The digital revolution is now breaching the walls of manufacturing as it continues to disrupt media, finance, consumer products, healthcare, and other sectors. The explosion in data and new computing capabilities such as artificial intelligence, automation and robotics will change the nature of manufacturing itself. Digital connectivity among designers, managers, workers, consumers, and physical industrial assets will unlock huge value and change the manufacturing landscape forever.
Yet while manufacturing generates more data than any other sector of the economy, few companies are harnessing it. One oil-and-gas company, for example, discards 99 percent of its data before decision makers have a chance to use it.
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Consider traditional car manufacturers and Uber, which are at the highest level in the business of moving people around. They meet people’s transportation needs not with steel, glass, rubber, and salespeople but with data, matching individual riders and vehicles via smartphones. Barely five years into its existence, it is valued at about $50 billion.
How leading manufacturers are responding to digital?
The ways people and organizations use information has shifted dramatically. Data storage is cheap and flexible, and advanced analytics and artificial intelligence are giving us new abilities to draw insights from large amount of data. Advances in virtual and augmented reality, next-level interfaces, advanced robotics, and additive manufacturing are all opening the gates to digital disruption. In the next decade, digital manufacturing technologies will allow companies to connect physical assets by a “digital thread”. This will unleash a seamless flow of data across the value chain that will link every phase of the product life cycle, from design, sourcing, testing, and production to distribution, point of sale, and use.
A number of leading global manufacturers—including the likes of Bosch, Cisco, FCA (Fiat Chrysler Automobiles), GE, General Mills, Harley-Davidson and Siemens—are early adopters of smart manufacturing (or Industries 4.0) in their plants. Some of their use cases include:
Pharmaceutical manufacturers are using their deeper understanding of end-to-end processes to develop continuous manufacturing suites with footprints less than half the size of conventional factories. Some have even developed portable factories that can be built in 40-foot trailers. They are also using the digital thread to improve quality control. A few companies are now relying on infrared technology to detect counterfeit medicines and contaminants without the conventional destructive tests
Global fashion retailer Zara is already renowned for developing and shipping new products within two weeks. It is now using digital tools to respond even faster to consumer preferences and reduce supply-chain costs, attaching reusable radio-frequency identification (RFID) tags to every item of clothing in more than 700 of its 2,000-plus stores. Ten staff members can now update a store’s inventory in a couple of hours. Previously it was a work that used to take 40 employees for more than five hours by waving small handheld computers at racks of clothing.
The aerospace-and-defense industry is using digital tools to integrate an enormously complex supply network. A modern jet turbine engine has hundreds of individual parts, for example, some of which the engine manufacturer makes in-house and others it sources from a network of dozens of vendors. With cloud computing based tools, suppliers can collaborate faster and more efficiently. An engine maker can share three-dimensional models of component design within its network, and each supplier in turn can share information about price, delivery, and quality. This type of information sharing and transparency reduces the labor required to manage design changes, reduces risk for the engine maker and suppliers. Boeing developed its two most recent airframes, for the 777 and 787, using all-virtual design, reducing time to market by more than 50 percent.
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Those manufacturers who have implemented digital manufacturing have typically reported substantial benefits from improved process and production planning. These benefits include increased production throughput, reduced lead times, reduction in capital costs, better use of facilities, a reduction in operating costs, improved product quality and a reduction in continued product support.