The business world is littered with big name companies who failed to keep pace with the changes required by digital innovation and have ceased to exist. In manufacturing, digitalisation is already threatening to create its own class system, with those who embrace the industrial transformation element of digital transformation securing their long-term health, and those who ignore it, their demise.

UK manufacturing has long needed a boost. Plagued by productivity problems, a lack of skilled employees and the shadow of Brexit, good news for UK manufacturing has been in short supply.  However, digitalisation – or Industry 4.0 – has offered cause for optimism, promising transformational improvements from the factory floor to the supply chain. Digitalisation is offering a lifeline to British manufacturing, so you’d think manufacturers would be racing to embrace it.

Not so. In a session during a recent conference, ARC Advisory Group (ARC) cited its recent research of 157 process manufacturers that found there were still barriers in organisational accountability, culture and employee change management that impeded transformation. The research found that although more than 80% of industrial process manufacturers are piloting advanced technology, only 5% to 8% of them are ready for digital transformation. Where other sectors have harnessed the Internet of Things (IoT), artificial intelligence and big data to meet the changing needs of their customers, the manufacturing sector has been slower in adopting new technologies.

So, what are the main barriers to adoption? For many, the issue is internal, with a shortage of skills to implement and maximise technologies, and a generally low awareness of how to build an effective business case for the required investment proving problematic. Other challenges to adoption include concerns about cybersecurity, challenges posed by legacy equipment and concerns about the cost of change.

It’s important to remember that technological advancements usually come in response to changing consumer requirements. Manufacturers used to be a step removed from the consumer, but changes to the buyer journey have filtered down every part of the supply chain. Mass producing one product for millions of customers is increasingly rare; consumers want options, personalisation and customisation, and to do that in an industrial environment requires the technology to dynamically adjust production, dialling up and dialling down, whilst looking for efficiencies and monitoring maintenance requirements. 

Digital transformation is key to achieving objectives like improving efficiency and quality, reducing costs and waste, and creating innovative products and services. It also enables improved asset health which helps eliminate unplanned downtime and enhance incident prediction capabilities. Other digital innovations now available for manufacturers include Artificial Intelligence and Machine learning, which allow the automation of low skilled tasks and IIOT devices that use sensor technology to deliver low cost sensing to drive efficiency without impacting control networks. 

Digitalisation is no longer simply a tactical aspect of the manufacturing business – it is becoming vital to pursue end-to-end digital transformation in order to achieve objectives like improving efficiency and quality, reducing costs and waste, and creating innovative products and services. To be a successful manufacturer of the future, the need to build an effective roadmap to guide you along the transformative changes of the next five, ten or fifteen years needs to start now. The key is to see industrial transformation not as a one-off implementation project, but as a constantly evolving process designed to add incremental value.

Perhaps, for some, the scale of what they feel is required for digital transformation is too daunting, but what’s important is to take those first initial steps. Continuously improving via the use of digital technologies is more appealing than stagnation or decline. It’s easy to see how failure to act now will create a huge gulf between manufacturers in the next two to three years. Digitalisation cannot be delayed any longer; the potential of Industry 4.0 must be recognised now.