7 Core Habits of Digitally Effective Manufacturing Organizations

Article

A robust manufacturing sector is the backbone of a healthy economy. Digital is here to stay and the manufacturing industry, already a leader in leveraging IoT, analytics, and other technological innovations, can accelerate the pace of adoption to create more opportunities and better outcomes.

Global developments such as Industry 4.0 and the industrial internet accentuate the need for innovative solutions. The changing expectations of consumers influence the entire supply chain, directly affecting manufacturers themselves. Moreover, manufacturing decision makers have different expectations regarding the level of enhanced efficiency, cost reduction, and, in more mature stages, innovation, as well as the development of new revenue sources.

With all the talk about digital across businesses, how do manufacturers know if they are headed in the right direction? How can they be sure they are following the correct path towards digital transformation? Are they working on the right diagnostic and maturity model that evaluates readiness and identifies the roadmap for digital transformation?

Questions like these reflect an urgent need to adopt “digital first” as an overall approach rather than taking random actions aimed at quick fixes to current issues. Although the path will understandably evolve, one thing is for sure: the direction taken needs to be the right one, aligned towards the right “north star” that will identify what the right results are and knowing which approaches will produce them.

To achieve this goal, here are seven core attributes manufacturers need in order to be truly effective:

Customer experience: It is an accepted fact that the majority of buyers will pay more for a better customer experience. This really means that during each interaction with the organization, either during the buying cycle or, more importantly, during service management, customers expect their customer experience to be convenient, easy, and fast with the ability to seamlessly switch between channels.

Operational excellence: Significant operational excellence can be achieved from digitization. Employee engagement also improves through initiatives like mobility and moving operations to the cloud for ease and convenience, thereby improving performance considerably. Nearly 40 percent of organizations cite complexity as the greatest barrier to improving operational excellence. Digitization needs to be focused on complexity reduction with innovative solutions to deliver higher throughput per dollar spent.

Performance tracking: A manufacturer is only as good as the machines that produce its products. Machines break down over time, parts wear down, and replacement costs can easily run into thousands of dollars. Performance tracking can enable preventive maintenance that aims to enhance machine utilization. It may include automatically signaling the need for repair of a broken part and reducing the load on the faulty machine. This step is critical in ensuring that all machines operate at maximum efficiency.

Analytics: They provide valuable insights on trends, needs, and likes and dislikes, both internal and external, providing a complete view of the operation and its bottlenecks. Manufacturing can generate a comprehensive view of their processes to identify trends and events that seem to recur with effective data capturing and analysis. Furthermore, underlining systems can analyze data in various forms and structures across sources, including social media.

Risk management: The pace of change in business requires organizations to act fast to mitigate risks and take corrective actions to stay ahead in the race. Planning for risk allows companies to anticipate change, respond to potential threats, and be prepared to face business uncertainties.

Integration: Digitization is not possible without a well-integrated environment. A great digital experience is made possible through seamless integration across the technology ecosystems with not just internal but also external entities like suppliers, vendors, financial institutions, and statutory bodies.

Security: Organizations have to take precautions to protect themselves from security perils that come along with the convenience of transacting anytime and anywhere and from across channels. Digital security at various levels is necessary, including applications, the infrastructure level, and all internal and external integration points.

Understanding the traits of digital enterprise is imperative for recognizing the accuracy of the path followed towards this goal. The framework outlined here encapsulates these traits in the form of seven attributes. Irrespective of where the organization may be in the transformation journey, these are reasonable parameters for assessing digital effectiveness overall.

Smitha Singh
Smitha Singh Vice President, Manufacturing

Smitha Singh, a vice president for Virtusa, heads the company’s Infor Solutions-led Digital Transformation initiatives for Manufacturing business unit, comprising Aerospace & Defense, Industrial Manufacturing & Hi-Tech Manufacturing & Automotive Industries.

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