US factories find they're lagging in computer integration

Worldwide overcapacity is squeezing US companies, helping computer integrated manufacturing finally find a home in American factories. US manufacturers are struggling to develop systems that link computers in order to orchestrate sales, accounting, design, machine control and work schedules. The aim: to lower turnaround time, improve quality, and reduce costs.

The movement toward computer integrated manufacturing is clear. From 1982 through 1986, US spending for CIM increased from $10 billion to about $16 billion - an increase of 60 percent, according to Dataquest, a San Jose, Calif., market research firm.

But while US sales of CIM components and systems have risen, the rest of the world is rapidly outpacing the US. World sales of CIM equipment in 1986 were $31.2 billion.

``We've found that companies often don't respond until they discover that if they don't do something, they'll be out of business in six months,'' says Daniel E. Whitney, a robotics expert with Draper Laboratory in Cambridge, Mass. ``They don't seem to catch on until the rising tide is right up to their noses.''

When manufacturers finally do automate, they are surprised to find even massive infusions of high tech equipment onto the factory floor don't yield desired improvements in efficiency and cost reduction.

``Some people who have installed some very expensive automation have had it turn out to be a failure,'' says David Penning, director of manufacturing automated services at Dataquest.

``The reason is, if you don't train the people and have their support all the technology is worse than nothing because what you do is you automate your problems.''

While failed attempts at CIM probably outnumber successes, there are a few good examples that illustrate - not just factory automation, but successful integration of marketing, design, sales and accounting.

At Deere & Co.'s tractor factory in Waterloo, Iowa, farm tractors are produced on a schedule that daily varies the type of tractor being produced. A mainframe computer tells nine smaller computers in four different buildings what parts to pull off the rack, what to build at its automated assembly centers and when to build it. The flexibility allows fast response to market demands.

At another plant, a Tennessee automotive parts factory, an electronic order-entry system is being built that automatically logs parts that will be needed according to a production schedule transmitted by the automaker. The computer then orders machines to make parts when they'll be needed.

What continues to hold CIM back is the head-in-the-sand approach mentioned earlier.

But also, says Harvard Professor Robert H. Hayes, ``managment often can't quantify the benefits of flexible manufacturing systems,'' which sometimes produce products at what appear to be about the same cost as existing equipment.

The advantages, Hayes says, are they can produce very small batch sizes that enable a company to offer a broader product line, faster response to customers, less inventory, superior quality.

``These things don't get captured well in current accounting systems, so if you just look at the payback with the return on investment it looks very low,'' Hayes says.

But to make US companies fully understand that they need CIM will take a fundamental change in attitude, according to Draper's Dr. Whitney. What is needed most, he says, is a conviction by management that there are benefits to manufacturing excellence.

``It isn't clear that many managers understand how important manufacturing [as opposed to marketing and finance] really is - it's about as important as water to a fireman.''

And there is a need to recognize that you cannot accomplish everything with technology,'' Whitney says. Management, he says, must understand the manufacturing process well enough that it puts ``robots and people in their proper places.''

Robotics, which is just one portion of CIM, is best applied he says when it is understood that robots belong where they're needed - resisting the urge to apply them indiscriminately. Harvard's professor Hayes concurs.

``People think that adding this technology is like getting a new car. But moving in one of these technologies is more like moving your old car out of the garage and moving in a helicopter,'' he says.

``But if you just go and try to use that helicopter living your life as before, and going the same route to work, not only are you not going to get an advantage from the helicopter - its not even as good as the car.''

We want to hear, did we miss an angle we should have covered? Should we come back to this topic? Or just give us a rating for this story. We want to hear from you.