Our views on Mechanical Engineering
Mechanical engineering is a branche of the metal industry that designs, builds and maintains complex machines. In the Netherlands this is a strong growing sector with not only large sized companies, but also many small niche players. The Dutch machine construction is specialized in customization of their products. Specification is done in narrow consultation with the customer. The challenges are to scale up in an efficient way but not to lose this customization ability. In this respect these companies need to reduce engineering costs to further scale up and adopt a 'Smart Customization' strategy. Focusing on new business models such as 'servitization' can further increase competitiveness and enterprise valuation. And of course, productivity in assembly and production remains essential.
When a machine builder adopts an Engineering-to-Order typology, every machine is built and engineered on a unique design. Every time again. This is a project based approach and provides maximum flexibility to deliver on the specific wishes of the customer. In specific niches this is the only way to compete and operate as a machine building company. However, in many other cases and with the right choice for product standardization and modularization, the customer's wishes can be fulfilled with predetermined solutions. When Smart Customization is implemented, a generic structure needs to be defined to which all product data and processes are related. Characteristic of this approach is the way of determining product information, product modules and product structures. With a Smart Customization strategy, a machine builder transitions into a Configure-to-Order (CTO) typology. This transition is not an easy road, but can deliver many operational benefits and great bottom line improvement.
Owners of machineparks on the one hand increasingly seek to lower capital expenditures spent on machines they use. On the other hand they want their machines maximally to be available. Enter the Servitization strategy. Deliver your machine-as-a-service. Maximize uptime and maintain the machines before issues apear based on IoT data flows. And increase the annual recurring revenue stream through a subscription pricing model. This will bring more stability to revenues on the long run which will significantly adds to enterprise value.
Given the limited availability of professionals, mechanics and engineers, it is essential for a machine builder to focus on further digitization of their shopfloors. Digital shopfloor solutions need to enable QRM and or Lean production concepts to boost productivity and flow. Near realtime production planning tools also add to productivity increases. We also see companies struggling with the efficient production of products with low volumes and a high mix / variety. Digitization of stepwise work instructions can offer a solution that delivers on flexibility, accuracy and communication efficiency.