American Metals Market: Dissecting IT trends in the metals industry
For over a century American Metal Market (AMM) has been identifying and reporting on trends before most in the metals industry become aware of them. It’s a magazine steel industry leaders depend on for insights and information to guide both short and long-term decision making. So when three articles on cloud computing and “big data” appear in quick succession it’s a clear sign of a shift underway.
Quoting SAP’s metals industry lead Stefan Koch extensively, “Virtual Drive”, “The creative process” and “Information technology architecture moves into the future” explore the impact and benefits of these technologies.
Migrating to the cloud
Cloud computing, which can reduce the burden on IT to manage data centers, lets manufacturers focus on their core business activities and have new flexibility to embrace different processes and business models. ThyssenKrupp for example is streamlining 250 ERP systems into about ten systems overseen by five worldwide data centers. This consolidation will help improve efficiency through better sharing of data and communication. “There are large amounts of data … that need to be shared across the enterprise,” said Koch, continuing, “… companies find a lot of flexibility and efficiency in using commercial software that allows them to access information about orders, inventory and even pricing from anywhere.”
“Anywhere” is an interesting aspect of cloud computing. Mobile devices let workers access information from the factory floor, the warehouse, and even at the customer’s facility. Many industry experts anticipate that we’ll see screens on forklift trucks and even wearable technology like “smart safety
glasses” to make product and process data viewable on demand from any location.
Within the steel industry Koch notes, “The cloud was first used … in the areas of human resources and sales force management.” Today cloud ERP is firmly established and areas like finance and integrated business planning are migrating that way.
Harnessing “big data”
Writing on the Forbes magazine website, contributor Lisa Arthur defines “big data” as, “… a collection of data from traditional and digital sources inside and outside your company that represents a source for ongoing discovery and analysis.” (“What Is Big Data?” 8/15/2013) (For a more diverse set of definitions, take a look at, “What Is Big Data?” on the UC Berkeley School of Information website.)
The key part of Arthur’s definition is, “… for ongoing discovery and analysis.” Cloud-based systems capture and store huge quantities of business data but until recently extracting information from those terabytes was a laborious task. Today though, tools like SAP’s HANA let organizations undertake sophisticated analytics, spatial processing and data virtualization to identify ways to optimize the performance of their business.
“Optimize” in this context relates to both process and production optimization. Quoted in “The creative process,” Koch explained that manufacturers are looking to continuously improve every process. For example, supply chain process optimization will help them “sell the right product to the right customers at the right time.” But he adds a word of caution: “Optimization isn’t just about reducing cost and going faster, … it’s about being smart in using information
technology to create value.”
Improving service, cutting costs
Recent trends in the steel and metals industries, cloud computing and “big data” are about businesses harnessing IT to keep finding ways of improving the delivery of products and services at ever lower cost. As the three articles in AMM show, here SAP is at the forefront, helping metals manufacturers to become ever more competitive.