When Frost & Sullivan’s Manufacturing Leadership Council identified six critical issues facing manufacturers in 2016, a common theme emerged in most areas. Advanced technologies will be needed for manufacturers to embrace Manufacturing 4.0, a next-generation approach to manufacturing that leverages information to accelerate and customize production, interact more closely with customers, and develop new products and services.
From the factory floor to the C-suite, transformative technologies are taking manufacturing into the future. Frost & Sullivan predicts that the digitization of processes will make production models more agile and sustainable. Intelligent equipment, big data analytics, modelling and simulation, mobile, cloud and 3D printing will shape new business models. Collaboration will drive innovation and a better customer experience. Cybersecurity will be managed not by a select few IT folks, but through collaboration between IT and operations, company-wide training and education, and the implementation of a modern security strategy.
Although many believe American manufacturing is on the upswing, significant obstacles to success remain, both in the U.S. and abroad. Global supply chains, long a requirement for successful manufacturing in terms of cost and reach, have become more difficult to manage. Everything from political unrest to unpredictable financial markets to volatile weather can break a link in the supply chain. Increasing wages in countries around the world are creating cost issues, and a shortage of skilled labor has left many positions unfilled.
Technology can play a key role in overcoming these challenges. Traditionally, enterprise resource planning (ERP) tools have made it possible for manufacturers to source materials globally at a reduced cost. However, modern enterprise risk management (ERM) tools are capable of factoring risk into the equation. While ERP decisions are based solely on cost, ERM can factor in other issues, such as the potential for bad weather, shipping issues, terrorism and disease outbreaks when choosing a supplier.
For manufacturers struggling with increasing labor costs, technology can be used to analyze data and find the best alternative, whether that means nearshoring or finding a new, more cost-effective location from which to produce goods. To overcome the skills gap, manufacturers can leverage technology and data to better understand areas in which skills are lacking, as well as the skills of those who are unemployed or underemployed. This can be done on a granular, local level, both domestically and around the world, to drive training and talent acquisition strategies.
The Internet of Things, industrial networking, high-performance computing and big data are essential to innovation and the optimization of operational processes, business models and the customer experience. In the next post, I’ll dig deeper into how technology can help to drive manufacturing forward.
By John Flores
Vice President, Marketing