Common Challenges Facing FVL Operations and How RTLS Can Solve Them
The last two years have revealed vulnerabilities in the automotive manufacturing supply chain that predate the pandemic. From parts and materials shortages, to inventory surges and labor challenges, the ripple effect has been felt throughout. Luckily, Real-time location solution (RTLS) technology can help identify and illuminate the insights needed to fix these vulnerabilities, but it is often overlooked as a solution because the legacy location tracking technology used is expensive and difficult to deploy. As a result, costly and ineffective practices go unchecked, and more importantly, unsolved.
Enter RTLS 2.0: Advancements in and further adoption of cloud technology and real-time locations services (RTLS) can mitigate (and even eliminate!) some of the most difficult challenges OEMs and their FVL operations face, here’s how.
As recently as July 2021, we’ve heard complaints from OEMs who are struggling to track vehicles throughout their finished vehicle operations. Locating thousands of vehicles as they progress through finishing is a series of interdependent tasks that truly require real-time visibility and process management software. However due to high-cost, operational disruptions and lack of line-of-sight to ROI, they have been relegated to “management by spreadsheet,” causing even the most organized operations to waste an immense amount of time and effort scouring lots and yards looking for cars and updating data by hand. When you factor in inventory surges caused by chip shortages and the pandemic’s broader impact on supply chains, you have a serious set of challenges to manage.
Or at least you did. Next-gen RTLS 2.0 technology leverages advancements in cloud technology, drastically reducing the amount of time, effort and disruption associated with the previous generation of RTLS tech. Additionally, its ultra-light footprint and SaaS-based business model enables breakthroughs in total cost of ownership while providing the precise location accuracy required to locate vehicles quickly and easily. Thanks to this new approach, providing real-time visibility to your teams is now easy, affordable, and helps ensure tasks are completed efficiently and on-time.
If your operation already has some flavor of asset tracking installed, you might think you’re all set. But it is important to ask yourself this question: How “real” is the real-time component of your system? Oftentimes, it’s real for a few minutes, like when a barcode is scanned or a beacon is pinged while taking daily inventory. But that location data quickly becomes obsolete the moment someone moves a vehicle and forgets to re-scan its new location or it misses pinging a beacon. Additionally, without visibility to the movement in between scans and pings, valuable information into employee and process efficiency are lost — and so too are the cost savings associated with improving them.
Not to worry. Next-gen RTLS leverages GPS and combines it with powerful long-range outdoor networking technology that enables coverage up to two-miles with the installation of a single gateway (about the size of the wireless router found in your home). This powerful hardware can manage tracking up to 10,000 assets and records every movement, capturing, in real-time, the current location of each tagged vehicle in its range. And, while true real-time location information is hugely beneficial for your team, what’s even more powerful is the data that is produced as a byproduct. This data provides actionable insights that highlight bottlenecks, employee productivity trends, and supports the development of KPIs that can help set the bar for the operational efficiency of teams across sites. Hyundai Glovis discusses this specific challenge (along with how Cognosos technology fixed it!) with Automotive Logistics here.
Supply Chain Fluctuations
We’ve all seen the recent articles about inventory fluctuations leading to unfinished cars being stored in fields and factories shutting down for weeks at a time due to semiconductor chips being in short supply. But what has been less acknowledged is that inventory fluctuations and the associated challenges are a long-accepted problem in automotive manufacturing. Every year, auto manufacturing operations experience periods of increased production and new model introductions, making the risk of losing track of inventory even greater. During these times, right-first-time rates drop while WIP inventory balloons, temporary (and less experienced) workers are brought in to support an overwhelmed labor force, storage and parking begins to run low and cars are parked any- and everywhere in a last-ditch effort to just keep things moving. It’s no wonder things become lost and efficiencies plummet.
So why then, with an operational area like FVL, which holds so much importance, would modern technology not be deployed to mitigate a potential disaster? Simple. Because even though RTLS solutions have existed for over a decade and are becoming widely adopted in some industries, no solution or technology has delivered the required return-on-investment to stimulate adoption in the vehicle plant.
The primary driver for the traditionally low ROI is not on the benefit side of the equation – gaining real-time visibility of complex processes across the plant is clearly of significant business value. Rather, the ROI is hurt by the significant cost associated with traditional visibility systems, based on turn-of-the-millennium RTLS that weren’t designed with ease of deployment in mind. New technologies eliminate many of the costs and fees shifting the ROI calculus and proving financial returns well within a year of deployment.
It’s important to understand the scale of the impact of COVID on the ability to hire skilled labor. According to data from the Bureau of Labor Statistics, the pandemic caused the labor force participation rate for workers to fall from 63.3% to 61.3%, exceeding the decline seen in the Great Recession and ranking among the largest 12-month declines in the post-World War II era. This dip in labor participation greatly affected manufacturer’s ability to hire workers after shutting down operations to address initial concerns about COVID.
With the addition of RTLS technology; however, employers are able to do more with less: improving visibility and efficiency across the lot allows the same amount of work to be done by fewer people: less finding, more driving. Additionally, employers are able to pass on the technological benefits to their employees, increasing appeal during the hiring process and improving retention (thanks in part to the fact that, with a click of a button, employees know exactly where the asset they’re looking for is).
We speak about it at-length about the benefits of RTLS for employees in our blog 4 ways RTLS improves employee retention and recruitment. You can read it here.
While the benefits of deploying RTLS have not changed, the times and technology has. No longer is it disruptive, expensive and challenging to deploy RTLS and with Cognosos technology, you can go from install to insights on day one.