The North American manufacturing sector is enjoying an overdue rebound. In the U.S. alone, manufacturing productivity rose nearly 3 percent, and output almost 5 percent, last year. The industry's willingness to adopt new technology has been a driving force of these gains.
In particular, increasing automation and widespread adoption of cloud applications have helped propel manufacturing operations into an era of agility and innovation. According to a recent study by Softchoice, the manufacturing sector is steps ahead of the cloud app adoption curve, with 71 percent of manufacturing employees using cloud apps at work, compared to 55 percent of healthcare workers and 54 percent of finance professionals.
Manufacturers aren't just embracing cloud apps, they're proactively implementing procedures designed to optimize employees' technology use. 64 percent of manufacturers enforce cloud app policies and more than half of manufacturing employees report that their IT departments are responsive to requests for new tools. This IT savvy has not only helped firms overcome legacy challenges like supply chain management and employee performance, but also bodes well for the industry's future.
Here are three major ways cloud apps are leading to a more productive and efficient supply chain:
1. Smoother supply chain collaboration
Supply chains are notoriously difficult to master. Common challenges like production delays and contracts with risky suppliers lead to regulatory penalties and sacrificed revenues. Simplifying the interactions between suppliers and customers has long been manufacturers' goal, but cloud apps make this an achievable reality. By consolidating vendor and customer data, and integrating with current enterprise systems, cloud apps help manufacturers collaborate better internally and pursue more productive partnerships.
In practice, manufacturers usually connect cloud apps with their existing supply chain through sourcing or procurement-facing portals. When tied into other systems, organizations can quickly review invoices, contracts and orders while tracking payment processing, vendor performance and other relevant metrics. This close integration allows manufacturers to automate approvals and eliminate hours of tedious paperwork. From a sales perspective, this reduced burden speeds up the negotiation and fulfillment of new contracts.
2. Redefining worker productivity
Manufacturers have attempted to track and benchmark employee productivity for decades, but many still lack the level of insight required to meaningfully improve operations. The rise of cloud-based tracking apps, however, gives organizations unprecedented visibility into the hidden causes of an inefficient staff.
Used in tandem with real-time analytics tools, manufacturers can employ cloud apps across a variety of job functions to accurately measure performance. Tracking employees' discrete steps for different tasks lets managers pinpoint and mitigate a variety of common drags on output. More often than not, poor productivity is the result of operational bottlenecks stemming from employee skill gaps, management challenges or flawed workflow issues. Labor management apps help production leaders overcome these and other "unknown unknowns" by revealing employee patterns and offering new solutions to process hiccups.
3. Overhauling inventory management
Inventory management isn't usually considered a manufacturing revenue generator. Traditional inventory management methods, however, have been wrought with challenges — which can wreak havoc on an organization's bottom line. Manufacturers relying on spreadsheets and fragmented software often suffer from subpar demand planning, wasted assets or both. With consolidated, transparent systems, organizations are free to forecast smarter and avoid customer service delays.
Many manufacturers are pairing cloud apps with connected sensor technology to improve a variety of business operations, including shipment receiving, dispatch, packing, picking and storage. Coupling cloud software with hardware-based solutions can help manufacturers track packages, serial and batch numbers, inventory storage location and more. These platforms let managers and executives easily access and share product information across departments as needed. When issues do arise, cloud apps provide a clear audit trail, saving manufacturers the time and expense of digging through paperwork or siloed systems to track down a stray unit.
An enduring investment
Manufacturers are becoming pioneers in the cloud space — despite their previously low-tech reputation — and exemplifying how cloud technology can fuel operational success. Given this track record, it's no surprise that Apple’s enterprise partnership with IBM is rumored to include manufacturing-specific apps and cloud services in the near future.
From minimized administrative delays to data-driven workflows, the manufacturing sector’s recent strides are a testament to the potential cloud apps bring to the workplace. Manufacturers' investments in new technology will pay off for years to come, facilitating innovation that benefits employees and customers alike.
Francis Li is VP of Information Technology at Softchoice.