Digital transformation is not a new concept. It has been brewing for years with many companies tried to wrap their heads around what it actually means, what it will cost and how long it will take to realize a return on the investment. Of course, as success stories started bubbling to the surface now and then, the number of skeptics started to wane. And when the pandemic took hold, it put a spotlight on the necessity (something the IW Technology Survey confirmed as well). At the same time, the frequency and depth of successes started to become more prominent. Need a few examples? Consider the successful journeys at Intertape Polymer, Stanley Black & Decker, Mars and Tata Steel.
Still need more affirmation?
Rackspace Technology recently asked manufacturers about the indisputable and constantly evolving role of technology in their business including the dangers of dropping behind, executive knowledge of the role of technology and executive familiarity with what technology can do for the bottom-line. The results of Rackspace's global survey show that, in addition to allowing products and services to stand out, modernizing technology and applications can improve competitiveness as well as the kinds of customer experiences (CX) and efficiencies that drive profits.It’s no surprise that manufacturers are as advanced as they are with technology adoption, Rackspace Technology CTO Jeff DeVerter tells IndustryWeek. “Manufacturers have lead technology adoption from early on. Think of the technology revolution Henry Ford unleashed on the world with the assembly line,” he says. “Today – manufacturers rely on the latest in technology to drive consistency, efficiency and productivity throughout their organizations.”
When digger deeper into the survey results manufacturers were most likely (71%) of all sectors surveyed to be in the process of digital transformation with 63% of manufacturers saying they figure their competitors are in a similar stage of transformation which 60% characterize as cross-functional practice which extends beyond a single business unit, making digital a way of thinking.
A clear majority (89%) of manufacturers say their appreciation for application technology has grown over the past five years, and 51% of manufacturers say it takes months to gain consensus before implementing change. Fewer (42%) say it takes weeks. Among the technologies that benefit manufacturers’ businesses most financially -- both in generating revenue and reducing costs -- AI/machine learning, cybersecurity, enterprise software, e-commerce and IoT rank the highest.
“Every industry can learn from the example being set by manufacturing in focusing on AI/ML as its top priority,” says DeVerter. “Every business is sitting on a mountain of data that they’ve generated for countless years. Machine learning can help assimilate that data into patterns the business can use to its benefit. Once they understand the data better – AI can help drive automated decisions to amplify the company’s workforce.”
Fortunately, a majority (68%) of non-tech C-suite manufacturing executives are thought to understand the bottom-line benefits of apps in the manufacturing industry. A whopping 93% have a better understanding of those benefits than they did five years ago.
According to survey results, manufacturers clearly understand the costs associated with not embarking on modernization efforts. Specifically, respondents noted a failure to move away from legacy applications in the next two to three years, will cause employee turnover (100%) and lack of ability to compete (67%). Additionally, respondents identify inability to meet new regulations, inability to meet new demands and reduced levels of customer service as consequences for manufacturers of delaying modernization efforts.
The biggest recommendation is to help make sure that all areas of the company understand the value that tech brings their company, explains DeVerter. “Now this recommendation is true of both those in the manufacturing market as well as every other industry,” he says. “We saw consistently across all industries that not every role in the C-Suite understood the value technology could bring their departments. The more individual leaders see technology not as a cost center – but a possibility center – the better off they will be.”