Steps to Future-Proofing and Risk-Proofing Your Manufacturing Business
60% of manufacturers and distributors were impacted by supply chain disruptions during the pandemic.
As these businesses attempt to stabilize, many are considering adopting emerging technologies and industry 4.0 to mitigate the impact of major disruptions in the future. The challenge for many of these businesses is understanding which technologies to adopt, when to pursue this transformation, and also how to budget for it. There are a number of technologies that have the potential to make a positive impact in manufacturing and distribution in the next five years.
The automated warehouse
If you are considering transitioning to an automated warehouse, you need to understand that it won’t happen overnight. While Fortune 500 companies may have billions to put towards automating their warehouses (and most of them started that journey many years ago already), most manufacturers don’t have big budgets to make this happen.
It’s important to be honest, it is going to be a long, and expensive journey — the key, however, is to start planning now. In most cases, it will take three to five years for organizations to be fully automated, and you will still see at least 65% of workers in the warehouse. This is because the automation augments the human capital, it doesn’t replace it, particularly in smaller manufacturing plants. There has been a shift due to the global pandemic and we are seeing more of a push for robots to overtake that augmentation to fill a more autonomous role to decrease the possible transmission of disease for example, but what we are seeing at this point is baby-steps. We’re a long way from a fully robotic scenario with remote monitoring.
Contactless payments and blockchain
What we have seen globally through this pandemic, is that manufacturers started their shift first with online shopping, and then contactless delivery in some instances using robots to enable social distancing. There has been increased implementation of digital and contactless payment, with many retailers upgrading their credit card payment systems to allow for tap.
One of the first areas manufacturers can start to make changes is to reduce paper-based systems, and to work on making their distribution more contactless, particularly at the point of delivery. There have been a lot of different approaches in different countries, from robot baristas, to grocery services delivering food from vans to front doors using robots, to no longer needing to sign paper forms to accept delivered goods and services, all in efforts to comply with governmental regulations and safety recommendations.
Many manufacturers are still using paper-based systems, so from the time you capture the order, to when it gets printed in the warehouse, picked and then packed, and then delivered, it’s been through multiple points of contact. This is the best point to start incorporating automation into your organization, and it can be easier than you think. If you are running an ERP system, this process can be fairly easily automated, and when it comes to devices, most people today have smart phones or tablets that can be used to facilitate it. Particularly for smaller manufacturers, the advent of BYOD means that there won’t be a huge outlay for specialist devices, so it’s an affordable way to start their digital transition.
Blockchain is a potential answer to increasing trust in order to reduce reliance on a paper-based environment, however it does need to mature still. I believe that we’ll start to see blockchain being incorporated into supply chain 4.0 and that industry will start to embrace the technology
Another way that organizations were transitioning during lockdown was taking their businesses to the cloud, to facilitate work-from-home environments, and to allow for more agile online shop fronts where orders could be automatically captured and processed. There has been a huge increase in online shopping during the pandemic and many organizations have had to upgrade their online presence to enable e-commerce. When you move from 20 online orders a day to 10,000 orders a day, that isn’t something that you can still manage manually. Those manufacturers who had the foresight to move their technology forward a year or two ago and upgraded their ERP systems were able to pivot quickly to plug in payment gateways, which made a big difference for their businesses. The ability to also plug into a connected supply chain and make use of an established third-party system for the retail and distribution of their products also proved a winning combination. This enabled them to extend their supply chain through a connected supply chain. It is critical to look at all potential avenues and not be stuck in your ways if you want to be agile enough to withstand sudden potentially hugely impactful events, such as war or pandemics.
Another financially attainable technology that has advanced innovation and had a major impact in the manufacturing sector over the past year is additive manufacturing or 3-D printing. Prior to 3-D printing , a part would be drawn on a piece of paper, then put into a CAD drawing, and sent to a plastic mold injection company who would create a prototype. Today, a lot more businesses have access to 3-D printers onsite, and product innovators are able to create the piece directly in CAD and send to the 3-D printer. This advancement is saving large amounts of time and concepts are coming alive a lot faster. A prime example of this is how auto manufacturers were 3-D printing critical ventilator parts in the peak of the pandemic.
The secret when planning your transition is to look at your immediate needs and choose technologies that can help you unlock the most value, for the least amount of stress and a more realistic cost. Don’t get locked into one technology, and use connected technology that will suit you, enabling you to jump from capturing orders on your laptop at your desk, to using your rugged handheld device in the warehouse, or on your mobile when you’re out and about. If everything is connected, you’ll see a big reduction in your paper-based system. Most organizations have existing technology that they can use, so you don’t need to incur costs of buying it all new. Huge value can be gained in talking to your ERP provider to see how you can increase automation within your organization using a combination of what you currently have available, and learning more about how you can use the payment gateways and the connected supply chain to boost your business. A few baby steps like that will take you further into futureproofing and risk-proofing your business.
SYSPRO can help you digitalize and future-proof your manufacturing business. Learn more here.