How to transform into an ‘experience-centred’ manufacturer through the digital revolution

Whether you produce consumer durables or industrial goods, the future of manufacturing is not just about using new technologies to design and make physical products that leave the factory door. This time-honoured method of mass-producing and selling of things at a profit is rapidly becoming obsolete.

Combined, 3D printing, connected devices, drones and robotics are showing promising signs of transforming manufacturing and the entire value chain. Emerging smart machines and digital infrastructures have the power to augment the workforce and the customer experience. The future is about using digital technologies to create more connected and personalised experiences for consumers, and in turn, evolving business models to create new streams of revenues.

Manufacturers are under pressure to follow in the footsteps of the likes of Ford, which is rethinking the future of cars as ‘mobile communications platforms’, and GE, which has reinvented itself as a ‘digital industrial company’.

So how do traditional manufacturers make the metamorphosis?

Overcoming the ‘cost’ fear to reap ROI

Manufacturers will need to assess their legacy industrial models and create a strategy to blend them with new, digitally-driven technology and approaches. Although manufacturers may have spent many years working on creating cost saving programmes to drive lean manufacturing, providing a digital cash injection may still be what’s needed for traditional manufacturers to thrive.

In the long run, investment in digital will pay off. Our recent research suggested that while initiatives increased manufacturing costs for respondents by 1% in the last year, technology also lead to a 5.4% increase in revenues. And by 2018, respondents expect it to boost revenues by 9.0% and by 2020, 78% of profits will derive from digital channels.

Skilling up for human-robotic collaboration

The future of the factory floor will see even more robots, and other autonomic systems, working alongside humans, rather than being contained in “just designed for robots” areas. Airbus is one firm that is already embracing this, with robots strapped to the side of fuselages riveting thousands of holes, with operators “piloting” the robots. In fact, manufacturers expect AI to be the most impactful technology, growing a whopping 395% by 2025.

While these technologies will allow manufacturers to become more strategic, they also require a greater technical expertise. The research found that smart factories will spur a surge in the need for analytics skills (by 75%), as well as design (by 70%) and fabrication skills (by 71%), by 2020.

Understanding how to make meaning out of data

Manufacturers should not just be ‘doing digital’ – they will need to make meaning out of the heaps of data created by smart machines and smart products. Do this and the workforce become a premium asset –for example, those with advanced analytics skills will be able to deliver numerous benefits to the business such as supply chain optimisation, improved product quality and asset optimisation.

Access to real-time data through intelligent embedded products means that manufacturers can continuously collect, analyse and make sense of customer data, allowing them to also continuously enhance the experience. In a world where consumers have high expectations, coupling data and design is crucial.These initiatives lay the foundation for Artificial Intelligence (AI) based applications in all functional processes.

It is my belief that we are ushering in an era of new thinking in manufacturing – one that shuns the abundance of ‘cost-plus’ offerings and heralds the coming of an ‘experience-centred’ strategy. Consumer demand is evolving fast and instead of just a product, they want a meaningful experience, and manufacturers will need to adapt their skills accordingly.

Successful manufacturers will be those that combine smart machines and physical products, data platforms and an analytical workforce, to glean valuable insights that enhance customer experience as well as have a workforce which embraces the future of manufacturing.

Author profile:
Prasad Satyavolu is head of innovation, manufacturing and logistics, Cognizant