Right now, manufacturing is thriving in America, and many companies are investigating technologies that connect and collect data from equipment for real-time, actionable data. The field of options for machine monitoring software is getting more and more crowded. Almost everyone has heard that the future of manufacturing is IoT. But are the small to mid-size manufacturers convinced that IoT, smart manufacturing, and Industry 4.0 strategies are a necessity for them, or do they view it as a “want”?
Huge Numbers and Lots of Hype – But Little Action
Despite the glamor and huge numbers associated with smart manufacturing data, adoption of data-driven manufacturing is still in its infancy stages. In my estimation, after visiting IoT conferences and talking with manufacturers daily, less than 5% of small to mid-size manufacturers even have a digital transformation strategy. That means that 95% of these companies haven’t thoughtfully planned what assets they need to connect and how they could begin to phase in connectivity and dashboards.
The Giants Are Picking Up Speed
This is in stark contrast to big manufacturers. Most large manufacturers are less than five years into the execution of their plans to connect their assets and utilize automated machine data. However, they are making exponential progress. They have teams of engineers on staff and work with big solution providers to piece together custom plans to collect and view their information across multiple plants. Asset by asset they are connecting and collecting data. Dashboard by dashboard they are building ways for people to interact with that data.
Hyper-Lean with Accurate Machine Data in Real-Time
This powerful data is driving decisions and driving down costs at a rate that “lean manufacturing” of the past only dreamed about. Just implementing a visual system to see when machines are up and down gives companies a boost of 6-10% productivity. And this is only the beginning. When that data becomes the company’s new “language,” it transforms company culture. The highly visual, customized, relevant data to each person’s function focuses the entire organization on driving out waste.
So, is machine data-driven manufacturing a necessity or a want? Big color-coded bars of live data rolling across a screen are fun to look at, and it’s neat to drill down and figure things out with the new-found knowledge - but this is not enough. The time will come when manufacturers aren’t as busy as they are now, and the question is, will manufacturers invest in data-driven technologies? Or will this become like icing on a cake, great to taste but not critical to the cake?
Consider the alternatives. Wait until the early adopters work out the kinks? Optimize your ERP system first? Some companies argue - ERP data is enough, it’s too expensive, it’s too complicated – what would we do with all that data? This line of thinking is common, but if it’s keeping you from stepping out and getting started, then it might be too late by the time you begin.
If your career is in manufacturing, you have a right to be concerned about automation taking away jobs. It will. Shops that fail to plan are at risk of failing if they don’t adapt soon enough.
The time to plan and execute a digital transformation strategy is now. Companies that embrace machine data-driven manufacturing now will have the tools to stay nimble, no matter what the state of the economy. Here are some steps to get started.
Steps to Get Started with a Digital Transformation Strategy (DTS)
- Begin a SWOT analysis of the key areas to implement IIoT plans successfully. You need a good picture of your company’s strengths, weaknesses, opportunities, and threats as it relates to your IT infrastructure, culture, and data management processes. Here are some areas to review:
- Digital maturity (infrastructure and data management)
- Organizational support for IIoT technologies
- Business use cases for IIoT
- Benefits to be achieved – typical areas include:
- Operating efficiency
- Product quality
- Predictive maintenance
- Supply chain management
- Inventory control
- Create an education campaign for all levels of the organization. Add to your DTS team anyone else interested in evaluating concepts and business use cases.
- Identify key people in each area of the business: Operations, Production, Quality, Engineering, IT and C-Level. Create your digital strategy team and assign an IoT manager.
- Create a digital vision of your company’s future.
- Select technology partner(s) that understand and support your business objectives
- Secure buy-in and evaluate the potential gains against the picture developed in the process
- Establish an infrastructure for inter-company communication and change management
- Select and implement the first IIoT technology solution
The Risk of Ad-Hoc IIoT Implementations
Many companies will be far-less strategic and ad-hoc a program together. They will try small-scale applications, and depending on the ROI, roll out solutions as they are cost-justified. This stepping-stone approach is common and can work, but it does carry risk.
Once a company has data, it’s only a matter of time before they will capture the low-hanging fruit and want more data. If the system they have created, and the partners they are using are not flexible, they may find expanding challenging. They may even have to deconstruct and reimplement with more powerful systems.
Worst-case, efforts will fail when the organization doesn’t embrace and use the newly acquired information to drive business decisions. Digital transformation is not just digital - it’s a culture change. For manufacturers who have been around awhile, it’s very similar to the first introduction of packaged ERP systems. Many implementations failed because organizations failed to embrace the change ultimately.
Join the (4th) Industrial Revolution Sooner Rather Than Later
IIoT, Industry 4.0, data-driven manufacturing, and smart manufacturing are not just buzz words. They are standards that will affect everyone in the manufacturing industry. Ignoring the technology revolution will not make it go away, but it could make your company go away. Get started with a strategic plan and join in for a new and better way of making the products that make us profit!