Digital is the Only Way

Increased utilization of digital technologies such as Internet of Things (IoT), corporate connectivity, and analysis is crucial in tackling the primary hurdles manufacturers encounter in 2024.

It appears that the global scenario, in general, and the manufacturing sector, specifically, have progressed beyond the issues faced during the pandemic and the significant disruptions in the supply chain a few years back. Nevertheless, in 2024, manufacturers confront fresh obstacles, many of which can be alleviated by embracing more digital technologies.

Recent surveys in the industry shed light on the challenges manufacturers are confronted with this year and their plans to combat them. One particular survey, outlined in a State of Manufacturing Report, revealed that in 2023, the manufacturing sector was “keen to embrace new technologies in light of economic uncertainty and workforce difficulties.”

Several other studies draw similar conclusions. Deloitte, in its “2024 Manufacturing Industry Outlook,” highlighted that manufacturers are grappling with economic uncertainty, supply chain disruptions, and challenges in filling skilled labor positions. In all instances, Deloitte maintains that technology will have a substantial role in the future.

Specifically, technologies like IoT, automation, analytical tools for data-driven decisions, and more can aid manufacturers in enhancing operational efficiencies, managing costs, and beyond. These technologies, when employed in production settings, furnish real-time insights and comprehensive visibility into processes. The insights and visibility allow manufacturers to pinpoint production bottlenecks, inefficiencies, and wastage. Subsequently, upon identifying these issues, steps can be taken to minimize downtime and enhance operations.

In the long term, most manufacturers will intensify their digital investments by fully embracing Industry 4.0 and intelligent manufacturing. Deloitte’s research found that 83% of manufacturers believe that smart factory solutions will revolutionize the production processes in five years. Nonetheless, in the short term, the introduction and application of IoT, automation, and analytics can yield immediate and substantial advantages.

Digital supply chains and other technological advancements
Although the manufacturing industry has substantially recovered from the repercussions of vast supply chain difficulties during the pandemic, challenges persist. Numerous manufacturers are striving to tackle their supply chain challenges by amalgamating insights from production lines garnered via IoT devices and analytics with corporate connectivity that facilitates making operational technology (OT) data from the plant floor accessible to conventional enterprise IT systems like ERP, CRM, and others.

Deloitte underlined in its forecast that through the adoption of digital tools, manufacturers gain enhanced transparency into their supply chain. This is achieved by integrating OT and IT systems, enabling manufacturers to proactively manage their ordering processes. This data, combined with information from suppliers, empowers manufacturers to digitize their supply chain operations.

Introduction of GenAI
The integration of more technology into the manufacturing process is propelling the necessity for skilled employees. Nonetheless, according to Deloitte and other sources, many manufacturers are encountering challenges in recruiting skilled workers.

This issue isn’t unique to the manufacturing sector. Luckily, across various industries, many are considering generative AI (GenAI), automation, and other tools to offer assistance.

GenAI can be utilized to support skilled employees and enhance their efficiency. For example, GenAI could be employed to quickly summarize a lengthy equipment user manual, locate a specific setting in an equipment specification sheet, or identify anomalies in an equipment’s log outputs.

By delegating these routine tasks to GenAI, skilled workers can focus on their specialized duties within a specific timeframe. This may diminish the necessity to recruit additional skilled workers in a market where they are scarce.

Another prevalent application of GenAI is to assist workers who might not possess the same level of technical proficiency as more experienced personnel. For instance, original equipment manufacturers (OEMs) developing production line equipment could integrate a GenAI interface on their management console. Instead of needing to comprehend cryptic command line instructions, GenAI might enable an employee to input or verbally communicate a request (e.g., adjust the operating speed to X). GenAI would translate typed or spoken requests into commands the machine comprehends. Once more, this application of technology reduces the need to recruit hard-to-find skilled workers.

Similarly, the intelligent automation of manufacturing processes based on real-time status data liberates an employee’s time. By automating routine tasks, employees can focus on critical responsibilities. For instance, instead of a worker routinely traversing the plant floor to assess the health status of a piece of equipment, automation could entail sending an automated alert when the health monitoring data of that piece of equipment surpasses a certain threshold.

Technological outlook
Utilizing technologies such as IoT, corporate connectivity, and analytics that have been prevalent for years is pivotal in addressing the primary challenges manufacturers face in 2024.

Other technologies and broader strategies that are currently being adopted will certainly play a crucial role in the future. These encompass full acceptance of Industry 4.0 and the transition to smart factories. The foundational technologies driving these endeavors are precisely the same technologies that are currently delivering benefits.

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