Data revolution can help manufacturing go full circle
The latest twist of the digital revolution looks set to send industry full circle, as innovative manufacturers match the individuality of their artisan forefathers to satisfy a demand for an ever more personalised product. This trend towards personalisation has already been seen in retail and has the potential to accelerate sales to the next level, but those left behind will struggle.
Henry Ford's pioneering mass production system of the early twentieth century was based on the premise of that every single car that rolled off his assembly line was identical, and famously, the same colour. Today, automotive is again among the industries pioneering the adoption of a new approach, but this time it is driving in the opposite direction.
The dramatic changes that are putting premium car makers through their paces will be felt across global manufacturing within the next two to four years, forcing firms to seize ownership of, manage and exploit, vast amounts of data currently lying idle. Digitisation means the information can be harnessed, and enterprise content management (ECM) allows it to be used strategically.
These changes have their origins in retail, where the advent of mass internet connectivity has richly rewarded those who were prepared to adapt, but destroyed many of those who weren't. Back when shopping meant going to the shops, the better boutiques employed impeccably mannered sales staff to make their clients feel welcome and well attended to, but the mass-market shopping experience was a mundane matter of choosing from what was available on the shelves. Online retail offered boutique service at “stack 'em high” prices.
Of the new internet retailers, Amazon in particular understood the new game and captured the lion's share of the market through personalisation. As well as offering unprecedented choice, Amazon greets each of its customers by name, makes suggestions for books and films they might like and offers discounts tailored to them. Underscoring the potential impact of the strategy, recent research found that 62 per cent of shoppers dig deeper into their pockets when the retail experience is personalised.
As the consumer becomes more accustomed to personalisation, manufacturers are being drawn in to the fray, not just because they have to but because many see mouth-watering possibilities for growing sales while at the same time increasing efficiencies, provided all the necessary data can be managed effectively. It's a long time since a car manufacturer could get away with producing only black cars, but now premium marques are responding faster than ever to the whims of even individual consumers. Not only can every last detail of a new car be chosen by the buyer, but sales departments are working closely with technical departments to devise new features with which to please customers. Thus, their manufacturing operations see customer feedback integrated into the design process, so that a new product resembles as closely as possible the desires of the consumer.
In face of such heightened expectations from customers, more and more manufacturers offering consumer goods to the growing global market of middle class, tech-savvy buyers are taking a personalised approach. And where premium products have gone, higher-volume lower-margin products are set to follow. Mobile phone manufacturers could use personalisation to challenge Apple's minimalist, Henry Ford-esque dominance at the top of the value chain. Apparel makers may abandon their traditional seasonal ranges and opt for a more responsive approach, tailoring new lines to the latest craze and making garments compatible with a variety of electronic devices.
In order to take a true end-to-end view of how it delivers its products, a company must develop a structure that allows its departments to be tightly joined together. Technology needs can no longer be dictated or even solely provided by internal IT departments. Instead, sophisticated ECM systems will ensure seamless sharing of the vast volumes of data needed to stay up-to date with the demands of sales departments and ultimately consumers. The benefits of such an effective platform for data transfer can also easily be extended up and down the supply chain.
A manufacturer can look at the weaknesses in its current processes and use an ECM system to solve the problems that are creating bottlenecks and slowing the flow of information and goods. It may be that design teams are wasting time looking for information, or that specific components are not reaching the relevant part of the production line fast enough after changes are made. Perhaps prototypes are not working as well as they should, or feedback on them is lacking. ECM systems can be targeted at the source of inefficiencies and allow solutions to be found by taking charge of the flow of information.
At the same time, a purely digital document trail reduces the need for manual intervention and, therefore, the number of errors. And by bringing previously unmanageable data under a single system that is easy to access by all those who need to, it allows a better strategic overview of all processes, making the organisation nimble enough to adapt to the pace of client demand.
Effective ECM can be viewed in a variety of formats and, instead of forcing change on employees, can be adapted to platforms with which they are already comfortable and put in place very quickly. In the modern era of personalisation, long term projects are unnecessary and inefficient – instead a system should be installed within days and fully rolled out to the workforce within weeks. Once in place, and using programmes and applications they are already familiar with, key staff will begin to adapt ECM to their needs and discover new opportunities for the organisation as a whole.
ECM systems allow firms to fully exploit the treasure trove of data flowing through their production system, supporting the drive towards profitable growth, better customer service and, ultimately, better products. This speed and adaptability, already evident in the low-volume, high-margin end of global industry, is also key to the next stage of growth for many high-volume consumer goods makers. And for those selling to industrial consumers, a digital paper trail that can be shared instantly will allow them to integrate with systems further down the chain and provide personalised quality control, individual component certification and an ever-more responsive service.
Tim Rushent is director, industry and commerce, with Hyland, creator of OnBase. www.onbase.com