Connecting to Customer Demands

The Digital Thread may soon have legacy systems all sewn up

Published: Tuesday, December 23, 2014 - 01:00

Everyone is talking about technology advancements. References to the cloud, mobile, big data, the Internet of things (IoT)—used as central talking points or tangential nuggets that bounce in and out of conversation—are nearly ubiquitous across manufacturing industries. Most professionals seem to understand, at least on some level, where technological trends are headed for operations.

But do they understand how their organizations currently stack up to competitors? Do they grasp how the current capabilities within the organization (or lack thereof) position them to meet objectives and face challenges as we move into 2015 and beyond?

Research suggests there’s still work to be done in education regarding the current state of the marketplace and the benefits and capabilities revealed as companies move toward a more digitized, seamless flow of information—what’s known as the Digital Thread. In this article we’ll discuss the current state of manufacturing operational goals and challenges, what’s shifting, and how reliance on legacy systems and manual processes is holding many companies back from achieving manufacturing and enterprise-level goals.

It probably comes as no surprise, but manufacturers are heavily focused on the wants and needs of their customers. When manufacturers taking LNS Research’s Manufacturing Operations Management (MOM) survey were questioned about their top objectives, meeting customer demands was second only to ensuring consistent product quality, at 55 percent vs. 61 percent of responses.

As manufacturers know, to connect to the customer’s perspective and demand, it’s imperative to have immediate and actionable information at hand to inform key stakeholders to make correct and timely decisions. This is monumentally difficult to achieve when you have an architecture of legacy systems and software that lack the ability to intercommunicate, contextualize data by role, and serve redundant purposes.

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And research bears this out: As seen in the graph above, the top two operational challenges in meeting goals are very much related to technology and process capabilities.

It’s worth mentioning that this snapshot of operational challenges doesn’t exist in a vacuum. This is the present reaction to today’s market, but things are changing rapidly. The chart below illustrates five manufacturing business conditions that have recently changed.

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These five conditions read as the beginning of a litany of requests from customers. They’re more fickle overall, and they want a greater number of more complex products in a shorter amount of time with greater visibility into how they’re made. Responding accurately and adequately to customer demands and expectations is becoming more difficult every year and causing even further strains on legacy systems. This applies to all industries, but in aerospace and defense, electronics, and life sciences, the legacy systems are rapidly becoming obsolete.

How the Digital Thread helps manufacturers respond and achieve operational excellence

Forward-thinking manufacturers have seen these trends coming and are beginning to invest in emerging Digital Thread technologies—those that enable a single, bidirectional flow of digitized information across the value chain. Cloud, mobile, big data, and IoT are important strands of the Digital Thread, breaking down informational silos to foster collaboration by:

• Enabling streamlined collaboration on product and process designs for manufacturing operations
• Providing real-time, role-based data on mobile devices
• Including quality, asset management, scheduling and planning, and customer sentiment in decision-making processes across departments
• Supporting closed-loop quality and end-to-end product traceability capabilities
• Extracting additional information from structured and unstructured data to better forecast and make decisions

With these and other capabilities integrated into companies’ operations, manufacturers find themselves in a much better position to extract and execute on information and workflows, greatly enhancing operational agility, and allowing operations to follow a proactive operational model instead of reacting to circumstance.

It’s important to remember that even if you’re still achieving your goals with your current, legacy IT architecture, this bar will always rise. Companies must consider not only the growing wants and desires of customers outlined above, but also the investments that competitors are making. As technologies improve and costs decrease, there will come a tipping point where Digital Thread capabilities will separate successful companies from bottom feeders—and you know which side you want to be on.

First published Dec. 9, 2014, on the LNS Research blog.

About The Author

Greg Goodwin

Greg Goodwin is a research associate with LNS Research based in Cambridge, Massachusetts. LNS Research provides executives a platform for accessing unbiased research and benchmark data to improve business performance. Goodwin writes research papers, case studies, and contributes regularly to the LNS Research blog, where he covers topics including manufacturing operations management, industrial automation, sustainability, enterprise quality management software, and asset performance management.