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The Opportunity Quadrant: Four Parts to Industry 4.0 Success

By Phil Lewis, Infor VP Solution Consulting EMEA

Many manufacturers are entering Industry 4.0 with technology systems and business processes better suited for a bygone era. Today, Industry 4.0 is forcing manufacturers to take a comprehensive look at how their operations are equipped to address today’s top challenges, including the talent shortage, inefficient business processes, supply chain complexity, asset management, and meeting customer demands.

Manufacturers can begin assessing their Industry 4.0 readiness by focusing on four key operational areas: workforce, business processes, assets, and customer experience. Through assessment, manufacturers may find that: productivity limits have been reached; they aren’t currently well equipped to take full advantage of new business models; they don’t have the necessary connectivity to share and view data globally, internally and externally; they lack the mobile and remote working capabilities required by a new generation of workers; they can’t meet the customisation and personalisation demands from customers.

Essentially, manufacturers may find that the way they support their business is outdated. Going through this rigorous assessment may be painful. However, this time of discomfort will prove necessary to help manufacturers chart a successful course to win within Industry 4.0. There are the top four optimisation opportunities manufacturers should consider:

The first is workforce optimisation. Manufacturing is facing a significant skills gap. Experienced professionals are retiring at a significant pace, and it has been difficult for the industry to attract and retain new talent. When many of today’s workers entered the job market, topics like data science and machine learning seemed like science fiction. Existing personnel may feel their skillsets are not aligned with evolving expectations, which can lead to their exit from the workforce.

For the new generation, expectations of a workplace with modern technology may cause recruits to look elsewhere when considering a future employer. Building a company culture that values innovation and collaboration is a necessary first step in a successful digital transformation.

Technology can help personnel feel engaged and aligned with enterprise goals. Workforce management solutions, combined with modern ERP solutions, can help manufacturers: gain access to relevant, timely data; identify, attract, retain, and utilise top talent; and provide mobile access to work instructions to expand their service business. To ensure a smooth transition to new digital concepts, the workforce needs to be educated and given opportunities to participate in decision making.

The second optimisation opportunity is process optimisation. Almost all bad decisions and inefficiencies stem from bad data. Interviewing people individually to find out where the value is in a dataset provides opportunities for mistakes and is incredibly time consuming. AI can analyse a system to identify potential bottlenecks, discover places to implement or reinforce best practices, and seek out opportunities to improve and automate repetitive tasks. This powerful technology introduces transparency to business processes and reveals inefficiencies that may be preventing an organisation from achieving a higher level of performance and customer service.

In today’s environment, manufacturers, contractors, and suppliers need to move with confidence, seizing opportunities that may have narrow windows for action. A holistic approach that provides visibility into all business processes will provide manufacturers with greater transparency and the ability to make well-informed business decisions. This can be achieved by consolidating software within one system or by implementing a two-tier ERP strategy.

Manufacturers will benefit from a consolidated view of financial planning, demand forecasting, lifecycle pricing, assortment planning, replenishment optimisation, and more. The addition of machine learning brings precision to every point of the supply chain with AI that can sense, predict, and fulfil demand based on real-time market data. Digital transformation of the supply chain depends on a solid foundation of visibility and trust.

The third is asset optimisation. Technology is changing at a rapid rate. With today’s high expectations for stretching resources and keeping current systems operating at their peak, manufacturers need every time-saving tool they can get.

The potential gains in efficiency and productivity from various technologies can help manufacturing operations run smoothly. For example, affordable sensors can monitor equipment for early warning signs of downtime. Leveraging the IoT to connect data from these sensors to enterprise asset management systems enables early detection of performance issues, allowing for timely intervention.

These sensors produce massive amounts of complex data. The data, with the context of time and place, must be sorted for it to have meaning. Without analytics, it is useless. Predictive analytics use embedded functionality such as artificial intelligence and machine learning to recognise patterns and apply data science algorithms to project future incidents.

Last, but certainly not least, comes the customer experience opportunity. Historically, manufacturing has been notorious for a “take-it-or-leave-it” business model. The Industry 4.0 era has rewritten the rules for customer engagement. Customers expect rich, compelling experiences and highly tailored transactions.

Leading manufacturers are implementing technology that delivers a seamless experience for their customers. AI can introduce transparency to business processes and reveal inefficiencies that prevent an organization from achieving a higher level of performance. Automated quoting and customer self-service network to track materials globally.

It is imperative for manufacturers to bring customers into the design process, even though customers may not have the technical language to easily share their ideas and concepts. Manufacturers can help bridge this communication gap with a solution that gives customers design parameters that are practical and based on best practices.

Configure-price-quote (CPQ) technology is helpful at this stage. It can help foster the custom order process with advanced visual product catalogues and search capabilities similar to tools such as Google, and guide customers through the process of isolating the precise product, options, and configurations to fit their unique needs – while an integrated approach between the CPQ and ERP systems ensures coordination between all disciplines and specialisations within the enterprise.

Data insights generated from the IoT enable manufacturers to turn a traditional product offering into a service. This new customer-centric feature becomes a differentiator, adding value, building relationships, preventing commoditization, and adding profits.

Industry 4.0 can be overwhelming, but with a strategic roadmap in place and a keen focus on the four key areas, manufacturers will gain momentum and be well positioned for success within this new era.