Digital Transformation

Intelligent Process Optimization for Manufacturing, Distribution, and Logistics

Find out why it's important for businesses to utilize intelligent process optimization in their strategies for 2020 and beyond.

Blog Post

5 minutes

Jan 08, 2020

As markets continue to evolve, more and more businesses are looking to transform digitally to stay competitive.

Even so, many manufacturing businesses are lagging when it comes to adopting some of the broader initiatives like intelligent process optimization that are inherent in a successful digital transformation.

That’s because most manufacturers are still using legacy applicationsoutdated operating systems, CRMs, ERPs, hardware, and infrastructure—for their processes.

While modernizing old and outdated systems can be time-consuming and complex, not doing so can lead to issues down the line.

These obstacles can range from incompatibility with modern tech solutions, weak security, inflexibility leading to poor customer experience, and maintenance issues—all the way up to staff resistance to installing a new system.

However, one way that manufacturers can gain access to the benefits of digital transformation is by adding intelligent process optimization to their arsenal of business applications.

Process optimization can make manufacturing in digital transformation smoother, easier, and more successful.

Goals of Intelligent Process Optimization in Manufacturing

Process improvement literally has no end, as the improvement cycle starts over each time a goal is attained.

But to start, there are two simple goals inherent in adopting a process optimization strategy—minimizing costs while maximizing production.

It’s a deceivingly simple formula. A plant’s profitability is ultimately determined by subtracting operating costs from the sales of the total yield of the product.

While it sounds easy enough, putting processes in place to maximize efficiency and productivity without adversely impacting costs can be daunting—unless a strong process optimization strategy is employed.

A study of over 1900 companies across the United States and Europe shows that higher levels of digital maturity equate with an increase in performance and competitiveness.

To create an actionable process optimization plan without putting undue strain on management or employees, goals for longer timeframes are broken down into bite-sized actionable tasks.

These tasks are able to be achieved in small specific periods to keep the momentum going and sustain staff buy-in and morale.

Prior to task creation, however, successful manufacturers must learn to leverage the considerable power of data in order to pinpoint areas of weakness and open up new methods of cost control and efficiency.

Doing More with Less: How Data Can Empower Decision-Makers

Achieving increased revenue and production while reducing inherent costs calls for a delicate balance that can put significant pressure on senior management.

Fortunately, adopting a digital focus can assist decision makers in making the best use of resources for increased productivity and controlled expenditures.

Data-driven organizations are 23 times more likely to acquire customers, 6 times as likely to retain customers, and 19 times as likely to be profitable as a result

Specifically, data analysis can help monitor and resolve:

  • Issues with low product turnover
  • Inventory management issues
  • On-point KPI tracking
  • Lack of data visibility
  • Demand fluctuations
  • Supply chain monitoring

And, this kind of data can transform every aspect of a manufacturing business—from human resources and marketing as well as other daily business operations.

How Intelligent Process Optimization Can Help Manufacturers

Computers, digital intelligence, and advanced robotics have revolutionized the manufacturing industry—but that shift brings with it significant challenges related to the complexity of the process.

To be successful in a modern manufacturing marketplace, companies must optimize across several aspects of their operations, including:

  • Adopting a strong ERP plan across enterprise functions
  • Optimizing processes for increased efficiency and flexibility
  • Finding and accessing new revenue opportunities
  • Coordinating diverse applications for increased information flow

Successfully handling these facets of the manufacturing business can help set individual organizations apart and hand them a competitive edge in an increasingly aggressive market.

For example, new ERP applications encompass not only supply chain management, but expand to include product lifecycle, human capital, customer relationships and expense management.

Integrating information on all these processes enterprise-wide can increase flexibility and allow companies to pivot as market demand shifts.

The analytics market, mostly driven by DX-related initiatives like AI and machine learning, was worth $3.6 billion in 2018 and is expected to hit $7.1 billion in 2023.

Production process optimization helps sort out and streamline supply-chain complexities and distribution channels with metrics and detailed reporting systems.

Tailored analytics help target potential problems and correct processes in advance of issues that can cause slowdowns or errors.

This highly investigative process can also assist in the on-boarding of new revenue streams by using analytics to identify new demands and pinpoint and serve evolving customer needs.

Finally, connecting the flow of information across business systems—from human resources and marketing to production, IT, and customer and supplier interactions—can help managers make critical business decisions with precision and insight.

Takeaways

  • Manufacturing businesses are lagging when it comes to adopting some of the broader initiatives like intelligent process optimization, that are inherent in a successful digital transformation
  • Putting processes in place to maximize efficiency and productivity without adversely impacting costs can be daunting—unless a strong process optimization strategy is employed
  • Adopting a digital focus can assist decision makers in making the best use of resources for increased productivity and controlled expenditures
  • Specifically, data analysis can help monitor and resolve Issues with low product turnover, inventory management issues, on-point KPI tracking, lack of data visibility, fluctuations in demand, and supply chain monitoring, among others
  • Ultimately, to be successful in a modern manufacturing marketplace, companies must optimize processes across several aspects of their operations

Impact is a leading provider in managed services, working with SMBs across every industry. We offer tried-and-tested strategies and only partner with vendors offering best-in-class solutions. Explore our digital transformation offering today.

Tags

Digital TransformationLogisticsManufacturingOperations

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