Operational Excellence through Digital in Manufacturing Industries

2 Manufacturing companies have historically had an on-off relation with technology. Most have aggressively adopted traditional technologies such as Enterprise Resource Planning (ERP). However, they have been slow in adopting recent digital technologies such as big data analytics, real-time order confirmation, Web-EDI among others. Moreover, most have adopted technologies to varying extent creating a connectivity gap in their operations. We believe digital technologies will help manufacturing companies in eliminating this gap. Our research and project experience indicate that by adopting digital tools, manufacturing companies can cut costs by as much as 30% by enabling savings on capital costs, labor field force among other key cost elements. The first area where digital technologies can have significant impact is on manufacturing operations. Most manufacturers still rely on traditional and outdated models of planning. By migrating to advanced planning systems, and using digital technologies, they can gain greater visibility into their manufacturing operations. LG Display integrated seven different planning and execution systems to gain a unified process data view of its global plants. Supply chain visibility is a key item on the agenda of Supply Chain Management (SCM) professionals. Over the years, SCM has seen deployment of multiple disparate digital tools, creating a siloed system that distorts end-to-end visibility. Digital tools can help bridge these connectivity gaps. Levi Strauss & Co. reduced manual tracking and tracing of inbound shipments by 98% by implementing a supply chain visibility platform supporting ASN (Advanced Shipping Notification). Digital tools aid the service function in overcoming information paucity, enabling effective scheduling, providing multifunctional tools to field technicians and driving the overall productivity of service operations. Kinetico, a manufacturer of water treatment systems, cut its service resolution time into half, after deploying a cloud-based service management solution. We believe digital technologies can help manufacturing organizations achieve excellence in manufacturing operations. However, this requires a structured approach involving, among other steps, a maturity assessment, prioritization of digital initiatives and setting up of a digital operating process model. Manufacturers should also consider lessons learnt from the earlier generation of technology deployments and stay away from taking a silo-based approach. Executive Summary 3 Manufacturing companies have traditionally been early adopters of selected technology such as ERP and Production Planning systems. For instance, a survey among 170 global manufacturers reported that 92% of them had implemented an ERP system i. Manufacturers also have systems in place that are able to support the management …