Korean mould industry requires to adopt more IT convergence technologies to enhance competitiveness (KODMIC Newsletter Oct 1, 2013 ( No. 491))
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Date : 14-01-20 10:07
IT to be introduced further to boost productivity and cut costs amid sluggish economic conditions
Recently, global mould industries have a hard time due to global financial crisis and subsequent economic slow-downs.
For the mould sector in Korea, domestic markets have continued to slow down and yen of Japan, the largest export market, has fluctuated changing business environments. Against this backdrop, the sector requires to explore new markets and consumers, and needs process innovation for cost reduction.
CAD/CAM/CAE and other basic IT softwares as well as ERP, MES and other convergence information technologies for production management have evolved and production facilities have been automated recently. These have made mould production more cutting-edge.
Nonetheless, it has been repeatedly pointed out that Korea's mould sector should adopt information technologies more proactively as a global IT powerhouse and innovate production processes to differentiate itself from others in order to improve productivity, cut costs and reduce lead time. In particular, as competition has become fiercer at home and abroad, 'price' has become a major competitive edge. Thus, it has become more necessary to acquire added values and improve profitability through process advancements.
Our cooperative conducted a survey on 250 mould businesses nationwide regarding IT convergence status of mould businesses. According to the results, still, information technologies have not been substantially introduced and utilized in the mould industry in general.
This is attributed to the situation of the sector where the sector is mostly composed of SMEs which can less afford to introduce information technologies and do not seem to think it is necessary. Even those already adopted ERP, process management system and so on do not appear to actively utilize them in overall processes. Rather, such systems are mostly being used in a limited way such as only in the accounting management system.
Moreover, as businesses use different moulds according to their production items, technologies and production processes, it is difficult to standardize IT systems for their adoption or common uses. In addition, long periods and high costs for development are also a major hurdle to proactive introduction of IT by the sector.
Differentiated process management technologies to be introduced amid fierce global competition

The mould industry in Korea was able to grow faster during a short span of time than Japan and other competitors thanks to technology innovation driven by other industry development such as that of NC machine tools. The early and wide adoption of CAD/CAM Systems played a significant part. In this respect, if Korea is to turn into an advanced mould powerhouse and acquire competitive advantage, it requires to link offline purchase, order receipt and production systems with the IT industry to go online. By doing so, it has to ensure prompt decision-making, super-short lead time, cost reduction, broader-based marketing activities and wider export markets.
For this, governments and related institutions as well as mould businesses and IT developers should join hands to develop customized IT convergence technologies suiting the needs of the mould sector. More active efforts to promote the adoption of ITs by the sector are also necessary.
Even though the mould businesses understand the significance of ITs, production personnel may not recognize their necessity and efficiency. For this reason, awareness improvement and education for people on production sites to more actively utilize information technologies are required.
Mould businesses' IT adoptions stay only at 30%

According to the survey on Korean mould businesses with respect to IT adoption and utilization in management and production sites, only 30% of them replied to use information technologies in those areas, showing that still many mould companies have yet to connect ITs and their business management.
As much as 32.8% of the answerers said that they would introduce diverse information technologies in the future as a positive sign that IT adoption will increase in the future. However, 17.6% of the businesses said they do not feel any necessity considering their businesses' characteristics.
Among the areas which are already utilizing information technologies in business management, the cost calculation system area accounts for the most proportion of 27.4%, followed by mould history management system, materials and part delivery-in/delivery-out and stock management system, real-time process monitoring system and others. However, these systems do not seem to be linked together and used organically process-wide.
Furthermore, the unmanned operation of machine facilities, which will lift the mould industry a notch to an advanced country's level and heighten added values, is not fully utilized on the site. Production is still highly dependent on skilled workers. This may be unavoidable considering the characteristics of mould processes, but high-cost facility introduction appears to be a huge burden on small and medium-sized mould businesses according to analysis.
40.0% operates ERP and other process management systems, 41.2% scheduled to introduce
As much as 40.0% of the surveyed businesses replied that they are operating the ERP system, an intimately utilized IT convergence technology in the area, and 41.2% said they would introduce the system in the future.
However, the survey showed that as regards ERP utilization, companies seem to recognize it as a management program rather than an IT convergence technology. In most cases, as the system is utilized for accountings, stock management and simply other management work, it seems to be necessary to use it in overall production processes in a linked way.
IT systems need to be linked with orderers and subcontractors
As mould businesses are based on orders from customers, required production q'ty is not changing and requests for design changes and customer services are frequent. Thus, organic cooperative relationships with ordering organizations and toll processing subcontractors are important. To this end, there is a growing trend of introducing web-based mutual process management and order receipt and placement system. However, merely 15.5% of mould businesses surveyed introduced related systems.

Information Technology mould businesses desire to adopt in the future : 'Cost Calculation System'
It was surveyed that the area in which mould businesses desired to adopt in management and production sites was cost calculation system followed by real-time process monitoring, mould history management system and unmanned operation system for machine facilities, etc. However, if the maximum effect is to be seen, each of those systems should be integrated in an organic way through the 'total management system'. Even if such technologies are employed, the systems should be more actively utilized early from the development stage.
In the mould area, long-time technology accumulation determines a business' competitiveness. As such technologies are handed down off-line, company-wide effort is required to make the existing technologies and know-how a database and IT-based. Moreover, through education for continual system improvements and better utilizations, not only executives and managers but also production personnel all should actively make use of the technologies to double their benefits.