What's 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.

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 focussed 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.

Here, we’ll explore the benefits of a production monitoring system and help you determine if it’s the right fit for your business.

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?

Firstly, let’s have a quick overview of what a PRODUCTION MONITORING SYSTEM is

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 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 costs 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 works 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, business can waste a lot of resources leaving unnecessary gaps between jobs.

Overall Equipment Effectiveness (OEE) is a lean manufacturing tool and universal best practice to monitor, evaluate and improve 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; why some machines, jobs or teams perform better than others. And more importantly, enable you to take action, make changes and adjustments that all contribute to more 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 production efficiency increases of at least 6%, and often 20% and up to 30%.

How it is achieved:

  • Real-time monitoring so that you and everyone knows 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 allows for last minute job to be added whilst still delivering on time.

Cost savings and your ROI

As you can see, there are some significant efficiencies that can be achieved through using production monitoring software. And there’s 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 quicker. 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 to your scheduling more efficiently. This maximises the efficiency of machine changeovers and setup.

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

Collecting, consolidating, and cleaning data in order 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 straight forward to estimate how many man hours are spent carrying out these activities in your business, and then applying 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

Why not try the ROI calculator to see what a 6% increase in efficiency would mean to your business:

ROI Calculator

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.

How it works

Getting started with Intouch is as easy as 1, 2, 3

1. Book a demo

Let us show you what we can do. Jump on a demo call and our friendly team will take you through the Intouch system and answer any questions you might have.

2. Enjoy a free trial

Don’t just take our word for it! We’ll lend you our technology for a 60-day free trial so you can see exactly how it can benefit the everyday operation of your business.

3. Receive ongoing support

It doesn’t end there. If you decide Intouch is the right production monitoring system for you, we’ll work with you to help you take control and make significant improvements in OEE.