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To gain a competitive edge, manufacturers are recognising and adopting the expanding role of digitalisation as a fundamental strategy to realise innovation

Image: Siemens PLM Software

Manufacturing IT Digitalisation as a business strategy

Jun 26, 2017

The shift from digitisation to digitalisation drives companies towards developing efficient production lines that require no human intervention. The article highlights on how companies can take advantage of these transformational technologies to innovate in today’s complex world of product and process.

Technology trends like Big Data, Cloud, Mobile and the Internet of Things (IoT) are just some of the technologies fuelling today’s digital transformation that is impacting how products are developed, manufactured and applied across all sectors of the manufacturing industry. Harnessing the power of new technologies is the key to continuous successful innovation. Many new technologies are already transforming industries by adding intelligence to current products such as autonomous vehicles (predicted by automakers to be launched by 2025). Planes without pilots - the Unmanned Aerial Vehicle (UAV) market is said to double in the next decade.

Leading by the reins on embracing digitalisation is the Asia Pacific region with Singapore positioned as a hub that drives forth digital growth. A*STAR, a Singapore-based science and research agency announced a new Additive Manufacturing centre that is set to launch this year to bolster the adoption of 3D printing technologies. Hot on its heels is India, which expects to have at least five IoT startups with a billion-dollar valuation by 2018 stated in a report published by Gartner. India is increasingly adopting digitalisation as a business strategy and has seen increased activity of late surrounding the digitalisation of businesses at home and across markets worldwide. Further, growth and interest in Big Data, Cloud and IoT within Asia is expected to rise, no longer seen as an emerging region but as an emerged player, according to IDC Manufacturing Insights.

The new age of smart innovation

This surge in adoption rates of digitalisation and developing new innovations point to the movement in which companies are required to go beyond evolving the value of their product and channelling digitalisation. They are required to reflect these critical developments into their services and business practices - such as consumer feedback. Through digitalisation, consumers are able to provide feedback directly to manufacturers via new mediums for sharing information when needed. This development reflects the accelerating advancements in technology, global competition and increasingly demanding consumers.

Moreover, these advancements do not merely enhance the value of a product, but bring about disruption to industries and previously prosperous business models. Some instances of smart products derived from such disruptive technologies are as follow.

Driver assistance to autonomous vehicles—the initial innovation focused on developing and providing advanced driver assistance systems. The transformation that could potentially result from this innovation is a fleet of driverless vehicles available on demand replacing auto ownership and taxis.

Unmanned Aerial Vehicles (UAV)—the intended purpose for UAVs, the most commonly known type being the drones, was pilotless flight. However, as the technology and uses evolved, there was greater emphasis on autonomous control. The transformation made possible due to this innovation has impacted other businesses in areas such as security, e-commerce and photography.

3D Printing—transforming the manufacturing chain and production at a much quicker pace and lower cost. With the aid of Computer Aided Design (CAD), a 3D printer is able to reproduce three dimensional products such as prosthetics and 3D printed implants.

The products, businesses and legacy positions which once gave companies their competitive edge are now no longer secure in the economy today – reinforcing the need to digitalise. How can companies take advantage of these transformational and often disruptive technologies to improve their own ability to innovate in today’s much more complex world of product and process?

Competing in a world of transformational innovation

To gain a competitive edge, manufacturers are recognising and adopting the expanding role of digitalisation as a fundamental strategy to realise innovation. The seamless integration of Big Data Analytics and Cloud Computing of the industrial value chain will be a great advantage to manufacturers. Some companies today are looking at one part of the process. They are leveraging the IoT connectedness to feed the innovation funnel with digitised utilisation data to help understand how products are being used. The goal of this approach is to identify trends which would then feed their ideation pipeline - in essence, helping them to identify their next batch of innovative ideas.

But having this information is not nearly enough. The question is, how effectively can your company execute to bring that innovation to market ahead of the competition and with the cost and quality requirements needed to be successful? Identifying the innovation and realising that innovation in a delivered product are two very different things.

Keys to success in the age of smart innovation

These next generation technologies, which are transforming today’s products have an even greater opportunity to be leveraged across all phases of product development, production and delivery, from ideation (conceiving the product), to realisation (producing the product) and utilisation (operating or servicing the product).This thus brings forth the key to successfully driving new innovations to the manufacturing market.

Some of these transformational forces are already impacting manufacturing organisations across Asia to innovate, especially in advanced robotics where smart robots with enhanced capabilities for operating & understanding work autonomously to complete complex tasks in plants and factories. Also knowledge automation as seen in the medical industry where fully digitalised processes now connect the patient, doctor, manufacturer and hospital through a continuous workflow creating a new business model that can bring customised implants to a level of being a successful business model. Leading automakers have followed suit and implemented initiatives for utilising advanced solutions to cut down both processing and manufacturing time. With the help of digitalisation, engineers at these automotive plants can manage a project collaboratively across various locations. As a result, they can reduce analysis and development times significantly.

Capitalising on these new technologies for innovation requires companies to go beyond simply digitising their data and adopting a new strategy – that is digitalisation. Digitalisation helps tie all phases (ideation, realisation and utilisation) together through a digital thread which possesses the intelligence of all products and its lifecycle processes to smart devices capable of processing complex information.

Optimising your digital enterprise

There are key requirements that are critical for manufacturers to successfully realise the ideation of their digital enterprise. They are delivering a simple yet compelling environment that meets the unique needs of each member of the product’s value chain; building highly intelligent digital models which accurately reflect the real product and manufacturing environment; seamlessly connecting the digital and physical worlds of product and production so that ideas come to life; delivering a foundation that can evolve with new applications, technologies and delivery models ensuring the long term return on the customer’s investment.

Once a fully digitalised business model is accomplished, the key for manufacturers is to then establish their digital enterprise that fosters product and process innovation to provide them a sustainable competitive advantage.

With the shift from digitisation to digitalisation, companies are able to develop sustainable and ultra-efficient production lines that require no human intervention. According to a Gartner Industry Research conducted in 2010, a smart factory in Amberg found 15 defects incurred per million produced, enjoying a 99% reliability rate and 100% traceability on its manufacturing process lines – all made possible with the help of smart innovation and a digital infrastructure in place.

The possibilities to innovate are endless. It is pivotal to an organisation’s future and growth to develop a solid digital infrastructure to compete in today’s economy. By getting these models united it realises disruptive innovations more quickly, and factors in the cornerstone required to become a market leader.

The article is authored by Dieter Klinke, Business Development Director, Asia Pacific, Siemens PLM Software

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