Produktivita práce pod lupou 🔎 Odhaľte skryté straty vo vašej výrobe | Productivity Under the Microscope 🔎 Uncover Hidden Losses in Your Production

Productivity Under the Microscope 🔎 Uncover Hidden Losses in Your Production

At first glance, everything seems to be working as it should. Machines are running, people are working, orders are being fulfilled. You might feel that you’re already getting the most out of your available capacities—that this is the maximum your operation can deliver. But this is often where the greatest potential lies hidden.

Many companies today operate under the impression that they’re running at full capacity, while in reality, they may be losing tens of percent of their true potential. Losses hidden in minor downtimes, underutilized resources, or inefficient processes often go unnoticed because they aren’t visible at first glance. This is why labor productivity is crucial—not as an abstract concept, but as a concrete metric that shows where real improvements are possible.

Produktivita práce pod lupou 🔎 Odhaľte skryté straty vo vašej výrobe | Productivity Under the Microscope 🔎 Uncover Hidden Losses in Your Production

What is labor productivity and why should you start measuring it?

Labor productivity shows how much value your company can create in a given period. Whether it’s the number of units produced, completed orders, or the volume of services delivered, it always answers the same essential question: What is the output compared to the time, people, and technology required?

That’s why productivity is one of the most important indicators of efficiency. If it’s low, the company must invest more energy, time, and money to achieve the same result, which translates into higher costs, lower competitiveness, and weaker business outcomes. On the other hand, increasing productivity allows you to achieve more with what you already have—without unnecessary investment in new machines or the need to hire more people.

There are various ways to measure productivity. These include metrics such as GDP per employee, GDP per hour worked, output per worker, or machine utilization efficiency (OEE). The right metric depends on the type of production and the goals you aim to achieve.

Since proper measurement is the foundation of all improvement, we’ll cover this topic in more detail in a dedicated article, “How to Calculate Labor Productivity.”

Labor productivity in the EU and Slovakia

Looking at the numbers, Slovakia has long lagged behind the EU average in terms of labor productivity. According to Eurostat, the Slovak economy reaches only about 70 to 80% of the average labor productivity in the EU. This means the average Slovak worker produces less value per hour than their counterpart in Western Europe.

For manufacturing companies, this is not only a warning sign but also a huge opportunity. The productivity gap isn’t necessarily due to a lower quality workforce. More often, it’s the result of insufficient use of technology, a lack of automation, poor production planning, or missing reliable data for decision-making. Simply put, Slovak firms often work more, but achieve less.

Common problems in companies that don’t measure productivity

If a company doesn’t measure labor productivity or relies only on estimates, the same scenario tends to repeat itself. Production may be running, but results don’t match the effort. Everything might look fine on the surface, but beneath that, small inefficiencies accumulate into major losses.

❌ 1. Unclear Downtimes

Without precise measurement, no one knows exactly when and why machines stop, how long downtimes last, or what their real impact is. Planned, unplanned, and short downtimes are accepted as “just part of the job” instead of being systematically reduced or eliminated.

❌ 2. Rapidly Rising Costs Without Clear Cause

Unnecessary waiting, material waste, overproduction, inefficient production cycles, and reduced machine speeds all increase costs, even when no one seems to be doing anything wrong. If these losses aren’t tracked and analyzed, they can’t be identified, quantified, or strategically reduced.

❌ 3. Invisible Quality Losses

Without consistent measurement, only the biggest failures are reported, while smaller but frequent errors during startup or in-process often go unnoticed. These can add up to significant losses. If they aren’t tracked, they won’t be addressed—and remain hidden costs.

❌ 4. Lack of Transparency in Production Processes

If performance, downtimes, and other key data are recorded manually (on paper or in spreadsheets), the outputs are often inaccurate, delayed, and don’t reflect real-time conditions. There’s no clear view of what’s happening on the floor, making it hard to respond quickly. This lack of agility is a serious disadvantage today.

❌ 5. Ineffecient Reporting and Intuition-Based Decisions

Without reliable performance data, decisions are made based on estimates, experience, or gut feeling. The result is often poor planning, unbalanced workloads, unnecessary stress, and ultimately, increased losses.

These problems result in tangible long-term consequences:

  • Lower efficiency
  • Higher operating costs
  • Reduced competitiveness at home and abroad

How to increase productivity without unnecessary investments

The good news is that higher productivity doesn’t necessarily mean buying new machines, hiring more staff, or pushing people to work faster at the cost of quality. In many cases, it’s the opposite. The greatest impact often comes from better use of what you already have. The key is to know where losses arise, why they happen, and how to reduce or eliminate them.

✅ 1. Start by measuring productivity precisely

The foundation of improvement is accurate data. Without measurement, you can’t know where losses occur or how much they impact your performance. In many cases, productivity increases by 10 to 15% immediately after measurement begins—a phenomenon known as the “halo effect,” where people naturally perform better because they know their output is being tracked.

✅ 2. Automate data collection and eliminate manual errors

If you’re still recording downtimes, breakdowns, and other data manually, you’re leaving room for errors and delays. The solution is automated data collection from machines, production lines, and sensors, using IIoT systems or traditional SCADA/MES platforms. These provide real-time, accurate insights into what’s happening in production.

✅ 3. Focus on uncovering hidden losses

Wasted time, frequent interruptions, poor planning—these are common but often overlooked productivity killers. The “Six Big Losses” model helps categorize these losses into availability, performance, and quality. What makes this model powerful isn’t just naming the six main losses, but assigning clear reduction goals to each. Some can be eliminated completely, while others should be minimized.

✅ 4. Optimize production planning

When you have real-time visibility into machine capacities, line status, and resource availability, you can align production with actual demand—avoiding overloads and downtimes. Integrating MES with ERP or BI systems lets you manage production, maintenance, logistics, and inventory as a unified, data-driven process.

✅ 5. Use visualization and clear reporting

Data is only useful when it’s accessible and understandable. Interactive dashboards in tools like Ignition or Power BI give managers and line operators instant insights into production status, performance, and the root causes of downtime. These insights must be available not just at weekly meetings, but in real time and to everyone who needs them.

✅ 6. Make productivity improvement an ongoing effort

A common mistake is to treat productivity improvements as one-time projects. Successful companies know it’s a continuous process. Regular performance reviews, KPI tracking, and strategic adjustments help maintain improvements and adapt quickly to new challenges.

Labor productivity isn’t about making people work more, but about empowering them to work smarter. To reduce downtime, prevent overloads, and make decisions based on real data—not guesses. That’s why measuring productivity isn’t just another metric. It’s a tool for better decisions, sustainable growth, and a stronger operation.

A Custom Solution from IoT Industries

At IoT Industries, we help you gain precise insights into the performance of your machines and processes, uncover hidden losses, and set measurable goals for boosting productivity. We bring experience with automated data collection, SCADA, MES, OEE implementation, and more—so you can make decisions based on facts, not assumptions. Contact us to find out where your biggest improvement opportunities lie—and how to unlock them. Let’s take your production to the next level.

Why Choose IoT/IIoT Implementation with IoT Industries?

Traditional companies typically specialize in OT (operational technologies, such as production lines and devices) or classic enterprise IT systems. However, we are able to connect both of these worlds. Our unique expertise in integrating OT and IT allows us to deliver innovative solutions in digital transformation, enhancing efficiency, reliability, and competitiveness for manufacturing companies.

10 dôvodov, prečo je implementácia systémov SCADA a MES kľúčom k úspechu vášho podniku | 10 Reasons Why Implementing SCADA and MES Systems is the Key to Your Business Success

10 Reasons Why Implementing SCADA and MES Systems is the Key to Your Business Success (Part 2)

In the first part of this article, we discussed the major challenges that manufacturing companies face. The solution to these challenges lies in implementing SCADA and MES systems. These systems enable transparent management and optimization of production processes. While SCADA focuses on monitoring and controlling production equipment, MES is dedicated to production management, planning, tracking efficiency, and ensuring smooth production operations.

10 dôvodov, prečo je implementácia systémov SCADA a MES kľúčom k úspechu vášho podniku | 10 Reasons Why Implementing SCADA and MES Systems is the Key to Your Business Success

➡️ SCADA

SCADA (Supervisory Control and Data Acquisition) serves as the eyes and hands of operators. It provides real-time oversight of manufacturing technology. It primarily communicates with PLC (Programmable Logic Controller) systems, which control individual machines. However, in the IoT environment, SCADA can also communicate directly with sensors via protocols such as MQTT and OPC UA.

✅ Immediate Response to Failures

One of the key advantages of SCADA is its ability to immediately respond to failures, minimizing downtime and reducing production losses. If a machine shuts down unexpectedly, experiences performance drops, or technological deviations (e.g., unacceptable temperatures or pressures), operators can quickly intervene and restore production.

✅ Remote Control of Technology

Another key feature of SCADA is remote control of technology. It allows operators to turn equipment on and off remotely, as well as adjust parameters such as speed, pressure, and temperature directly from their interface without having to be physically present at the machine.

✅ Historical Data Storage for Analysis and Optimization

SCADA also stores historical data, enabling not only retrospective analysis of problems but also long-term improvements in production processes.

❓ When is SCADA (Not) Suitable for a Business?

If a SCADA system were not implemented, operators in smaller plants might be able to manage oversight manually. However, in large-scale enterprises, this would significantly extend response times and cause losses. Additionally, without data collection, it would be impossible to generate accurate reports, further complicating strategic decision-making at the management level.

➡️ MES

While SCADA monitors technological equipment, MES (Manufacturing Execution System) manages the production process itself. It integrates machines, materials, and workers to provide a comprehensive view of the entire production process — from planning and execution to storage. While SCADA collects data at intervals of seconds, MES links them to orders, allowing managers to monitor production status in real-time and respond to deviations immediately.

✅ Digitalization and a Unified Data Source

The MES system replaces paper-based processes with electronic data collection, ensuring that all information is available in real-time and eliminating errors caused by manual data handling.

It allows both automated and manual data entry throughout the entire production process, creating a single source of truth (SSOT). All data is centrally recorded and accessible at every level of management, eliminating delays, inaccuracies, and adjustments caused by manual reporting. Decision-making is based on hard real-time data.

✅ Automated Production Planning

One of the main benefits of MES is automated production planning. The system uses data from ERP (e.g., SAP) to manage manufacturing operations based on orders and available resources, providing a complete real-time overview of production status (WIP – Work in Progress). MES also synchronizes production data with ERP systems, ensuring seamless data exchange between the company and the shop floor without the need for manual intervention.

✅ Efficient Workforce Management

The system ensures that only qualified employees are assigned to production operations. By logging into the MES system, employees verify their credentials, and the system checks whether they meet the requirements for operating a specific machine or performing a particular task. This process eliminates errors caused by unqualified workers and reduces the likelihood of workplace accidents.

✅ Optimization of Resource Utilization

MES provides detailed insights into the use of production resources, whether it be machines, materials, or personnel. It monitors equipment conditions, reports failures, and alerts to potential shortages of materials. If necessary, the system automatically notifies the warehouse to replenish materials before production is disrupted. This approach minimizes downtime and maximizes resource utilization.

✅ Production and Product Traceability

Every manufactured unit or batch is linked to all production data — from raw materials and individual operations to the final product. This system allows for full traceability in the event of a complaint, which is crucial in industries with strict regulations, such as pharmaceuticals and food production.

✅ Quality and Performance Management

MES actively monitors the quality of production processes. It detects deviations from standards and immediately signals them, minimizing the risk of production errors. Quality data can be integrated with external software for Statistical Process Control (SPC) or Laboratory Management Systems (LMS), ensuring even more precise quality management.

The system also calculates OEE (Overall Equipment Effectiveness), identifying production bottlenecks and providing tools for their optimization.

✅ Digitalization of Documentation

MES automates document management, ensuring that workers have access to all necessary information, such as work instructions, technical drawings, and safety guidelines, at the right time. Documentation is available electronically, often via QR codes placed directly on machines, reducing the need for physical documents and increasing operational efficiency.

✅ Efficient Maintenance Management

MES plays a significant role in maintenance management. The system enables preventive maintenance planning, reducing unexpected failures and minimizing costs associated with reactive maintenance. Maintenance staff can log interventions, plan tasks, and monitor equipment status directly in the system.

MES also analyzes historical equipment performance data, allowing businesses to predict potential failures before they occur. In combination with SCADA, businesses can gradually transition to predictive maintenance, leveraging advanced analytical algorithms to detect anomalies and prevent failures before they happen.

❓ When is MES (Not) Suitable for a Business?

Not every business requires all MES system functionalities. While some companies implement only selected modules to address specific issues, industries such as pharmaceuticals or food production (F&B) often require a comprehensive MES system. These sectors must ensure batch traceability, quality control, and strict regulatory compliance, as even the smallest mistake can have serious consequences for consumer health.

Companies that aim to improve efficiency, reduce costs, and increase competitiveness can no longer rely on outdated manual processes and paper-based records. SCADA and MES are not just technologies—they are strategic tools that enable businesses to transition to smart manufacturing, driven by real-time data and automated processes. Are you ready to take the next step?

10 Reasons to Implement SCADA and MES

📌 1. Increased transparency in production processes

📌 2. Faster and more accurate reporting

📌 3. Precise inventory management

📌 4. Immediate response to issues

📌 5. Reduced downtime and prevention of unplanned failures

📌 6. Improved workforce management and error reduction

📌 7. Higher product quality and elimination of production defects

📌 8. Complete traceability and tracking of production processes

📌 9. Increased efficiency, productivity, and optimization of production resources and costs

📌 10. Readiness for Industry 4.0 and future innovations

Why Choose IoT/IIoT Implementation with IoT Industries?

Traditional companies typically specialize in OT (operational technologies, such as production lines and devices) or classic enterprise IT systems. However, we are able to connect both of these worlds. Our unique expertise in integrating OT and IT allows us to deliver innovative solutions in digital transformation, enhancing efficiency, reliability, and competitiveness for manufacturing companies.

10 dôvodov, prečo je implementácia systémov SCADA a MES kľúčom k úspechu vášho podniku | 10 Reasons Why Implementing SCADA and MES Systems is the Key to Your Business Success

10 Reasons Why Implementing SCADA and MES Systems is the Key to Your Business Success (Part 1)

SCADA and MES systems are key pillars of modern manufacturing companies striving to optimize production processes, increase efficiency, and minimize costs. Despite their advantages, many businesses still rely on outdated manual processes, paper-based records, and inaccurate estimates. To enhance competitiveness and adapt to changing market demands, implementing SCADA and MES is no longer just an option. It is a necessity.

10 dôvodov, prečo je implementácia systémov SCADA a MES kľúčom k úspechu vášho podniku | 10 Reasons Why Implementing SCADA and MES Systems is the Key to Your Business Success

Challenges Faced by Companies Without SCADA and MES

❌ Lack of Transparency in Production Processes

The biggest challenge in such companies is the lack of transparency in production. Without a comprehensive system for monitoring and managing manufacturing, efficiency is often estimated based on manual records, Excel spreadsheets, or inaccurate reports.

However, these data do not reflect the real situation. When companies try to optimize costs or increase production, they lack clear data to pinpoint bottlenecks and identify where the biggest time or financial losses occur.

❌ Inefficient Reporting and Production Tracking

One of the main consequences of a lack of transparency is inefficient reporting. Many companies struggle with slow and inaccurate reporting. Obtaining the necessary data can take days or even weeks. By the time management receives reports, they are often outdated and do not reflect the current state of production. In many cases, reports are distorted or embellished because data is collected manually, making accuracy dependent on subjective reporting from employees.

This issue is particularly evident in tracking work-in-progress. At the end of the month, an ERP system like SAP might record a lower number of produced units than planned. However, the company may struggle to quickly determine whether the products have been manufactured or are still in production. This leads to delays, inefficient planning, and difficulties in meeting deadlines.

A similar issue arises in production planning. If a production plan changes, many companies still rely on printed documents. These must be physically distributed to workers on the shop floor, and changes must be explained in person. This results in unnecessary delays and the risk that some employees may miss critical updates.

❌ Material Tracking and Inventory Management Issues

Another significant challenge is material tracking and inventory management. In many cases, production teams realize they are out of materials only when workers on the production line run out. When an operator reports a material shortage, it often takes hours to resolve the issue. The material must be manually picked from storage, checked, transported to the right location, and prepared for further processing. During this time, production slows down or completely stops, causing downtime and disrupting delivery schedules.

The absence of a digital system also affects the accuracy of material usage. There is no mechanism to ensure that workers use the correct material in the required quantity. Without automated verification, operators may use incorrect components or incorrect dosing, leading to defective products or even damage to machinery.

❌ Delayed Fault Detection and Reactive Maintenance

In large and complex manufacturing facilities, it is impossible to have everything physically monitored at all times. Production often relies on workers noticing a malfunction and contacting maintenance, leading to time losses and unplanned downtime.

Without proactive monitoring, companies cannot detect warning signs before a failure occurs. For example, an increase in oil temperature in a machine may indicate an impending issue. However, if there is no monitoring system in place, maintenance only reacts when an actual failure happens. This approach, known as reactive maintenance, means problems are only addressed after they have already caused disruptions.

Additionally, when a failure occurs, the root cause is often unclear. There are no historical records indicating which parameters were out of range, what actions preceded the failure, and what interventions operators attempted. As a result, companies simply “extinguish the fire” and hope the issue does not recur, rather than preventing it proactively.

❌ Limited Remote Control of Production

Without a SCADA system, controlling production equipment is only possible locally. Operators must be physically present at the machines to make adjustments. If an error occurs or a process is configured incorrectly, there is no way to address the issue remotely, leading to extended response times and costly consequences.

For instance, if a worker misconfigures the routing of a manufactured product, employees must manually transfer materials to the correct location. This causes delays and disrupts production planning. Moreover, many local control panels do not require operator authentication, meaning that if an error occurs, there is no way to trace who was responsible. This lack of accountability prevents targeted prevention measures such as training.

❌ Limitations in Workforce Management

Many companies aim to optimize labor costs, but without accurate data, this becomes extremely challenging. Without an MES system, it is impossible to track individual worker efficiency, evaluate performance, and analyze how much time is spent on specific operations. In most companies, productivity is measured only at the team or department level, making it difficult to identify areas for optimization.

HR records may indicate which employees are trained to operate specific machines, but production equipment itself does not use this information. This means that an unqualified worker may access and operate machinery, increasing the risk of production errors, lowering product quality, and, in the worst cases, leading to workplace accidents.

❌ Lack of Traceability in Production Information

Another critical issue is the lack of traceability in production records. If a product defect is discovered, companies often struggle to determine which other products may have the same issue. There are no detailed records of when the product was manufactured, which machine was used, what settings were applied, or what materials were used.

For example, if a production deviation occurs on a specific machine, the company cannot simply recall the affected batch of 1,500 units. Instead, they must recall all 10,000 products made during the same period as a precaution. This results in significant financial losses and unnecessary waste.

❌ Limitations in Energy Management

Companies may have ambitious plans to implement an Energy Management System (EMS) to monitor energy consumption and reduce operating costs. However, even if energy meters are installed on all machines, their effectiveness is limited without centralized data collection and visualization.

If a company cannot track and analyze this data in real time, the only option is manual regulation—employees would have to physically check and turn off machines that are not in use, which is inefficient and impractical. Energy savings are not just about data collection but also about real-time response and automated interventions, which are impossible without SCADA and MES.

❌ Inability to Implement Advanced Technologies

Without comprehensive data collection and production monitoring, adopting advanced technologies such as artificial intelligence and predictive maintenance is unrealistic.

SCADA and MES systems provide the foundation necessary for expanding production monitoring. For example, predictive maintenance relies on machine learning algorithms to analyze machine vibrations and detect anomalies early. However, this approach is ineffective if the company lacks a basic system to monitor key parameters such as temperature, pressure, and speed.

SCADA and MES as a Solution to Manufacturing Challenges

In this part of the article, we explored the biggest challenges that slow down manufacturing companies and lead to unnecessary costs. In the second part, we will look at specific solutions and show how SCADA and MES systems help optimize production management and reduce losses.

Why Choose IoT/IIoT Implementation with IoT Industries?

Traditional companies typically specialize in OT (operational technologies, such as production lines and devices) or classic enterprise IT systems. However, we are able to connect both of these worlds. Our unique expertise in integrating OT and IT allows us to deliver innovative solutions in digital transformation, enhancing efficiency, reliability, and competitiveness for manufacturing companies.

Ako znížiť režijné náklady vo výrobe pomocou digitálnej transformácie? | How to Reduce Overhead Costs in Manufacturing with Digital Transformation?

How to Reduce Overhead Costs in Manufacturing with Digital Transformation?

Overhead costs make up a significant portion of manufacturing expenses, yet many companies fail to give them sufficient attention. While direct production costs, such as material expenses and wages, are easily measurable, overhead costs often remain hidden in excessive energy consumption, unnecessary downtime, and inefficient processes. The result is higher expenses, lower productivity, and reduced competitiveness.

With modern digital solutions like SCADA (Supervisory Control and Data Acquisition), MES (Manufacturing Execution System), EMS (Energy Management System), and BMS (Building Management System), companies can not only accurately identify sources of unnecessary overhead costs but also significantly reduce them.

Ako znížiť režijné náklady vo výrobe pomocou digitálnej transformácie? | How to Reduce Overhead Costs in Manufacturing with Digital Transformation?

What Are Overhead Costs in Manufacturing?

Overhead costs include all expenses that are not directly linked to producing a specific product but still impact the entire manufacturing process. These typically include:

  • Energy costs – electricity, gas, water, cooling, heating
  • Maintenance and repairs – unplanned downtime, machine failures, service interventions
  • Inefficient production planning – downtime, material waste, underutilized workforce

Many companies accept these expenses as an unavoidable part of manufacturing. However, the truth is that modern technologies can significantly optimize them.

What Are the Most Common Issues That Increase Overhead Costs?

❌ High Energy Consumption and Inefficient Operational Costs

Manufacturers often lack a detailed overview of which machines consume the most energy and where waste occurs. It is common for machines to remain powered even when idle, heating and lighting to run in unused spaces, and production cycles to be poorly optimized for energy efficiency. As a result, energy expenses continue to rise.

❌ Inefficient Maintenance and Frequent Downtime

Many companies still rely on reactive maintenance fixing machines only after they break down. This leads to unplanned downtime, delays, and increased costs for urgent repairs. A more effective approach is implementing digital planned maintenance and condition-based maintenance, which monitors key parameters such as oil temperature or bearing vibrations, allowing companies to address issues before they result in breakdowns. Once these levels are established, businesses can advance to predictive maintenance using advanced data analysis.

❌ Poor Planning and Underutilized Production Capacity

Lack of accurate data results in inefficient production planning. Machines operate with low efficiency, employees wait for materials, and inventory levels spiral out of control. Poor planning also means that production is not flexible enough to quickly respond to shifts in demand.

How Can Digital Transformation Reduce Overhead Costs?

✅ Optimizing Energy Consumption with EMS and BMS

An Energy Management System (EMS) provides companies with real-time insights into energy consumption across different production areas. A Building Management System (BMS) uses this data to automate energy regulation, shut down unnecessary machines, and optimize production cycles to significantly reduce energy costs.

✅ Immediate Failure Response and Smart Maintenance with SCADA and MES

Supervisory Control and Data Acquisition (SCADA) continuously monitors production equipment and allows for immediate responses to malfunctions through remote control. It also provides essential data for optimizing maintenance strategies—whether planned, condition-based, or predictive. Manufacturing Execution System (MES) further integrates this data into the broader production context.

✅ More Efficient Production Planning with MES

MES connects ERP systems with real-time production data, improving the efficiency of manufacturing operations. This reduces downtime, enhances workforce utilization, and optimizes material inventory, leading to significant cost savings.

Overhead Costs – Example of Savings Calculation

A company that pays €30,000 per month for electricity can reduce consumption by 15–20% using EMS and BMS, resulting in annual savings of up to €72,000. Similar savings can be achieved in maintenance, logistics, and overall production process optimization.

The Key to Successful IoT/IIoT Implementation

Many companies struggle with where to start when optimizing their overhead costs. The solution lies in a detailed analysis of manufacturing processes and the implementation of intelligent control systems. At IoT Industries, we offer tailored solutions – from cost analysis and the implementation of MES, SCADA, EMS, and BMS systems to long-term support and production optimization. Contact us to find out how you can reduce your overhead costs.

Why Choose IoT/IIoT Implementation with IoT Industries?

Traditional companies typically specialize in OT (operational technologies, such as production lines and devices) or classic enterprise IT systems. However, we are able to connect both of these worlds. Our unique expertise in integrating OT and IT allows us to deliver innovative solutions in digital transformation, enhancing efficiency, reliability, and competitiveness for manufacturing companies.