Digital transformation: time for industry to kick into high gear
Digital transformation is about transforming and changing the business for the future and creating new and better ways of doing business.
The simplest definition of digital transformation is the use of digital technology, such as computers, networks, databases, and the internet, to solve business problems. While this is correct, it’s far from complete.
Digital transformation is about using digital technology to transform and change the business for the future, creating new and better ways of doing business. Digital transformation creates new capabilities and new processes, reduces capital costs and operating costs, empowers teams, improves decision making, and creates new and better products and services for customers.
At its core, digital transformation is more about people and processes than it is about digital technology. It’s all about using the power of digital technology to improve and transform business processes and the jobs people perform. It’s about empowering people, delivering value to customers, and providing returns to shareholders.
Almost every region of the world, and every type of business, has embarked on a digital transformation journey. The manufacturing sector is no exception. In almost every industrialized country, manufacturing companies in various industries are using a myriad of different digital technologies, along with their internet- and technology-savvy people, to transform their businesses into economic powerhouses.
What kinds of digital technologies are the manufacturing industries using? Here’s a few of the technologies powering digital transformation:
- Artificial intelligence (AI): While we don’t yet have androids like Lieutenant Commander Data, we do have AI systems analyzing vast amounts of data and extracting trends and knowledge from seemingly incoherent numbers.
- Industrial Internet of Things (IIoT): Smart devices, smart machines, and smart sensors only work and make sense when they’re connected and can talk to one another. They let people know what’s going on, all the time, in real time.
- Machine learning (ML): Smart machines create and extend their own mathematical models to make decisions, and even predictions, without having to be programmed; they essentially learn from the past and from the world around them.
- Augmented reality (AR): Anything and everything in the real world can now be enhanced, or augmented, by digital information — and it’s not just visual — it can be one, or all, of the five senses.
- Virtual reality (VR): While VR has been around in gaming for a while now, it’s also being used to create simulations, training, and a whole lot more.
- Digital twin: Digital twins are connected to their physical counterparts to create cyber-physical systems. Digital twins get a continuous real-time data stream from the physical twin, becoming a digital replica of the physical twin.
- Digital thread: As parts and products move through a manufacturing facility, they’re consumed, produced, and transformed throughout the process. The digital thread is the details behind everything that happened to them from beginning to end.
- Manufacturing execution systems (MES): While MES systems have been around a long time, they have a new lease on life as part of a digital transformation strategy. Any facility that executes manufacturing orders needs a MES.
- Radio frequency identification (RFID): RFID, and other electronic identification systems, are now ubiquitous in every industry. They are used to identify anything and everything and are indispensable as a foundational element to any digital transformation strategy.
- Advanced robotics: Robotics continues to advance in leaps and bounds. It’s almost inconceivable any manufacturing facility could even exist without autonomous robots.
- Collaborative robots: Collaborative robots take robotics a step further by being designed not to be autonomous, but to interact with humans collaboratively, side by side.
- Mobile internet: It’s easy to take mobile smart phones for granted nowadays; manufacturing is no exception. In a modern manufacturing facility, everything and everyone is mobile to the max.
- 3D printing: Many people know 3D printing builds a 3D object from a computer design. When it comes to manufacturing, however, 3D printing has created a new type of manufacturing – additive manufacturing –where products are created by adding materials layer by layer to build the product.
- Cloud and edge computing: On-demand data storage and on-demand computing power exist just about everywhere. Cloud and edge technologies enable digital capabilities, often anywhere, any time.
Many more types of technology are a part of digital transformation, including blockchain, drones, the greater Internet of Things (IoT), the automation of knowledge work, social media, new types of energy storage, the next generation of genomics and more.
A lot of technology is out there, and it’s grand and glorious. It works very well and it’s all coming together to make digital transformation a reality.
It’s not just a reality where it works, though. It’s cool, people like it, and a reality where manufacturing is being transformed back into an economic powerhouse is coming. So how is this digital transformation and all this technology remaking the manufacturing industries into an economic powerhouse?
- Increasing capacity
- Increasing capacity to theoretical maximum and beyond
- Increasing capacity without additional equipment or labor
- Reducing downtime and increasing overall equipment effectiveness (OEE).
- Increasing throughput
- Increasing material velocity and material flow
- Reducing queue times and lead times between processes
- Increasing labor efficiency by reducing non-productive wait times.
- Going paperless
- Supporting greater efficiency and productivity
- Providing quicker responsiveness
- Increasing operational flexibility
- Reducing errors associated with recording information on paper
- Providing data digitally to people when and where it’s needed
- Supporting decisions with visibility into jobs, tasks, materials, quality, etc.
- Eliminating paper job sheets, paper travelers and a whole lot more.
- Managing materials
- Reducing “lost” materials with visibility into jobs, quantities, locations, etc.
- Increasing material velocity with better queueing and visibility
- Increasing accuracy with automated data on components built and used.
- Improving quality
- Increasing first-pass quality by resolving issues on the spot
- Integrating quality into the processes, not with after–the–fact inspections
- Supporting continuous improvements processes with quality data.
- Improving customer service
- Providing visibility into jobs to build what’s needed when it’s needed
- Reducing customer lead times with increased velocity
- Increasing accuracy of commitments with up-to-date visibility
- Reducing delays and customer issues with increased quality.
- Increasing profitability
- Increasing throughput without increases in labor costs
- Reducing costs associated with delays, rework, waiting, etc.
- Increasing product mixes, serving more customers with more products
- Consolidating manufacturing operations for greater efficiencies
- Redirecting labor to higher value operations and needs
- Reducing costs associated with non-conformance and other quality issues
- Expanding product lines, products, customers, etc.
Digital technology and digital transformation are helping companies reimagine the customer journey. They can better establish one-on-one customer relationships, reward and incentivize the sales and marketing channels in new ways and deliver new value with connected products.
It’s also helping companies redesign operational processes and incorporate usage data into the innovation and marketing processes, make automation processes faster and easier, and maintain equipment more predictably and proactively.
Perhaps most importantly, it’s challenging business models and helping companies evolve from product companies to services-centric organizations, using data to increase quality, output, and revenue, and augment physical experiences with digital ones.
Digital transformation is a reality. Today’s manufacturers can leverage digital technology to transform and change their business processes. They can reduce costs, empower people, improve decision making, and create new and better ways to deliver products and services. They can deliver more value to customers and provide greater returns to shareholders.
The digital transformation payback is real and it’s happening now. The technology is here and ready to go. There’s no excuse. It’s time for manufacturers to hit the accelerator and put digital transformation into high gear.
John Clemons is a consultant for Rockwell Automation and Maverick Technologies. Maverick Technologies is a CFE Media content partner. Edited by Chris Vavra, associate editor, Control Engineering, CFE Media and Technology, firstname.lastname@example.org.
Keywords: digital transformation, digital manufacturing
Digital transformation allows manufacturers to change their business processes.
Digital transformation covers many aspects including IIoT, collaborative robots, machine learning and more.
Long-term benefits include better customer response and greater returns to shareholders.
What is your company doing to take advantage of the digital transformation in manufacturing?