Manufacturing execution systems market in Bulgaria

Automation & RoboticsIndustrySouth-East European INDUSTRIAL Мarket - issue 2/2019 • 08.07.2019

With the transformation of Industry 4.0 from a visionary concept to a new production standard the development trends in the Manufacturing Execution Systems (MES) and Manufacturing Operation Management (MOM) solutions segments are increasingly defined by innovative technologies such as the Internet of Things IoT), cloud computing and big data analytics.

The MES/MOM platforms evolve thanks to the almost unlimited data flow from and to production systems, setting new criteria for added value, operational efficiency and quality control. More and more industrial companies are willing to invest in a new-generation of production management software solutions that offer greater transparency and traceability to business processes combined with a comprehensive set of tools for ensuring timely and adequate decision-making.

The European market of MES solutions is dynamically developing in line with the global trends of expansion in this field. The market in the South-East region faces equally fast transformation resulting in more and more local companies developing and implementing MES solutions. Manufacturing Execution Systems are also one of the most sought solutions for optimizing the business operations in the Bulgarian industry, a current global survey shows.

Every second chief executive officer (CEO) in the Industrial, Manufacturing & Automotive (IMA) sector in the country considers investing in such a technology. The Bulgarian companies designing and providing systems in this field are becoming more and more numerous, adding strong competitiveness, costs-benefits estimation and product diversification to the market equation.


Global technology trends

According to a global survey conducted in 2018 by Aberdeen Research, more than 55% of international production companies that participated in the market study claim they have to deal with too many problems having negative impact on operational efficiency.

As such, respondents point out the losses of materials and resources, production delays and stops, defected batches, the need to remanufacture defective products, etc. 45% of the surveyed companies say their operating costs are too high and 64% are under constant pressure to reduce total manufacturing costs.

As an additional, complicating factor, manufacturers take into account the need to make real-time critical decisions during manufacturing operations or the so-called short decision-making time windows. According to Aberdeen Research, the most popular solution for improving the efficiency, traceability, visibility and quality control of manufacturing operations are the MES systems or their evolutionary technological successors – the comprehensive operational production management platforms.

Large international companies are 50% more interested in investing in MES systems than small local businesses and 76% more ready to deploy MOM systems in their production. Their propensity to buy such platforms corresponds to the growing demands of the global industry in line with the Industry 4.0 concept.

According to Aberdeen Research, the market of MES/MOM solutions is changing due to this ubiquitous trend, with a distinct evolution at the architecture level of the automation traditional pyramid to more flexible embedded systems with service-oriented architecture and self-learning capabilities.


A solution for the IMA sector in Bulgaria

50% of the chief executive officers (CEOs) of companies in the Industrial, Manufacturing & Automotive Industry (IMA) in Bulgaria see the technology implementation of manufacturing execution systems (MES) as the next point on the agenda at present, according to the Bulgarian CEO Survey, part of the 22nd Annual Global CEO Survey conducted by PwC (PricewaterhouseCoopers). 68 Bulgarian business leaders completed the local survey and 1378 CEOs were interviewed in 91 countries globally.
11% of the IMA CEOs globally also think so.

The second technology segment that IMA CEOs in Bulgaria unanimously state to be currently pursuing is predictive maintenance of assets and products (100% of Bulgarian CEOs vs. 19% on a global level). This is in clear alignment with the overall tendency expressed by the Bulgarian business leaders to look for organizational growth by ensuring operational efficiencies, the research claims.

“Both types of solutions are ranked top of mind by the IMA CEOs in Bulgaria and relatively lower by their global counterparts, which might be an indication that on a global scale these are already in place and we are catching up in the utilisation of such technologies, which are considered industry standards already”, the survey says.
“Automation, robotisation, digitalization, industrial Internet of Things, augmented reality, robotic process automation… are no longer mere words for the Industrial, Manufacturing & Automotive (IMA) sector, but spring the CEOs into action now”, the authors add.


Current technological development

Manufacturing execution systems (MES) are used for management, monitoring and synchronization in the implementation of physical processes in real time related to the transformation of raw materials into work pieces or finished components and products. They coordinate the performance of work tasks in a specific order with respect to production schedules and enterprise-level management systems.

MES applications provide feedback on technological processes, while facilitating traceability at component or material level, and integrate with archive data for the history of process execution over the course of production cycles.

Operational Production Management (MOM) is a methodology for the overall management of production processes in order to optimize performance. Different types of MOM software platforms for manufacturing management, performance analysis, quality control and interoperability, as well as HMI solutions, are currently available on the market.

Among the basic features of these next-generation production management solutions are the standard-based integration with ERP systems for resource planning and traditional industrial automation tools, as well as their improved architecture based on a configurable and extensible platform.

Other advantages of today’s MOM solutions are: standardized model of production data management; advanced tools for modeling, visualizing, optimizing, updating and harmonizing business processes globally; event management options that allow for collection, storage, data analysis, and real-time response to different production events; as well as the use of the same software product for the management of production, maintenance, quality control and inventory.

The MES abbreviation appeared in the mid-1980s, and a little later the MOM acronym entered the industry, describing a more extensive functionality of production management systems, architecturally based on the ISA-95 international industrial automation standard.
While the field of action of the two types of platforms largely coincides, apart from the various aspects of production, MOM solutions further emphasize quality control, maintenance and inventory.


Evolution of the MES architecture

MES are computerized systems that provide all the necessary information for making timely and adequate decisions about optimizing production efficiency. MES platforms operate in real time and provide management of multiple aspects of manufacturing processes including configuration, staffing, machinery and equipment, maintenance and service.

They cover various functional areas, such as life cycle product management, resource planning and scheduling, ordering and order execution, performance analysis and critical event response policy. As a result, MES systems collect big data about production processes, allowing predictive modeling of different scenarios. This is particularly important in a number of industries subject to strict quality and safety regulation, such as the food, beverage, pharmaceutical, cosmetic and chemical industries, where accurate tracking and documentation is legally required.

In functional aspect MES solutions appear intermediate between ERP systems (for resource planning) and SCADA platforms, although in practice the boundaries between the technologies are often blurred. Various industrial organizations such as MESA International have been established to assist the MES deployment and operation worldwide. Increasingly, the functional scope of MES systems is overlapped and upgraded by the comprehensive MOM platforms for operational production management, experts say.


Development of the MOM methodology

Modern MOM platforms combine production management tools, efficiency and performance analysis, quality control and compatibility, and human-machine interface. They provide detailed and clear visualization of comprehensive data (in real time and chronologically) about processes, equipment, employees, facilities, orders, supplies, and so on.

Flexible organization of the management platform is possible both at the machine or production line level and at the factory level, and even at an enterprise level when a broad global network of subdivisions and business units is at place. The methodology for comprehensive operational management of production is constantly evolving under the latest technology trends in the industry, filling the missing functional areas among the other types of system management architecture.

Contemporary MOM solutions provide seamless system integration, facilitate communication and interoperability between the staff representatives, the staff and the equipment, and between the different elements of the production equipment network.

These platforms also ensure a high level of security for the manufacturing system, defining roles, responsibilities and levels of access to control functions and critical information, merging with corporate IT security systems. Other important features of today’s MOM solutions are: unified asset management and production models in a shared database; a unified database for archiving and chronological tracking of all elements of the production network; enhanced visualization capabilities, and even mobile functionality. Modern MOM systems support a wide array of graphical user interfaces, web-based and mobile applications that allow extreme flexibility in platform access and management of desktop and mobile devices.


Trends in the MES segment

Digitized production systems in smart factories today are data-driven. The processing of big data leads to the creation of a new business value consisting of improved asset management, easier inventory management and more systematic tracking, co-ordination and monitoring of processes, materials and components. The evolution of MES platforms in the context of Industry 4.0 requires the adoption of concepts and technologies such as cloud computing, Big Data, Internet of Things and Industrial IoT.

Advanced intelligent machines, new forms of additive production, the next generation of robots and cobots implemented in the enterprises worldwide, connected devices, smart sensors, artificial intelligence, cyber-physical systems, and the industry-oriented approach of Industry 4.0 radically transform global manufacturing practices. New forms of interaction, exchange, collaboration and coordination between information, technology, people, machines, ecosystems, industrial processes and knowledge are needed. Therefore, logically, MES platforms are becoming more and more connected and intelligent.

According to a recent Transparency Market Research (TMR) report, including an in-depth study of MES systems trends and segment forecasts over the period 2017-2025, the MES market will grow to over 18 million USD in 2025 with a combined annual growth rate (CAGR) of 11,2%. As the main drivers of this growth market analysts outline the improvement in global economic conditions and the pressure on manufacturing industries to continually increase the efficiency of technological and business processes. As a result, there is an increased demand for automation tools, aimed at higher efficiency and quality of production.

Specialists expect the MES market to grow significantly over the forecast period in response to the need of efficient implementation of complex manufacturing processes and tightening of regulatory requirements in a number of key for the global economy industries. Among the leading client sectors are the food and the pharmaceutical industries, according to Transparency Market Research. Other process industries with growing demand for MES systems are the oil and gas industry, the paper and pulp sector, the power sector, the potable and waste water management, etc.

MES products and services are becoming more and more popular in the automotive, aerospace, electronics, electrical and medical devices industries, metalworking, machine building, mining. The drive to digitize production and introduce a paperless administration of business processes in countries such as China, India and Brazil gives additional impetus to the global market of MES solutions.

Among the leading trends in the segment are the cloud-based MES platforms, increasingly demanded in discrete industries. The use of MES systems as-a-service is the next logical step in the evolution of automation technologies in process industries, experts explain. A popular trend is also the integration between MES and ERP platforms and PLM systems for product lifecycle management.
Increased applications of universally compliant open source MES systems provide an alternative to the expensive development of proprietary software products for enterprise management, developed by the enterprise itself. Increasingly, MES systems also include IoT, IIoT and cloud connectivity, mobility, and real time big data analysis functions.


Development of MOM platforms

Modern MOM platforms combine complex systems for archiving operating data and databases with real-time processing and analysis capabilities, asset management tools, quality control, planning and production schedules, offsite automation, etc.

The challenges in terms of industry digitalization require the adoption of new technologies in the methodology of comprehensive operational management of production, oriented towards speed, flexibility, efficiency in process implementation, database work and collaboration. New technology approaches allow for better visibility of business processes, help reduce the number and duration of unintended manufacturing breaks and downtimes, and optimize real time decision-making.

Another recent Transparency Market Research study, focusing on current and forecast trends in the manufacturing operations software segment during the 2018-2026 period, identifies MOM solutions as an innovation which helps manufacturing companies improve their efficiency, revenue, and competitiveness. Market analysts define MOM platforms as an improved version of MES systems that provide a wide range of additional functional tools.

According to the survey, the MOM software and services market is expected to grow at a combined annual growth rate of 9,6% till the end of the forecast period and to exceed 15,5 mln. USD. The main reason for this growth are the increasing requirements for quality and compatibility of products on a national and global scale, experts explain.

In this segment there is also a growing demand for cloud-based MOM solutions, and specialists estimate that the proportion of such systems will be greater than that of conventional MOM platforms by 2026. Most demanded remain the specialized tools for process management and inventory management. Gradually increases the deployment of products and services for operational production management in small and medium-sized enterprises, according to Transparency Market Research.

This trend will continue till the end of the forecast period, TMR experts predict. In large manufacturing companies there is also a steady increase in MOM deployments due to the growing adoption of digital technologies and the increasing need of processing big data.

In 2018, the largest revenue from sales of MOM platforms was registered in the pharmaceutical and healthcare sectors. Other leading client industries are automotive, chemical, food and bottling. Regions with greatest market growth potential are North America, Europe and the Asia-Pacific region.