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By Jeff Ralyea
The rise of digital technology in manufacturing, known as Industry 4.0, is a transformation that makes it possible for manufacturers to gather and analyze data across numerous devices, machines, and systems. This enables faster, more flexible, and more efficient processes. According to a U.S. manufacturing industry survey commissioned by ECi Software Solutions, more and more manufacturers are embracing Industry 4.0 as well as the digital technology revolution. In fact, 89 percent of respondents said they have made increased technology investments over the past year to stay on top of this rise in innovation. However, as manufacturers continue to digitize their operations and adopt more technology, the amount of data they will access will inevitably increase. Manufacturers may struggle to know which data is actually useful.
The same survey found that 50 percent of manufacturers have begun turning to predictive analytics and tools that analyze both current and historical data to make predictions about future events. The more data available, the more accurate these predictions become. By incorporating predictive analytics tools in concert with an enterprise software solution, like enterprise resource planning (ERP), manufacturers create opportunities to make more informed, strategic data-based decisions.
Here are some examples of how predictive analytics helps manufacturers make the most of their data:
- Forecasts market demand. Market demand is rarely stable, making it harder for manufacturers to have a clear, comprehensive view of the future. By taking a closer look at the trends and events that reoccur in the market, manufacturers will have an easier time determining what they need to prioritize within their business to address market needs. Predictive analytics does exactly that by combining demand forecasting with risk-based inputs, helping manufacturers produce more outputs when they are needed, which ultimately saves them time and money.
- Improves equipment management. Machines break down over time, parts wear away, and the cost of replacing broken down equipment can add up. By implementing predictive analytics, manufacturers can reduce machine loss by determining when machines may need to be brought online or shut off. This tool can also help with preventive maintenance by triggering alerts or calls for assistance from machines based on the data captured. This reduces the issues found in devices and can also be used to identify manufacturer equipment defects in machines.
- Applies forward-thinking business decisions. Predictive analytics looks at all the manufacturer's historical data and determines what has worked and what has not worked in the past, allowing manufacturers to ask themselves important business questions like "how efficient are my workers and machines? How many jobs can I get through? Will my business benefit from investing in a new, expensive machine?" By answering these questions before making an investment, manufacturers can spend more time looking into the additional data they do not already collect and determining how they want to collect it and what to do with it in the future.
Manufacturers who are looking for business success need to incorporate predictive analytics into their tech stack, because it will help them better forecast inefficiencies in their processes, give them insight into what they should do to grow their business, and much more.
Unfortunately, some manufacturers think these analytics are too advanced; according to the survey, 34 percent of manufacturers fear they do not have the internal expertise required to implement these technological tools. Luckily, manufacturers who have management systems in place, like ERP, are already moving in the right direction toward an analytical approach toward their data. Many ERP systems are frequently updated through the cloud, so they stay up to date on the latest analytics tools and insights.
With simple accessibility to these tools comes a potential increase in competition amongst manufacturers. Manufacturers must realize that the most effective way to enhance their processes and grow their business is to embrace innovation and react swiftly and strategically to the ever-changing market.
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