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How to drive a digital-first operating model in manufacturing

December 13, 2022

Kim Bybjerg   

Vice President and Head – Continental Europe, Tata Communications

Many industries and businesses are undergoing digital transformation; however, its widespread adoption is yet to be seen. In this blog, Kim Bybjerg, Vice President and Head of Continental Europe, Tata Communications, discusses how businesses within the manufacturing sector can leverage digital technologies in order to reach it’s full potential. 

In the manufacturing sector, digitalisation is usually limited to individual production sites or sometimes just a few machines. To leverage the full potential of digital technologies, a business needs to have globally interconnected production that encompasses all its plants and branches distributed around the world. While having connected operations is critical to remain competitive and increase agility to address persistent disruptions, it’s not all easy as it sounds.

Fragmented interconnectedness also increases the risk for manufacturers and their production sites to become more vulnerable to disruption, which can lead to global product delays or bottlenecks. Hence, in today’s borderless era, it’s a prerequisite for every business in the manufacturing industry to become a digital-first company. And this transformation requires not only the instrumentation of all physical assets, in as real time as possible, but also the reliable and secure collection of data in a unified way for processing and gathering insights.

We recently conducted a study focused on the digitalisation of the Manufacturing sector which shows that while these changes are well underway, only a few businesses have gone through the complete digital transformation process.

“So, what steps do manufacturing companies need to take to reach their digital-first ambitions?”

Efficient and integrated communications strategy

Any manufacturing process must deal with the constant challenges of wear and tear of the machinery, variation in raw materials due to external factors, and actions taken on the shop floor. Given all of these variables, an efficient manufacturing process is important: the goal is to produce the highest quality product in the shortest possible time with the least number of resources. This pursuit of efficiency is driving the investment in IT infrastructure of the manufacturing sector.

Additionally, while remote or hybrid operations gained prominence with the pandemic, manufacturing companies do require at least few workers on the shop floor to physically interact with machines. However, our survey of 186 organisations in the discrete, process and hybrid manufacturing sectors with headquarters and operations, found that many jobs allow some location flexibility, with 80 percent of respondents to our indicating that probably about half of the total workforce will be fully remote over the next three years. Those who work partially on-site will need access to enterprise systems even when they are on the road, which is one of many factors driving the growth of private mobile networks.

“In our survey, more than half of manufacturing companies plan to spend the most on digital collaboration platforms and private mobile networks (4G/5G) for connectivity within offices or work premises.”

They also see unified communications platforms and cloud contact centers for routing customer interactions, call recording and workforce management as important investments.

Accelerate strategic digital transformation

Many manufacturing companies are already on the path to digital transformation, with the first step being the development of a strategy. According to our survey, 8 out of 10 businesses now have a strategy for digital transformation using 5G and automation. The IIoT (Industrial IoT) technology wave has evolved over the past decade and pandemic-driven remote operations further accelerated the need for strategic digital transformation for enterprises. IoT instrumentation of machines and connecting the entire plant with edge and cloud processing is key to keeping operations running smoothly, reducing downtime, increasing throughput, and ensuring efficient use of resources. Control and instrumentation flexibility helps make a manufacturing process more resilient to future challenges.

End-to-end security

While connected operations bring many advantages in terms of agility, efficiency and productivity, they also give rise to plant and data security concerns. As disconnected factory islands become integrated with the rest of the enterprise, the security strategy isn’t just limited to emails, chats and other collaboration tools. Businesses need an integrated security approach that safeguards the data of their employees as well as machines.

Another area of concern is the security of the partner ecosystem.

“In our research, only 17% of respondents chose security of the partner ecosystem (i.e., the supply chain) as a challenge to secure.”

The control of remote users accessing cloud services, on-premises applications and resources as well as data storage and use in cloud services emerged as pressing priorities. This certainly reflects the rapid shift to new, pandemic-induced working strategies that were reactive rather than planned. As digitalisation becomes a necessity, enterprises will also need to increase focus on supply chain security in the near future.

Becoming a digital-first enterprise is a clear mandate for manufacturing companies, but the starting points for digital transformation among different manufacturers may vary. Digital-first business transformation is about making an impact on the bottom line by digitising processes, reinventing workflows and automating to achieve strategic business ambitions including profitability.

To read more from Kim, please read this blog on reimagining hybrid networks.