Control of production costs by monitoring electrical consumption

How much does it cost me to produce? Which of my products generates the most profit? Do my prices match my costs?

These and similar questions are asked by almost all production companies on a monthly basis, however, we would be surprised at the multitude of companies that would answer these questions based on qualitative or biased perceptions or data.

Rotogal, a success story

Rotogal is a company dedicated to the design and manufacture of multiple plastic products by rotomolding. Its production process consists mainly of rotational baking and molding, where the main element is these ovens, along with other machines complementary to the process. In this process, its highest production costs are: electrical consumption, working hours and gas consumption of the ovens.

Rotogal, before the beginning of the project, had the following shortcomings:

  • Ignorance of the production cost of each of its multiple references.
  • Making budgets based on own experience without really knowing the expected margins.
  • Lack of information to improve production planning with the aim of maximizing profits.
  • Impossibility of knowing which products are more profitable.

Minerva as a centralized information platform

Muutech’s monitoring platform. Minerva allows to centralize data from multiple sources in a single tool, and generate valuable information from them. In this case, Minerva was installed on one of Rotogal’s servers, but Muutech’s cloud solution could also have been chosen.

From a production cost control perspective, we have seen that it is essential to control the electricity consumption of the different machines in the factory and the working hours (these are usually the highest production expenses in almost any company). Moreover, in Rotogal the gas consumption of the ovens is also important. All this is combined with the References and Manufacturing Orders that in this case, we collected from the production module of the ERP or MES.

Minerva and the monitoring of electrical consumption

Minerva, by its very nature, is a perfect platform for collecting energy and electricity consumption information. Minerva allows us to easily incorporate network analyzers from different manufacturers

In this case, we have opted for network analyzers from Schneider and SenNet, and one has been installed on each of the production machines. These analyzers provide a lot of information to the technical and maintenance people, but also very useful data for cost control:

Direct Data Indirect Data
- Consumption of each machine
- Average electricity consumption in each part of the production process
- Working hours
- Machine hours on
- Production downtime
- Ineficiencies

Cost control, combining other data

The great potential of Minerva is that in addition to being able to collect information on electrical consumption as a traditional tool, it is also capable of relating this information to other highly relevant data such as machine data (such as gas consumption) and data such as the manufacturing order or product reference.

Reference and PO’s data collection was executed in two phases:

Phase 1: manual collection of the data. Initially, the ERP was not prepared to have information about each machine, so they were indicated directly in Minerva.

Phase 2: information is collected directly from the ERP or MES production module.

Dashboards and customized reports

Dashboards were created that perfectly fit Rotogal’s needs in cost control, such as the following dashboard that allows seeing machine real-time electric and gas consumption. And relate this information to the Reference and PO that is in each machine.
Another type of report that was created was historical where you can see for each PO and Reference, the hours worked, the electric and gas consumption, as well as the machine on which it was made and the parts produced. This provides an overview of each of the most important costs of their production.

Indirect expenses and how to measure their consumption

The main focus is on the direct expenses derived from production, however, in a similar way we can also obtain the consumption cost associated with the rest of our company’s activities. To do this we will install a new consumption analyzer at the main entrance of our company, and we will be able to monitor the general data:

With this information of the general consumption, it will be enough to exclude the expenses by production and we will already have a quantitative data of office light, coffee machine, printer, computers and any expense not directly associated to the production.

Impact of the solution

Rotogal today, has improved enormously thanks to being able to make informed decisions and obtain data in a very short period of time, thus improving their daily business. It has contributed to a 10% reduction in machine downtime, which directly impacts on planning improvement and profitability of production lines.

In addition, this solution has provided a saving of 40% in the time of creation of reports to profiles such as Controller or Management, which are the biggest demanders of production cost reports.