Whether it’s called smart manufacturing, Industry 4.0 or just the industrial internet of things (IIoT), smart technology and smart people are transforming manufacturing back into an economic powerhouse. But getting there is easier said than done.
Simply installing an IIoT platform doesn’t magically deliver the business benefits everyone’s talking about. How do you move forward and get the desired return on investment? Focus on how to achieve the business benefits.
New Capabilities And Processes
Many companies don’t want to admit it, but their technology is old and not getting the job done. Couple that with bureaucracy that’s too big, too hierarchical and too slow, and you have processes that aren’t reliable, repeatable or predictable. Ultimately, what’s needed isn’t just new technology, it’s new business processes and new business capabilities.
To create new processes and capabilities, first look at basic concepts like personalizing and customizing your products and adding data and services to them. Next, focus on solving problems and providing solutions for your customers, not just providing them with products and services. Then work on expanding the business strategy, focusing on new business capabilities. Let the new capabilities drive the new technology.
If you don’t want to be left in the dust, your company needs to change because your competition is changing. Don’t be afraid to ask the hard questions early on and make sure your projects are aligned with your new business strategy. Remember, technology is a tactic, not a strategy.
Reduce Capital And Operating Costs
Reducing costs has been an objective forever, but it’s getting harder because all the easy wins have long been achieved. That means it’s getting more and more difficult to reduce ongoing operating costs or sometimes even to measure them.
To reduce costs, both top-down and bottom-up approaches are valid. Real-time data is invaluable and often makes the business case all by itself. Good old-fashioned asset performance can also be worth a lot of money. There’s often no need to buy new equipment; you just need to get more out of what you already have. How? Focus on waste, rework and energy. “Sweat” the assets. Measure yields and efficiencies. Eliminate processes and standardize the processes you can’t eliminate.
Make sure the solutions and architecture are flexible enough to support different manufacturing processes, plants and products. Look at ways to collect less data by focusing only on the data that’s relevant and the data that’s used to make key decisions. Be relentless in your focus on waste, rework, repetitive jobs, energy usage and other key cost areas.
Empower Teams And Improve Decision-Making
When it comes to teams and decision-making, culture change is difficult. Convincing people is always the challenge. Technology is not the problem. Getting skilled resources has always been a challenge, but with the aging workforce, it’s becoming more difficult every day. New business models, new capabilities and new processes almost always put stress on an organization, and they’re disruptive because they change people’s jobs.
To offset this, get people involved and invested in the process. Continually retrain and realign the workforce. Invest in ongoing training. Provide incentives for versatility and for deep process knowledge. Look at your business model, and review how you collaborate not only within your company but with your customers and suppliers.
In the end, to empower your teams and improve decision-making, make sure you have top-down alignment of all your people and processes. Make sure everyone has access to the right data at the right time in real time. Make your suppliers your partners to help solve problems together. Be a partner for your customers and help them solve their problems. Use technology to produce and share information to bring people closer to one another. Let people do what people do best, and don’t be stingy with your data. Your people need it; your customers need it, and your suppliers need it so they can all do a better job.
Create New And Better Ways Of Doing Business
Most companies have too many paper-based processes that aren’t really that good, and many people pay lip service to creating new and better ways of doing business. The companies that do it well are going to be the ones that thrive instead of merely survive. Changing business models doesn’t only mean big changes for the company; it also means big changes for your suppliers and your customers.
These changes are good for everyone, but creating new and better ways of doing business is difficult. The best way to start is to create small successes and build on them. And while new technology can be cool, it must be practical and usable, as the business model is always more important than the technology. For instance, a big change might be to go from a product supplier to a solution provider, but that’s probably what your customers really want because there are a lot of places where they can get products but few places where they can get solutions.
To create new and better ways of doing business, look to simplify processes and decision-making. Focus on the new business model, and build a solid, step-by-step road map to get there. The idea is to get started and keep moving no matter what.
Focus On The End Goal
No matter what the technology is called, it’s still just technology and a tool to help you get where you want to be.
Whether it’s providing new capabilities and processes, reducing capital costs and operating costs, empowering teams, improving decision-making or creating new and better ways of doing business, stay focused, and keep your eye on the end goal.
Leverage all the cool, new, smart technology you want, but stay focused on how to achieve the business benefits and ROI. You do that, and you will have found the smart manufacturing payback.