Reduce risk and build resiliency: ‘new norm’ for manufacturers
Manufacturers are recognising the world around them has changed very quickly and the need to change with it is only growing. The companies are facing unprecedented threats, such as rapid volatility in manufacturing output and increased complexity of operations due to a lockdown and social distancing.
Manufacturers may lose up to 50% of their on-site personnel with social distancing measures in place. some manufacturer have seen a 30 percent reduction in productivity in thier factory.
Adjusting to the rapid changes have forced companies to respond in new ways such as: design collaborations for rapid innovations, changes in manufacturing focus, products and supply chain as well as remote and expert support of products in the field.
Short Term Challenges
- Health and safety of employees
- Manageing demand volatility
- Introduceing new and optimise product mixes
- Productivity of employees remotely
- Operation of critical equipment
To respond to immidiate challenges of the slow-down companies are changing internal operations by enabling remote collaboration, empowering knowledge transfer and driving low touch handoffs. By implementing IIoT solutions to their operations, manufacturers are immidiately keeping employees connected and safe.
The ‘new normal’
Manufacturers looking ahead to the medium and long term should focus on the following:
Medium Term Challenges
- New employee working practices
- Optimise cash flow
- New design collaborations
For companies facing difficult choices regarding where to cut costs, rebalance operations, and pin point opportunities for increasing productivity, data driven decision making is the key.
Manufacturers can connect to real-time industrial data on the shop floor – without having to modify existing assets. They can create visibility for remote teams and leadership by leveraging real-time data to understand manufacturing and asset performance, and monitor the most critical assets.
Preparing for the future
The drastic sudden reduction in demand, from a financial perspective, is going to put pressure on the bottom line. Manufacturers will need to quickly find ways to cut manufacturing costs, including looking at operations and how they may need to be rebalanced with extremely difficult choices ahead. They need to do this while not losing sight of existing customers and orders that need to be met on time, and at the level of quality customers expect.
CapEX budgets are likely to be strained or drastically reduced in the coming years. Therefore, manufacturers should plan to optimise asset efficiency to find efficiencies, but also prepare for large swings in demand that are possible in the recovery. Early signs coming out of China show a V shaped recovery; albeit, a different economy, there is hope that demand will return quickly.
Which means manufacturers need to also build flexibility, agility, and resilience into processes, supply chain to manage these large swings in demand and product mix.
McKinsey & Co. studied what helps companies thrive through downturns, and found that resilient companies:
- Cut costs ahead of the curve
- Created operational flexibility
- Built a foundation to capture market opportunities at the end of the crisis
Manufacturers can lower labor, material, and overhead costs with real-time visibility into manufacturing performance. This can be achieved with use cases like real-time production performance monitoring, digital shift handover, in process quality control, digital & augmented work instructions, and connected work cell
Asset efficiency can be optimised by maximising existing CapEx investments through efficiency gains. This can be achieved with use cases like asset monitoring and utilisation, predictive maintenance, AR remote assistance, and enterprise plant benchmarking.
To increase flexibility and agility manufacturers need to build resilience into the people, processes, and assets in operations. This can be achieved with use cases like digital and augmented work instructions to create a flexible, agile workforce, along with connected work cells, and work order dispatching and tracking.
In summary, IIoT solutions can help you address the immediate challenges you’re facing today while also helping you ensure you’ll be resilient in the future.
Join us Thursday 4th June, 2:00pm for “Doing more with less: The ‘new norm’ for manufacturers” webinar, to explore the role Industry 4.0 can play in digitalising Predictive Maintenance.
Webinar – Doing more with less: The ‘new norm’ for manufacturers
The role Industry 4.0 can play in digitalizing Predictive Maintenance
Thursday 4th June, 2:00pm GMT+1