Out With the Old: The Risks of Using On-Prem Manufacturing Execution Systems

There is a common misconception that on-prem Manufacturing Execution Systems (MES) can offer increased security, control, and customization that easily fit your business needs. In actuality, on-prem comes with significant risks that can impact the operational efficiency, security, and long-term viability of the system.

And while the perception is largely tied to “the way things have always been done,” a quick Google search for the meaning of “legacy” gives the following:

adjective: legacy‍

denoting or relating to software or hardware that has been superseded but is difficult to replace because of its wide use

It’s interesting that the word superseded seems to imply that there is a better known solution but because of comfort and familiarity the old ways are still used. Before making that decision consider the following implications and inherent risks on deploying or continuing to invest in an on-prem MES.

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‍High Initial Capital Expense

Risk: On-prem MES requires significant upfront investment in hardware, software licenses, and infrastructure. 

Impact:This capital expenditure can strain financial resources, limit budget flexibility for other initiatives and impact timelines for getting a project started especially for small and medium-sized enterprises.

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Complex Implementation and Long Time-to-Value

Risk: The implementation of on-prem MES is complex and time-consuming, often requiring extensive planning, customization, and IT resources.

Impact: Longer implementations can delay the benefits of the MES,  decrease adoption rates, and increases the risk of project overruns or failure. Additionally, customizations are costly and challenging to maintain as your organization becomes more dependent on the vendor to support them.

Scalability Challenges

Risk: Scaling an on-prem MES requires additional hardware, software licenses, and possibly new infrastructure

Impact: The inability to scale quickly can limit the company’s ability to respond to growth opportunities or changes in production demands. Furthermore, supporting new site builds, earlier stage products, and emerging market facilities is a difficult and costly endeavor. 

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Ongoing Maintenance and Upkeep

Risk: The company’s IT team is responsible for maintaining the system, including applying updates, patches, and troubleshooting issues. 

Impact: This high dependency on IT teams leads to higher operational costs, slower support responding to issues, and the potential for system downtime or vulnerabilities if maintenance is not performed effectively and routinely.

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Data Security and Compliance Risks

Risk: Data security and compliance are entirely the responsibility of the company. 

Impact: If the company lacks the necessary expertise or resources, this can lead to security vulnerabilities, data breaches, or non-compliance with regulations.

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Disaster Recovery and Business Continuity

Risk: Disaster recovery and business continuity plans must be developed, maintained, and paid for by the company. 

Impact: Without proper planning and significant investment, data loss or extended downtime can occur in the event of a disaster or outage. Loss of critical data, and an inability to keep production going can result in product shortages and lost revenues. 

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Limited Innovation

Risk: On-prem solutions lack the continuous updates and innovations that cloud-based solutions receive.  

Impact: The company may face challenges in staying competitive if its MES system cannot keep pace with industry and technological advancements, leading to inefficiencies, increased operational risks, and increased costs or lost revenue. 

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In summary, while on-prem MES solutions appear to offer control and customization, they come with significant risks related to cost, scalability, maintenance, security, and the ability to adapt to new technologies and business needs. Carefully weigh these risks against the potential benefits when deciding whether an on-prem MES is the right choice for your operations. Consider all of your options and explore Unlocking Manufacturing Excellence with a SaaS MES.

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