At OSRAM’s Berlin plant of manufacturing xenon lamps, more and more employees are sharing about their improved abilities to carry out their tasks faster and more efficiently with greater precision using an app on their mobile devices. The ticket manager (this new-digital application), which gives them their work assignments and keeps them constantly up to date on the status of their machines, is moving the industry towards creating an ecosystem of enhanced communication, collaboration and mobility.
Hari Nallan & Mohita Jaiswal - November 2018
Like Osram, a lot many in the traditional manufacturing sector are progressing towards encapsulating digital maturity in practice, embedding the agenda of Industry 4.0 by helping its workforce to put digital, flexible manufacturing into practice. From the times of Henry Ford who introduced mass production in 1913, there has never been a revolution in the manufacturing sector, to this scale, where companies are increasingly using technology to move from mass production to customized production, all at an unprecedented pace.
Yet a lot of manufacturing industries are still in their stages of digital enrichment and process automation and would require time to move towards a comprehensive digital ecosystem. Just as banking, Life sciences and telecom have been transformed adopting the digital agenda integrally, traditional manufacturing industry also inhibits an immense potential to rethink its current business model and benefit across the value chain.
According to a report by Technet , manufacturing companies can use digitization to gain benefits in employee productivity ($162B), Operational improvement ($117B), Product Innovation ($55B) and Customer facing processes($38B), globally.
In the classic movie ‘Modern Times’ from 1936, Charlie Chaplin is seen fumbling in keeping pace with his work on the assembly lines. Definitely, a lot has changed since then, a question of pertinence for industrial leaders around the world today would be:
- What would the essence of ‘Modern times’ look like in the age of digitization?
- What would the future of the manufacturing industry hold for its umbrella of stakeholders?
New world challenges disrupting the growth of industry 4.0
Many manufacturers are still thinking of “going digital” in terms of either their customer or the shop floor but not for both or beyond. However true optimization and the potential to leverage disruptive capabilities of digital can only be realized when manufacturers start looking at digitizing and connecting supply chain partners, customers and investing in smart operations and technology likewise.
What impedes adoption of digital transformation strategies?
1. Resistance to new disruptive business models
New business models center around the idea of addressing the changing demand of customers, use of data and predictive analysis pushing for a complete value chain transformation. Traditional manufacturers, viewing this as a high risk investment and technical ask without a clear understanding of the promise in ROI, apprehend deviation from the core business.
2. Lack of perceived expertise in data management and solutions
The adoption of new-age technologies will drive levels of competitiveness and enable faster and more agile production systems yet bring global data management challenges. With vast amounts of data being generated and gathered − (through IIoT systems), if manufacturers do not have adequate experience or resources to analyze this data, they may fall behind competitors who move more quickly.
3. Challenges in upskilling the workforce
Manufacturers struggle to recruit workers with the right mix of problem-solving and technical skill, as the next generation sees more attractive career development opportunities in other sectors. Due to a talent gap and perceived difficulty in training to implement a digital strategy it seems a task cumbersome and long-tailed to drive growth and outcomes.
4. Increased customer and regulatory scrutiny
Sensors, equipment and technologies such as industrial control systems used by manufacturers to implement IoT, are vulnerable to cyber attacks. Since machines and industrial systems rarely go offline for security updates, risk of cyber attacks is high. Digitization also involves gathering stored customer data, increasing additional maintenance to comply with privacy laws.
Despite challenges a global survey by PWC shared that respondents expect to more than double their level of digitisation by 2020, from 33%-72%, a mark of growing acceptance and adoption of digitization in industry 4.0.
How has digitization and UX design penetrated the industry and is transforming it futuristically?
User Experience design is at the cusp of making this great re-make actualize. Design thinking as an approach is an imperative solution which enterprises could leverage to reinvent themselves while being in synergy with new-age technologies.
CASE STUDY
Schindler: From a product to a service centric business
Schindler is a global manufacturer of elevators and escalators and as an industry leader is continually looking at technology innovations that will keep it at the forefront of its industry.
With an objective of achieving digital service excellence, Schindler took on a slew of initiatives in early 2015 to bring in digital innovation as a way towards ecosystem transformation which was acknowledged with the 2015 Digital Business Innovation Award and MIT Sloan CIO Leadership Award.
Taking a structured approach to digital transformation:
1. Leadership through Customer Service
Schindler built in an online portal—the “Schindler Dashboard”—where customers could check the operational status of their elevators or escalators, getting alerts in case of equipment malfunction and making service requests. This dashboard was also offered as a mobile application.
- The dashboard was designed to share real-time alerts on current or future outages not only with their service engineers but also with their customers. The engineers now do not need to wait for customers to inform them of an elevator breakdown, reducing latency of redressal.
- Service engineers also used an app to access this information in real-time and attend to the problem without the need for customer intervention. This closed-loop service platform, where everyone has the same, real-time information, marked a first for the elevator industry.
2. Digitizing the workforce tasks
Bestowing multiple benefits to Schindler the company now uses an app that optimizes service routes for technicians by providing them with instant access to data across platforms, on both iPhones and iPads.
- Saving 40 million kilometres of driving and preventing more than 4,000 tons of emissions per year, Schindler’s “Digital Tool case,” was designed as an application which provided cross platform, simple yet intuitive updates to more than 20,000 Schindler front-line employees.
- Helping in everyday access to technical data, analysis of errors, or easy process to order parts from the customer site, the app considered the users customized needs and provided powerful insights on the go.
The company has been featured in Forbes’ Most Innovative Companies list in the past five years for these initiatives and continues to inspire leaders across the world.
Which are the most promising areas and trends potentiating an industrial metamorphosis?
1. Accelerating Growth digitization and UX
Industry 4.0, otherwise known as the 4th Industrial Revolution, along with IoT is central to digital transformation in the manufacturing industry. A few points governing its agenda are:
- Product innovation and design: Great product experiences separate the winners from the crowd. Introducing new industrial products with digital features, integrating UX right from the start and bundling of products and services has consequently increased perceived end-client values significantly
- Rethinking business model: Online marketplaces such as Amazon Business and Alibaba are virtually connecting unlimited buyers and sellers. Where customer access was once constrained by minimum order sizes and the cost to serve in a particular market, designing e-commerce portals can allow companies to reach customers they could never have reached before; hence cutting costs to serve by 50 to 70 percent.
- Mitigating Business risks: The entire manufacturing value chain can be monitored, with advanced analytics, where insights could be sought into manufacturing performance, customer behaviour, and real time anomaly detection.
2. Understanding Customers
Rise of the digitally native consumer is moving production closer to the customers. A B2B Landscape Transformation to monetize can happen by asking ‘How is customer behaviour changing and how does my relationship to customers need to change in response?’
- Building Vendor and Customer self service Portals: Since customers expect the products they use to be intuitive, mobile and easy to interact with, investing in software-enabled products, providing post sales support and implementing product as a service model(pay per use) can extend customer experience and strengthen relationships.
- Leveraging Omni-channel commerce: UX-driven technology solutions can help improve customer interactions across various touch points by providing seamless user experience cross platforms, on different devices.
- Investing in Consumer Analytics and engagement: Consumer insight could also be used in giving personalized recommendations and monetized through building customized products and services. 72% of executives report that their organizations seek to gain customer trust and confidence by being transparent in their AI-based decisions and actions.
3. Improving organizational efficiency and capacity
Digital solutions can bring in the required agility, streamline processes and integrate solutions for data management and capacity building.
- Operational improvement- Smart UX can reduce production cycle time, improve productivity by improving Process Efficiency through automation (using well designed ERP’s), IOT, automated inventory systems, real time Planning & Analytics and advanced process control to enable errors and quality lapses to be picked up immediately.
- Enhancing employee efficiency: Digital solutions can focus on people and culture to drive transformation. Employee portals or applications can build to cross-functional collaboration, internal knowledge sharing and add value in cross-training, building an agile digital culture by further digitizing functions of finance and HR, the lack of such training and culture being the biggest challenges perceived .
- Improving Supply Chain Efficiency and management: A UX-powered supply chain management system can deliver efficient integration and manufacturing intelligence to any business . It can allow one to easily understand and take actionable decisions on challenge areas such as cost and price pressures, operational complexity, capacity and global supply base, among other such metrics.
- Reworking distribution and sales: Marketing and sales is a core function of any industry. Instead of relying on hunches personalised and targeted insight based marketing & sales services, dynamic pricing, e-payment could all be leveraged by using digital insights and discovery.
Designing the next tipping point: How could design solutions add value to new age enterprises?
1. By creating customer-centric solutions
Most digital systems are designed for the systems and not the users of those systems. With design based approaches and research facilitating customer journey mapping, persona creations, design re-establishes the center of gravity to shift towards the needs of customers.
2. Opening gateway to simple and intuitive interfaces
As the attention span of the users continues to decrease, design focuses to make the experience upfront sans deep hierarchies or repetitive steps. Validated with the users, interaction design enables to transform the experience to one which is engaging and easily comprehended.
3. Boosting collaboration
As enterprise applications necessitate a lot of collaboration and interdependencies to complete tasks, handoffs, navigation frameworks need to be well visualized and designed for expedited implementations.
4. Supplementing intelligent solutions
User Experiences in Enterprise applications are defined by how intuitive the applications are; the advent of AI, VR, AR, Predictive analytics and forecasting in enterprises could be leveraged by designing them to capture maximum user data and share insights through smarter dashboards.
5. Building digital trust
As cybersecurity turns as a top priority for enterprises, designing products and services with visual cues which assuage users and build a perception of trust and confidence would go a long way to ensure engagement.
