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Why Digital Transformation Is Vital To Success In The Manufacturing Industry

Much has been written about the impact of technology on business over the past decade. It is also clear that digital transformation has revolutionised every type of business, from; telecommunications to travel, healthcare to hospitality. This also includes the manufacturing industry.

Over the past thirty years, European manufacturers have felt the impact of change more than most, particularly in the UK. A combination of evolving business needs, the strength of the sterling, and the rise in cheap production in the far east, has all taken its toll.

But there’s another factor at play here too; technology.

In China, Japan and South Korea, where digital transformation has revolutionised the industry, it’s reflected in their global status. As such, China is the biggest manufacturing economy, accounting for 20 per cent of all global output

Let’s take a deeper look at why digital transformation is essential for success, and why European businesses need to keep up:

Improves Productivity

Known as the fourth Industrial revolution, technology has improved productivity beyond expectation. This has seen greater levels of output, more accurate results and overall less wastage/scrappage for the environment.

Research in the American manufacturing sector found that owing to changes in technology, workers are now producing 47 per cent more than they did 20 years ago.

It can be no coincidence that Japan, the third largest global manufacturer, is also the number one investor in industrial robots with 306,000 in use. 

Enhances Efficiency

There’s no denying that technology has allowed businesses to streamline processes. From the introduction of robotics to artificial intelligence, this has resulted in greater accuracy, delivery output, income streams and much more.

According to lean manufacturing, there’s also a correlation between technology and capacity. Insight reveals that world-class manufacturing sites are working to 85 per cent capacity, in comparison to the average factory operating at just 60 per cent efficiency. This highlights the gap between manufacturers that have moved with the times.

Global Competitiveness

If the high street has taught us anything, it’s that you need to move with the times. Businesses that have failed to keep up with mobile technology, online shopping and responding to the ‘instant’ culture of consumerism, have all lost clients, customers and footfall as a result.

The manufacturing industry is no different. In order to remain globally competitive, it’s more important than ever to have an infrastructure that can accommodate business demands. Failure to do so, means that clients have plenty of choice to go elsewhere.

Economy

Not just important for the bottom line of business, manufacturing is vital for the success of the economy.

In America, where half of goods are exported, the market accounts for $2.33 trillion. Likewise, in the UK, where economic output is estimated at £1.86 billon, (10 per cent of our economy) nearly half (44 per cent) of goods are also exported. This helps keep people in jobs, inward investment and our place in the global market intact.

Innovation

Technology is always at the forefront of progress and an essential component in innovation. In order to remain competitive, it’s therefore essential for enterprise to invest in research and development to remain market leaders.

As an example, one of the biggest game-changers for Apple was its ‘A12 bionic’ chip, as featured in its bestselling iPhones. According to industry experts, this piece of software delivered dramatically faster performance and lower power consumption than previous software. In doing so, it has helped underpin Apple’s leadership status as a world leader, valued at $87.1 billion.

Builds Client Loyalty

Technology in manufacturing is often considered a streamlining tool, and while this is true, it has also been shown to help with overall efficiency. This in turn aids client communication, improves delivery and turnaround times, and allows for cost savings to be shared. This results in an overall better customer experience, promoting client loyalty and repeat business.

Removes Admin Tasks

While technology has replaced some prior roles in manufacturing, it has also improved the day-to-day process for workers.

Robots and automation have freed up the plant floor from some of the manual and administration-heavy tasks from yesteryear. The result is an engaged and skilled workforce that can focus on the job in hand.

Cost-Saving

There’s no question that new technology comes at a cost. But ultimately, in the long-run, this pays for itself in the following ways:

  •   New machinery is made with sustainability in mind. This means using less energy than before, or finding new materials and resources. Great for the environment, as well as business.
  •   The loss of manpower has been to the benefit of business, with overheads reduced as a result of robots.
  •   Output is higher with fewer mistakes, this means less scrappage and draw on resources.
  •   With a higher volume than before, production schedules are able to work 24/7.

To remain competitive, productive, efficient and at the forefront innovation, manufacturers must embrace digital transformation.  It’s time to get involved, the revolution is here!

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