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Understand how the integration of vertical and horizontal systems enables industries to develop for the future market.

One of the biggest positive impacts of systems integration is the ease in standardizing processes, with data concentrated in one source only. In addition to the possibility of obtaining data in real-time, which enriches the process of continuous improvement. 

Both vertical and horizontal integration of production systems aim to make the industry operate in a unified way, with systemic developments that will be part of a digital transformation process, which is so necessary today.

Thus, there is the standardization of processes, and feedback of information that allows continuous improvement to happen. In addition to the systems integration, it makes possible the capture and sharing of information regardless of the moment in which the activities occur in the production chain.

With this, there are gains in the control and visibility of all the processes carried out in production, transforming its general management.

What is vertical and horizontal integration?

Companies always have decisions to make regarding their products and processes, and one of the main ones is to define whether they will do their internal development or outsource it.

In that sense, there is a basic difference between vertical and horizontal integration. When a company internally manufactures its products and processes, we say that it is verticalizing the systems. On the other hand, when the company has an outsourcing strategy, the strategy is horizontal.

Both forms of systems integration guarantee the benefits mentioned above of standardization of processes and continuous improvement of products and processes.

Understand more deeply the characteristics of each of these integrations.

Horizontal Integration

Horizontal systems integration refers to the ability to unify, reconfigure and make production processes more flexible, starting from product development to manufacturing. 

This approach results in greater agility in changing industry configurations. This applies both to the manufacturing system and to the production system, in areas such as maintenance and quality.

Like any ecosystem with systems integration, we can provide standardization of processes, which has the characteristic of simplifying and reducing costs. In addition to having important inputs for continuous improvement that impacts the entire production chain. 

The current market demand is to expand the offer of product types, to cover increasingly specific audiences. In addition, the life cycle of products is reducing, that is, people use products for less time and already have new consumption demands. 

Therefore, reconfiguring production systems quickly is a latent need, building the company in a modular and flexible way.

Consequently aiming at optimizing human resources and raw materials, in addition to having a greater possibility of innovation and quality of the products sold.

Main advantages: 

  1. Increased flexibility in the industry; 
  2. Agile reconfiguration of the production system; 
  3. Possibility to increase the variety of products; 
  4. The possibility of customized products with low-cost increases;
  5. Interconnection of areas, from suppliers to the customer. 

Vertical integration

Vertical integration in industries is nothing more than the sharing of data and information between different information systems, devices, and software that are the base for the manufacturing activity. 

As a result, data collection, processing, and analysis help to increase control, accuracy, and speed in industry decision-making. 

This type of approach has a greater volume of data and information that qualifies and provides continuous improvement and standardization of processes in the manufacturing environment. 

While in the past we had strategies and decision-making based primarily on market instinct or experience, now we see a reality that is increasingly focused on data. 

Main advantages:

  1. “Data-driven” organization;
  2. Agility in decision making and continuous improvement with real-time data;
  3. Integration of systems with more assertive analysis and resulting in transparency in the need for the operation; 
  4. Ease in product scalability, process standardization, and low production cost.

How may I verticalize my company and integrate all of this into Industry 4.0?

Both types of system integration we’ve covered so far are very important in today’s industry.

However, the second is especially necessary when a company seeks an overview of productivity, standardization of processes, and relies on the use of data for new business strategies. 

To achieve this type of integration and automation, investment in technology is essential. In addition to the engagement of senior leadership for the implantations and support in the management of the company’s changes.

In general, investment in technological innovation means looking for tools, software, and systems that fit your company. 

Also, one of the best ways to implement systems integration is to hire specialized companies to obtain the best solutions and have a successful implementation. Always seeking to guarantee the standardization of processes and continuous improvement in production. 

An example of a tool to support vertical integration is the iPremium, which offers options that adapt to different companies and simplify deployment. 

System integration, or vertical integration, is one of the pillars of Industry 4.0. In addition, it is the foundation that will structure all business intelligence. 

If you don’t know which pillar to start the transformation of your industry to Industry 4.0, systems integration can be a good first step!

Impact of vertical integration for company management

Vertical integration is like a pyramid. This pyramid collects production data and filters it into reports and systems that can give you a much better sense of obstacles and opportunities to improve industry performance. 

In improving performance, we often rely on the simplification and standardization of processes. In addition to the perception of opportunities being transformed into continuous improvement actions in the operation.

In order to have this system integration complete, it is up to the IT area to create a hierarchical structure at different levels. They must be able to collect and gather information from several sources in one system. 

From the integration of systems, there will be the unification of information management at different levels of the industry: 

  • Control;
  • Produccion;
  • Operation.

In this way, company executives are able to have an overview and objective view of the current state of the business, as well as paths that must be followed.

Therefore, the managers have data to define a more assertive strategy for the company, bringing optimization of time in the operation, guaranteeing safe and lasting information management. Which are key features for the success and continuous improvement of 21st-century industries. 

As if there were not enough reasons and benefits for managers to use systems integration as an essential support to lead their company, another major advantage is the increase in competitiveness.

This is because it helps to satisfy customer demands and increase the efficiency of business processes. 

For this reason, systems integration allows easier process standardization by improving the data governance of the entire ecosystem. In addition to guaranteeing inputs so that continuous improvement processes can be carried out with quality. 

Finally, this action allows for a clearer analysis of what is happening at all stages of manufacture. And consequently, there is greater knowledge of what needs to be corrected and how it will be done. Are you ready to implement this solution?

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