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How to Prepare Your Manufacturing Business for Digital Transformation

In the ever-shifting landscape of manufacturing, digital transformation is no longer a ‘nice to have’. It’s a necessity for any firm hoping to stay competitive and to continue to grow.

Embracing digital solutions for your manufacturing business has been shown in some cases to boost cost savings by more than 20%. Automated and amalgamated tech solutions can revolutionise the shop floor by proving greater coordination and precision; machine fault or error alerts; automated stock control; real-time updates on materials pricing; quality control protocols and so much more.

But digital transformations are major projects, with so many moving parts that plenty can go wrong if a business is not adequately prepared. McKinsey cites a figure claiming that 70% of all attempted digital transformations end in failure. While digital transformation is a necessary process, it is nonetheless not one that can be entered into lightly.

The cost of a full-bore digital transformation, in labour hours as well as cash, is not insignificant, even in successful implementations. Thorough planning in advance of your manufacturing business’ digital transformation not only heightens your chance of a successful implementation, but helps you control your budget and keep control of feature creep and any other extraneous add-ons that may bog down or even derail the process.

So what can manufacturers do, in the main, to thoroughly prepare themselves for digital transformation, in order to place their best foot forwards into the process?

 

How Can Your Manufacturing Business Benefit From Digital Transformation?

Why embark on a fraught digital transformation journey in the first place, when the potential for failure – and a costly failure at that – is so high?

As we have previously argued in our breakdown of the strategic value of ERP in manufacturing, the benefits of a comprehensive (not to mention successful) implementation of a digital transformation program go far beyond return on initial investment.

Aside from the financial savings, another key benefit to a digital transformation program is the massive enhancement in operational efficiency. By equipping your shop floor with IoT solutions and technologies; data analytics; and automation systems, manufacturers can effect real-time monitoring and automation of their entire production line, from the stockroom to distribution. These advances to your existing processes help you slash factory downtime; implement quality control systems; minimise waste and redundancy and offer insights into overall machine/production line efficiency.

Data analytics can equip decisionmakers with up-to-date information on details such as stock levels; production efficiency; quality yield to defect ratio and much more, to help in critical decision-making at a strategic level. Data points can also be leveraged to help craft relationships with external stakeholders, as information can offer crucial insights into supplier reliability; real-time market prices on raw materials; and purchase volume for output goods, allowing production to be ramped up or ramped down automatically in line with market fluctuations and trends.

What Essential Digital Transformation Tools Can Help Your Manufacturing Business Boost Productivity and Growth?

The very first step to roadmapping your digital transformation journey is in understanding what you hope to gain from that journey in the first place.

This begins with identifying the pain points that most urgently need to be served by a digital solution; what shortcomings in your current operations and processes can be addressed with technology? Engaging leadership in this thought experiment is crucial, but no less so is querying the teams and people who manage your business’ workflows every single day, to harness their insights into how their everyday working lives could be improved.

From here you can begin to develop a picture of what your destination is going to look like – what are the KPIs by which you will measure the success of your transformation program? With those in mind, be they cost savings, cutting the defect rate, improving turnaround time on production, you can begin to explore questions of how those KPIs are to be achieved.

What tools do you have at your disposal to digitally transform your business?

ERP – Enterprise Resource Planning systems aim to unify your systems, streamlining processes and data-sharing across your organisation. This eliminates data siloes and cuts down on redundant data-entry, as data in one filing system does not need to be manually input into another. This shifts labour from repetitive menial tasks, like form-filling, and allows more time for high-level strategy and operations.

Internet of Things – But unifying your software systems is only the first step. Getting that software to talk to the hardware on the shop floor, that quite literally is doing most of the heavy lifting of your manufacturing operation, is how you uplift your business to the next level. Affixing IoT devices such as sensors, trackers and other smart devices to your machinery allows them to feed real-time data to your systems, monitoring output efficiency, energy consumption, defect rate and anything else you decide is important to monitor. These insights can alert you to problems in your production line as they arise, but before they become a major issue, or can help drive strategic decisionmaking for your business as a whole.

Automation – Where the two above solutions meet is in the potential to automate manufacturing processes and other operations that define your business. Digital systems can monitor and track stock levels in real time, placing orders based on your own pre-set parameters when stock reaches a critical level. By tracking market prices and order trends, production can be ramped up or ramped down automatically to response to market fluctuations. This allows your operation to respond in real time to developments as they happen, without the need for human intervention until all the data has been collected.

Draft Your Roadmap To Digital Transformation Success

Forearmed with the knowledge of what you’re setting out to achieve, and the tools at your disposable to do so, you’re placing yourself in the best possible position to put plans down for how to embark upon your digital transformation journey.

When drawing up a plan for institutional change, keeping the triad of People, Processes and Technology in mind will help develop a robust plan for digital transformation. Knowing how your organisation operates, and how your proposed plans will change how your operation operates, is a vital part of understanding how to map out your digital transformation program.

People – It is vital that you understand the key stakeholders, internally and externally, who stand to be affected by your program for change. Understand your team’s roles in driving processes and workflows in your organisation, the skills they currently employ and the skills they may require training in to manage the incoming digitalisation. This will not only identify areas of redundancy and overlap that your transformation program will be able to address and streamline, but highlight skillsets and performance metrics in personnel that you can use to inform your transformation process, and the new workflows that come after.

Processes – Correctly identifying the business processes which define your manufacturing operations helps you highlight key areas for improvement, and the stakeholders involved at each step of your workflows. This gives you the chance to ensure everybody who is to be affected by the upcoming changes are informed in due course, and gives you full visibility over your processes to vouchsafe against business-disrupting stoppages or mistakes when digitising those processes.

Technology – Understanding your existing technological framework for operations will help you communicate your existing specifications and needs to the team responsible for implementing your digital transformation. What machinery do you employ on your shop floor, and what software solutions are already in operation throughout your organisation? Building bridges between systems is as integral a part of the digital transformation process as introducing new technologies, so just as important as understanding where you hope to go is understanding where your business is right now.

Discover A Checklist for Digital Transformation Success in Our Upcoming Webinar

Want to know more?

Join us on July 30th, from 12PM to 1PM GMT +1 for a live webinar discussion with digital transformation subject matter experts Rohit Thakral and Steve Glaze on the integral steps every manufacturer can take to prepare their operation for a digital transformation.

Register for free and take the first step towards your manufacturing business’ technological overhaul!

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