What does it mean to become a more project-centric manufacturer? It starts with ditching the old definition of project and how manufacturers handled the various components of the day-to-day work processes. The technological advances and organizational needs are pushing manufacturers to rethink the way they handle projects.
Manufacturers with a project-centric approach no longer rely on 100 percent internal processing, according to this IFS Radio Network podcast. They’ve begun to outsource various parts of the manufacturing process for many reasons. For one, the rate at which new technologies are developed makes it hard for them to stay current on all of their processes, so third parties are being brought in to deliver some of the smaller components of the project.
However, a project-centric manufacturer still has total knowledge of how much those items will cost and when they can be delivered. Control is as important as ever in a project centric process.
Engineer to order manufacturers as well as make to order manufacturers have always been project centric in their focus. The companies that have a more make to stock focus where items are sold through channels of distribution have begun to take up a more project-centric approach.
In becoming more project-centric, manufacturers including engineer to order manufacturers have to rethink their tracking costs, which would once have been considered overhead. Those costs are now attributed directly to product development- related projects.
Manufacturers are finding that time to market is decreasing. But they also must track costs from the design stage through the completion of a project. Engineer to order manufacturers are taking on more pressure from consumers to be flexible in their ability to deliver their products. Manufacturers must react quickly to market demands, meaning they have to have complete knowledge of the availability of their product that is outsourced to third parties.
Engineer to order manufacturers are also finding that they can create more efficiency by testing their products off-premise. Most traditional manufacturers have old systems in place for testing, which means outsourcing becomes a more viable option as the testing technology has changed and it’s cheaper to outsource that part of the process.
Engineer to order manufacturers must know what risk they are up against as they begin a project, how much cash is going in and out, what each element of the project is going to cost, how much time it will take, and the availability of their resources, especially when a project involves a variety of subcontractors. In paying close attention to their resources and options, the resulting project is better positioned for driving success in the market with that product and future versions.
Edited by Jamie Epstein