The engine of next-level manufacturing is the hard- and software of digital technologies. The fuel is data. Smart manufacturers uses data to power ahead.

Imagine the laptop, desktop and mobile phone of a Chief Supply Chain Officer. Or, all the equipment in a plant, linked with the hardware in its manufacturing execution system.

Now imagine: what would these technologies do without data?

It’s called Big Data for a reason

Today, the challenge and the opportunity is that never before in human history has there been so much data: so many sources, so much accumulation, billions of individual users and hundreds of millions of enterprises thirsting and competing for information. It’s both elusive and all-pervading. Business intelligence is available, but knowing which data to seek, how to get it, and how to interpret and leverage it has become a fundamental business requirement.

Data is diverse – and can be put to diverse uses. But it has to be gathered, managed and massaged in order to enable better results for the enterprise. How manufacturers do this is integral to leveraging the advantages of digital technologies and fulfilling the promise of digitized operations.

The value of data starts with asking the right questions

The proliferation of data means that extracting optimal value from it requires a step back. Start by revisiting the business objectives and the key strategies to achieve them. (For instance, operating margins are targeted for a 1% improvement, or new product innovations are earmarked for faster development.) Those will be the areas where data-gathering should be prioritized. To narrow the scope, set the implementation outcome. (The primary plant’s OEE scores must increase 5%, or three business-to-business innovations are scheduled for launch.) This will determine precisely where data should be mined, analysed, and modelled, and the tools required.

Data-driven organizations are three times more likely to report improvement in the outcomes of major decisions. Comparative advantage in the use of data correlates strongly with better financial performance versus competitors. But how, precisely, can metrics and data improve productivity, workflows, and outcomes? There are five main dimensions.

Current operational improvement  

Digital Operating Systems (DOS) represent the principle of data as the fulcrum of the business. Together with advanced analytics and technologies, traditional manufacturing supply chains are transformed into digital demand-driven value networks (DDVN).

But data continues to serve – and improve – certain fundamentals. When lean methods are augmented with advanced technologies, studies report an improvement of up to 50% in overall equipment effectiveness (OEE) measures.

Operational connectedness – between information- and operations-technologies, and real-time data reporting into monitoring systems – allows management oversight. And when hundreds or even thousands of pieces of plant, machinery and equipment are fitted with sensors and diagnostic applications the potential for operational efficiencies, boosted productivity, and predictive maintenance, is enormous.

Buttressing future operations

Data and algorithms are the basis for machine-learning systems. The stage is set for increased automation and – as the enterprise progresses to digital maturity – artificial intelligence (AI). AI is an acceleration of data power, and is expected to boost global GDP by $15.7 trillion by the end of the decade. Manufacturers who lag in AI investments reduce prospects of sharing in these gains, and risk their future-fit competitiveness.

Insights

Digitally progressive companies report higher revenue growth or net profit margins than industry averages. This emanates from the smart interpretation of data and metrics: precisely because digital leaders seek to measure, more, they have access to wider information and can make deeply informed decisions.

Data mining and diagnostics from social media, for instance, can yield powerful consumer insights towards CPG product innovation. Distribution and retail trend analyses can reveal opportunities for segmentation or realigned S&OP structures to drive margins.

Data is alive with such strategic and tactical insights awaiting discovery.

End-to-end visibility

A digitally-enabled organization gains value from clarity, with data used to gauge real-time tracking and progress.

Digital twinning can use connected data streams to simulate and instantly model for alternative, optimized actions, and blockchain enhances the transparency of transactions. These, among other digital applications, contribute to a narrower trade-off between cost-to-produce and speed-to-market.

Digital dashboards give management agility, too. For example, each C-Suite leader can constantly track selected KPIs which are mission-critical for his or her area of responsibility. This allows for teams to be empowered through decentralized decision-making whilst maintaining centralized overview and control, and the capability for instantaneous course-correction if required.

In strengthening the overall value chain, this is data as resilience. Shared information and aggregated business intelligence, rapidly analyzed, not only improves operational outcomes but also creates fortitude and the flexibility to manoeuvre, fast.

Data creates culture

When data is prioritized, its value also lies in the behaviours this creates. Traditional manufacturing principles used data to benchmark, to drive continuous improvement, to reinforce lean. But fully digitized operations and systems ramp this up: modern applications and tools, in allowing data to be visualized and rapidly dispersed across the enterprise, foster an understanding of how data helps, and the ability to “think in data”.

Data, as part of an investigative discipline and performance focus, is a plus for the company’s culture. When the question ‘What does the data say?’ echoes from factory meeting alcoves to the C-Suite’s offices, the organization is likely to be digitally advanced – and a leader in its industry.

One of the world’s most valuable commodities

Data – information – has always been of the utmost importance. Now, as businesses exist within an ever more complex and competitive environment, and digital systems provide the means to cope and the pathway to opportunity, its value is clear. Data-centric, data-capable manufacturing organizations will be primed to thrive.

Contact CCi for further information about orchestrating your digital operating system, and making your organization truly data-centric.

CCi is a privately held global company that enables organizations to deliver sustainable results across the value chain through TRACC, a solution for continuous, integrated improvement.

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