Mark Humphlett, Senior Director of Industry and Product Marketing, Infor Manufacturers want to jumpstart growth. Digital opportunities offers a fresh approach to manufacturers who are ready to try new service offerings, target new niche markets, and expand product offerings around data and connectivity. New technologies offer exciting ways to focus on innovation and engage customers. While the potential impact is promising, it can also be intimidating.
You need a strategic approach, a firm foundation, and methodical processes to measure success. These factors should be addressed early in the planning stages:
1. Define your mission. Your digital action plan must start with what you hope to achieve. This should reflect your organization’s purpose — or communicate how you want to change. Articulate your mission through the experiences and products you want to offer. Although product and service offerings are often blended, you must clearly define these goals to avoid confusion among your personnel, partners and customers.
2. Encourage innovation. Line operators, technicians, and hands-on crews keep manufacturing plants operating smoothly. But you also need creative problem solvers to provide imagination and a vision for the future. Innovation will flourish if personnel have avenues for expressing ideas and providing feedback. Different perspectives spark fresh approaches to solving business problems. Encourage individuals from divergent disciplines to form teams and learn from each other and reward risk taking by developing new products and services.
3. Focus on your core revenue stream. First conceptualize your primary business model, then decide how to execute it. You can have more than one business model and multiple revenue streams, but start from a core objective, then determine what technologies, people and systems you need. Multiple layers of partner networks, suppliers, and contractors may be involved. Map these out early and in detail, as these contributors will impact the cost of doing business and profit margins.
4. Apply data-driven decisions. Collecting, understanding, and using data in a meaningful way is the crux of the digital era. To forge a competitive advantage, you need the data foundation and systems for collecting, storing, and aggregating data points into logical patterns that can be leveraged for decision making. Smart sensors that monitor condition and location do more and cost less, driving digital initiatives and expanding opportunities. With the plethora of data, cloud deployment is necessary for practical, economical storage and organization. Data for the sake of data is counterproductive. As you collect and analyze data, look for ways it can be used to make better decisions, serve customers or solve problems.
5. Focus on co-creation. High-tech components, product complexity, and thin margins are forcing manufacturers to turn to specialists for key elements or to perform steps that require specialized equipment or processes. Chrome accessories, brake assemblies, thermal insulation, hydraulics, circuit boards, solar panels, and LED displays are often outsourced for speed, convenience or cost savings. Contractors focusing on specific components have economies of scale and decrease per unit costs. Component design allows manufacturers to configure multiple variations of a product, giving customers more options. Partners also bring fresh ideas as co-innovators, developing new features and processes. This is important in a digital world where quality, value, and the ability to personalize products are essential to meeting customer demands.
6. Create cross functional teams. The IT team cannot plan and execute the digital agenda alone. Mandates must come from the top and key executives should be highly engaged, especially in setting the company culture, pace of change, risk acceptance, and investment priorities. Teams should focus on specific aspects, such as creating new revenue streams or commercializing data, and involve personnel from diverse backgrounds for comprehensive perspective and wide range of ideas. There should also be a method to share ideas, ensure ideas are compatible with others, and settle disagreements.
7. Expand offerings and customer engagement. As you set priorities for digital transformation, focus on customer offerings. Align with customers and create an enhanced buying experience that builds long-term relationships. Customers expect a highly personalized, interactive and engaging experience in both B2C and B2B markets. They demand ecommerce, personalized products, and portals for placing orders, requesting service, tracking claims, and more — all features offered thanks to modern technology. CRM systems and digital marketing tactics provide a strategic approach by making smart investments of resources, targeting potential buyers and sending a message corresponding with their business needs.
8. Enhance the supply chain and connected networks. Inventory management controls costs minimizes waste, and ensures just-in-time delivery of resources. When suppliers are scattered across continents, delivery methods range from containers on ships to 3D printing of a rare part, presenting varied risks of delays. To keep operations running smoothly, an integration of decisions based on real-time data from suppliers is essential. Take advantage of sensors and IoT to help monitor conditions within shipping containers. This data can trigger needed adjustments — especially valuable in the food and beverage industry where temperatures must be controlled for safety and freshness. Sensors can also track location using GPS and satellites, helping managers navigate adverse weather conditions and plan back-up options.
9. Keep equipment running. This is a fundamental use case of digital technologies, offering tremendous value. Smart sensors on internal machinery can monitor and communicate a wide variety of conditions, such as speed, temperature, vibration, volume, weight or mass. This data is collected and aggregated, indicating anomalies which signal imminent machine failure and triggering an automated response. Responses range from sending a notice for maintenance, an alarm sounding, dispatching a technician, pulling a replacement part out inventory, or shutting down the line. This ability to spot equipment issues before they cause a safety issue is a tremendous value.
This checklist can help to map out your digital journey so that it is logical, manageable and yields high returns. In this era of fast-paced change, you will keep up or fall behind. Your competition may already be on the path to modernizing. Are you ready to become a digital enterprise?
Mark Humphlett is Senior Director of Industry & Solution Strategy at Infor.
