Industry 4.0, or the fourth industrial revolution, is already bringing radical change to the entire manufacturing value chain. One of the key enablers is connected manufacturing which is today helping to link together all the components - from the supplier to the production line, reseller or distributor, and finally end customer. By Fabrizio Battaglia, Head of Manufacturing, HSO
Across the world, manufacturers are already gleaning information about the supply chain and their products through the Internet of Things. The new paradigm is enabling them to extend this connection to the end customer and start to feedback the information they assemble there to production to adapt the value chain.
Reaping the Rewards
This new connectivity enables manufacturers to find out more about how their customers are using their products. And these developments are likely to have a profound influence on the way that goods and solutions are made in the future. Thanks to the change unleashed by Industry 4.0, manufacturers are already designing and developing products based not just on their own vision and expertise but also on customer feedback and an analysis of how customers are using the product itself.
Moving a further step forward, manufacturers can use that information not just to improve the product but also embed it with services that align with customer needs and deliver incremental revenue streams. It is an evolution of the whole concept of design. Manufacturers no longer simply have to consider the shape, form and build of the product but they now have to think about how best to embed services into the product too.
Customer usage can increasingly be tracked and this knowledge shapes the ongoing development of the product. If a particular function is not being used at all, it can be removed in the next version. If a function is being used intensively on the other hand, its capabilities can be developed further in the next release. In a sense, the customer is in charge, leading and driving the evolution of the product based on the way they are using it. It’s also critical though to have a feedback loop in place so that customer complaints can be fed back into the design and development process. If customers are complaining to customer service that a valve has broken, for example, then the design team also needs to be aware of it so that they can adjust the product accordingly.
Dawn of a New Era
The arrival of the new age of connected manufacturing represents not just a big change but also a major challenge to most manufacturers. Their focus is no longer simply on creating a product and then trying to sell it, instead they need to gather together and then utilise information about how the product can be used and how it can be serviced. Doing this successfully necessitates cross-department collaboration. Working in silos is no longer a viable option.
Moving to a connected manufacturing model is not easy, of course. Organisations need to put an overarching business strategy in place before they take the plunge. They need to know what their ultimate goal is - what they are looking to achieve - before they switch to the new model. They need to understand, for example, what markets they want to target, what demand is likely to be and what KPIs are they going to put in place to measure achievement. And they need to have a talented team of people in post who can read and analyse information coming from the customer and then kick-start the development of new products and services that address this new insight into behaviours and preferences.
And remember - all of this has to be part of an evolutionary process. A big bang approach simply will not work because the risk involved will be too high. If an organisation moves too early, they are likely to find that in fact they can’t change sufficiently quickly because they haven’t tested their plans properly and they don’t have a fully thought-through strategy in place.
The capabilities enabled by this new connected manufacturing paradigm are today enabling manufacturers to transform not just the way they engage with customers but also their entire business model and approach. The days of the traditional ‘sell it and forget about it’ manufacturing approach look to be numbered.
Manufacturers today can’t afford to adopt a purely sales-focused approach. Instead, they need to go beyond that to draw on the data resources they have across the organisation and beyond in order to understand clearly how the customer is using the product and what they are looking to get out of that usage, so they can deliver value added services that enable them to build a long-term relationship post-sale, improve the user experience and tap into incremental revenue streams. It’s a revolution in the whole way that manufacturing is carried out – and ultimately that is likely to be one of the greatest legacies of the new connected world that Industry 4.0 has ushered in.
For more information, please visit www.hso.com/uk