EDITOR’S CHOICE


 


By Nils Olson, Chief of Strategy, Tacton


I


n capital equipment manufacturing, variability is part of the business model, not an exception to it. Even enterprises that are built on a standardised platform rarely produce identical  of performance requirements, environmental conditions, regulatory constraints, automation levels, materials and regional standards. Personalisation drives growth. But as


 coincides with margin erosion, operational instability and discount pressure. The root cause    executed across the business.


EACH ORDER IS A FINANCIAL COMMITMENT Capital equipment operates on a project-based system. Each order carries its own revenue, cost structure and margin expectation. Unlike high- volume manufacturing, errors don’t average out   amends, or contractual consequences. Production costs dominate the cost structure in complex equipment environments. Small deviations in materials, routing, or engineering


30 March/April 2026 Irish Manufacturing


 Once costs are embedded in assemblies or site installations, recovery options are limited. Prioritising margins requires controlling complexity before it reaches execution. The  evolve across the enterprise.


FRAGMENTATION ISSUES ARISE Customers demand speed, honesty and coherent  product representations, performance tiers, bundled features and high-level choices. 


   components based on cost and lead time. Service  


 local tools, inconsistency is unavoidable. Each function operates from its own interpretation of   are most expensive.   supply disruptions and limited installed-base


naturally follow. These issues may surface late in the process, but their root cause sits upstream in fragmented governance and disconnected logic.


THEN MARGIN EROSION BEGINS  uncertainty enters the commercial process. Sales teams cannot always answer critical questions with  •  •  •  •  To ensure business deals continue moving


forward, enterprises must compensate without discounting, post-quote validation and late-stage design adjustments. Revenue is secured, but cost volatility is built in from the start. Engineering spends disproportionate time


 incompatible or missing components. Supply chain reacts with alternative sourcing and expediting. Projects ship despite reduced margins.


MOVING DISCIPLINE UPRIVER  governance upstream at commercial decision- making.The objective is not to limit customer 


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