Insights

Manufacturers focused on supply chain optimization for at least three decades to minimize costs, reduce inventories, and drive asset utilization. These strategies delivered logical cost savings but removed buffers and flexibility to the point where any disruption became difficult to absorb.  

This pain was felt acutely at the onset of (and during) the pandemic. 

In large part, the past few years have provided ample time to solve some of these vexing logistical challenges.  

With many supply chain issues in the rear-view mirror, forward-thinking C-level executives are now committed to rethinking digital transformation. Clearly, digital transformation is needed for all areas of manufacturing. it’s no secret that digitally transformed manufacturing processes can deliver incremental efficiency improvements—and improvement well beyond merely incremental. However, more is needed. 

Reimagine labor
Process automation and physical automation technologies, like robotics, can supplement labor capacity. In addition, global supply chains disrupted by the pandemic and geopolitical issues are forcing manufacturers to reconsider the nature of labor. Increasingly, the answer points to drastically decreasing reliance on inexpensive labor markets. Instead, manufacturers must reimagine how to shorten their supply chains and reshore much of their manufacturing—digital transformation of manufacturing processes is the only way to address these needs. 

Augment human expertise with AI
Large language models (LLMs) like ChatGPT have transformed human-computer interaction by generating human-like text, translating languages, answering questions, and writing code.   

Autonomous agents can now generate unit tests for an open-source and complex financial application such as Apache Fineract 12. In one use case, the autonomous Agent calls on a test coverage tool that supplies information on what requires new or more testing. Once a class and method are retrieved, the Agent decides what information to retrieve from a local vector store. Finally, a unit test is created using the retrieved information and then tested using the test suite. Discovering test coverage and writing a test case are two slightly complex tasks traditionally completed by humans. Now, these tasks can be automated by one or more Agents, depending on the desired delivery speed, leaving human developers to continue working on high-priority tasks.

Collect digital data
Any processes entailing operators walking around a plant with a clipboard, writing down data, must be changed. Manual data collection is ripe with error and requires more people to be on the manufacturing floor. Digital solutions automate data collection by adding sensors or tapping into machines’ programmable logic controllers to collect the needed data. 

Digital data collection allows supervisors to monitor factory performance remotely and in real time—one person on-site. This digital transformation allows them to address problems, conduct performance-management meetings, adapt operations to changing supply chain demand, improve labor productivity, and improve operational efficiency. These outcomes can be managed entirely remotely. 

Pivot faster
While the future cannot be known, we can be certain it will be volatile.  Manufacturers must pivot quickly based on changed market conditions and data insights. The flexibility required to manage escalating volatility can only be achieved by a thorough digital transformation. 

Future-Proof Manufacturing —Overcoming Barriers
Many manufacturers will face organizational and cultural barriers as they strive to digitally transform manufacturing. Perhaps there isn’t true buy-in from senior executives or the board of directors. In addition, many organizations will face technology-funding challenges, and most will grapple with a technology talent shortage. 

For organizations that were not prioritizing technology investment and are now facing pressured sales revenues, the ongoing investments required to digitally enable their manufacturing will be tough. 

Additionally, the technology labor market will remain tight, making recruiting challenging.   

Global Technology Talent Pool Is Needed
Onshore, offshore, or nearshore – location no longer matters. 

The acceleration of manufacturing’s digitization has also accelerated the demand for advanced computing talent.  

In addition to accelerating demand for technology talent, current US immigration policies are severely affecting the number of international professionals the United States can employ. For IT professionals, securing H-1Bs has long been a dependable strategy for hiring technical talent, but this option is becoming less feasible, which reduces the available talent pool and creates further competition for available talent. 

Organizations seeking to utilize AI, RPA, cloud computing, and other advanced technologies will need to tap into pools of technology talent wherever the talent is located and much of this talent will be made accessible by relationships with the right offshore technology partners. 

For years, the manufacturing sector knew that it needed to apply digital technologies to revolutionize manufacturing processes and supply chains. However, the world has changed. Manufacturers that decide to wait for the market to return to “normal”will be left behind and likely unable to remain competitive within a drastically altered market.  

Conclusion
The manufacturing sector is changing fast.   Changing economic headwinds, an evolving workforce, and rapid technological advances create opportunities for organizations to engineer successful outcomes, eliminate waste, and maximize value.  

We are not fixing airplanes midair but building new planes in the air.  

This is the nature of revolutions. Change is not graceful or comfortable, but with the right technologies, processes, and technology talent leading the way, it becomes possible to build future-proof organizations.

The time to transform is now. 

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