Cloud-native MES - evolution and paradigm shift

In the following article, we will examine the various stages and driving forces of MES evolution, highlight their advantages and disadvantages and take a look at the future of Manufacturing Execution Systems (MES):

• Driving forces of MES evolution 
• On-premises MES - the solid classic
• Cloud-hosted MES - the classic with a modern twist
• Cloud-native MES - the revolutionary leap into the MES future
  
  
• MES - the trailblazer for sustainability and Industry 5.0
• MES - how you can get started today

Driving forces of MES evolution

Driven by the constant search for efficiency, precision and flexibility, manufacturing companies have always been at the forefront of technological innovation. A key component in the quest for improvement is the Manufacturing Execution System (MES), an information system for the effective control and optimization of production.

The continuous optimization of production processes through the use of advanced MES systems leads to significant efficiency gains and increased transparency in the manufacturing industry. Driven by the search for more cost-effective MES solutions and fast implementation times, the MES architecture has evolved over time from local installations (on-premises) to hybrid models and fully cloud-based MES products.

On-premises MES - the solid classic

The origins of MES systems date back to the late 1970s and early 1980s, when companies began to introduce computerized systems to increase the efficiency of their production processes. These early systems are installed entirely on site, customized to the specific requirements of each company.

Advantages:

• Control and security: On-premises MES systems offer companies full control over their data and processes. As all information is stored internally, companies have the security and responsibility to ensure that their sensitive data is not transmitted over the internet or stored on external servers.
  
  
  • Cybersecurity:
    Companies have now realized that considerable resources need to be spent on protecting their own IT infrastructure - and then often realize that the protection was not sufficient after all. 
    A survey conducted by Bitkom as part of the "Wirtschaftsschutz 2021" report revealed that 88% of the companies surveyed had fallen victim to theft, industrial espionage or sabotage in the last 12 months, an increase of 13 percentage points compared to two years previously.
    
    SMEs are particularly affected, with the same survey showing that 88% of companies with between ten and 99 employees were affected by such incidents.
      
• Customization: Local MES solutions are usually customized to meet a company's specific requirements and processes. These tailor-made individualized MES systems enable optimal integration into existing production processes.

Challenges:

• High initial investment (CAPEX): Implementing an on-premises MES requires significant investment in hardware and software as well as staff training.
  
  
  • IT investment costs are typically well over EUR 100,000.
  • For security reasons, the IT hardware must be replaced after four years at the latest.
     
• Maintenance and updates - high running costs: Companies are responsible for their own maintenance, updates and security measures, which ties up additional internal resources.
  
  
  • The costs of an independently operated MES amount to several tens of thousands of euros per year.
  • The local IT infrastructure (hardware and software) must be permanently monitored by an internal or external service provider and, in the event of a failure, quickly restarted with a short response time - if necessary, a 24/7 on-call service must be organized.
  • The actual MES information system must be adapted to the constantly changing IT framework conditions (operating system, frameworks, replacement of IT services, interfaces, etc.).  This results in high running costs every year.
     
• Scalability: The expansion of production capacities is made more difficult by the limited flexibility of local systems.
  
  
  • Expansions and adaptations of an on-premises MES are accompanied by additional investment costs.
  • The number of experts who can support an individualized MES is constantly decreasing due to the complexity and is also decreasing over the years due to staff turnover.
  • Due to the lack of competition and very limited alternatives, the costs for MES scaling and expansions are usually quite high.

Cloud-hosted MES - the classic with a modern twist

With the advent of cloud technology in the 2000s, companies began to recognize the benefits of the cloud for storing and analyzing data.

Cloud-hosted MES and hybrid MES are solutions that enable companies to partially migrate to the cloud without completely abandoning their existing on-premises systems. Ultimately, however, these are still classic MES information systems whose central server component has been moved from a company's local server room to a data center of an IT infrastructure provider "in the cloud". This approach is also referred to as "lift and shift" MES.

Ultimately, the economic impact for the company - over the entire term of an MES - is low, as "only" the MES server is located elsewhere. One advantage is that the required IT hardware can be rented quickly. Subsequent scaling of the hardware capacities (RAM, hard disk, ...) is another advantage.

However, the general challenges of an on-premises MES must still be taken into account. This applies in particular to cybersecurity, which is becoming increasingly important. In addition, performance and redundancy must be taken into account for the data channel from the local company to the external MES server (additional costs).

Additional challenges:

• Complexity of integration: 
  Connecting on-premises and cloud components is a technical challenge, especially in terms of data consistency and security, which must be ensured.
• Dependence on internet connections:
  Apart from the redundancy of the external MES server, the reliability of cloud services in a cloud-hosted or hybrid MES also depends on the quality of the internet connection. This can now be easily managed through the appropriate redundancy design of fiber optic providers and lines.

Cloud-native MES - the revolutionary leap into the MES future

The emergence of the first cloud-native MES systems in the 2010s marked a significant turning point. These systems were built from the ground up for the cloud to take full advantage of the cloud computing architecture, including flexibility, scalability and efficiency.

Cloud-native MES products represent the state of the art in the manufacturing industry by taking full advantage of cloud computing technology. They offer a wide range of benefits, but also face specific challenges:

Advantages

• Scalability: The cloud-native architecture makes it possible to dynamically adapt resources to meet current needs without the need for costly and time-consuming hardware upgrades.
  
  
• Flexibility and agility: Cloud-native MES support faster development and provision of new functions as well as easy adaptation to changing business processes or market requirements.
  
  
• Cost efficiency: The "pay-as-you-go" or Software-as-a-Service (SaaS) pricing model allows companies to save considerably on operating costs, as they only pay for the resources they actually use.
  
  
• Reliability and availability: Cloud providers guarantee high availability rates thanks to redundant systems and data centers, which ensures operational continuity.
  
  
• Security and compliance: Cloud-native solutions offer advanced security features that are constantly updated to counter the latest threats. They also facilitate adherence to compliance standards through integrated functions and certifications.
  
  
• Speed of innovation: Companies benefit from the continuous improvement and introduction of new technologies by the cloud provider without having to make their own investments in research and development.
  
  
• Improved data analysis: The integration of big data and analytical tools in cloud-native MES enables in-depth insights into production processes and supports data-driven decisions.
  

Challenges

• Internet dependency: The reliability of cloud-native MES is directly dependent on the internet connection, which can be a problem in areas with poor connectivity.
  
  
• Data security and privacy concerns: Although cloud providers take extensive security measures, there are concerns about the security of sensitive data, especially in industries with strict data protection regulations.
  
  
• Complexity of the migration: Switching from an existing on-premises system to a cloud-native MES can be complex and requires careful planning and execution. The advantage is that both systems can be operated in parallel and a step-by-step migration is possible with minimal risk.

Cloud-native MES products offer significant benefits that make them an attractive option for many manufacturing companies looking to increase efficiency, reduce costs and drive the digital transformation of their production processes.

MES - the trailblazer for sustainability and Industry 5.0

Industry 4.0 - Manufacturing Execution Systems (MES) are a central component of this current approach, which is characterized by digitalization, networking and intelligent automation in manufacturing processes. MES software forms the backbone that not only improves transparency and control at every level of production processes, but also enables seamless integration between the operational level of production and the company's strategic goals. The operational MES connects the store floor with the higher-level ERP system.

The advantages of cloud-native MES products over on-premises MES solutions are particularly relevant when it comes to scalability, flexibility and efficiency, which are crucial for the dynamic requirements of Industry 4.0.

Manufacturing Execution Systems (MES) are at the heart of the digital transformation in Industry 5.0. While Industry 4.0 paved the way for automation and data integration, Industry 5.0 is shifting the focus towards human-centered, sustainable and flexible manufacturing. Cloud-native MES play a key role in this by bridging the gap between advanced technology and human influence. Industry 5.0 takes the following aspects into account from an MES perspective:

• Personalization and flexibility
  Cloud-native MES in particular offer unprecedented flexibility, enabling production processes to be adapted quickly and efficiently to individual customer requirements. This agility is a core feature of Industry 5.0, which places customized production at the forefront.
  
  
• Integration of man and machine
  The real-time data processing and analysis of MES systems, supported by upcoming AI assistants, improve decision-making and process control. Modern MES products, including smart phone apps, enable more intuitive and effective collaboration between employees and machines, underlining the human-centered approach of Industry 5.0.
  
  
• Sustainability and efficiency
  The real-time data processing and analysis of MES systems, supported by upcoming AI assistants, improve decision-making and process control. Modern MES products, including smart phone apps, enable more intuitive and effective collaboration between employees and machines, underlining the human-centered approach of Industry 5.0.
  
  
• Improved collaboration
  Sustainability is another key element of Industry 5.0 and MES systems contribute to this by optimizing the use of resources and reducing waste. Precise monitoring of energy consumption and material usage leads to more sustainable production.
  
  
• Resilience and adaptability
  The modular and service-oriented nature of cloud-native MES ensures a high level of resilience and enables rapid adaptation to changing circumstances. This helps companies to remain competitive in the dynamic landscape of Industry 5.0.
  
  
• Support for distributed production networks
  Cloud-native MES facilitate the management of distributed production facilities and support the vision of networked, collaborative production ecosystems. They enable centralized access to data and applications, which is essential for the implementation of Industry 5.0.

Conclusion

The MES evolution reflects the general trend in the IT landscape and business models. Each MES architecture has its own pros and cons that companies should consider when choosing to meet their specific needs.

While the future undoubtedly lies in the cloud, the path to get there is unique to each organization and requires careful planning and implementation. Continued innovation in MES technology promises an exciting future for the manufacturing industry, with flexibility, efficiency and integration at the forefront.

MES - further information

• Everything you want to know about Manufacturing Execution Systems (MES)
• Cloud-native MES vs Microsoft Power BI for the digitalization of production
• The SaaS revolution in manufacturing - CLOUD MES