Industry
Manufacturing
Future-Ready Manufacturing: Partnering in your journey to a sustainable manufacturing enterprise
Highlights
- Industrial manufacturing is undergoing rapid transformation with decarbonization, automation and software driven services. Therefore, it is imperative for the enterprise to build an AI-powered digital fabric that will enable this transition and ensure market leading growth.
- As the industry transitions rapidly and accelerates towards their net-zero goals, every business function is rapidly adapting to the change with agile product development, and supply chain and operational resiliency.
- An AI powered digital fabric will bring a paradigm shift in products, services, operations and business outcomes of manufacturing organizations ushering in data insights driven productivity and market differentiating growth.
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Industrial manufacturing macro trends
Industrial manufacturing is accelerating the energy transition with a focus on electrification, reducing emissions, and reimagining existing business models.
As per the US Environment Protection Agency (EPA), industries, along with commercial and residential sectors accounted for over 60% of direct and indirect greenhouse gas emissions in 2022. As a result, manufacturers are increasingly focused on lowering their carbon footprint and aligning with science-based net-zero targets. For industrial manufacturing, with its complex product structures and supply chains, the journey to net-zero involves electrifying products, improving product design and efficiency, and enabling circularity. For instance, in the mining industry manufacturers are offering a mix of electric and hybrid equipment that lowers diesel emissions while offering charging solutions and autonomous haulage solutions.
Industrial manufacturers are also focusing on reimagining supply chains and investing in new greenfield production as well as enabling operational efficiencies through automation. The new production facilities enable manufacturers to improve service levels by being closer to customers and lower supply chain risk. The shortages in skilled labor, is bringing more automation in shopfloor and warehouses leading to improved efficiency and throughput. Manufacturers are reimagining their business models through investments in digital platforms, promoting connected services, and growing their subscription revenue base. Schneider Electric, a leader in energy management and industrial automation, are enabling sustainable business outcomes for clients through EcoStruxure™ platform resulting in software and services accounting for 19% of FY23 revenue.
Industry in transition
As the industry transitions rapidly and accelerates towards their net-zero goals, every business function is rapidly adapting to the change.
Agile product development – This is driving faster innovation, with teams adopting model-based systems engineering, connected labs, and digital twins to streamline product design, engineering, prototyping, and cost reduction. The software defined products require tighter Product Lifecycle Management – Application Lifecycle Managment integration and accelerating time to market. With engineering teams spread globally, delivering customer features is key for growth. We estimate that agile practices can accelerate time to market by 20-30%.
Supply chain and operational resiliency – Manufacturers are reimagining supply chains through near-shoring operations, alternative supplier identifications, and ensuring compliance with new regulations like EUDR. To proactively predict and mitigate risks, supply chain functions must leverage technologies like AI and ML, utilizing both enterprise data and external events. As new greenfield plants are being set up, manufacturers need to simulate material flow and impact of automation before making capital investments. With smarter shop floor assets, there is a need to monetize the information for improving asset performance and throughput.
Ecosystem play - The ability to identify white spaces aligned to the growth strategy drives various mergers, acquisitions and divestitures that is building an ecosystem for value creation. This provides an opportunity to identify complementary offerings creating a win-win for all the participating players. The joint go-to market opportunities use the power of AI, Connectivity, SaaS-based platforms to create unique value propositions that result in Intellectual Property rights and new revenue streams.
Insights for decision making
To make an informed decision in this accelerated transformation, manufacturers are realizing the abundance of data available across the enterprise, however struggle to extract meaningful insights from this data.
As enterprises transform, every business function adopts new tools and technologies, but challenges like traceability and addressing business process inter-dependencies do exist. For example, tracking changes from the engineering bill of materials (EBOM) to shop floor operations and service BOM is still a challenge. Similarly, manufacturers evaluating near-shore suppliers or new automation solutions still rely on time-consuming, inaccurate spreadsheets, due to fragmented IT applications and inconsistent data sets.
The solution lies in building a strong connected enterprise with a seamless flow of information through a digital thread. Laying a strong digital foundation across the enterprise systems like PLM, ERP, and MES systems will start bringing business process efficiencies and transformational capabilities. The result is reduced downtime, scrap, and costs, and improved machine utilization. From a field service point of view, it can ensure improved first-time fix, MTTR and service efficiency with the right part for right repair and equipment. While there are clear gains, the opportunity to proactively generate insights out of the data – both enterprise data and external - to stay ahead of the curve, adapt to changing market dynamics, and achieve competitive differentiation is the motivation that drives many manufacturers to invest in AI and advanced computing.
Bringing power of AI
An AI powered digital fabric will bring a paradigm shift in products, services, operations and business outcomes of manufacturing organizations ushering in the next industrial revolution.
Industrial manufacturers with their diverse product mix are building the foundation for connecting the enterprise and enabling the digital thread. The impact of bringing AI across this digitally connected enterprise is transformative.
Agile product development - Quantum computing is enabling discovery of new and alternate materials. These along with AI led design simulations, analysis, model-based systems, concurrent engineering with ecosystem partners, cloud and edge computing, will give birth to sustainable, intelligent, and autonomous products.
Optimized Operations - Simulations of factory operations in AI enabled digital twins with layout, sensors, machines, humans, robots, spatial relationships and physical rules can generate nearly all possible scenarios to train generative physical AI. These pre-trained models enable robots to work alongside humans safely in complex environments, autonomous guided vehicles to navigate obstacles and manipulators to grasp even fine objects, optimizing material flow and manufacturing processes.
Supply chain resiliency - AI-enabled digital twin of supply chain can mirror complexity showing raw material sources through various stages of conversion to final assembly along with transportation and warehousing. An augmented generative AI model trained with synthetic data can indicate potential disruptions in real time and mitigation options.
Aftermarket services and circularity - Manufacturers deliver outcome-based services for their customers, ensuring uptime of products, first time fix through right provisioning of parts, services, real time monitoring of assets. AI led analytics of sensor data helps proactively plan and intervene with appropriate prognostics, parts and repairs to keep equipment running optimally. Digital thread ensures optimal equipment operation and drives reliability through feedback to engineering.
The way forward
As the industry transitions rapidly, it is imperative to reimagine processes and operating models and bring agility which is data and AI driven.
A connected industrial enterprise, built on an AI-driven foundation of digital twins, extended reality, blockchain, cloud, and edge computing will enable manufacturers to navigate and lead the next wave of transformation.
