How Technology and People Are Steering Manufacturing's Future

Sept. 16, 2014
From new technologies and new customer demands to new employee expectations, it’s clear that dramatic shifts in manufacturing are taking place. Here’s one view of the top factors driving these changes and what it could mean for you.

If there’s one thing that’s rarely in short supply, it’s prognostications about the future. Whether it's the political future, the socio-economic future, the future of education, or the future of business and industry, there always seems to be a thought leader—or two or three or four of them—who has something to say on the topic.

Rarer are specific descriptions about the changes to come, why they’re coming and what to do about them. I happened upon one of those rare pieces of insight recently in a white paper from IDC titled “The Future of Manufacturing.” As with most such papers, it had plenty of general assessments about the need to rethink business models, the development of “globally local” sites, and increased adoption of IT.

With that said, the paper did hit upon some very salient points about manufacturing’s near-term future and how to prepare for it. The key idea behind these points is that manufacturers are quickly moving away from today’s “transactional business approach … to become real-time businesses.” Though this sentiment has been expressed many times before, the IDC paper notes three initiatives that are key to manufacturers making this transition:

Initiative 1: Manufacturers must shift from being efficiency-driven to being fulfillment-driven. The paper notes: “Efficiency will continue to be important for future manufacturers, but they will acknowledge that an excess of efficiency tends to be inward-looking and risks distracting attention from the essential goal of fulfilling customer expectations. To do so, manufacturers will have to nurture a customer-centric culture among their employees; they will have to become more agile and flexible in fulfilling customer requests; they will have to pursue process execution excellence along with planning excellence.” This move away from an efficiency focus will be anathema to many engineers as well as c-suite leaders who insist on an overarching focus on efficiency. Though a focus on efficiency will not disappear from manufacturing’s future, current shifts in technology and processes already show that delivering to customer expectations will share the front seat with efficiency moving forward.

Initiative 2: Moving from the 2nd IT Platform to the 3rd IT Platform. The historical friction between operations and IT is only going to get more heated in many cases as IT technologies play an increasing role in production operations. It may have all started with Ethernet coming onto the plant floor, but it certainly doesn’t end there. The IDC paper states: “The transition from the 2nd IT Platform (client/server applications) to the 3rd IT Platform (based on cloud, mobility, social business, and Big Data analytics technologies) promises to create a real-time, collaborative, decision-making environment that will be pivotal to supporting manufacturers as they make the shift from a transactional to a real-time business.” IDC admits that the shift from the 2nd IT platform to the 3rd will be “very difficult to implement”; however, it is this initiative that will bring the fastest benefits to manufacturers. Evidence of this shift can already be seen in numerous areas—from the ability to create your own mobile HMI with technologies such as Opto 22’s groov to GE Intelligent Platforms’ recent roll out of Equipment Insight for OEMs.

Initiative 3: Moving away from organizational silos to self-forming teams. We’ve all heard about the problem of information silos in manufacturing for decades, but mostly in connection with specific approaches designed to break legacy technology silos. The more persistent problem, however, lies in corporate cultures that foster the informational silos regardless of how open the supporting technologies may be. IDC’s point here is that “with an embedded customer-centric culture and the 3rd IT Platform in place,” manufacturers can take the ultimate step toward becoming real-time businesses by breaking organizational and information silos and simplifying the hierarchical organization. “Enabled by the 3rd IT Platform (see graphic), future manufacturing employees will form communities of interest and focus. They will create dynamic teams to address issues and leverage opportunities through a higher degree of real-time visibility and the collaborative working environment. Self-forming teams will take informed decisions in real time based on evidence and will provide future manufacturers with the level of speed and flexibility required to be successful in the future.”

Having visited with many manufacturers, I have to admit that Initiative 3 here sounds like something out of Star Trek compared to a typical modern manufacturing operation. However, I am seeing the seeds for the eventual success of this type of initiative being sown in two ways: 1) the fast adoption of mobile/cloud technologies by manufacturers; and 2) the different mindset toward work and cooperation that first started to become evident with Generations X and Y and that are full-blown with the Millennials. I still think Initiative 3 is loosest of IDC’s visions for the Future of Manufacturing, but agree that their observations here are likely to be spot on. The question is not if self-forming teams will happen—the advance of mobile technologies and Millennials’ own cultural tendencies will see to that. The bigger question for Initiative 3’s success will revolve around how these self-forming teams will be fostered, tracked, and managed to ensure success?

IDC admits that the transformation of manufacturing described by their three initiatives won't “happen immediately and will require a step-by-step approach.” To depict how they see this happening, IDC developed an S-curve graphic that highlights the initiatives manufacturers will go through over time to as they move into the future of manufacturing (see graphic).

As you ponder the future of the manufacturing for your operation, the clear takeaways the IDC paper provides can be gauged in the following questions to ask yourself:

  • Are you focused on efficiency far more heavily than fulfillment? If so, you should begin thinking of plans to bring more of a balance to these complimentary, but sometimes competing goals.
  • Where do you stand with mobile applications as part of your automation strategy? Now is the time to wade in if you haven't already begun the journey.
  • How empowered are operations, engineers and other manufacturing personnel to address production and delivery issues? If the operational processes at your facility are so formal to the point of having unbreakable outlines for who is allowed to do what and when … you may need to revisit those rules and start allowing employees to make certain levels of decisions on their own to create more flexible decision-making. This type of accountable, yet malleable decision-making will play a more important role in all future business operations — not just manufacturing. Technology and the Millennials will see to that.

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