If water starts leaking from a pipe, it might not be noticed immediately. Similarly, many manufacturing companies have numerous hidden costs that slowly accumulate and can lead to significant losses if not detected and addressed. A DTU researcher aims to plug these small leaks using artificial intelligence.
Most manufacturing companies use ERP systems (Enterprise Resource Planning) that provide an overview of everything from finances to inventory, supply chains, procurement, and sales, so they know the cost of most decisions in monetary terms. However, ERP systems are static and have many blind spots. They only account for direct costs and not the extra work required to produce one product over another, or the additional maintenance or storage space it will entail.
"So they don't get the real picture of what it will cost to make one decision over another," says Carsten Keinicke Fjord Christensen.
He is a postdoc at DTU Construct, specializing in modularization, which is based on the idea that reusing components in multiple places simplifies many processes and saves time and money. In his research project AIMO, Carsten Keinicke Fjord Christensen and his team of researchers have developed a new solution that uses artificial intelligence to analyze company data, predict how changes will affect the entire organization, and help make better decisions.
"It's about making fundamentally better decisions in the company and making them smarter about trade-offs and how decisions affect their colleagues' tasks. Ultimately, they become more productive and get more out of their resources," says Carsten Keinicke Fjord Christensen.
An hour saved can waste others' time
Carsten Keinicke Fjord Christensen believes that most companies think of office hours as fixed – they have already accounted for the cost of paying employees and therefore think less about what a new process will cost in work hours. When a company decides whether to produce product A or B, the ERP system looks at direct costs like materials and wages but doesn't account for the work hours needed to develop and maintain the two products.
For example, an engineer might save an hour by designing a new component for a product instead of finding an existing one. However, colleagues in the organization will spend several hours figuring out everything from how to manufacture the component, what materials to use, where to store it, and how to implement it in the final product.
"We would rather use our skilled people to develop something new for the customer instead of having them deal with unnecessary complexity," says Carsten Keinicke Fjord Christensen.
