Manufacturing Technology Insights: How SMBs Are Using Tech
When we think of manufacturing technology insights for small and midsize businesses, it’s often the exact opposite of what people are expecting.
We’re all familiar with the sight of a politician donning a hardhat for tour of an enterprise corporation’s factory floor, but the reality for SMBs can seem a long way off from the advanced technology you might see in the hands of the country’s biggest firms.
We’re far more likely to be talking about how much SMB manufacturing firms are lagging behind other industries than we are about how advanced they are.
So, while large enterprises may revel in the press, it’s really SMBs that need to take a good look at their digital maturity and assess whether they have what it takes to grow and succeed in the future.
98.43% of all manufacturing firms in the United States are considered SMBs, and just one in five of those consider themselves “highly prepared” to address the emerging business models the Fourth Industrial Revolution brings.
The importance of implementing a strategy for technology is unlikely to dissipate, and expectations will in fact grow as sophisticated technologies become more readily available to SMBs.
Join us today as we give you some insights into the manufacturing technology that SMBs are investing heavily in to stay competitive and prepare themselves for the future.
5 Technologies Driving the Manufacturing Sector
Industrial Internet of Things (IIoT)
The Internet of Things is one of the biggest buzzwords in the industry, so before you shake your head in dismay, let’s take a look at the Industrial Internet of Things—complete with its additional prefixed sector qualifier.
The IIoT has several uses in the manufacturing sector and is more an exercise in common sense than it is the frivolous implementation of technology.
Let’s take a very common example of IIoT use that manufacturers like to see put to use: sensors.
Organizations task workers with checking and maintaining their machines. But we’re human—we don’t always spot an issue until it’s too late.
The IIoT simply seeks to take data from machine sensors and deliver it in an actionable way. Is it running hot? Maybe the rotation speed or pressure of a machine isn’t quite right.
The Global IoT Sensor Market is expected to exceed more than $68 Billion by 2024 at a CAGR of 40% in the given forecast period.
With the IIoT, you can pick up on these issues long before they become a bigger problem by getting accurate information delivered to you from a variety of machine sensors whenever you need it, saving yourself maintenance costs and downtime.
According to Deloitte, IIoT-based predictive maintenance solutions are expected to reduce factory equipment maintenance costs by 40% and generate an economic value of $630 billion annually by 2025.
And that’s just one example; the principle remains the same in terms of bridging the gap between machines and tools and workers’ devices.
Whether it’s a location tracker for a machine to save an employee time finding it or a monitor that helps you determine the health and safety of individuals on the factory floor, the possibilities for IIoT tech in manufacturing settings are wide and varied.
Big data & analytics
Data in manufacturing doesn’t end at IIoT implementation, either.
The role of big data and analytics has had an enormous effect on the ways manufacturers conduct their businesses, particularly with regard to their supply chain management.
We probably don’t have to go into the effects that the COVID-19 pandemic has had on the supply chains of businesses up and down the country, but it has illustrated just how important a factor data analysis can be in minimizing disruptions as much as possible.
Because of the vast proliferation of data over even just the last two years, SMBs find themselves sitting on a veritable mountain of valuable information which is often underutilized by organizations that don’t have the right technology.
Up to 73% of company data goes unused for analytics.
This is where an ERP that can help provide you with actionable insights can be vital.
The number of supply chain professionals who say they’re currently using predictive analytics at their company grew 76% from 2017 to 2019.
Businesses can use analytics to assess their data in order to determine their supply chain needs, potential disruptions, and prevent common issues like overstocking or overproducing.
In essence, you’re using more advanced data to cut waste and prepare for inevitable supply chain disruptions.
Businesses are adopting predictive analysis techniques on a much wider scale than ever—approximately 30% of organizations used it in 2019, up from 17% two years previously.
As we just noted, the amount of data that businesses now possess and have to look after is higher than ever too.
This needs to be stored somewhere, and data privacy laws are ramping up as lawmakers seek to ensure companies are being responsible with customer data.
We’ve already seen GDPR have an enormous effect in Europe (and US firms that trade with Europeans) as well as CCPA in California.
Congressional representatives on both sides of the aisle have already begun drafting data privacy laws at the federal level, and major businesses such as Microsoft and Verizon have been calling for legislation to be passed as early as this year.
Why does this matter?
Well, put simply, data protection is fast becoming a key priority for SMBs, and compliance regulations will have to be adhered to so as not to fall foul of hefty fines.
So, what we have are two concurrent trends:
- A proliferation of general business data which needs to be stored
- Customer data that needs to be stored with the correct protections, such as in a Tier IV data center
This makes the cloud an extremely attractive option for SMBs, who are choosing to host their data with Azure and similar services because of their scalability and flexibility, depending on company needs.
Automation & AI
Typically, when we think about automation, we envision sophisticated robots acting of their own accord.
In fact, it’s more likely that the most useful automation and AI technology they’ll be using will be software bots for automating key working processes.
AI and automation actually tie-in to some of our other trends, specifically the Industrial Internet of Things and analytics.
57.6% of SMB CEOs think advanced technology will impact their business in the next year.
Let’s take the machine maintenance example of IIoT above.
In addition to some of the more standard tasks you might be more familiar with automating, such as document workflows and reports, you can use AI-powered technology to do a lot of the heavy lifting required when it comes to analyzing the processes on your factory floor.
Say, for example, that a particular machine is not running at full capacity. An automated solution can be used to assess every machine automatically, comparing each one and then reporting back to you with actionable data.
Automation also means that instead of wholesale getting rid of old machinery, you can instead upgrade your existing infrastructure (by adding sensors) and still automate it along with your other processes.
Low-code apps have upended the traditional software development cycle to a large degree.
For the uninitiated, low-code can be used to create custom apps for business to solve unique problems that an off-the-shelf solution can’t. The name refers to the visual nature of low-code platforms and the premise that they require very little coding, as opposed to more traditional methods.
Not only is it far cheaper to contract developers to create the apps you need, but you can expect the completion time to be significantly quicker too.
More than 65% of application development in 2024 will be from low-code.
Low-code apps can be used for virtually anything, whether it’s a visual inspecting app for machinery, streamlining workflows, or automating sales processes from start to finish.
We expect the low-code market in manufacturing to pick up significantly in the next few years, as businesses see the appeal in reduced deployment times for apps and its value propositions.
A Word on Smart Manufacturing
One of the most important things to recognize about these technologies is that to some extent—or rather to a large extent—they drive one another.
Smart Manufacturing, as it’s come to be termed, is an encompassing phrase which means a digital approach to manufacturing that employs to some extent all of the above.
The market for smart manufacturing and related technologies was worth $152.3 billion in 2017 and is expected to be $479.01 billion in 2023.
These technologies should not be utilized in an al a carte manner, but rather organizations should have a close look at their processes and see where these key components of modern manufacturing technology can be used as part of a larger approach to digitizing their processes.
Technology solutions like ERPs use your data to give you analytics of your operations with pinpoint accuracy. Using analytics, you can reduce overstocking, assess historical trends in your inventory, see the productivity of employees, and get predictions to help you prepare for market fluctuations that you might not have otherwise been aware of. And there’s so much more you can do for your business with modern technology.
For more information about how tech solutions can help your manufacturing SMB, download our free eBook, “Fast-Tracking Your Digital Transformation”, featuring an entire chapter on Enterprise Resource Management, which helps improve the efficiency of your supply chain and other processes.