact is, COVID-19 has provided a crystal-clear business case for manufacturers to accelerate their efforts to implement a sophisticated control tower to make them more resilient. It’s a capability that’s no longer a “nice to have,” but a requirement for being competitive in both the current environment and beyond.

What’s the span of control?

A defining element of a control tower is its span of vision and control — it is about who uses it to make decisions and how those decisions are made. In some cases, a manufacturer will want to centralize decision-making, relieving those on the line of the responsibility to determine what to do. In others, the best move is to have decision-making as close to the line as possible. In both situations, a control tower that delivers the right information to the right people at the right time is critical (see figure 1). 

Figure 1. Capturing workers’ knowledge

Figure 1: Speeding the decision making process.

Centralized tower — optimizing for the whole

A central control tower sits in a corporate function. It is monitored by an individual who looks across facilities to optimize execution for the overall business, rather than allowing individual sites to make decisions that may be the best for them.

Take, for instance, a company that makes bread, a very fast-moving product. Consumers expect fresh bread on the shelf of their favorite grocery store whenever they shop. But what if there’s a breakdown at one of the bread company’s facilities? If the company can’t make bread, it will lose its place on the shelf to a competitor. With a central control tower, someone can see current capacity and availability in all facilities, and then determine which one or ones can cover the production of the facility that’s down — and, thus, avoid losing sales at retail.

Here’s another example: a company’s production line includes a massive dryer that turns various liquids into powders. When the dryer fails, all of what’s being processed has to be scrapped — a huge waste of product. Plus, it takes a lot of time to repair the dryer and get it back up to speed. So the question is, what’s next? After the dryer is running again, does that line continue to make the product it was working on to replace the batch that was lost, or move on to another product? The workers on the shop floor can’t make that decision, but someone manning the central control tower can. That individual in the central tower can see that other facilities are adequately meeting demands for the first product, so the newly repaired dryer should shift to what’s next in line. 

Companies have seen benefits from these types of control towers even before the COVID-19 crisis. One company had used a central control tower built on Microsoft technologies to monitor key product quality metrics by using stock keeping units (SKUs) on certain production lines. And when a metric strayed from the acceptable range, they suggested line personnel to make certain adjustments to equipment settings. By being able to make corrections on the fly, the company decreased defects and increased yield — which, in turn, generated an annual US$40m windfall.

Localized tower — optimizing at the line level

A more localized control tower, which is deployed in a specific facility, enables line workers to make critical production decisions that are best made closest to the action. By deploying a control tower at the line, a company can create self-sufficient teams that have the information (and accountability) they need to make the day-to-day, shift-by-shift, hour-by-hour decisions to optimize the execution of their specific line. Team members also get insights on their own performance to identify and address any shortcomings that might affect the operation of the line. And they can access digital standards, policies and protocols that are key to maintaining consistent operations.

The impact of a control tower at the line level can be significant and highly visible. One consumer goods company, for instance, had rolled out localized control tower capabilities to a select group of facilities before COVID-19’s effects were being felt. As the company began experiencing disruption in demand, something caught company leaders’ eyes. The sites which were equipped with a control tower were far outperforming those without one, despite the fact that all were having to scramble to respond to extreme changes in demand and supply. In fact, the former ones were posting record results, running better than they ever had. One line saw a jump of 9% in productivity and a rise in overall equipment effectiveness (OEE) from 35% to 65% in the most recent quarter, in spite of pandemic-related lockdowns. 

Furthermore, the sites’ outsized performance was achieved without any input from the company’s leaders. It was the direct result of the onsite teams having daily access to the information and insights they needed to make the right decisions. In other words, a control tower made these teams more resilient and agile, and enabled them to see developments as they unfolded. It helped them adjust on the fly in response to those changes.

Another global consumer goods company experienced similar results. Its localized control towers enabled certain lines to squeeze out 20% more production volume for certain products that saw an explosion in demand as governments’ responses to COVID-19 took shape.

Key technologies drive control tower performance

None of this is possible without technology, of course. The extreme amount of data involved and the depth of analysis needed to generate actionable, accurate insights are far beyond what humans working with spreadsheets can handle. 

“The most sophisticated control towers incorporate robust artificial intelligence and machine learning capabilities that are increasingly taking over the initial steps in analyzing data and presenting recommended actions based on what the system’s ‘seeing',” notes Neal Meldrum, Business Strategy Manager at Microsoft. “Over time, as more data continues to be added to the data lake, the system learns from it. The recommendations become more accurate and the system can handle many more scenarios — with its capacity easily outstripping that of teams of humans. And the incredible speed with which machine learning can analyze huge piles of data and variables across an extremely complex process, and generate the right insights and suggestions, can cut a company’s "time to decision" dramatically. This is critical when minutes or even seconds count.”

The most sophisticated control towers incorporate robust artificial intelligence and machine learning capabilities that are increasingly taking over the initial steps in analyzing data and presenting recommended actions.
Neal Meldrum
Business Strategy Manager at Microsoft

Today, making the final call is still in the hands of humans. But that will change. Ultimately, with continued technology advancements, manufacturers will be able to deploy unmanned control towers to certain processes for “lights out” decision-making that eliminates the variability associated with the human element. At this point, manufacturers will enjoy the height of resilience. Think about the current crisis: manufacturers rely on experienced workers in short supply to make these difficult decisions to keep plants running. When they’re not able to be physically on site — whether because they’ve fallen ill or are not permitted to come to work — production and overall business performance plummet. An unmanned control tower making all the decisions for key processes can keep the lines running and the company operating at the capacity required to meet demands when workers cannot be there.

Read the previous article in this series, Four ways to use digital to strengthen manufacturing resilience.

The views of third parties set out in this publication are not necessarily the views of the global EY organization or its member firms. Moreover, they should be seen in the context of the time they were made.

Summary

For years, manufacturers have talked about getting better at sensing demand, understanding inbound supply and making execution decisions. These have been pain points for a long time.  Good times in the past may have masked shortcomings and inefficiencies, but they’re now rising to the surface and the need for greater visibility across the enterprise has become painfully clear. With a control tower at the right levels of its business, manufacturers can gain that visibility to quickly make the right decisions to respond to and bounce back from the changes and disruptions that influence today’s global economy.

About this article

By EY Americas

Multidisciplinary professional services organization