The fourth industrial revolution has brought several transformational changes and technological reforms to the manufacturing industry. With its focus on advanced robotics and data intelligence, Industry 4.0 has paved new ways to improve human-machine interactions. Nevertheless, an increasing number of organizations are already using next-gen technologies to strengthen and streamline their day-to-day operations. Besides, to overturn the impact of COVID-19, the adoption of Industry 4.0 is gaining pace, not only in manufacturing but across all major industries. Now as the whole world adjusts to the new normal and businesses prepare for the next normal, Industry 4.0 is poised to dominate the global market.
Implementation of technologies associated with the fourth industrial revolution is a tried-and-tested way to boost business productivity and enhance operational efficiency. However, it is critical to note that even after implementing these technologies, you are less likely to reap immediate benefits. Nevertheless, the benefits become quite apparent in the following months, in terms of increased productivity and ROI.
In this blog post, we highlight the key performance metrics that indicate the current progress of your Industry 4.0-based enterprise software infrastructure.
Also read Strengthening Manufacturing Processes With Industry 4.0
Business KPIs For Industry 4.0 Compliance
Let’s move ahead and investigate the key performance indicators for Industry 4.0 and use them to discover the performance of your enterprise systems.
Digital Maturity Index
The main reason for implementing Industry 4.0 technologies is to drive digital transformation across different business verticals, especially manufacturing units. The digital maturity index (DMI) is a method of measuring the digital performance of an organization across the most relevant parameters.
Simply put, digital maturity is the ability of an organization to leverage the latest technological developments and respond to the changing market functions. In this context, DMI outlines an organization’s digital capabilities and their maturity levels to provide an effective roadmap for successful digital transformation.
PO Cycle Time
Purchase order cycle time is the time required to prepare and dispatch a purchase order to its respective supplier or customer. For a manufacturing company, the PO cycle time should be as low as possible. As this time depreciates, it’s a clear indication that your software performance is improving after Industry 4.0 implementation. It means you can easily increase production capacity that would help you expand your business to new horizons.
Fill Rate
Fill rate is defined as the percentage of orders that were successfully delivered to the customers in good condition i.e the number of completed orders. If this percentage is high, you’re on the right track and it’s also an indication that the newly installed systems are performing well. On the contrary, if the percentage is low, it suggests that there are loopholes in your existing order fulfillment system. You can also use fill rate as a KPI to measure the performance of your enterprise systems post the Industry 4.0 implementation.
Scrap Material Rate
Effective scrap management is imperative to efficiently run manufacturing and supply chain operations. Although waste generation is inevitable, by enabling automation across your manufacturing units, you can significantly mitigate its quantity. At the same time, smart manufacturing tools provide effective scrap handling capabilities, enabling organizations to dispose of their biodegradable waste and recycle non-biodegradables.
Scrap material rate is a crucial business KPI that enables organizations to measure the extent of their waste generation. At the same time, it can measure the scrap management efforts of an enterprise after Industry 4.0 implementation.
Forecast Accuracy
Analyzing the forecast accuracy of your Industry 4.0-compliant enterprise systems is a simple and straightforward way to measure its performance changes. Due to the implementation of machine learning algorithms, the accuracy of these systems increases with time. As more data is fed to these systems, their accuracy increases gradually. As a result, enterprises can enhance their production capacity and align their operations with towards efficient workflows through intelligent decision making. Therefore, if the forecast accuracy of your enterprise systems is improving, it’s a clear indication of Industry 4.0 doing its job.
You may also be interested in reading Industry 4.0 and Its Impact On ERP Systems
Wrapping Up
These were the most crucial business KPIs that let you know the current performance of your business modules. There are many other similar metrics that you can use to measure your business performance post the Industry 4.0 implementation. The most basic ones are energy consumption, overhead costs, capacity utilization, error resolution time, and supplier lead time. Besides, hardware and software maintenance plays a critical role in improving the performance of your enterprise systems that ensures speedy recovery of the capital investments. To further improve business productivity through performance enhancements, businesses must stay on the ball with the latest technological advancements. It is equally important to keep pace with the latest technologies and upgrade your time-tested enterprise systems from time to time.
How We Help You Enhance Your Business Productivity Through Industry 4.0 Implementation?
We are a seasoned ERP development company that provides complete enterprise solutions with a focus on SaaS application development. Our enterprise-grade web application development services enable organizations to overcome diverse business challenges with advanced problem-solving capabilities. With a proven track record in Industry 4.0 implementation, we help you enhance your enterprise productivity and boost operational efficiency. Our developers are proficient at building performance-driven software solutions for cross-industry business use cases. Our experienced developers have successfully completed several full-scale ERP projects that involved implementing Industry 4.0 technologies including AI, Big Data, IoT, and cloud computing. For more information, visit erpsolutions.oodles.io or drop us a line at [email protected].
