3 Steps to Addressing the Digitization Gap for Mid-Sized Manufacturers

  • December 7, 2022

Three years into the pandemic, businesses are still navigating the challenge of global supply chain fragility. Unpredictable factory closures, port back-ups, and disrupted sourcing streams have resulted in 83 percent of manufacturers looking to re-shore manufacturing operations. It’s easier to mitigate the risk that comes with relying on foreign countries for critical goods and services by moving factories back to the U.S. Today, an adaptable factory is critical for not only delivering products to U.S. businesses, but also boosting the local economy. 

90 percent of senior manufacturing executives agree that strengthening their supply chain resilience is a top priority. Additionally, the Biden Administration is investing in the manufacturing segment with key initiatives, most notably, the CHIPS for America program, a $50 billion strategy to establish and expand domestic production of leading edge semiconductors. In order to revolutionize the manufacturing industry and restore the US’s role as a leader, businesses of all sizes must take a step back and adjust their traditional ‘ways of working’ to pursue a more agile, sustainable, and digital approach. It’s time to implement Industry 4.0 in mid-sized manufacturing plants across North America. 

Industry 4.0 technology solutions should deliver actionable, operations-wide insights by tightly integrating live plant data, machine learning, and cloud computing. While many large enterprises have had the budget and bandwidth to adopt these cutting-edge tools, only 18 percent of firms bringing in less than $1 billion have a long term digital strategy in place. Although Industry 4.0 technologies have demonstrated improvements in labor productivity, reduced machine downtime, increased throughput, many small to mid-size companies are falling behind their larger manufacturing counterparts due to the lack of digitization. 

Seamless Industry 4.0 integration may sound challenging, but with the right vision, framework, and resources to get started, mid-sized manufacturers can take the lead on creating a roadmap to operational excellence. Here’s how: 

  1. Understand your goals and start small

Adopting a digital strategy does not mean investing in a massive overhaul of existing ERP systems and IT infrastructure. This is a very customizable process, and it begins with implementing technologies that work along-side well established legacy systems. Manufacturing execution systems designed over the last three decades were often built to work independently, rather than communicate with each other. Therefore, the first step toward digitization includes walking through the factory floor to identify paper-based communications, manual systems, and information gaps. With the help of experienced manufacturing consultants, businesses can identify the ‘low hanging fruit’ and begin there to digitize processes and proceed only when quantifiable benefits are achieved. Changing everything at once would likely cause disruptions and frustration. A successful, long-term Industry 4.0 rollout requires creating a comprehensive foundation, starting small, and leveraging tools that enable the bigger picture. 

  1. Decrease the learning curve 

One of the biggest misconceptions about digitization is that it’s too complex. One of the biggest challenges in the manufacturing industry is senior employees taking knowledge with them when they go. The solution to both pain points is implementing an intuitive, user-friendly analytics platform that provides visibility to original data sources. Once the data is ingested, rationalized, and processed, it is available to be translated into meaningful, actionable knowledge to increase business performance. However, if front-line staff are not engaged at the early stages of the design stage, and there is insufficient understanding of front-line impact, employees will likely feel resistant and fear the change. 60 percent of companies report that Industry 4.0 initiatives have failed at the piloting stage due to lack of company-wide vision. There is often a disconnect between the factory floor and the C-suite, which is why it is important to address engagement, up front, to ensure plant managers have a comprehensive understanding of new processes and their tangible benefits. The purpose of a digital transformation is to harness the power of the people behind an operation and deliver the framework and tools that are crucial to dramatically improving operations and the business. 

  1. Focus on continuous improvement 

The key to end-to-end digitization is continuous process improvement. New technologies offer the tools and solutions needed to maximize efficiencies and collect data, but without intelligent data management, the operation will still face bottlenecks. Closely monitoring performance of all equipment and systems, from production, to quality, and across the supply chain, enables the rapid identification and remedying of operational issues. Additionally, it is easier to pinpoint information gaps when everybody across the operation is on the same page. Traditional legacy systems managed by individual departments are often used to achieve independent goals, and can promote disconnected, unstructured data silos. Given that actionable insight is the most valuable tool a business can use to achieve operational excellence, maintaining intelligent data architecture is pivotal for keeping every link in the supply chain connected and informed at all times.

If mid-size businesses largely adopt Industry 4.0 technology, the economic and social effects will be huge. By restoring supply chain growth and resilience, the manufacturing industry could boost US GDP by more than 15 percent by 2030. Digitization is the future, and the technology is not only for large enterprises with large research teams and larger budgets.  

Let FactoryEye be your partner on this journey – learn how our modern data architecture combined with a sprint approach empowers mid-sized manufacturers just like you.  Contact us for a complimentary assessment.


About FactoryEye

FactoryEye is an advanced Industry 4.0 manufacturing & cross-organizational intelligence platform for full visibility and actionable data insights. FactoryEye enables manufacturing personnel at all levels to make data-based decisions and the manufacturing organization as a whole to achieve business excellence. Contact us to see how we can help you drive operational and business excellence.

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