A big factor snarling manufacturing supply chains? The manufacturers.
According to Rockwell Automation’s 2023 State of Smart Manufacturing Report, 80% of manufacturers do not have end-to-end supply chain planning in place.
We wanted to dive deeper into supply chains and other trending topics covered in the report, so we connected with Jerry Foster, founder and CTO at Plex. Take a look…
Smart Industry: What is the state of smart manufacturing?
Jerry: Smart manufacturing adoption is robust, and the technology is evolving faster than ever. In a sense, COVID forced us to develop decades worth of innovation in just a few years. We are seeing huge advancements in areas like artificial intelligence (AI), cloud and automation. For instance, more than 50% of manufacturers using AI more than the year prior. We expect these advancements in smart manufacturing will continue to grow, as 97% of participants plan to use some type of smart-manufacturing technology in their operations.
Smart Industry: How does talent acquisition / retention / training factor into this story?
Jerry: A lack of skilled laborers is a top concern for manufacturers. In fact, lack of skilled workers is the #1 reason why manufacturers believe they cannot outpace competition. However, 66% of manufacturers say technology can help address these workforce challenges. Additionally, the new age of digital-native workers will be more attracted to operations that have incorporated AI and machine learning (ML) to automate boring, redundant tasks. Manufacturing in general, and our customers specifically, are becoming much more creative in their efforts to bolster interest in a manufacturing career, from sponsoring First Robotics teams, to using manufacturing expos as potential field trips for local schools.
Smart Industry: This report emphasizes "accessing data’s true potential." What do you mean by that...what is true potential of industrial data and is it challenging to achieve that?
Jerry: The “true potential” of data is not just collecting it, or even viewing it, but using it to improve operational efficiencies, and make better decisions. Yet, the report found that on average, 30% of the data being collected by manufacturers is not being used. We suspect this number might be much higher, because so much more data is being produced and recorded than just a few years ago.
This, coupled with 40% more manufacturers (compared to last year) reporting that they lack the ability to use data to make better business decisions, shows there is a clear need for access to and better use of data analytics. But for many respondents, the range of available systems and platforms can lead to “technology paralysis,” an inability to decide between solutions, leaving manufacturers feeling overwhelmed by choice. In these cases, we believe that many organizations do not have the right systems and tools implemented to give them contextual insights that are relevant to their industry and business.
Smart Industry: Organizations feel they lack technology needed to compete? Do they?
Jerry: I think manufacturers are starting to feel overwhelmed by what they are reading and hearing; there is so much noise about so many new technologies, that most manufacturers can’t help but to think they’re behind. So, I suspect the reality is perhaps not as grim as they suspect.
However, that’s not to say they can sit on their laurels. Things are moving fast, so manufacturers need to be intentional and focused on implementing technologies that solve real-world problems. And do so at a steady pace.
In addition, they need to learn out to use the resulting data to provide true ROI. In other words, manufacturers need to focus on investing in technology that will do more than provide access to data but offer insights and analytics specific to their organization and industry—the IT-driven data must take into consideration the OT context of that data.
Smart Industry: Why are we still so bad with supply-chain-planning solutions?
Jerry: For so long, supply-chain management was not a big deal. It was one of the most basic functions of running a business, and everyone basically did it the same way. There are now so many factors at play in the global supply chain and when any one of those elements goes sideways, the chain breaks. So the winners are going to be those who can figure this out—how well you do supply-chain management is now a major competitive advantage.
While there is no way to still a ship in stormy seas, you can, with preparation and experience, weather hard times. Having full visibility across vendor and partner ecosystem, as well as a complete understanding of production and operations, can make manufacturers more agile in the face of supply-chain snarls. Yet knowing this, 80% of manufacturers still lack end-to-end supply-chain planning, and 50% have no supply-chain planning process or are still using manual tools. That lack of visibility makes it nearly impossible to foresee challenges and react in a timely manner.
Smart Industry: What surprised you about report findings related to ESG?
Jerry: Sustainability is taking center stage. Sustainability and ESG initiatives are being recognized as operational-improvement opportunities that can impact the bottom line in a positive way—not just an ethical concern. This move toward sustainability also comes amid increased awareness of regulatory demands. Overall, 95% of manufacturers recognize the value of a policy for sustainability and ESG and how it impacts the bottom line and brings a positive social impact, which, by the way, is great for attracting the next/new generation of talent. With a workforce shortage, these are things that can differentiate your business.
Smart Industry: What do you find encouraging in the results here?
Jerry: There is a lot of room for optimism in this report. For starters, manufacturers view technology as an advantage for improving quality, agility, innovation and to attract the next generation of workers. These smart-manufacturing investments will help manufacturers to mitigate risk tied to processes and people, to build lasting resiliency that will drive future success.
It is also encouraging to see technologies that previously were on the hype curve, such as cloud and AI, actually being adopted at increasing rates, and even better, providing actual ROI.
