The Digital Shift in Manufacturing
Revolutionizing the industry through technological innovation
It’s 7:30 in the morning and I’m leaving home to drive my daughter to school. Although I know the route, I always use my GPS, not just to guide me, but especially for the gold mine of information the app provides: traffic, construction, accidents, estimated arrival time and even the route that minimizes gas consumption based on all these factors. With 30 minutes for the round trip, my GPS allows me to make informed choices and effective decisions that allow me to save time and money, while simultaneously enhancing the safety of my journey. We have arrived in the digital era, through our cell phones, our smart watches and lots of equipment in our homes or vehicles. The digital shift is in our daily lives and will be evermore present in the years ahead. But what about in the manufacturing industry?
Manufacturing has been undergoing constant change, and the digital shift is playing an essential role. Current technologies such as automation, the Internet of Things (IoT), artificial intelligence (AI) and virtual reality (VR) are transforming the way manufacturers operate, create value and interact with their clients. In this article, we will explore these various digital shift technologies in the manufacturing sector.
Automation: Redefining manufacturing operations
Smart automation plays a central role in the digital shift within the manufacturing sector. Thanks to the use of robots, automated systems and machine learning, manufacturers can improve the efficiency, productivity and quality of their operations. According to a recent McKinsey study, smart automation may increase productivity in the manufacturing sector by up to 30% by 2025. By replacing repetitive tasks and manual processes with smart machines, manufacturers can improve the quality of their productions, speed up production cycles, increase their manufacturing capacity and, above all, tackle the scourge of labour shortages.
The Internet of Things (IoT): Connectivity and optimism
The IoT plays a key role in the digital shift within the manufacturing sector by offering increased connectivity among machines, sensors and devices. This connectivity allows for real-time data collection, which can be used to improve decision-making, optimize production processes and reduce unplanned downtime. According to a PwC study, nearly 70% of manufacturing companies consider the IoT to be a strategic priority. The data collected by the IoT can be used to optimize preventive maintenance, improve production planning, optimize inventory and improve the visibility of the supply chain. In 2006, British mathematician Clive Humby even declared that “data is the new oil.”
Artificial Intelligence (AI): Increasingly complex algorithms
AI is taking on ever-growing importance in the digital shift within the manufacturing sector. By using machine learning algorithms, AI can analyze enormous quantities of data and provide valuable information to optimize production processes. According to a study by Capgemini, the use of AI in manufacturing can increase productivity by up to 45%. AI can also be used to customize products by using predictive analyses to meet specific client needs and create tailor-made offers. Some companies offer asset durability services based on algorithms that can extend the lifecycle of equipment, anticipate shutdowns and plan maintenance operations. We are also seeing the emergence of interactive tools such as ChatGPT, which can be used to enhance the client experience, improve training and technical assistance, optimize processes and analyze data for decision-making.
Virtual Reality (VR) and Augmented Reality (AR): Welcome to the matrix!
VR and AR offer unlimited possibilities for the manufacturing sector, in terms of both training and collaboration. According to a study by Deloitte, 56% of manufacturing companies see the potential of VR/AR for employee training. These technologies allow for realistic immersive training, reducing the time required to acquire new skills. Furthermore, VR/AR facilitates collaboration among teams by offering virtual interactions and layering contextual information on the real environment. A few weeks ago, we also witnessed the announcement of a new Apple product: Vision Pro, a mixed virtual and augmented reality headset that allows the user to access an immersive digital environment, simulate workspaces and take advantage of multimedia in a revolutionary way. VR/AR will democratize and change our daily lives.
What about humans?
In the digital shift, humans play an essential role and are central to the process. While digital technologies and smart automation are becoming more important, it is crucial to recognize that humans offer unique competencies and precious expertise. Manufacturing employees interact directly with the machines, data and digital systems. Their experience and in-depth knowledge of the production process mean they can optimize operation, solve complex problems and innovate. The digital shift offers workers new opportunities by allowing them to develop new skills, learn to use emerging technologies and play a more strategic role in the manufacturing process. Companies will have to invest in professional development, collaboration and employee engagement to take full advantage of the digital shift while still emphasizing the role of humans in the success of the contemporary manufacturing industry.
What’s the next step?
At the Quebec manufacturing update conference (Le Point sur le Québec manufacturier) held by Deloitte in 2023 (7th ed.), strategic consultant Louis J. Duhamel confirmed that the industry is already starting its fifth revolution, which involves the convergence of digital tools, environmental performance and humans. On this new path, pioneers consider resource limitations, energy transition and GHG reduction through production and the product lifecycle. The goal is to put the well-being of humans, communities and the planet at the heart of industrial and economic development.
In conclusion, the digital shift has the potential to revolutionize the manufacturing sector by improving efficiency, productivity, quality and even product customization. Smart automation, the IoT, VR and AR are key technologies that will fuel this shift. Manufacturers who embrace these technologies and invest in the digital shift will gain a significant competitive advantage. According to a Deloitte study, manufacturers that adopt digital technologies are seeing income growth of up to twice as much as those that don’t. The digital shift is not an end, however. It’s a tool. Manufacturers must maintain a clear vision of the industry they want tomorrow: an innovative industry that is mindful of environmental and social issues. Thanks to these technologies, every organization and every person can make informed choices and still keep humans at the heart of our decisions.
- McKinsey & Company, “Preparing for the next normal via digital manufacturing’s scaling potential” (2020). https://www.mckinsey.com/capabilities/operations/our-insights/preparing-for-the-next-normal-via-digital-manufacturings-scaling-potential
- PwC, “Connected and ready: Manufacturing industry trends 2019” (2019).
- Capgemini Research Institute, ” RESKILLING IN THE 21ST CENTURY – WHERE WE ARE NOW, AND WHERE WE’RE HEADING ” (2019). https://www.capgemini.com/us-en/insights/expert-perspectives/reskilling-in-the-21st-century-where-we-are-now-and-where-were-heading/
- Deloitte, “2018 Deloitte and The Manufacturing Institute skills gap and future of work study” (2018). https://www2.deloitte.com/content/dam/insights/us/articles/4736_2018-Deloitte-skills-gap-FoW-manufacturing/DI_2018-Deloitte-skills-gap-FoW-manufacturing-study.pdf
- Deloitte, “The Fourth Industrial Revolution: At the intersection of readiness and responsibility” (2018). https://www.forbes.com/sites/deloitte/2020/01/20/the-fourth-industrial-revolution-at-the-intersection-of-readiness-and-responsibility/?sh=3fecfee2e9b0
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Manufacturing and Processing