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  • By Janice Abel
  • Automation Basics Advisory Group survey delivers key takeaways.

ARC Advisory Group and recently collaborated on a web survey to gauge the current take up of various functionalities related to manufacturing execution systems (MESs) in the context of digital transformation. This article summarizes our key takeaways from this survey using only data from those respondents who identified as end users.

Readers should note that for the purpose of this survey, MES and manufacturing operations management (MOM) are synonymous. MES/MOM solutions help fill the traditional gap between operational-level automation systems like distributed control systems, programmable logic controllers, and supervisory control and data acquisition and enterprise-level business or enterprise resource planning systems. An MES takes information from the automation systems, business systems, and (increasingly) edge devices and the cloud to manage the process, events, notifications, and workflows. In general, an MES enables collaboration and visibility in real time and improves efficiencies and performance to help industrial organizations reduce costs and gain competitive advantage. While the scope of MES keeps evolving, typical applications today include:

  • Planning and scheduling for the manufacturing or operations environment (including batch management, where applicable)
  • Workflow and process management
  • Quality management, energy management, and track and trace.

MES could also include manufacturing intelligence applications, such as analytics and digital dashboards. MES solutions are typically specialized by industry. Many suppliers include specialized, configurable reports, dashboards, or other functionalities that make sense for a particular application or industry, for example, batch management capabilities for specialty chemicals or serialization capabilities for highly regulated industries such as pharmaceuticals.

Digital transformation maturity model

ARC has developed a multilevel digital transformation maturity model for this MES survey (figure 1) to help end user organizations determine where they stand in their respective digital transformation journeys relative to peer organizations. The survey questions all relate back to this multilevel model, which progresses from initial exploration, to limited application, to significant application, to proficient application, and—finally—to best-in-class.

Figure 1

At the exploring level, end user organizations have one or more basic, but typically siloed MES applications in place with some data integration. At the limited level, the basic MES functionality (now including limited visualization) is in place in one or two plants, with somewhat more data integration and thus fewer data and functional silos and improved interoperability between applications. At the significant MES implementation level, MES functionality extends across entire plants, often with multiple plants connected across the enterprise. At this level, MES solutions are integrated to most manufacturing-related data sources, with increased visibility into the production and related supply chain processes. 

At the proficient level, organizations have further developed their visualization capabilities and begun to incorporate (or integrate to) some of the newer, more advanced digital capabilities. These could include artificial intelligence (AI), machine learning (ML), digital twins, robotics, or new digital sensors. Where appropriate, these capabilities could reside on the premises, in the cloud, or at the edge. Best-in-class organizations have further refined and expanded these capabilities to support enterprise-wide visibility and collaboration. Relative to the MES, this represents a highly mature level of digital transformation.

Survey results

To gauge the impact of the different maturity levels on plant and enterprise performance, we asked respondents to indicate the respective levels in their worst-performing plant, an average-performing plant, and their best-performing plant. As the results charts show in figure 2, while digital transformation adoption may be increasing, it definitely varies among plants. 

Figure 2.

In the worst-performing plants, approximately 75 percent of respondents are either not doing anything in this area or are doing so on either an exploratory or limited basis. In average-performing plants, 40 percent of respondents have implemented MES applications on a limited basis. And in the best-performing plants, more than half of our respondents believe they have either achieved digital transformation proficiency with MES or at least are making significant use of these applications.

We asked our survey respondents about their MES adoption by application type and then sorted the data by both application type and the indicated MES digital transformation maturity level of the plant or enterprise (figure 3). Production execution, production management, performance management, and planning and scheduling have the highest adoption level in high-performing plants. Workflow management, labor management, and energy had the least levels of adoption. ARC believes this could be because these applications, while important, are often sold and implemented separately from the MES.

Cloud computing for MES

Cloud computing is playing a more important role in digital transformation to help accommodate the enormous volume of production and other manufacturing-related data. So, we also asked our survey respondents about how they are deploying their various MES applications.

We grouped the deployment options into either public cloud, private cloud, public/private clouds, or on-premises deployment. One issue we encountered here is that the definition of “cloud” can vary.

The largest group of respondents still prefers to keep critical MES applications on premises. As the promise of cloud computing increases (along with further improvements in cloud cybersecurity and associated user confidence), ARC believes that this is likely to change in the future. However, ARC also believes that in certain industries some applications will remain on premises permanently due to either the nature of the application itself or legal, regulatory, and/or intellectual property issues.

Not surprisingly, we learned that advanced analytics, including ML and AI, are the applications most often deployed in the cloud. Significantly, many companies are moving their data to the cloud, but keeping the applications on site. It will be interesting to see if and how the survey responses change when we update the survey in 2021.

Value of digital transformation

We also asked about the value of digital transformation in MES by application. This value does not necessarily have to be expressed in monetary terms. It could also involve intangibles, such as ease of use, improved collaboration, safety improvements, or company cultural or morale improvements. Most respondents perceived that their organizations are receiving a positive return on investment (ROI) from their MES-related digital transformation investments. However, the degree of value achieved varies by the application type, the industry, and the specific company where the technology is being applied and measured.

Figure 3.

In general, it appears that for every MES application on the survey, users obtained greater than 50 percent ROI. However, the average returns were between 1 and 20 percent, and for some application areas, respondents did not report any value. The top values received were in in the areas of production performance improvements (which are usually measured) and cost reductions.

For detailed charts showing additional results, view the report on or visit

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About The Authors

Janice Abel is a principal consultant with ARC Advisory Group. Abel is lead analyst in the areas of enterprise manufacturing intelligence, MESs, operational analytics, batch management software, and operator training simulators. Before joining ARC, she was the director of pharmaceutical industry marketing at The Foxboro Company, Validation Technologies, and Invensys (now Schneider-Electric).