Relatively few organizations have yet turned the potential of smart manufacturing into sustained action. It’s time they did, especially with the pandemic as a catalyst to accelerate and reprioritize smart manufacturing initiatives.
Smart manufacturing combines technology, data, processes and human interactions to disrupt and transform production’s role in a digital business, making it the foundation for reliable output from smart factories.
What’s needed, though, is a rigorous end-to-end approach — from knowledge gathering and strategy development through piloting and testing to implementation and then a fully deployed strategy. And success requires a candid assessment of both the benefits and challenges.
“Organizations must realize — and quickly — that smart manufacturing requires synchronizing activities for capability building, capability enablement and empowering people. It’s not just about putting in place the right technology,” says Simon Jacobson, VP Analyst, Gartner.
Execution of smart manufacturing lags
The 2020 Gartner Smart Manufacturing Strategy and Implementation Trends Survey shows that less than 50% of manufacturing leaders are implementing or have a fully deployed smart manufacturing strategy, even though many tout its importance:
To develop successful smart manufacturing strategies, corporate leaders need to understand both the potential benefits and challenges upfront. Otherwise they risk celebrating tactical wins at sites that can create costs and constraints that limit competitive advantage elsewhere.
Smart manufacturing ensures reliable output from smart factories
Manufacturing leaders see a range of actual or expected benefits from smart manufacturing, including agility, flexibility and optimization. The common denominator is operational excellence. which delivers reliable supplies from smart factories.
It’s easy to measure operational excellence at specific sites through cost and quality improvements. Indeed, use cases that combine workflow, data management, and enabling technologies for real-time equipment or process monitoring offer a strong return on investment (ROI). But such tactical gains at sites should line up with initiatives to align the new capabilities that make factories smarter with delivering end-to-end supply chain advantage.
Too much site-centricity can inadvertently create excess constraints and complexity elsewhere and undermine sustainable performance improvement across the business. Pushing the benefits of smart manufacturing beyond the factory walls enables the supply chain to focus on its primary mission — the effective fulfillment of demand.
This underscores the importance of knowing which smart manufacturing benefits are desirable and realistically attainable at each phase of your strategy. It also forces organizations to know their obstacles, too.
Change management is holding back smart manufacturing
Technology or solution immaturity is much less of a challenge than many might expect. Our study shows it’s not technology or poorly educated leadership that’s constraining smart manufacturing. “It’s a matter of rightsizing your tactics and being able to change the wheels on a moving bus,” says Jacobson. “Our survey respondents cited cybersecurity, access to skills, and competition for resources as “substantial challenges” to deployment.”
Organizational complexity, integration, and process reengineering are the most prevalent obstacles to executing smart manufacturing initiatives. These challenges together reflect the largest change management obstacles.
Notably, “leadership commitment” isn’t considered to be an issue: 83% of manufacturing leaders agree that their organization’s leadership understands and accepts the need to invest in smart manufacturing. But that isn’t any indicator that the majority of leaders understand the magnitude of the change in front of them in terms of both technology and talent.
6 key actions for a smart manufacturing strategy
To move smart manufacturing strategies and roadmaps from aspirational to actionable, and to set realistic expectations for resources and funding, here are some key actions:
The original article by Simon Jacobson, vice president analyst at Gartner, is here.
The views and opinions expressed in this article are those of the author and do not necessarily reflect those of CDOTrends. Image credit: iStockphoto/gorodenkoff