Analysis: Benefits of tighter GE Fanuc, SAP integration

11/09/2006


Automation needs to integrate with enterprise resource planning (ERP) systems to maximize benefits to an organization and its supply chain. The other side of the coin is that some ERP installations haven't delivered as promised because of lack of real-time integration with other areas of the enterprise, plant floor included. Beyond a marketing announcement, GE Fanuc Automation and SAP America Inc . are applying what's been talked about for years: tighter two-way information flow between manufacturing and enterprise systems. A few end-users have done so with custom system integration; others have worked with commercially available EAI (enterprise application integration) middleware. This GE Fanuc-SAP integration effort intends to deliver a faster off-the-shelf means to augment quality, productivity, Lean Six Sigma, regulatory compliance, and efficiency. Services to help that happen also are planned.

On Oct. 18, the companies announced plans to combine GE Fanuc's Production Management Software solutions with SAP's Production Execution services. Joint engineering is underway, and joint marketing and sales efforts are planned, say GE Fanuc representatives. The combination, says the GE Fanuc announcement, 'allows for the gathering, analyzing, and transforming of real-time data into information to continuously improve a company's level of productivity and performance. The real-time visibility and intelligence facilitated by the combined solution translates into improved agility, quality, and efficiency by tracking and executing production operations through a closed-loop information exchange with the SAP Business Suite.'

That's based on GE Fanuc experience in more than 100 projects integrating its production management systems and ERP in discrete, hybrid and process industries, according to John Dyck, GE Fanuc global director of Production Management software. And although this is the first such agreement for tighter integration with an ERP vendor, it won't be the last, Dyck told Control Engineering . SAP was the logical first choice, he says, since close to 70% of the installed base for GE Fanuc Production Management software also uses SAP. Benefits will be large; many ERP installations haven't produced the expected results; less than 5% of facilities are integrated as they should be, he estimates.

Mike Yost, GE Fanuc product marketing manager for Production Management software, says the SAP agreement builds on GE Fanuc's Enterprise Connector introduced a year ago. 'Manufacturing is GE Fanuc's world, in real time,' Yost says. 'The value of the marriage of the two pieces, enterprise and manufacturing expertise, is more than the sum of the parts.'

Analysts also have been addressing the need for tighter integration. 'Connecting plant floor and business systems in a robust way is a critical business issue for manufacturers today,' says Greg Gorbach, ARC Advisory Group's VP of collaborative manufacturing research, in a statement provided by GE Fanuc. Gorbach maintains that such integration 'is the only way to get the performance and responsiveness' that manufacturers require.

First efforts in the GE Fanuc-SAP agreement will address the needs of customers in important Americas markets and in two key industries: automotive and mill products. Other programs that fall under the agreement include the development of specialized professional services to support customers with planning, design, and implementation.

Product availability is expected within a few months; pricing for software and services will be based loosely on the size of the manufacturing facility, Dyck says.

What's the cost of the integration effort for GE Fanuc, adapting prior experiences from individual projects into a standard offering? After a bit of silence, then laughter, it was clear that Dyck and Yost weren't going to quantify the company's investment. The agreement does indicate that representatives at GE Fanuc and SAP believe that end-users have significant efficiencies to gain from easier, pre-packaged integration, and related services to ensure proper implementation

Mark T. Hoske , Control Engineering editor in chief





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