“After years of developing cost-saving programs, Australian manufacturing companies are beginning to see digital as a business-growth tool, not simply as a means of ensuring efficiency,” write Robert H. Brown and Prasad Satyavolu. “Manufacturers now have the opportunity to increase revenue streams and results through investment in digital strategies.” Excerpts:
“Evidence shows that globally, investment in digital initiatives has increased manufacturing costs by 1 per cent. Much of this is due to the investment, training and skills needed to use and operate cutting-edge technologies, but this increase in costs is not in vain, as manufacturers are already beginning to see growth from investment in digital strategies. For certain manufacturers, digital is estimated to have added 5.4 per cent to total revenue between 2015 and 2016. This is a worthwhile return on investment from a 1 per cent growth in cost.
As technology advances, the relationship between manufacturers and customers will drastically evolve due to digital communication and new routes to market. Personalization is one of the keys to growth in this Fourth Industrial Revolution as digital becomes increasingly embedded in societies and its role becomes synonymous with manufacturing success.
Digital allows manufacturers to diversify, and offer better solutions and products for their customers. There has never been a better opportunity for businesses to invest in advanced manufacturing processes in which software and hardware converge to create rapid production times and to meet all-important customer demand.
The benefits extend to creating new routes to market and new product streams. The traditional supply chain becomes newly connected, smart, and efficient, as integrated planning and execution systems, logistics, and warehousing forms a new ecosystem within manufacturing.
Customer experience is also a major benefit of digitization. No longer is it acceptable for manufacturers to take a ‘one-size-fits-all’ approach with customer pain-points. Consider the advent of 3D printing, and the global rise of so-called “maker-artisans” in diverse locales worldwide, heralding a near-term future of “what you want, when you want it” manufacturing. Manufacturers need to recognize that digital technologies are the most cost-effective way to produce the personalization that customers now expect.
It is predicted that by 2018, digital will drive almost 25 per cent additional growth in the global manufacturing industry. In response, companies must acknowledge the importance of adopting a broader transformation strategy that will affect all stakeholders, whether they be customers, suppliers, products, markets or employees. It’s this exact mind-shift of thinking big that will ensure manufacturers are well-placed to use digital wisely.”
Click below to read the article that appeared in the October-November 2017 issue of Australian Manufacturing Technology magazine.