Like the Industrial Revolution impacted manufacturing, digital transformation is now responsible for changing the industry. Finally, industrial manufacturers are joining their counterparts–as I’ve previously discussed–and are moving to a digital world. Not since Henry Ford introduced mass production has there been a revolution to this scale. Now, manufacturing companies are using technology to move from mass production to customized production, and it’s happening at a rapid pace.
Consumer expectations and the advent of connected devices and platforms are driving the persistent digitization of the manufacturing. While the majority of manufacturing executives acknowledge the importance of this transformation, only five percent of them are satisfied with their current digital strategies. The industry continues to evolve in response to the challenge of ensuring the right products are delivered at the right price to the right person through a process of improved sophistication.
IoT and Industry 4.0
At the center of industrial transformation is IoT, accounting for more than $178 billion in 2016 and proving critical to providing companies with a competitive edge. The manufacturing industry is leading in the IoT because of the revolutionary ways this connected technology has streamlined and simplified various manufacturing processes. For instance, IoT can provide real-time feedback and alerts companies of defects or damaged goods. These simple yet critical implementations of IoT reduce cost and waste. Further incorporation of IoT, Industry 4.0 “represents the vision of the interconnected factory where equipment is online, and in some way is also intelligent and capable of making its own decisions.” Responsible for the rise of smart machinery, Industry 4.0 also introduced a hybrid approach of virtual and actual content warehouses that has freed up manpower on the production and collaboration side of the industry. The trend of mass customization has allowed manufacturers to more efficiently react to consumer demand. Because customers expect the products they use to be intuitive and easy to interact with, mobilization and connectedness continues to drive manufacturers to innovate faster and create software-enabled products. IoT and Industry 4.0 capabilities are also changing how post-sale service is provided, offering immediate and consistent online support.
AI and machine learning
A machine’s ability to learn and adopt intelligent human behavior is not a new advancement. It has been a decade since IBM’s supercomputer beat the greatest chess player in the world, forever changing the relationship between man and machine. Today, these advanced algorithms are transforming the way the manufacturing industry collects information, performs skilled labor, and predicts consumer behavior. Smart factories with integrated IT systems provide relevant data to both sides of the supply chain more easily, increasing production capacity by 20 percent. Quality is no longer sacrificed for efficiency, as machine learning algorithms determine which factors impact service and production quality. Sensors have replaced human hands, resulting in less wasted time and materials, as well as optimal accuracy and workflow. Digitizing the industry means lower cost of production, quicker turnarounds, and more efficiently meeting customer demand.
Traditionally, robots have been used to perform tedious, repetitive tasks on the assembly line. Today, however, robots are capable of mimicking more human traits such as dexterity and memory, which makes them more useful in industries like manufacturing. Highly trainable and collaborative, robots are also providing safer working environments for humans by switching places with them in dangerous or unsuitable situations. For instance, autonomous dump trucks used at mining sites can be remotely controlled by operators, eliminating the need for human drivers. In addition, robots equipped with sensors also provide valuable feedback and data. Sensors are these smart machines “talk” to the control board, quickly identifying and fixing mechanical issues, allowing companies to make necessary adjustments more accurately. Robots increase efficiency and minimize delays.
Improved speed and efficiency
Robots and other automated technology are also integral in improving speed and efficiency, allowing manufacturing companies to “optimize production workflows, inventory, Work in Progress, and value chain decisions.” By integrating their IT systems, teams across the platform in various geographical locations can access relevant data, facilitating quicker, more collaborative and transparent communication. As cloud computing grows more stable, manufacturers are beginning to implement its software with more confidence. With this new level of predictive accuracy comes an improvement in condition monitoring processes, providing manufacturers “with the scale to manage Overall Equipment Effectiveness (OEE) at the plant level increasing OEE performance from 65 percent to 85 percent.” California-based cherry company, Prima Frutta, knows a thing or two about improving efficiency. In the last year, Prima Frutta installed automated equipment without a single additional hire and increased production by 50 percent. This connected technology provides real-time feedback to 900 employees, allowing them the information necessary to make quick decisions and act accordingly. As a result, the company now has the largest cherry production line in the world. Just ask Prima Frutta: Improving speed and efficiency translates into lower costs and better quality control.
Data and analytics
It is predicted that by 2020, there will be 50 times the digital content compared to what exists today. Big data analysis becomes increasingly difficult and time-consuming as the digitized manufacturer struggles manage, update, and analyze product and consumer information. As such, many businesses are opting to move content to the cloud as well as house on-site for a blended approach to their storing, managing, and processing needs. Information about things like supply, delivery, customer support used to be difficult to find or cumbersome to work with. In the digital era, that data is streamlined and collaboration-friendly, increasing accessibility for all stakeholders. Because production teams and consumers alike have grown accustom to the immediacy and intuitiveness of IoT, they now expect the same from their processes and products, requiring faster innovation from manufacturers. To keep up with these expectations, digital transformation changes the way businesses manage and share product information across the enterprise, increasing production and transparency and decreasing cost and down time.
There has never been a more intense or focused need for highly skilled workers with STEM talents. The businesses that hire accordingly and who continue to use technological advancements to move their companies forward are the ones that will thrive and remain current and competitive.
A 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.