Where Does Your Company Stand on Manufacturing Digital Transformation?
Everyone is talking about digital transformation as an imperative for businesses. Some manufacturers are already reaping the benefits of making their digital transformation. Others are still wondering what exactly the term means and whether the concept even applies to their situation.
If you fall into the latter category, you’re not alone. Making a digital transformation is much easier for, say, a software company than it is for an industrial manufacturer that still runs on spreadsheets, printouts, and file folders.
Before you dive into digital transformation, then, you’ll need to form a clear idea of what it entails. It’s not necessarily a throw-out-the-playbook-and-start-over venture—and it doesn’t have to be particularly painful or costly.
But, as you might have guessed, it is indeed a transformation. It’s the process of incorporating digital technology into all your business functions in ways that help you deliver greater value at a lower cost.
So, for a very “old-school” industrial manufacturer, that doesn’t mean replacing weekly team meetings with video chats. That would be tech-for-tech’s-sake—an example of using technology to create a barrier rather than eliminate one.
But what about those printouts and clipboards everyone is carrying around the warehouse? Yeah, it’s probably time to replace them with tablets that allow line workers to check off tasks by tapping the screen—and then have this information automatically updated in the company’s ERP.
This is just one small example of the benefits of digital transformation. There are many other reasons why you should embrace this trend.
The Numbers Don’t Lie About Digital Technology
Digital transformation has a certain intuitive value for manufacturers. At a glance, it offers many ways to make slow, tedious processes run more efficiently.
But if you’re going to make a business case for digital transformation, you’ll need hard data. That’s why Capgemini recently studied the impact of digital technologies on the manufacturing landscape and published its findings online.
Capgemini’s research focused on the smart factory—a key goal of the digital transformation for manufacturers. In the smart factory, machines are connected to software that enables them to monitor and optimize their own performance.
Among the good news: industrial manufacturers that have implemented smart factories have realized productivity gains of 20% and product quality increases of 20%.
In what could be even better news for manufacturers, Capgemini also found that you don’t have to be an expert in digital transformation to reap its benefits for your organization. Survey respondents that consider themselves to be beginners in digital transformation are projecting increased profits of $14.7 million over the next five years. Those that consider themselves to be digital masters will increase their profits by nearly three times that much.
Start Planning Your Digital Transformation
So, how close is your company to achieving benefits like these? Mint Jutras recently assessed the readiness of manufacturers to embrace the digital revolution. According to its survey, 52% of manufacturers strongly agree that adopting digital technologies is necessary for survival, while another 34% agree somewhat.
In the same survey, two-thirds of manufacturers considered themselves either fully prepared or very close to prepared for the digital economy. But when Mint Jutras dug deeper, they discovered a possible cognitive disconnect. For example, respondents were asked about the extent to which various business transactions in their organizations were digital. The most-digitized process was B2B customer orders—and only 20% of respondents had established a process that was completely digital.
The bottom line is that more and more manufacturers trust technology such as the cloud and the Industrial IoT to deliver security, reliability, and ROI. But many organizations still don’t know how to get there.
If you’re one of them, don’t wait any longer for your initiation. Find out what it takes to launch your digital transformation in a free Plex webinar: “3 Keys to Digital Transformation in Manufacturing.”
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