Are you also struggling to innovate and manage costs in a fiercely competitive manufacturing landscape with enormous change?
Manufacturers are operating in an incredibly challenging environment.
Global competition has taken out many manufacturers, for example, the US car industry has gone from world leader to needing government bailouts.
Move to sustainability and e-products is forcing manufacturers to innovate and adapt production.
The fast-paced 6-12 months cycles of producing new cutting edge competitive products is a challenging race to stay competitive and puts enormous strain on managing efficient manufacturing operations. Economies of scale and moving production to countries like India, and China, and technology lean production, AI, and Robotics is creating competitive costs and efficiency advantages. All this in an environment that is highly sensitive to volatile and economic downturns.
These change drivers in the highly complex macro environment creates two pains that manufactures wrestle with today:
Enormous strain on costs, profitability, and cash flow to stay competitive.
Urgency to resolve and adjust quickly or risk extinction or acquisition.
So what different options do you have to solve this?
To navigate in this highly complex ecosystem there are several strategic actions one fundamental is what we call Cost Orchestration. The discipline of orchestrating costs across multiple functions and stakeholders to establish a true cost blueprint. Once you have the cost blueprint the next step is orchestrating effectively to make significant saves and efficiency improvements. You have 4 different options:
Do it yourself - if you have the competence and software in-house this is a viable option. The challenges we observe are that many companies in the industry don’t have know-how in-house to orchestrate costs around the 4 key orchestration cornerstones, what we call ACPE: Assessment (to understand the gaps), Calculate (software to manage the complexity), Plan and Execute operational excellence.
Recruit - A viable option if you can find talent that masters ACPE. We observe that this is a scarce resource. The second challenge is recruiting, onboard, and getting them fully operational is time-consuming. If you get the recruitment wrong you lose even more time which can be fatal given the urgency to orchestrate costs to be competitive.
Buy/bring in Advisory- Bring in the expertise quickly and get the cost orchestration in place quickly. In-house employees can also be upskilled to learn how to orchestrate and you have access to software that can calculate the complexity of the manufacturing costs.
Acquire or merge - this is also a viable option that takes time before the new organization is in place.
ET represents option to Buy/bring in Advisory - in this subcategory you can choose serval options where you choose between either bringing in companies that help you with each part of ACPE or one that orchestrates costs in a disciplined methodology. Below are the 4 cornerstones of cost orchestration:
Assessment - companies that help you make the assessment current cost set up and share a proposal of what you need to do. You will then need to Execute the Plan yourself and if you want to re-do the exercise in 6-12 months you will need to pay big bucks for a new assessment and plan.
Create - Buy/license software that helps you understand your current cost situation and where you have opportunities to make efficiencies. This requires you to make the Assessment, develop a Plan and Execute
Execution - a third option is to bring in a 3rd party that executes the plan. This requires you to assess, calculate, and develop the plan.
ET represents the 4th option - Assess, Create (software), Plan, and Execute. If you prefer the option to outsource the whole end to end process whilst upskilling your internal teams to manage costs.
ET is unique in the market in orchestrating ACPE in complex manufacturing. Backed by Siemens and sole distributor of Siemens software in the Nordics. ET Advisory is an agile company with enormous experience in Cost Orchestration backed by the "mother ship" Siemens.
PLM/Cost Management: A Hot Solution That Can Save from $10,000's to over $10 million
A PLM-related stand-alone solution which can save from tens of thousands of dollars to over $10 million—is this really possible?
"Absolutely," says seasoned PLM expert Tony Bergström, CEO of ET Advisory, who has a long history of experience in this area. He has teamed up with Mats Bergkvist, a cost management specialist with many years of domain experience, and founded ET Advisory. The mission is to market and sell a software from Siemens: the stand-alone solution, Teamcenter Product Cost Management (TcPCM). An advantage is that TcPCM works in virtually any of the big industrial PLM environments where other solutions—such as those from Dassault Systèmes
or PTC—are already installed.