COVID-19 has disrupted life around the world, leading to a global crisis and significant effect on businesses. Manufacturing is unfortunately, one of the industries that has been impacted the most. Mired in between an agenda for transformation and legacy systems, the industry was not prepared for something like a global shutdown, and companies have been grappling with numerous challenges to continue critical operations under lockdown.
Even as manufacturers get their bearings in these turbulent times, one thing is clear – disruption doesn’t come without business opportunities, and technology adoption will need to accelerate across the board to aid survival and recovery.
BCG has derived that approximately $900 billion will be spent on digitization globally. 80%+ leaders believe analytics will be key for decision making in industrial manufacturing1.
Chinks in the armor
Almost overnight, lockdowns left manufacturers facing supply shortages, increased prices, and fulfilment delays due to trade restrictions and labor shortage, and a slowdown in demand. These challenges could have been overcome to an extent if not for deeper hurdles to business continuity within the system:
Driving change in the wake of COVID-19
Pre-COVID-19, manufacturers were taking measured steps towards digital transformation and Industry 4.0. The pandemic has changed that. Instead of a “good to have” option, technologies that digitize assets, automate operations, and bring in efficiencies and innovation in the system have become critical for survival and recovery. In addition, there is a strong focus on employee wellbeing and creating safe work environments. At Wipro, we had an overwhelming effort to enable 165,000 billable client-facing employees to work from home. We moved massive number of desktops (40K+), additional laptops and data-cards (30K+) to employees’ homes almost overnight.
As companies reopen their factories, immense planning has to go into workforce safety, optimizing operational costs, remodeling supply chains and creating short term and long terms plans for the future.
Here are 4 key changes we see being implemented in the manufacturing enterprise in the near future:
Modernization of remote work capabilities
Digital workforce is the norm now. There will be no going back. The remote work mandate has stressed existing IT environments, and network modernization is essential to act with agility in the face of change. To become a 100% virtual workplace meant delays, challenges in user experience, and additional expenses to provide the required infrastructure. Going forward, manufacturers will need to transition to cloud and multi-cloud-based workplace models that allow secure information access and real-time collaboration environments from anywhere. Adoption of zero-trust frameworks will help deal with security threats in a remote access scenario. Companies will also need to put in place Artificial Intelligence (AI)-based rules to prioritize network access for critical activities in case of an overload in bandwidth demand. Intelligent, aware, and self-healing networks will become a norm. We have helped factories reopen with solutions that help digitizing health declarations, automating temperature tracking, and monitoring of sanitization and social distancing.
Automation takes center stage
In the immediate future, we will see heavy investment in process automation that reduces dependency on factory floor workers. These include areas like materials movement using autonomous robots, automation of repetitive, labor-intensive tasks with Robotic Process Automation (RPA) or AI, and predictive maintenance enabled by connected systems. AI will also play a key role in driving insights that enable manufacturers to constantly assess the situation and re-plan activities to suit the requirements. AI-driven guidance for critical decisions will also limit human intervention while leading to data-driven decisions. Gartner says that by 2023, manufacturing companies will spend $42.8 billion more on software than they did in 2019.
Centralized remote asset monitoring
Today, most manufacturers lack the ability to get real time visibility across their organizations. Connected technologies can help present a single view of the enterprise, drive remote monitoring and diagnostics of operations and assets, enable digital twins to improve decision making, and create new value streams with servitization. Machine monitoring solutions will play a major role in initializing the Internet of Things within the industry. It is the first step towards Industry 4.0 because beyond monitoring, it creates a next-level communication network within the industry.
Building resilient supply chains
COVID-19 crisis is neither the first disruption, nor will it be the last. Manufacturers need to rethink their supply chains and make them more resilient in the face of change. This requires a keener, real-time situational awareness to identify and fix weak links and a proactive stance against risk. Innovative use of technology, such as using 3D printing for spare parts can also cushion against supply shocks.
Building resilience into supply chains will not happen overnight. Companies have to plan a phased approach to modernization, and adopt technology that will allow visibility, enable real time monitoring, and help predict and prevent failures.
The way ahead for manufacturers after COVID-19
While most countries have only allowed critical manufacturing operations, they do have a plan to re-start non-critical production as the COVID-19 crisis resolves.
As manufacturers start rebuilding for the future, they need to think Digital First and People First. The immediate action is to start building an organization that supports digital operations and looks at the convergence of IT and OT to support digital engineering. However, in the long run, the mindset of efficiency and throughput needs to evolve and shift to one of market-centricity and resiliency. High on the agenda for the manufacturing leadership is to transition to an intelligent enterprise and deliver innovation at scale, and build the ability to pivot quickly in response to market conditions. Only a shift to becoming an agile, automated, technology-driven entity can prepare manufacturers for the next disruption. Will you be ready?
We can help you embark on your journey of transformation. Connect with us here.
2 Talent Management Survey 2019, IDC, April, 2019
Vice President and Business Head, Manufacturing - North America, Wipro
Ashish has 25+ years of experience demonstrating visionary leadership and outstanding performance leading many Fortune 500 and Global 1000 client relationships across Asia, Europe, and North America.