The Artificial Intelligence and Robotics Center AIRE offers advisory services on the feasibility of implementing artificial intelligence in industrial enterprises.

Author: Elo Gaver

Tehnopol Science and Business Park conducted a public procurement process to find partners who could provide advisory services on the feasibility of implementing artificial intelligence in industrial enterprises. The new partners selected include Proud Engineers OÜ, Lean OÜ, Net Group OÜ and Digiwise OÜ, who are all experts with extensive experience in advising on the feasibility of implementing artificial intelligence. Digiwise has already offered guidance on this topic to more than ten companies, some of which have also received support from the Ministry of Economic Affairs and Communications for their pilot projects.

The advisory service is mainly intended for small and medium-sized Estonian manufacturing companies that wish to increase productivity by incorporating artificial intelligence competencies into various production processes. The advisory service involves preparing a report for the company, mapping out their strengths and weaknesses, and their capability to implement artificial intelligence.

The report provides a clear overview of the feasibility and practicality of implementing artificial intelligence solutions and, based on the results obtained, companies have the opportunity to seek additional funding from both AIRE’s advisory services and Tehnopol.

The contract for providing advisory services is valid until 2025, and companies can register for the advisory service here.

Estiko-Plastar can invest in a better future by implementing green technologies.

Author: Elo Gaver

Estiko-Plastar AS approached Digiwise with an ambitious desire to modernise production and bring a new sustainable and innovative product category to the market. Our part in this process was to help Estiko-Plastar think through the project plan and the financial calculations related to the new product as well as to find additional financing for investments.

Estiko-Plastar’s daily commitment to constantly move towards more environmentally friendly solutions, their strategic choices, post-processing, and extrusion have been a direct indicator for other production companies as well as customers. Therefore, we wanted to contribute to taking the next steps and helped to find additional funding for the implementation of the project.

The goal of the Estonian-Norwegian cooperation programme is to support the sustainable development of companies, and we helped Estiko-Plastar prepare a project. It received a very high score from the project committee and received funding, too. During the project, a new printing machine, an additional plastic regranulation device to increase recycling, and a laser cleaning device for the environmentally friendly cleaning of aniloxes used in printing machines were placed in the production building. The existing afterburner will also be expanded as part of the project, and additional developments will be carried out for resource planning software. To make all this possible, the production building was expanded. Many new jobs are planned to be created through the project. Given the challenging times in the industry, this is undoubtedly welcome news.

The Digiwise team is happy that the project prepared with our help was successfully launched. In the meantime, we have also carried out the next cooperation project with Estiko-Plastar in assessing the company’s readiness for artificial intelligence.

How to avoid costly mistakes? – Smart Manufacturing Meetup

Author: Elo Gaver

The Smart Manufacturing Meetup took place in Tartu for the fifth time, where it focused on the benefits of digitisation. The goal of the conference has always been to offer participants new ideas and solutions in a pleasant setting. This event, too, offered something for the live audience, those participating via video link and the contributors who shared their ideas on stage.

Lauri Antalainen, Chief Consultant at Digiwise, led a discussion on how to avoid mistakes related to digitisation.

In consulting work, we come across mistakes that have previously been made involving a specialist. Panelists Reigo Rusin, Kadri Rehkli and Kaur Saarepuu agreed that digitisation doesn’t necessarily make processes easier simply for the sake of digitisation. Just because one company uses ERP doesn’t mean it is the answer to all the questions of another company.

Lauri Antalainen pointed out that the most important stages of the four-stage journey of digitisation are the first and the fourth.

It is important to start with mapping out the problems. His idea was further developed by Kadri Rehkli, who talked about practical experiences and shared a story about how they thought they desperately needed an ERP system without knowing what possibilities it offered and which problems it solved.

Once the problems have been identified, work can begin towards solving them – at this stage, the insight of an experienced consultant who has encountered countless similar challenges over the years and is familiar with various solutions can be extremely useful.

When suitable solutions for the company have been identified, they need to be implemented. This is the stage that some mistakenly believe is the end of setting up the digitisation process. However, Reigo Rusing aptly said that no matter how good the coach is, you still have to run the race yourself. In other words, the last stage, implementation of the solutions, is something that all employees in the company must be involved in, and if not addressed properly, all the previous work will have been in vain.

Therefore, it is important to ensure from the outset that the company is clear about which processes need to be digitised, and that the entire team is willing to work on implementing the new solutions.

EIT Digital opens its Baltic office in Tallinn.

Author: Elo Gaver

Europe’s most influential digital development and innovation cluster, EIT Digital, opened its Baltic office in collaboration with the Estonian Research Council and TalTech Mektory. The purpose of establishing the office is to increase investments in research and development activities, as well as to promote the more effective integration of regional digital innovation and entrepreneurship communities.

The opening of the office was marked by a conference led by Johannes Tralla, who engaged in conversations with guests throughout the day. Among the speakers was Lauri Antalainen, Chief Consultant at Digiwise, who discussed topics related to the importance of digitisation – this is clearly a growing trend, but how can we ensure that it actually brings benefits?

EIT Digital offers various opportunities for universities as well as businesses. Its support is important for fortifying the innovation ecosystem and fostering relationships with different European stakeholders. Furthermore, it offers new prospects for our own start-ups.

Digiwise attended a development marathon organised by Tehnopol and evaluated the business and technical aspects of ideas.

Author: Elo Gaver

Tehnopol Science and Business Park hosts AI development program hackathons for companies whose processes in manufacturing, customer management, product development or other areas could be made more efficient and sustainable with AI solutions.

The hackathon held in August welcomed data-intensive education, green, health and industrial companies. During the hackathon, solutions were found for creating a new technical AI solution, evaluating the new solution from the commercial side and creating a comprehensive project plan. The main focus of the event is teamwork in creating AI solutions.

In addition to companies interested in improving their processes with AI, the hackathon welcomes anyone who can and wants to test themselves in creating and implementing AI solutions. The program also features experienced trainers and mentors, who help to match problems with solutions.

Digiwise participated in the program as an evaluator of AI solutions from the technical and business side. We wish all funded teams the best of luck! You can read more about their ideas on the Tehnopol website.

Digiwise has assessed and consulted Estonian industrial enterprises on implementing artificial intelligence.

Author: Elo Gaver

Since its inception, Digiwise has researched and analyzed fourteen forward-thinking Estonian industrial companies to determine their readiness to implement artificial intelligence. Among others, we have been approached by companies from the forest, metal, plastic, food, oil and textile industries seeking our advice.

Innovation-minded companies seek to digitize their processes. They understand that it is wise to consult specialists for answers to existing questions and to those that arise during the process.

Questions typically arise around the following topics:

  • Requirement prediction – statically set requirements for inventory and other parameters in production programs are insufficient. Instead, smarter solutions are needed that dynamically predict both the requirements and other parameters and adjust them as circumstances change.
  • Predictive maintenance – enterprises seek solutions that can predict equipment maintenance needs, and thereby save time and resources. This, in turn, would reduce the likelihood of more costly problems arising.
  • Automation of robotic processes – most companies see potential in this area, but questions arise about the rigidity and capabilities of the software.
  • Automated guided vehicles (AGVs) – there is a growing interest and need for them. The movement of material from storage to production, as well as transferring components and semi-finished products between workstations is a time-consuming process that can now be automated through the use of robots.
  • Quality control – several timber industry companies already use artificial intelligence-based solutions for sorting and assessing timber quality. Other companies are also assessing the opportunity for and exploring the means to digitize quality control.

Companies that have sought advice from us include Tarmeko Spoon AS, Lasita Maja OÜ, Nõo Lihatööstus OÜ and Baltoil AS.

The framework for implementing artificial intelligence in industrial companies is now available.

Author: Elo Gaver

AI and Robotics Center AIRE collaborated with Digiwise to develop a framework for implementing artificial intelligence in Estonian industrial companies. The framework was needed in order to define projects that AIRE can assist businesses with and to create a vision and decision-making document for industrial companies to plan their AI and digital development.

The framework has already been used by AIRE, the Ministry of Economic Affairs and Communications and several consulting firms offering AI advisory services.

AIRE is dedicated to promoting the development and innovation of Estonian industry, and Digiwise is delighted to support this initiative.

Digiwise leads the conversation on the use of artificial intelligence in industry.

Author: Elo Gaver

On 13 April 2022, “Artificial Intelligence in Industry and Support Measures”, the fifth event of the AI & Robotics Estonia club, took place in the Yanu OÜ premises in Tartu. Digiwise was there to lead the discussion on the use of artificial intelligence in industry. The participants who shared their thoughts included Karl Kruusamäe from University of Tartu, Oskar Kilk from TORM Metall OÜ, Marko Saviauk from Leanest OÜ and Alan Adojaan from Yanu OÜ. The discussion was moderated by Lauri Antalainen.

During the conversation, the participants exchanged experiences on the topic of prejudices related to robots. It has often been necessary to convince companies that robots can be trained to do what humans do, and in some respects, robots can be even more efficient in doing the same job. However, the fact that training a robot is a time-consuming process should certainly not be ignored.
Another idea that emerged was that if there is a desire to get something done, a solution can always be found. A good example of this was the Yanu OÜ robot bar – after experiencing bottlenecks in how bars function, the founders came up with an idea to solve them, and the result is a fully self-functioning contactless robot bar.

As the event took place in Tartu, Katrin Kask, head of the Department of Business Development at Tartu City Government, presented support measures for the financing of production and digitisation for companies based in Tartu.

Kersti Kuusalu spoke about the digitisation journey among Estonian companies, and Kirke Maar introduced the future of AIRE and financial advisory services.

The highlight of the evening was testing the robot bar, which was accompanied by great food and pleasant company.

ELMO Rent received a large grant from Enterprise Estonia.

Author: Elo Gaver

ELMO Rent has been developing its remote-controlled car and controller technology for over a year. While currently the rental car is delivered to the customer by an ELMO driver, then after the introduction of remote-control technology, the car will reach the customer by remote control. Therefore, the introduction of new technology reduces the cost of delivering a car to the customer and increases the efficiency of car use.

ELMO Rent is satisfied with the opportunities offered in Estonia for the implementation of various innovations. “Estonia is the only right place for developing and testing innovation, and if we can speed up the global conquest of green technology in cooperation with the state, then everyone will win,” said Enn Laansoo Jr., founder of ELMO Rent. “The purpose of Enterprise Estonia is to support ambitious companies such as ELMO Rent in challenges related to export and product development so that their developmental leap is as big as possible,” said Peeter Raudsepp, Head of Enterprise Estonia. So, Enterprise Estonia simply needed someone to formalise the reception of support successfully.

 

Digiwise consultant Tomi Meitus accepted the challenge and is glad to be able to help ELMO Rent take its development to the next level. As the grant received will help ELMO Rent complete the processes of remote-controlled cars, Tomi hopes to see remote-controlled cars on city streets soon.

Lauri Antalainen was elected as the new VP of EstBAN

Author: Elo Gaver

Estonian Business Angels Network was founded in 2012 as an umbrella organisation for business angels and business angel groups seeking investment opportunities in Estonia to grow the quantity and quality of local seed-stage investments.

On the 31st of August in 2021, due to changes in the EstBAN board, a new President and Vice President were elected. As of that day, Lev Dolgatsjov will serve as the President and Lauri Antalainen as the Vice President. Lauri has already been a board member of EstBAN for a little over two years. He says that business angels in Estonia are having great times and opportunities to fund new ideas right now. During the last year, a record number of new members have joined, so EstBAN already has about 230 bold and innovative investors.

Changes in EstBAN board – EstBAN

Lauri Antalainen Foto: Jake Farra

Five important reasons why you should digitalise the flow of information in production right now

Author: Lauri Antalainen

When implementing production, it is important to consider how work orders are transmitted to production and how the implementation of these work orders is reported. The organisation of production management can be judged by its digitalisation:

  • At one end of the scale, production will be completely paperless, with work orders, their reporting, stocking and other operations fully digitalised and in real time.
  • At the other end of the scale is the type of manufacturing, where work orders, drawings and other information are printed out in the office, taken to the production floor, where these papers then make their ‘rounds’ and come back to the office with notes made by the production worker. In the office, someone collects these papers and enters the information, usually either into an accounting program or Excel.

Non-digital, paper-based production management has a number of other important shortcomings that can be eliminated through digitalisation, in addition to the miles-long daily transportation of documents by workers.

Five important reasons why you should digitalise the flow of information in production right now are:

1. Post-calculation and cost price calculation

Post-calculation should be an integral part of the core process of any manufacturing company. Unfortunately, many companies still do not do this (or do it only partially) because they lack the information needed to carry out post-calculation. This, in turn, means that the calculation of cost price of the product and of production itself (cost estimate) on which the quotations are based is often inaccurate and the prices offered to customers are sometimes too high and sometimes too low. Even more problematic is the fact that a company tends to win bids that are too low, more often than average, while it loses work to competitors with bids that have been made too high. The result is lower profitability and lost work.

To perform a post-calculation, the following digital information is needed: the amount of material actually used to manufacture the product and the time spent on operations. The collection of information requires work reporting on a work centre basis and the existence of a system of stock records related to production orders. Only a digitalised process can ensure sufficiently accurate accounting of both material and time consumption.

 

2. Tracking and partial reporting of production orders

A major problem in non-digitised production management is the lack of information in the office about the status of one or another production order currently in production. It is not possible to respond to a customer’s queries about the delivery time of a product without asking for this information on the production floor. Even more problematic is the situation where, for one reason or another, it is not possible to complete a production order, but there is a wish to invoice (and potentially ship to the customer) the items or quantities already produced. Partially reporting the completion of work orders on paper is complex and requires a lot of non-value-added activities both in production and in the office.

 

In order to digitalise partial reporting of production orders, MRP functionality should be available in the work centre to allow partial reporting of a production order, ideally automatically generating a new work order for the unreported part.

 

3. Monitoring OEE – Overall Equipment Effectiveness – and occupancy of work centres

The importance of monitoring the occupancy of work centres has been recognised for many years, and a number of production facilities, also otherwise poorly digitalised ones, have introduced external tools to measure and visualise overall equipment effectiveness and cycle times. While useful, there are also problems with using such external tools (especially if they are not linked to the company’s ERP system) – describing the nuances of deviations from the norm/cycle times is often an extra task that production workers do not have the time or the work ethic for, and is often left undone. The result is knowing that overall equipment effectiveness was low, without knowing what caused it and what could be done to prevent it in the future.

Fully digitalised production order transmission and reporting, and the digital, real-time handling of additional information – workers on the shop floor, job types, etc. – will take overall equipment effectiveness monitoring and the related analytics to a qualitatively new level. A decrease in overall equipment effectiveness can be immediately linked to various parameters such as the worker, the type of production order and its parameters, the raw materials used, etc. In addition to the knowledge that the overall equipment effectiveness is at level X, knowledge of the associated circumstances is also added. In well-digitalised production, the company’s own information system is often sufficient to monitor overall equipment effectiveness, and no external tools are needed.

 

4. Information and analysis of non-conformities

The monitoring of non-conformities (or defects) and the gathering of information on them is already carried out by the vast majority of manufacturing companies operating in Estonia. If what is happening on the production floor has not been digitalised, the typical solution is a sheet of paper with a predefined description of the non-conformity and the likely cause. These sheets of paper are collected, the information on them is entered into Excel, and a meeting is held once a week or month to analyse the information on such non-conformities.

Collecting this kind of information is certainly helpful, but nowhere near as effective as digitally collecting the information on non-conformities in a structured and digitally processable form. While the analysis of non-conformities in Excel usually focuses on the most recent acute cases, structured nonconformity information, linked to predefined defect codes and specific orders, allows one to keep an eye on the ‘bigger picture’ and to see correlations between the occurrence of a non-conformity and the work centre/worker/technology/type of work and other parameters. Only having digital and structural information enables one to take data-driven management decisions to further prevent non-conformities.

 

 

5. BI – Business Intelligence

Last but not least, a very important reason to digitalise what happens on the shop floor is the capacity that will be created to implement different types of business intelligence. The management of what is happening on the shop floor, in the form of work order transmission and reporting, generates a wealth of operational information that is of much higher quality (more accurate and comprehensive) than that collected manually and stored in Excel. Operational information gathered in this way on a day-to-day basis can later be used to make or support different types of business decisions, whether related to investment, human resources, production management, etc.

 

The article originally appeared in two parts in Äripäev’s thematic news site Tööstusuudised:
Info liikumise digitaliseerimise 2 põhjust tootmises: järelkalkulatsioon ja osaline raporteerimine – Tööstusuudised (toostusuudised.ee)

Lauri Antalainen: taktiaegade kõrvalekaldumise asjaolud jäävad tihti kirjeldamata – Tööstusuudised (toostusuudised.ee)

The first class of Digitalisation Masterclass has graduated

18 companies have successfully graduated from the three-month Digitalisation Masterclass that started this year in March and lasted for three months.

Enterprise Estonia, in partnership with Digiwise, BDA Consulting, Lean Digital and FlowIT, offered a development opportunity to manufacturing companies interested in digitalisation. Under the programme, companies were given the opportunity to draw up a plan for digitalising their most critical work process with a personal mentor. With the help of practical guidance and mentoring, the companies started to implement changes.

In the Masterclass, two companies – Plastok and Lasita Aken – were under the guidance of Digiwise. In the corporate competition, they came second and third, respectively, after Interconnect Product Assembly. More important than ranking companies, however, is the change in mindset, which the participants recognised – the digitalisation of some work processes results in free resources that can be redirected into business growth.

Lasita Aken participated in the programme because they felt they could no longer go faster and further with the existing solutions. In the course of the programme, they found a way to reduce the time to enter data per employee from ten hours to two, and use the time saved to increase production by 20%.

For more information and to register for the Digitalisation Masterclass Spring 2022 programme, click here: Digitaliseerimise meistriklassi esimese lennu kogemus – EAS

Practical digitalisation in industrial and service enterprises

In his work, Lauri Antalainen, the Chief Consultant at Digiwise, mainly sees problems with internal project communication, the flow of work orders or information moving between different departments in a company. To offer proven solutions, IT Koolitus and Lauri Antalainen are organising an eight-hour training day called ‘Practical digitalisation in industrial and service enterprises’.

The aim of the training is to provide guidance for identifying digitalisation opportunities and implementing digitalisation projects in an industrial or service enterprise to business managers, middle managers, quality managers and those responsible for business processes.

The training will focus on specific steps that a company interested in digitalisation should take to turn ideas into action. As a result of the training, the participant will understand the content of digitalisation as a business process development activity and will be able to assess the potential gains that can be achieved as a result of digitalisation. In addition, the participant will be able to identify problems and bottlenecks in business processes that can be mitigated through digitalisation, and will create a roadmap for the implementation of the digitalisation project and find the right digitalisation solutions.

Digitalisation is a topic that we hear about almost every day in different sectors. Unfortunately, the vast majority of lectures and seminars on digitalisation are either very theoretical or very technical. This means that the focus is either on reiterating the importance of digitalisation or on adopting a specific solution. This training teaches how to identify digitalisation opportunities in the company and how to find appropriate solutions.

More information including the exact schedule and the registration link can be found here: IT Koolitus – Koolitused – Praktiline digitaliseerimine tööstus- ja teenindusettevõtetes

Lauri Antalainen, the CEO of Digiwise Photo: Jake Farra

Improving process efficiency in production

On 3 and 10 June, TietoEVRY, DigiWise and the Institute of Computer Science of the University of Tartu are organising online workshops for manufacturing companies on improving process efficiency. With real-life examples and practical exercises, these workshops will help to start improving the efficiency of production processes.

The content of the training is spread over two Thursdays (3 June and 10 June) – both workshops will take place from 13:00 to 17:00. Participation in the training requires full attendance on both days.

Thanks to the funding from the Interreg BSR project InnoCAPE, the first 50 registrants in the workshop will be able to participate in the training for free!

Schedule:
3 June
➠ Module 1: Identifying and eliminating inefficiencies in a manufacturing company
➠ Module 2: Identifying opportunities for process development and digitalisation in a manufacturing company

10 June
➠ Module 3: Data creation and flow in a manufacturing enterprise
➠ Module 4: Implementing a process improvement/digitalisation project in a manufacturing company

NB! To get the most out of the practical exercises, we recommend that at least two people from each company take part.

Digitalisation of manufacturing through practical experience

Digiwise and TietoEVRY are organising a webinar on digitalisation called ‘Digitalisation of manufacturing through practical experience’.

During the seminar, participants will learn whether and how to make a company’s processes more efficient through digitalisation, what is necessary to consider when digitalising processes, and share experiences from practice.

We will talk about data, which are at least equally as important as processes in a company. Data are a company’s main asset for making management decisions and ensuring the efficiency of processes.

We will share tips on starting a digital journey and implementing projects. We will also introduce support measures that can help you plan your journey.

Topics will be opened by Lauri Antalainen, Chief Consultant at Digiwise, and Tarvo Avaste, Lead Analyst at TietoEVRY. More information and registration here: Digital advantage for businesses and societies | TietoEVRY

Digitalisation through practical experience

Lauri Antalainen, the Chief Consultant at Digiwise, gave a presentation at a webinar of the Elva Entrepreneurs’ Mentor Club, which was attended by representatives of companies from Elva rural municipality that are interested in digitalisation. During the evening seminar, Lauri spoke about digitalisation in different companies, and participants discussed the causes of inefficiency and the topics of process development and digitalisation.

For both service and manufacturing companies, Lauri also suggested specific aspects to start from and targets to reach with digitalisation.

In addition to sharing practical advice, Lauri also gave examples of situations he has encountered in his work, and participants had the opportunity to ask questions about internal communication as well as different support measures.

Masterclass of Digitalization

Enterprise Estonia in cooperation with Digiwise, BDA Consulting, Lean Digital, and FlowIT invites manufacturing companies to join the Masterclass of Digitalization! The Masterclass is a three-month program aimed at manufacturing companies that are interested in digitalizing their processes.

With the help of consultants and personal mentor, the participating companies can identify the most critical process to be digitalized. During the programme they find out what data is really necessary, where does it come from and who needs it. The team then makes a plan, finds a suitable digital solution, and takes the first steps to implement the change.

The Masterclass of digitalization offers companies a great chance to use the help of experts on the topic. Companies often have a vision about how things should be, but they lack the knowledge on how to get there. During the programme, companies have the possibility to make things happen, using the help from consultants and experts who are experienced in finding the most suitable solutions.

The Masterclass of digitalization is also a contest – the main prize for the best team is 10 000 euros. The grant can be used to implement all the necessary changes in digitalization.

Additional information about the program can be found here.  (in Estonian) Applications are open until 19th of February 2021

 

 

Digiwise Supports the Guide Running of Visually Impaired People

The Guide Running Estonia non-profit association was founded by two running enthusiasts. Their purpose is to offer visually impaired people the opportunity to participate in sports. Guide Running Estonia is where volunteers and visually impaired people meet to go running together. In only a few weeks, over twenty volunteers in Tallinn and Tartu have been trained. Most of them have already had a chance to go running with someone who can’t do it alone.

Digiwise is the first contributor to Guide Running Estonia.

Visually impaired people and the volunteers have a Facebook page for communications called Jooksusilmad (Eyes for Running) and additional info can be obtained from guiderunningestonia@gmail.com.

 

7 Steps to Smart Industry – Smart Management Day

Author: Lauri Antalainen

Digiwise senior consultant Lauri Antalainen participated in the Smart Management Day during Tartu Entrepreneurship Week. He held a presentation entitled 7 Steps to Smart Industry, which introduced the principles of digitalisation and process development. You can see the presentation on the Tartu Linnavalitsus Facebook page. Link: https://www.facebook.com/watch/?v=3361632300556494 (The presentation starts  from 5:00:00 and it is in Estonian)

In addition to Digivise, the Smart Management Day also had speakers from Enterprise Estonia, University of Tartu Institute of Computer Science and specialists from Saint Gobain and Ektaco.

Äripäev Radio – How to implement digitalisation?

Digiwise partner and senior consultant, Lauri Antalainen, went to Äripäev Raadio to talk about digitalisation. The programme offered several examples of successful projects.

The programme can be listened to again on the Äripäev Raadio website and is also available as a podcast (in Estonian). https://www.aripaev.ee/saated/2020/08/31/kuidas-alustada-digitaliseerimisega

How to implement digitalisation?

Author: Lauri Antalainen

What is digitalisation?

My definition of Digitalisation: it is the development of processes through the application of information technology. It is hereby important to draw attention to the words “the development of processes” – the application of technology or the utilisation of software is never a final solution on its own, but a means of making processes more efficient. It is therefore not correct to observe digitialsation as the application of a software program, but as an important change in the internal processes of an organisation that is realised (amongst others), with the assistance of software.

Digitalisation starts with a digital audit

A properly thought-out and prepared digitalisation project begins with the realisation of a digital audit. Digital diagnostics (also known as a digital audit) is a systematic analysis of the possibilities of developing the processes of a company through the application of digitalisation and automation solutions.

The first step in realising digital diagnostics is the AS-IS mapping (mapping of the existing processes). These processes, as well as their related problems and bottlenecks, are described in detail during the mapping stage. The mapping stage must be detailed, describing the roles of the employees involved in each business process, the solutions they use, how the processing information flows and the businesses’ rules. This information will assist in being able to understand possible restrictions to making changes to processes and to foresee possibilities for establishing process standards.

The next step after the AS-IS process is the development of the new (TO-BE) processes. This stage aims to eliminate the major problems and bottlenecks of the AS-IS processes. The differences in comparison to the AS-IS processes are highlighted and the solutions to the problems and bottlenecks described. The business requirements of the technological solutions (e.g. software) to be implemented and recommended software are highlighted.

This step completes the realisation of the digital diagnostics and a digital diagnostics report is completed. Then, the introduction of the process changes can be initiated.

Selecting and deploying solutions

If the digital diagnostics has been executed correctly, the descriptions of the changes to the processes and the business requirements of the solution(s) to be used will be available, as well as recommendations for the consideration of one or more software programs. The descriptions of the business requirements and changes to the process are hereby of critical importance as they allow the company delivering the concrete solution, which cannot be the conductor of the digital audit due to a conflict of interest, to configure the software and implement it for the company in the most optimal way. The recommendations of the software are also not of minor importance – the conductor of the digital diagnostics has the best understanding of the most optimal solutions for the company. There is also, in many cases, no need or reason to apply especially expensive and powerful IT solutions, whereby a fraction of the functionality of the software will be used by the company. Just like it makes no sense to go pick up the dining table purchased from the furniture shop with a big Scania truck.

The solution, once selected, must be implemented. The more trivial part of phasing in software is its installation and even executing its interfacing; experience indicates that significantly more problems occur, as a rule, with phasing in process changes. As the digitalisation project brings with it changes in processes, it will also always mean changing the employees’ existing patterns of activity and habits. The phasing in of a software (e.g. an ERP system), in some cases, is assisted by the supplier of the solution; the phasing in, in other cases, can be executed internally.

It is possible to complete many digitalisation projects based on the execution of a single digital audit. One component of the digital audit/digital diagnostics is the Digitalisation Roadmap which highlights recommendations for the realisation of digitalisation projects for the upcoming years. Digiwise can assist you in conducting digital diagnostics, the preparation of digitalisation projects, as well as the successful completion of failed digitalisation projects. If interested, contact us on info/at/digiwise.ee

An efficient and simple method of warehouse management – Kanban.

Author: Lauri Antalainen

Problems with warehouse management

Companies that have not yet digitalised their main processes, may often experience significant problems with the management of their warehouses, including not being able to fulfil deadlines promised to clients. For example, when stock of a component required for production has been depleted and production of the corresponding product cannot continue until the additional component or material has been ordered and received, leading to a longer delivery schedule which may prove time consuming.

In many industries, to minimise the associated risk, systems are put in place whereby the person responsible for production, the warehouse, or purchasing, visits the warehouse on a daily basis to ensure that there is sufficient stock of the most important materials. Such a “daily inventory” system, is, however, costly, can still cause problems, and is subject to human error. Another drawback of this system is that the amount of stock stored is often much more than optimally required, and this can lead to waste and the tying up of capital.

What is the Kanban system?

Fortunately, there is a simple yet effective method of bringing the management of a non-digitalised warehouse under control and reducing the average stock holding – namely, the Kanban Warehouse System. The main idea behind the Kanban Warehouse System is simple – the creation of a signal representing the need to augment stock. Such a signal is achieved by visually differentiating the so-called minimal stock (quantity ordered – minimum quantity) from the balance of the stock, which then triggers the ordering process when this stock is depleted.

In the Kanban System, to differentiate from the minimum and remaining stock of a component or material, two separate locations in close proximity to each other in the warehouse are used. The minimum stock, for example, can be stored on the bottom shelf (location 2) and the remaining stock on the top shelf (location 1). They can even be stored on the same shelf by placing a labelled sheet between the minimum quantity and the remaining quantity. The most common practice for smaller details is the use of two boxes or containers.

 

Figure 1. Kanban System – a new order for the component (in the given picture – medication), is triggered when the first box is emptied. The rear box contains the safety margin which is used until the ordered goods arrive. The rear box is filled to the established quantity foreseen first, and the remainder is placed in the first box.

Thus, it is important to think through which process is initiated when the labelling representing the minimal quantity is reached. There are many different possibilities here as well. The map representing the goods can be turned the other way around, as seen in the solution displayed in Figure 1 where the back of the map is red. This in turn signals the need to place an order to the responsible employee regularly visiting the warehouse. Another solution which is often used is when the sheet differentiating the two quantities becomes visible, the given sheet is taken to the office or purchasing department, and from there, a new order is raised.

 

How to apply the Kanban System?

When using the Kanban System, it is important to consider which components or materials it should be applied to. Also, the minimum quantities and quantities ordered should be determined, so that the minimum quantity that remains in the warehouse is sufficient for the waiting time of the delivery. This quantity may be different for each item, depending on the conditions of the supplier and the material used in production. The system must be flexible and readily adaptable.

A well thought-out established Kanban System is extremely efficient, minimising work interruptions caused by running out of stock, while at the same time, minimising the average stock. The system functions so well that I have seen s company in which, despite the digitalisation of the warehouse, the Kanban System that had previously been used was maintained for the standard components for the stock of half-finished goods.

I recommend considering the application of the Kanban System if there are no plans to digitalise the warehouse in the immediate future. If, in the near future, you are planning to digitise the company’s processes (including the warehouse management). the experienced Digiwise specialists can assist you in finding and implementing solutions suitable for your company. If you are interested, please contact us at info/at/digiwise.ee