Manufacturers, this is how you become future-proof
As many companies’ business models depend on globally integrated supply chains, the changing geo-political-economic landscape and significant fluctuations in consumer demand will mean manufacturers will need to be even more flexible and agile than ever before. As a result, the development of new manufacturing ecosystems, with the right set of technologies, people and culture to bring them to life has become increasingly important during 2019, a crucial part of which will be human experience in order to design, develop and implement effective change strategies.
Prasad Satyavolu, Chief Digital Officer, Manufacturing & Logistics at Cognizant, outlines three key areas for manufacturers for 2019.
The scaling-up challenge
To create an ecosystem that will stand the test of time, scaling up in manufacturing is - and will continue to be - a critical area that involves several technological aspects. According to a survey by PwC, 72% of manufacturing companies are dramatically increasing the speed of their digital transformation and expect to be able to be ranked as ‘digitally advanced’ by 2020, compared with just 33% in 2018. These companies are committing almost US$907bn per year, about 5% of revenues, toward greater connectivity and smarter factories.
In line with this, there should be large-scale adoption of ‘maturing’ technologies, like 3D printing, blockchain and drones. The latter, for example, will be increasingly used not only for distribution but also to automate internal processes, for example, carrying materials inside facilities in a matter of minutes, increasing productivity.
Unfortunately, many businesses are now failing to take advantage of innovation, mainly because of a lack of a business model that allows a seamless implementation across multiple locations. Companies would be wise to review their current investment in automating processes to establish if they are working as efficiently as they could be with the aim of increasing productivity.
Focus on human experience
The second focus area for manufacturers in 2019 will be improving the human experience, not only customer experience (CX) but also employee & partner experience. Companies will, therefore, need to invest heavily in people development and training in 2019.
- To maximise automation, manufacturers must integrate business apps
- The UK steel, pharmaceutical and transport manufacturing industry are receiving a £30mn investment
- The journey to utilising 3D printing across the manufacturing space
- Read the latest issue of Manufacturing Global here
All industries increasingly realise that it is important to create a strategy and culture that supports digital transformation that incorporates skill and career development.
As for experience, we expect to see many large-scale initiatives with a focus on integrating Industrial Internet of Things (IIoT) programmes and increased application of Artificial Intelligence and Machine Learning to create intelligent processes and improve products and services. Closed loop systems will start to emerge as the norm for creative experience design effectively merging AI and analytics with voice, video and hepatic front ends besides device screens.
Invest in a sustainable future
Last but not least, every company needs to beware of climate change. Companies are struggling with the need to decrease emissions through lower energy consumption. For example, the European Commission has set ambitious targets to lower carbon emissions in the region, as much as 40% less by 2030.
Many manufacturers may start using IIoT systems more broadly to measure and optimise energy consumption across their operations in the region. Climate change and investments in energy efficiencies will take centre stage in 2019 and beyond. According to a global survey by Bain & Company, the share of companies that have adopted a truly transformative sustainability aspiration will nearly triple over the next five years, from 9% to 26%.
Increasing awareness of climate change issues will lead to a boost in the production of products and services that are sustainable, such as investments in electric vehicles and alternative fuels.
“For competitive advantage, manufacturers should invest in maturing technologies at scale to increase productivity, improve the human experience and make a positive contribution to climate change”, Satyavolu explains. “Therefore, we will see manufacturers investing in new business models that enable them to innovate, transform and respond to change quickly. Only when the high demands of consumers are met in an experience-focused economy will manufacturers be able to realise growth and stay relevant in 2019 and beyond.”
SAP Whitepaper: Advantages of Intelligent Assets
A core pillar in SAP’s Industry 4.0 strategy, Intelligent Assets equip organisations to reduce downtime, empower employees and increase efficiencies across industrial equipment and manufacturing units.
In a whitepaper produced in partnership between SAP and BizClik Media Group, Rachel Romanoski, Solutions Manager, Digital Assets, SAP, dispels some of the myths surrounding asset intelligent, and shares insight into how even small investment in asset intelligence can pay dividends in minimising cost leakage and realising an asset’s potential.
As with all innovations, the ceiling for Intelligent Assets is as high as an organisation can dream, afford and implement. But Romanoski says that just a little intelligence can go a long way: “Oftentimes people think Intelligent Assets need to be the latest and greatest cutting-edge technology. They can be super advanced, such as leveraging physics-based engineering simulations to forecast potential failures, and help mitigate them. But it could be as simple as a temperature reading. You can pull a lot of simple information from most equipment, and by enhancing that data through ancillary solutions and digital capabilities, you can create that Intelligent Asset.”
One of the most immediate benefits is reducing or, in some cases, eliminating unplanned downtime. Equipment failure is one of the most common causes of disruption and can cause chaos throughout the supply chain.
“The true power of the Intelligent Asset is in changing the basic, reactive emergency work or time-based, planned maintenance and being more prescriptive and tailored to that specific asset and use case,” Romanoski says. “Ultimately, you can reduce the unplanned events that often carry a big price tag.”
"Oftentimes people think Intelligent Assets need to be the latest and greatest cutting-edge technology... But it could be as simple as a temperature reading"
Other financial benefits include stemming cost leakage and “sweating assets” to the full potential. “Maybe you can consider the lifecycle of the asset and understand whether you can push it a little bit further,” Romanoski explains. “It might be that the best course of action for a low-cost item is to run it to failure. Having this information that we collect over time empowers those people to make those better decisions, but also has a trickle down effect to building resiliency and efficiency into the entire supply chain.”
To read the full report, including insight from Intelligent Assets, Intelligent Factories, Empowered People, and exclusive insight from Dominik Metzger, the lead on SAP’s Industry 4.0 programme, CLICK HERE.