Digital transformation has become a hot topic – and for good reason. When a digital transformation is successful, its impact on the organization is undeniable. Mars, Stanley Black & Decker, Tata Steel and IPG Tremonton are all prime examples.
However, feelings about the process have not always sparked happy thoughts. Looking back just a few years, even though transformation efforts were on the radar for most companies, the idea of embarking on the journey was less than appealing.
Fortunately, numerous driving forces have helped attitudes towards the potential benefits of digital transformation evolve not only leading to a true acceleration across manufacturing environments worldwide, but ultimately ushering in the new digital frontier.
The Covid Effect. There is no denying the pandemic exposed companies and entire industries that really weren't resilient or agile enough to adapt to the rapid changes in the market and consumer demand.
“There were big digitization gaps across engineering and manufacturing, which was evident when looking at how many companies had to shut down production lines or reduce capacity because of people suddenly working from home,” Nigel Stacey, senior managing director and global lead for Accenture’s Industry X business tells IndustryWeek. “Consumer demand changed overnight, and manufacturing is complex. Being able to just adapt your manufacturing capacity or supply chain capacity in line with that changing demand was incredibly difficult.”
The more companies can effectively implement technologies like digital twins, digital threads, AR/VR, autonomous systems, robotics, it is going to help industries not only be more productive but also operate more autonomously and more remotely, explains Stacey. “It's absolutely vital to be able to respond much faster to whatever is changing,” he says.
Additionally, as Gartner research shows, 76% of CIOs reported an increase in demand for new digital products and services as a direct result COVID-19. “While the demand for intelligent products was on the rise before the pandemic, COVID has accelerated it,” he says. “At the same time, spending has increased from consumers, with more than half of consumers purchasing at least one smart device while working from home.”
Software’s Prominence. In many ways, software is now defining the product. And it is happening across an array of industries include automotive, medical device, industrial equipment, life sciences and consumer goods.
“To make a successful physical product, you've got to be able to design and engineer that product from its digital features, which is driving a massive change in engineering functions,” Stacey says.
The sustainability imperative. Simply put, consumers and regulators alike want businesses to be more sustainable. “Digital is clearly a key enabler – and the evidence is pretty stark with sustainable products growing five times faster than conventional products,” he says. “Sustainability is everywhere, and definitely top of mind for the C-suite.”
The question is how manufacturers can quickly meet sustainability commitments. Within manufacturing this means using less energy, less water and reduce waste. For engineering, it's more about design and develop a sustainable product – and what's the impact on the supply chain.
Leaning on tech maturity
Industry 4.0 started with sensors paving the way to equipment connectivity. This kicked off the data science, machine learning, advanced algorithms movement. “Now we can start to do some really clever things with data and analytics, and we could get insights none of us could have believed,” says Stacey. “The ability to accurately predict trends is now at our fingertips.”
As technology has matured massively, price points have come down. “There's been lots of proof of concepts over the last decade, but industries are now seeing the ROI,” he says. “Of course, there are still organizations deeply siloed between functions and departments. Removing those barriers to work seamlessly across departments and functions needs to be part of the digital transformation strategy, vision and journey.”
Robotics and cobots are prime examples of technologies benefiting from maturity. Likewise, the digital twin – and the digital threads extending beyond the enterprise to include consumers – are also critical and rapidly maturing technologies. “When all your data streams are connected, you can use the power of AI and machine learning to take you into another level of faster decision making with greater insights and more ability to predict ahead of time,” says Stacey. “All of these technologies have advanced at such a rate they are now being deployed regularly across organizations.”
Not all fun and games
According to an Accenture study, 38% of companies deployed at least one project to digitize manufacturing and engineering. “But that's only one project and the ongoing acceleration is now across multiple projects,” says Stacey. “What’s critical is the need for experience, expertise, speed and scale.”
At the same time, digital transformations come with a massive change management requirement, which is always complex and often daunting. “This is why you need a C-suite leader for your digital transformation who can work across departments and functions to drive the agenda and strategy,” says Stacey. “Someone who will focus on reducing internal silos and removing internal competition for digital dollars.”
Manufacturers need to think about where to start, and then go fast, explains Stacey. “Speed and a need to continuously innovate, and how you bring people on the journey with you,” he says. “After all, employees are still top of mind critical elements of making the leap forward on bigger, faster, broader transformation programs.”
