Even before the pandemic hit, manufacturers were facing big changes—ecosystems, business models, customer expectations—everything was changing. Add in a labor shortage and the advent of new technologies and the pace of change was picking up. Modern manufacturers need a digital supply chain where they can see actual product condition information flow in realtime.
Neal Meldrum, global business strategy manager for manufacturing and resources group, Microsoft, says, “Manufacturers rarely exchanged or shared data. It was considered proprietary or high value. And now we have secure mechanisms to exchange data and build broader awareness visibility across the supply chain—and it impacts everybody within the value chain. So those are a few elements of driving it.”
He also points to one of the key challenges: we rarely see the key business value outcomes that are attained through building a digital strategy.
“There’s some interesting proof points, a fascinating program from the World Economic Forum around Fourth Industrial Revolution—lighthouse innovators—which has chronicled over 80 different use cases in the business value creation that’s occurred,” he explains. “And as we begin to kind of align these core areas to build a journey, we can build a very resourceful and targeted approach towards execution. And I think that’s where we’ll start to see the scale.”
As he mentions, in the past several years, a group of manufacturers have made strides toward scaling Fourth Industrial Revolution technologies in the plant. The World Economic Forum and McKinsey recognize these factories as part of its Global Lighthouse Network. Back in September, they announced the addition of 10 new factories to the network.
Even amid the COVID-19 pandemic, these manufacturers found a way to leverage technology to improve business. This creates opportunities for cross-company learning and collaboration and enables the manufacturing industry to set new benchmarks for the global manufacturing community.
The goal here is to share and learn from best practices and to help other manufacturers deploy technology, adopt sustainable solutions, and transform their workforces.
“Visibility is really the beginning of the journey and the need to generate end-to-end visibility, enabling orchestration, planning, and mitigating disruptions,” explains Meldrum. “I would say, once it’s through a series of waves of connectivity, we gain that visibility. And that’s really the starting point. But I would say the short-term profit pressures are in the effort to build resiliency within supply chains, accelerating investments to building this Factory Control Tower.”
He says then the next wave is really driven around building resiliency and becoming more predictive leveraging technologies like machine learning or AI (artificial intelligence) to build better visibility and planning and forecasting, and really diversifying operations is a key element.
“We have this idea of what we call digital feedback loops—which if you think about, and then visibility and building a circular supply chain, leveraging IoT and other technologies to build broader visibility—it really ultimately impacts the value chain and drives efficiency and productivity that we’ve never seen before,” says Meldrum.
Now, I have spent quite some time digging through the World Economic Forum reports produced here to understand how these manufacturers have made the move successfully to Industry 4.0 and want to share what I have found with you. These manufacturers started by building digital connectivity on a broader level, which required companies to break down internal divisions, share data with external stakeholders, and build new capabilities.
“I always argue that the cultural disruption is greater than the technology disruption,” says Meldrum. “People are challenged to build these digital journeys. And I think that’s where we as a company really differentiate ourselves. And in looking at the multi-year journeys and understanding the core aspects of operations and supply chain to help people guide and build out these capabilities.”
Here is where this gets interesting: this requires investing in people and developing new ways of working. It requires reskilling and upskilling workers. As I always say, technology is only one part. It is really about people, process, and the technology. We need it all working together in harmony for a successful Industry 4.0 implementation.
One factor Meldrum and I talked about in detail was the aging workforce and the evolution of the workforce. He says, “So leveraging a digital strategy there and capturing that domain knowledge and operationalize it becomes inherently important.”
He explains that by leveraging a mobile-first strategy and bringing information to the worker helps to empower them. Disruptive technologies like mixed reality, immersive training, guided worker, assist and validation using AI image recognition, and more can really drive higher levels of efficiency and productivity through the technology portfolio.
We are making a lot of strides in these areas today too. In October, MxD made a big announcement—it was awarded $15 million to boost U.S. manufacturing’s COVID response. The funding will specifically support supply chain resiliency, medical device deployment, and pharmaceutical industry production. MxD will deliver a supply chain risk alert framework tool to help the Dept. of Defense and the U.S. manufacturing industry map existing supply chains; will help create a standard digital pathway for material testing, approval, and validation of the process or part being produced; and will also provide lessons learned, best practices, and digital tools for manufacturers to accelerate the use of digital technologies to scale or flex production, increase resiliency, and strengthen their supply chain.
For those of you interested in learning more about bridging manufacturing and construction, we will be holding a live and virtual event at MxD this week—November 12-13. The Technology Days 2020 event is a hybrid event with the mission of applying transformative technologies with people and processes to achieve sustainability to help mankind for years to come in their communities and cities.
As Meldrum tells me, “Data is the foundation for any of these journeys.” And that is the direction the manufacturing industry is heading.
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