By Vincent Tang
WE may be experiencing uncertain times globally – both politically and economically – but it is also the perfect time for manufacturers to regroup, refocus and embrace the unknown by taking steps to future-proof their business.
Being agile and adaptable has never been more relevant, but taking the opportunity will demand change for many manufacturers.
One example is the firms operating in and with the UK, for whom the reality of Brexit has led to a re-evaluation of relationships and a review of processes.
But this isn’t necessarily a bad thing. Being able to adapt to change should underpin every business strategy. The use of technology and the Internet of Things (IoT) to make this happen is crucial, and a key part of success – not just a cost centre.
Digital transformation has a vital role to play in helping manufacturers across the globe steady the ship and ride the choppy waters of change. Political uncertainty and volatility are a common cause for concern among manufacturers across the globe when it comes to business growth.
Indeed, a recent survey suggests that one in three are worried about the negative impact that the China-US trade dispute could have on future business growth, with 29% of manufacturers considering exchange rate fluctuations as a significant threat.
In addition to the current political climate, ever-changing legislation and regulations keep businesses on their toes and needing to adapt to a moving target.
Embracing agility
Keeping pace with technology is crucial in helping to overcome the unknown and remain agile and competitive in the future. The businesses that embrace uncertainty will also become more attractive to potential employees and the existing workforce by positioning themselves as a company willing to innovate and invest for long-term success.
Becoming more agile doesn’t mean massive capital investment in technology or a complete overhaul of existing systems. In fact, technology is now much more affordable and accessible than it was a few years ago. When it comes to using technology to enhance productivity and operations – and ultimately business agility – the barriers to entry have fallen.
Technology should be adopted to help solve business needs and drive growth, particularly in times of uncertainty or flux, when resources must be examined and minimised where possible.
For example, London EV – an automotive engineering company and wholly-owned subsidiary of Chinese automaker Geely that is famous for its London back cabs – has deployed technology across the factory floor to streamline processes and drive up productivity.
By connecting multiple sources of information to its enterprise resource planning (ERP) system, it now has access to real-time information and can locate data much more quickly for better decision-making and more efficient day-to-day operations.
This improved visibility and transparency will also give London EV a much-needed layer of agility and adaptability to respond to changing market conditions now and in the future.
To remain agile, manufacturers should look at digital transformation as a system of levels, and take it step by step – you can’t unlock the benefits of the next stage until you have the current one finalised.
The journey to digital transformation should be something that builds, and the growing availability of software as a service (SaaS) and cloud computing is making it easier and more affordable for firms to achieve that, putting the right foundations in place to be able to adapt when needed.
Investing in the future
Having the right technology foundations in place will also pay dividends in making manufacturing an attractive sector to work in, positioning it as innovative and ready to embrace change.
With skills shortages still making the headlines across the globe, only those firms who take the right steps to attract workers will succeed. A recent report found that 4.6 million jobs in the US will need to be filled in the sector over the next decade, and 2.4 million jobs may be left open due to a lack of trained workers.
The marriage of technology and skills will pay a central role in getting the most from the existing and future workforce. Being agile not only applies to the technology deployed but also the way it is used and developed.
Many manufacturers will already have the relevant expertise and digital understanding in-house to make technology adoption a success. It just requires a change in mindset and a switch of the traditional ‘top-down’ approach to diffusing knowledge throughout the workforce. Once a digital culture is established in the workplace, the door is open for innovation.
Refocus to realise results
Digital transformation is fundamental to the survival of manufacturing but it need not be overwhelming or a ‘rip and replace’ scenario. If businesses can build their systems step-by-step, level-by-level, and transform only where there is a good business case, they are well on their way to thriving in the new world and remaining successful.
Times are changing, but it doesn’t have to pose a threat. Instead it should give manufacturers the imperative to regroup and realign, becoming more agile and able to embrace change head on – it’s not a threat on the horizon but an opportunity. – Feb 4, 2020
Vincent Tang is regional vice-president, Asia of Epicor
