When you hear the word ‘industry’ you may think of factories or tall smokestacks. And even though technology grows in leaps and bounds daily, this is still our mindset. For manufacturers that want to remain in the game, they must embrace the digital transformation and everything it has to offer. They need to pay attention to the digital transformation trends driving industry 4.0.
How important is the digital transformation for manufacturers? According to PWC, out of 2,000 manufacturers, 86 percent expect to see cost reductions and revenue gains from their digitization efforts over the next five years. If you’re not on it already, it’s time to jump on board with the digital transformation trends driving industry 4.0.
Digital Transformation Trends Driving Industry 4.0: What Does That Mean?
Industry 4.0 is a term coined for the mixing of traditional manufacturing and industrial practices with the technological world. I’ve also heard and used the term “smart factory” during discussions about the technology advancements. We are seeing a complete revolution in factories and manufacturing. Technology including advanced analytics, machine learning, the IoT, cloud computing and human-machine interfaces are part of the mix.
Although these technologies are already making a difference throughout industry, they now make sense for use within the manufacturing sector. They are reliable and with lower costs, allowing them to be used within growing industrial applications. No longer do manufacturers have to be large to take advantage of smart tools. In fact, companies of all sizes now have opportunity.
Industry 4.0 is also the stance that manufacturer must digitize using these technologies to remain in the future or risk becoming obsolete. There are four digital transformation trends driving industry 4.0 that manufacturers and the rest of us alike should be paying close attention to. They are the driving force behind it all.
Perhaps one of the biggest switches in mindset will be between assets and customers. Gone are the days of manufacturing one product to be the fix for millions of consumers. Instead, consumers are connected to the industry via social networks, customer interactions and data analytics. Every part of business can be informed by the consumer.
Recently I went car shopping for the first time in years. I was astounded by the number of customizable options that the manufacturer was offering. Forget just exterior color options, but interior colors, equipped with technology, built in wifi, you name it—they had it. It’s so clear that the manufacturers are listening to what consumers want and building it.
Before, the thought of customizing a million products for a million consumers struck fear into every company. The cost and the time were impossible. Now, it is just as efficient to produce customized products than it is to produce batches. Why? If you understand what a customer truly wants the first time, there is no room for mistake.
Beyond connected consumers are our connected employees. Employees become empowered when they are given direct access to the information they need most. New collaboration platforms and tools make it easy for employees to access everything they need, from anywhere, using the device of their choosing. Now, remote work is more than possible and worldwide use of talent will soon be normal.
Businesses and manufacturers alike will benefit from a more streamlined decision-making process thanks to the visibility that technology has given us. We are now able to view the entire supply chain which empowers employees to make informed decisions about products, marketing strategies and the assembly line.
New technology has made quick change in production a reality. As consumers shift their mindset towards products and their demand, production can be dynamically adjusted to follow suit. From the assembly align, insights can be accessed in real time.
For the longest time, cloud analytics devices such as sensors were only available to the larger manufacturers and companies that had the time and cash to use them. Now, businesses, organizations and manufacturers of all sizes can take advantage of these tools.
Where can we speed up production? Where are we wasting product or time? Where is our inventory lacking? All of this and more can be answered quickly. As machine learning becomes more prominent in manufacturing, I predict these issues will go away all together.
Vehicles that can track their own gas usage and engine health can potentially save manufacturers and companies millions of dollars per year. They can also bring forth new and improved products thanks to the analytics gathered from these enhancements. The IoT, mixed with machine learning capabilities is the only way to make this happen.
This live product performance will increase productivity by allowing for product enhancements and changes quickly. Other tech such as AR and VR can also change the way we design products, by using live demos and full immersion. Products can be tested even before they hit the assembly line saving time and money.
For manufacturers and other businesses, the digital transformation is critical for success. Industry 4.0 isn’t just a mindset, it is the only way to ensure you have a future within the industry. These digital transformation trends driving industry 4.0 are only the first steps too. I’m sure that next year more technology and more trends will be taking us further. But for now, taking steps to ensure you are ready for complete digitization is the only way to make it to 4.0 status.
The original version of this post was first published on Forbes.
Daniel Newman is the Principal Analyst of Futurum Research and the CEO of Broadsuite Media Group. Living his life at the intersection of people and technology, Daniel works with the world’s largest technology brands exploring Digital Transformation and how it is influencing the enterprise. From Big Data to IoT to Cloud Computing, Newman makes the connections between business, people and tech that are required for companies to benefit most from their technology projects, which leads to his ideas regularly being cited in CIO.Com, CIO Review and hundreds of other sites across the world. A 5x Best Selling Author including his most recent “Building Dragons: Digital Transformation in the Experience Economy,” Daniel is also a Forbes, Entrepreneur and Huffington Post Contributor. MBA and Graduate Adjunct Professor, Daniel Newman is a Chicago Native and his speaking takes him around the world each year as he shares his vision of the role technology will play in our future.