Riding the Digital Wave to Build Factories of the Future

Rohit Saboo, President & CEO, National Engineering IndustriesBefore wearing the hat of CEO of NEI, Rohit was the VP (R&D & Manufacturing) for eight years, and under his leadership the company is able to maintain its legacy and is on to a fast-track growth path.

The technology wave has engulfed one and all across the globe and this rising wave of new offerings that includes artificial intelligence (AI), automation, robotics, human-machine interaction and Internet of Things (IoT) as well as cloud computing has helped the factories to operate faster and more efficiently. In addition, performance of machines in these units can be closely tracked and predictive analytics performed. As a result, enterprises have the opportunity to leverage these emerging technologies not as a threat to their existence, but as a competitive edge to steer ahead of peers and rivals.

Armed to the teeth with these technology advances, legacy manufacturing companies—often considered laggards in this adoption-have the chance to re-invent themselves for a data and digital-driven future. However, while manufacturing company CEOs talk of ambitious plans, the challenge for them is to walk the talk. They need to invest in harvesting the massive amount of unstructured data that they generate and transform them into actionable insights that will help transform their companies into world beaters.

Consider the case of a large auto components maker in India. The company has over 1,000 machines in its factories and around 3,000 people working in them. It has business across 30-plus countries and makes over 200 million units in as many as 1,500 different sizes. As a large-scale manufacturer, the company’s management realized that although it had used some basic technology in its units, vast amounts of data from machines were barely scrutinized across production, process, supply chain, machine health and quality. There are machines that are two months old and two decades old – the challenge is to put them on the same technology page.

Manufacturers in India and worldwide today wrestle with a whole new set of technology offerings that are making this $10 trillion industry rethink the way it operates. Although, the technology is still not economically feasible for many of the small and medium businesses,
the lure of getting insights of their own operations with the rise of computing capabilities and analytics on the tap is giving companies a first time opportunity to leapfrog into this industrial revolution. In addition, the onset of breakthrough innovations in the fields of robotics, virtual and augmented reality (AR) and additive manufacturing means that factories of the future bear little resemblance to those of the past. Soon, companies will be able to use these tech capabilities to assemble a seamless flow of data across the value chain that will link every phase of the product life cycle, from design, sourcing, testing, and production to distribution, point of sale, and use.

Technology and digital initiatives are going to upend the global economy like never before. Around the world, manufacturing companies are racing to keep up with these frenetic changes. For example, in the United States, the National Network for Manufacturing Innovation is organizing six major research institutes to hasten new manufacturing technologies to market. Elsewhere, Germany’s Industry 4.0 effort and China’s Made in China 2025 too are riding on this new tech wave. One global forum, the Industrial Internet Consortium, was founded just 18 months ago and already has 175 members.

Armed to the teeth with these technology advances, legacy manufacturing companies-often considered laggards in this adoption-have the chance to re-invent themselves for a data and digital-driven future

As companies embrace the latest in manufacturing and digital technologies, they want all their machinery to be armed with the latest data extraction capabilities. The focus is on using real-time data capabilities for better decision making. To stay competitive, these companies are embarking on digital transformation initiatives and leveraging an array of technologies, ranging from QR codes, RFID to new investments in IoT, industrial IoT, cloud and data analytics to embark on this digital manufacturing drive.

For the manufacturing sector, investment in technology is no longer an option, but a business imperative. As the world shrinks and we find ourselves competing on the global stage, companies are realizing that if they don’t act now, they run the risk of going extinct. As companies seek to stay relevant in this fast-changing world, making this digital transformation will help them survive and as manufacturers they will focus on sweating their assets using technology as well as focus on overall equipment efficiency.

In this quest to be digital-driven manufacturing companies, they need to focus on three important pillars: people (a rush of millennials and Gen-Z employees joining and having very different work place expectations), process and technology, to become winners. As they consider investing and expanding tech capabilities, one key focus holds true across the board: business has to be at the forefront and technology is just an enabler. They need to continue to do the work, but more efficiently integrating technology with the business process at each opportunity to drive value.

As the old world of manufacturing embraces the new realities of digital transformation, the first step of this process is recognizing your enterprise needs to change and adapt. Then, typically companies will go through a brainstorming, often with an external advisor, to piece together a roadmap for this technology and digital overhaul. Companies need to take this plunge and be prepared for a shock to the system but anticipate emerging on the other side a leaner and future-ready organization. Typically, companies can expect to go through three phases of tech adoption in their quest to stay relevant: build, grow and mature. If they are not at least building out their technology stack, there’s no better time than the present to get started.