While Industry 4.0 as a concept has been with us for some time, successfully embracing it for business is a challenge. How do you go from strategy to execution? One way to do it is the new SaaS-based solution Factory Insights as a Service that supports the most common high-value digital transformation use cases.
The next generation of industry – Industry 4.0 – holds the promise of increased flexibility in manufacturing, along with mass-customization, enhanced quality, and improved productivity. It thus enables companies to cope with the challenges of producing increasingly individualized products with a short time to market and higher quality.
Firstly, what is the overall goal for industrial companies using digital technologies related to Industry 4.0? Digital transformation is not about becoming a digital company; it about an industrial company capitalizing on digital technologies to defend and advance its competitive advantage.
Manufacturers who have already embarked on the road to Industry 4.0 are making impressive advances. They are shifting their organizations, changing how people work, and deploying technology to achieve value. An example comes from one of our customers, a commercial automaker, that uses telematics data to improve the ownership experience for their customers’ 400,000 vehicles. The company forecasts more than $40 million in monthly savings for customers by lowering the costs of repairs. Further, they forecast $65 million in warranty cost savings in two years, with savings increasing over time.
Turning data into actionable insights
More commonly though, beyond the early adopters, there is a stark divide between the vision of Industry 4.0 and the current industrial landscape. While the Nordics are ahead in digitalization, many of today’s manufacturers are still running on disconnected processes with little integration between operational equipment, IT systems, and business units. How to solve these, and other matters were discussed by Scania, Orkla, Sandvik, and others during our recent Reimagining Manufacturing event.
To be clear, there is no shortage of data in this industry – manufacturers are swimming in oceans of data. Solving problems and adding value necessitates far more than “getting” data – it is about making data actionable. The fundamental question is: How can organizations gain actionable insights from the massive data flows?
While there is no lack of Industry 4.0 strategies and visions, achieving real results isn’t always that easy for most manufacturers. Based on Cognizant’s experience from numerous IIoT projects across the globe, leaders hesitate on where to get started, organizations experience capability and competence gaps, and there are also issues with building, deploying, and integrating the various technologies.
The ability to scale up IoT projects
Another common dilemma is about scaling up initiatives. A recent study by Forrester and Cognizant showed that more than one in five respondents report their firms struggle with moving IoT projects beyond proof of concept in a consistent, effective way, and 34% have established a clear, proven process for implementing IoT but are failing to connect it with business outcomes. From experience, I know that IoT failure or success depends less on the volume and breadth of IoT initiatives and more on how companies plan and execute them.
The ability to scale and succeed with IoT hinges on five key levers that organizations must address:
• organizational enablement
• data and analytics
• infrastructure and technology
The two most influential levers to successfully expand the value of IoT, are organizational enablement and infrastructure/technology. Companies that are more successful in addressing these levers see greater success in moving these initiatives beyond the pilot phase and have realized greater value from programs (1.5x to 3x more commonly seeing “high value” from IoT programs).
Accelerated time to value
This is where the new Factory Insights as a Service, a result of the alliance between Cognizant’s partners PTC, Rockwell, and Microsoft, comes in. It is a perfect ramp for manufacturers who wish to improve their business through valuable intelligence and insights on operational performance, asset utilization, and workforce efficiency. It bridges the physical and digital worlds and addresses the need for digital transformation with impact, speed, and scale.
Realizing the new service, entails a wide breadth of capabilities, including navigating the uncertainties of an emerging business and technology space. Cognizant, with its 10,000+ people strong industrial expert team, can help manufacturers move from idea and vision to technology strategy, piloting, and finally production. This approach allows leadership teams to achieve key milestones along their journey with tangible business outcomes and value.
Cognizant and its partners have tailored a Factory Insights as a service offering: Cognizant® FACTORY INSIGHT AS A SERVICE Strategy & Advisory. This will guide customers through strategy, technology strategy, and scaling beyond proof of concepts.
In my next blog post, I will describe how to use the five levers as well as provide a more in-depth discussion on our Cognizant® FACTORY INSIGHT AS A SERVICE Strategy & Advisory.
If you’re curious to learn more, please contact me directly.
Covid-19 served as a wake-up call to manufacturers – one that has accelerated the need for digitalization. To find out what technology investments will propel manufacturers forward, we conducted ESI ThoughtLab. Learn more in our e-Book.