Smart manufacturing? It is a dynamic chain

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For the manufacturing of the future it is not just a question of new technologies: we need a strategic vision in which the supply chain is a dynamic ecosystem

Italy is one of the main nations in the manufacturing field, which is why all the debates made in the past on the subject of Industry 4.0 are not simply generic comparisons on industrial innovation. From an effective digitalization of manufacturing passes a good slice of the country’s competitiveness. In this perspective, 2020 has been a litmus test: all production companies have realized that they need to be more “flexible” – in a broad sense – and that digital can give them a big hand. The difference was made by the degree of digitization already assimilated. Those who were further along in the transposition of digital suffered less than those who were further behind. Starting from this observation, the priorities for manufacturing become evident.

Improve the efficiency of processes, strengthen the components of demand planning and supply chain management, intervene on shop floor platforms (MES, for example) but also on digital components not expressly produced (from ERP onwards). But today it is perceived as critical the need to “absorb” unforeseen events – not necessarily global emergencies, hopefully – and fluctuations in demand, so the real cross-cutting need is to ensure the much-cited “single source of truth” along all processes.

The reason is obvious. If the goal is to make a qualitative leap in one’s ability to predict the future and react quickly to any change, you need a solid data base on which to build these capabilities. That is, it is necessary to know exactly one’s current state, in order to move towards a desired state.

So far nothing new, on a theoretical level. Only the acceleration that the pandemic has given to any form of Digital Transformation. Manufacturing, however, has one more difficulty: complexity. It is estimated that on average a manufacturing company uses three times as many platforms and applications as a similar but only commercial company. And these platforms and applications are often very vertical and were not designed from scratch for the simple sharing of their operational information. However, these are platforms that concretely carry on production and cannot be discarded or “modernized” lightly. The new need for more responsiveness in production can be the evolutionary factor that has so far been lacking, especially in companies that are not really enterprise for which investments are always a problem.

According to Forrester analysts, a prevalent slice (63%) of manufacturing companies do not have the ability to make effective predictions in real time. Those who are part of this percentage today are obviously oriented to get out of it. Otherwise today its competitiveness will be very dangerously declined.

But it is not enough to adopt new technological tools: we also need a different vision of production processes. No longer as a linear sequence of steps and transactions to be optimized individually but, rather, as a complex of continuous interactions to be managed according to one’s objectives, generic or contingent. The supply chain no longer as a “chain”, therefore, but as an ecosystem. It is not a trivial evolution and requires breaking down many “walls” that are historically present in manufacturing.

To constantly optimize your supply chain – to reduce risks and maximize the benefits for production – you need to constantly acquire data on the performance of your processes and those of the other components of the value chain. Integration and transparency (of data and in general) therefore become key factors. For which manufacturing companies are increasingly looking to the cloud.

For this reason, in the coming years, production companies will be pushed to invest not only in the renewal of ERP and MES but also in platforms for monitoring events in the supply chain, logistics reprogramming, dynamic production, possibly even hooking up to different B2B marketplaces in the sector. The manufacturing of the near future is therefore “open”: sharing (or rather, federation) of data, close integration with the most critical suppliers, feedback from end customers.

For those who are further behind on the road to digitization, it is probably necessary to focus more on approaches than on individual technologies (additive manufacturing, augmented reality, predictive maintenance, digital worker, AI, blockchain…).

These are certainly useful and bring tangible value but must be lowered, to be really effective, in a strategic vision. Possibly even in the long term.