ERP Trend: Taking over The Manufacturing Execution Systems Market

Many ERP software vendors are making significant investments in their weakest segments, and one of the results is increased production in manufacturing execution systems (MES)—a segment that saw little attention previously. The main reason for the surge is one that’s been something of a trend this year: companies are trying to make the most of their existing, expensive ERP investments. Automation World, a site that follows manufacturing news, noted the trend and gave details about some of the companies benefitting from, and the ERP vendors making the investments.

One of the companies Automation World named as an example was a big one: Whirlpool. A couple years ago, the appliances giant was managing business processes across more than 100 ERP and legacy systems, and chose SAP’s platform as their integration solution. They deployed SAP’s ERP product, as well as their Manufacturing Integration and Intelligence (MII) system for collecting data from the manufacturing plant, which came to SAP through the acquisition of a company called Lighthammer. Lighthammer was an enterprise manufacturing intelligence system that SAP purchased in 2005, and is helping SAP customers streamline back-office processes down to the plant floor. Production data is viewed from the ERP dashboards, and Whirlpool reportedly saw an ROI within two years of deployment.

Other companies in the process and discrete industries have taken the same path as Whirlpool, deploying MESs for plant data management and ERP integration. Previously, such companies had to look to control vendors dealing almost exclusively in MES for the greatest product functionality, but that fact has changed a lot in recent years. SAP acquired Lighthammer, and Oracle and Microsoft have made the move toward MES with like mergers and acquisitions.

An interesting things about the rise of MES within ERP is that it isn’t enough for ERP software vendors to simply offer an ease of integration when marketing their own MES. However, companies looking for both ERP and MES like the idea that they can map plant technology across multiple facilities. Furthermore, with the number and quality of acquisitions some companies are making, many ERP vendors are beginning to offer very extensive MES tools; Microsoft is even offering a package for SMBs.

Will ERP take the lead in MES from control systems providers? It’ll be interesting to see how the next few years play out in that market.

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