In the modern manufacturing industry, choosing the right manufacturing execution system (MES) is crucial for the efficiency, transparency and flexibility of production processes. For companies that already use an SAP ERP (Enterprise Resource Planning) system, the question arises as to whether they should invest in an integrated MES solution from SAP or opt for an MES from a specialized MES provider ("best of breed" strategy).
In this article, we examine the advantages and disadvantages of both approaches, including a look at the cloud-native MES from Symestic GmbH:
SAP has a clear strategy to promote cloud solutions that respond to the increasing demand for flexibility, scalability and innovation. This strategy includes investments in cloud-based platforms such as SAP S/4HANA Cloud, SAP Digital Manufacturing Cloud (DMC) and other cloud solutions.
There is currently no official announcement that the on-premises solutions will be completely discontinued. Instead, SAP appears to be pursuing a hybrid approach that allows customers to choose between on-premises, cloud and hybrid solutions based on their specific business needs.
SAP is a large, multinational company that offers a wide range of products and services. These include the following core solutions:
- SAP S/4Hana
- SAP Successfactors
- SAP Ariba
- SAP Customer Experiance (CX)
- SAP Business Technologie Platform (BTP)
- SAP BusinessObjects Business Intelligence (BI)
- SAP Concur
SAP MES solutions are part of the diversification of the extensive SAP overall portfolio.
With ME (Manufacturing Execution), MII (Manufacturing Integration and Intelligence) and the cloud-based SAP DMC (Digital Manufacturing Cloud) approach, SAP offers three solutions that promise seamless integration into SAP ERP systems.
Worin unterscheiden sich die drei SAP Lösungsansätze?
This traditional on-premises solution has been offered by SAP since 2008 and focuses on the direct control and monitoring of production processes at plant level.
SAP ME enables detailed tracking and control of production processes, machine utilization and quality assurance processes in real time. It is designed to help companies increase their production efficiency, reduce downtime and improve product quality.
SAP ME is the result of SAP's own development work and the integration of functions from acquired solutions. One of the core elements of SAP ME, manufacturing execution, is based on the acquisition of Visiprise.
This SAP solution supports ISA-95, i.e. an international standard for MES functions for the integration of enterprise and control systems from MESA (Manufacturing Enterprise Solutions Association).
SAP MII is also a traditional on-premises solution that has been offered by SAP since 2005. It serves as a link between the manufacturing processes and the enterprise levels.
SAP acquired Lighthammer Software Development Corporation in 2005 to strengthen its offering in the area of manufacturing intelligence and integration. Lighthammer's technologies and capabilities, particularly in relation to manufacturing information system integration and the provision of real-time manufacturing intelligence, have been used to extend and enhance SAP MII.
SAP MII provides tools to integrate manufacturing systems with ERP systems (e.g. SAP S/4HANA) and enables real-time data analysis. SAP MII provides the intelligence and analytics needed to make decisions based on real-time manufacturing data, optimizing production efficiency and flexibility.
This SAP solution also supports the ISA-95 standard to ensure smooth communication and data flow between operations management systems and the enterprise level.
SAP DMC is a relatively new cloud-based approach from SAP that combines functions from both SAP ME and SAP MII into one integrated solution to increase manufacturing efficiency and innovation. SAP began to promote this solution in 2018.
SAP DMC offers not only the control and monitoring of manufacturing processes, but also advanced analytics and integration functions in a cloud environment. It helps companies scale their manufacturing operations and quickly adapt to new market conditions by facilitating access to the latest technologies and innovations. With this solution, SAP aims to make the transition to the cloud easier for customers.
As a cloud-based solution, SAP DMC is designed to meet modern cloud standards and security practices. It supports the basic principles of Industry 4.0.
The SAP Digital Manufacturing Cloud (DMC) offers a suite of modules and components that are specifically designed to meet the requirements of modern manufacturing companies. Here is a detailed look at the modules and components mentioned:
DMCe, or SAP Digital Manufacturing Cloud for Execution, is the heart of manufacturing execution within SAP DMC. It enables the management and monitoring of production processes in real time and ensures that manufacturing processes are carried out efficiently, with high quality and in compliance with planned costs and deadlines. DMCe offers tools for order management, production monitoring, quality inspection and much more.
Resource Orchestration, or REO, focuses on the optimal allocation and utilization of production resources, including machinery, equipment and personnel. By improving resource planning and allocation, REO helps companies increase productivity, minimize downtime and improve overall manufacturing efficiency.
DMCi, or SAP Digital Manufacturing Cloud for Insights, is designed for the analysis and reporting of manufacturing data. It enables companies to gain insights into their production processes by collecting, analysing and visualizing data from various sources. DMCi supports decision-making by providing real-time information on production performance, quality metrics and efficiency indicators.
Plant Connectivity, or PCo, serves as an interface between the SAP DMC and the physical production facilities. PCo enables the seamless integration of machine, plant and sensor systems into the digital manufacturing environment. By collecting and transmitting real-time data from production, PCo supports data-driven manufacturing and improves the transparency of production processes.
The integration of SAP DMC with SAP S/4HANA is critical to creating a seamless connection between manufacturing processes and core business operations. This interface enables bi-directional data flow between the manufacturing level and the ERP system, ensuring consistency and accuracy of company data. Among other things, it supports the synchronization of production orders, material movements and stock levels, enabling integrated and efficient operations management.
Together, these modules and components of the SAP Digital Manufacturing Cloud provide an integrated solution that helps companies digitize, optimize and adapt their manufacturing processes to the demands of the modern market. The combination of manufacturing execution, resource orchestration, production data insights, plant connectivity and integration with SAP S/4HANA creates a solid foundation for digital transformation in the manufacturing industry.
SAP DMC represents SAP's most advanced approach to integrated MES solutions, designed to communicate seamlessly with SAP ERP systems. Its cloud infrastructure offers scalability and flexibility, supported by a range of security features that ensure the integrity and confidentiality of production data.
Through the use of modern integration technologies and APIs, SAP DMC enables efficient data exchange and deep integration into the SAP ecosystem, providing a unified view of enterprise data in principle.
Scalability and flexibility: The cloud basis allows companies to dynamically adapt their resources to respond to changes in production volumes.
Security and compliance: Advanced security mechanisms protect against data loss and theft while ensuring compliance with industry standards.
Integration and data consistency: The close connection to SAP ERP promotes communication and consistency across all business areas.
Complexity and integration challenges: The integration of SAP DMC into existing system landscapes and production environments can be complex, especially when it comes to connecting to older systems or third-party software.
Data migration and integrity: The transfer of existing data to the new cloud environment must be carefully planned and executed to avoid data loss or corruption.
Security and data protection: When using a cloud-based solution, companies must ensure that their data is secure and that the solution complies with local data protection laws.
Dependence on the provider: The use of a cloud solution can lead to greater dependence on SAP, particularly with regard to the availability and security of services.
License and operating costs: In addition to the initial license costs for SAP DMC, ongoing costs may also be incurred for the operation, maintenance and any extensions to the cloud solution.
Customization and integration: Adapting SAP DMC to specific business processes and integrating it with other systems requires time and resources, especially if special interfaces or extensions need to be developed.
Project management and consulting: The planning and execution of the implementation requires professional project management. External consultants may be required to provide expertise and best practices, which incurs additional costs.
For several strategic and operational reasons, a manufacturing company that is already using an SAP ERP solution should not simply opt for an integrated SAP MES solution, but should instead consider a cloud-native MES solution from a specialized provider. This decision can be influenced by various factors, ranging from the company's specific needs and IT strategy to industry-specific requirements.
Traditional on-premises MES and cloud-hosted MES architectures are not taken into account in the following considerations due to their lack of scalability and high total and follow-up costs.
Here are some key considerations that could guide a "best-of-breed" decision for a cloud-native MES product from a specialized MES provider:
When deciding between an integrated SAP MES solution and a cloud-native MES from a specialized provider, companies should carefully evaluate their specific requirements, business objectives and the potential long-term impact on their manufacturing and IT strategy.
The decision between SAP DMC and a cloud-native MES from a specialist provider should not be made solely on the basis of cost or technical specifications.
Companies need to consider their long-term business goals and the role the MES plays in their digital transformation strategy. Choosing the right system can have a significant impact on a company's agility, ability to innovate and competitiveness.
Opting for a "best of breed" approach when choosing a Manufacturing Execution System (MES) offers manufacturing companies that already use SAP ERP solutions a number of strategic advantages. The "best of breed" approach unfolds its full potential, particularly in terms of cost benefits, independence from a single provider (such as SAP) and the rapid usability and implementation of such systems.
These considerations underline the attractiveness of this approach for companies seeking a leading position in the field of digital manufacturing:
The "best of breed" approach can offer significant cost benefits. By choosing specialized solutions, companies have the ability to purchase exactly the functionality they need without having to pay for extensive, integrated system packages that include features that may never be used. Cloud-native solutions further amplify these cost benefits with scalable subscription models that allow customization to actual needs, avoiding unnecessary spending. The transformation of capital expenditure into operational expenditure enables better cash flow planning and financial flexibility, which can be particularly beneficial for mid-sized companies.
Choosing a "best of breed" MES from a specialized provider increases independence from SAP and avoids excessive dependence on a single software provider. This independence is strategically important as it gives companies more negotiating power and increases the flexibility to react to technological developments and market changes. The ability to choose the best available system on the market, without being limited by the technological or business policy restrictions of one provider, allows IT strategy to be truly aligned with company goals and needs.
"Best of breed" solutions are often characterized by their rapid implementation and usability. Specialized MES providers usually have experience with the fast and efficient introduction of their systems, including integration into existing ERP landscapes. Cloud-native solutions also offer the advantage that no extensive on-site infrastructure is required, which speeds up the implementation process. Companies can therefore benefit from the new functions more quickly and see a rapid return on their investment. The agile nature of "best of breed" systems also makes it possible to continuously implement new functions and improvements without having to go through lengthy upgrade processes.
Opting for a 'best of breed' approach offers clear benefits to manufacturing companies striving for tailored excellence, technological innovation and operational efficiency. By focusing on specialized, cloud-native MES solutions, companies can not only optimize their costs and reduce their dependence on a single provider, but also realize faster implementation and utilization of the technology.
This strategic choice supports dynamic adaptability to market changes and promotes a culture of continuous improvement and innovation. In a fast-paced and technologically advanced manufacturing environment, the "Best of Breed" approach positions companies at the forefront of Industry 4.0 and creates a solid foundation for sustainable growth and competitiveness.
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In addition, lean production, continuous improvement, Kaizen, Six Sigma and store floor management play an important role for MES in recognizing the potential for improvement in production. MES products enable efficient communication and coordination directly at production level (operational excellence), which is essential for identifying and quickly rectifying problems.
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