Breaking the Mould—Helping Manufacturers in Singapore Embrace Innovation in 2020 and Beyond

Technology innovation does not need to be intrusive or all-encompassing. It is something that can be achieved by every manufacturer—no matter where they are along their digital transformation journey. What is important is the approach taken towards its implementation.

As the Fourth Industrial Revolution extends its reach to the manufacturing industry, now should be a time to embrace innovation. Research from Microsoft and IDC has found that the Asia-Pacific region could earn an additional US$387b towards its GDP by 2021, if the region's manufacturing sector goes digital now. Singapore's manufacturing industry is taking on the challenge, adopting technologies such as intelligent warehouse management systems, predictive maintenance, robotics, and artificial intelligence (AI) to transform the industry and open up new opportunities for growth and innovation.

However, manufacturing companies' legacy systems make it difficult to know just where to start, and which parts of the operation will benefit most from a digital helping hand. Through partnerships and collaboration, businesses can achieve agility and address potential problems quickly and effectively.

The role of cloud will be crucial
The use of cloud-based systems within the manufacturing industry to support operational efficiencies is nothing new. Tata Steel is just one example of an organisation that has removed ongoing licensing and hardware costs by moving to a cloud model, cutting collaboration costs by 40 percent as a result. Moving forward, cloud will not only be a way of reducing technology adoption costs, but will also help bring a sustained level of innovation and return on investment—as it allows manufacturers to further increase scalability and mobility.

To truly reap the benefits of exciting new technologies that began to make headway in the industry in 2019—including a AI, IoT, and robotic process automation (RPA)—more workloads will need to transition to the cloud. From there, businesses will be able to manage the vast volume of data produced and have the processing power required to analyse and gain insight from it. Reviewing the configuration of cloud environments will be crucial to embracing innovation and understanding where efficiency and profitability gains can be made moving forward.

Enabling agility and scalability through ERP
While cloud platforms will become more valuable in the manufacturing sector to support new technology adoption, the evolution of cloud-based ERP systems also has a key role to play in helping companies get the most from any investment made. For example, research carried out by the Capgemini Research Institute found that integration issues with existing systems and tools are the biggest technological challenges standing in the way of scaling AI in the automotive industry. ERP systems provide valuable data inputs for AI technologies but the challenges of integration are clear in the Capgemini research, which found that only 14 percent of automotive original equipment manufacturers (OEMs) had delivered AI implementations in 2019. This was only a marginal increase from 10 percent in 2017.

Instead of being seen as a system of record in the world of modern manufacturing, ERP systems should be seen as integral to leveraging the power of AI and other data-driven innovations. As such, ERP systems will need predictive and collaborative capabilities to fulfil business intelligence (BI) and AI requirements. With machine learning (ML) and chatbots being trained to complete repetitive transactions, integration with a ‘smart’ ERP system will enable simpler and quicker decisions to be made and ensure the success of such tech innovations.

In short, ERP systems will need built-in intelligence and predictability to help solve real business issues in manufacturing moving forward.

Steps to success
Software solutions can deliver game-changing results for the manufacturing industry from the get-go. However, to get innovation right, there first needs to be a thorough assessment of existing processes and what needs to change. Only then can organisations fully extract the expected value of any new technology solution.

Another key factor is the software delivery model. While many organisations are comfortable with on-premise deployment models, often a cloud-based, software-as-a-service (SaaS) approach is the best means to truly drive simplicity and process improvement. When assessing existing processes, businesses must look for a solution and delivery model that will empower operations and enable growth with greater simplicity and automation of processes.

The right technology can be transformative, so the choice of technology partner should also be a key consideration when embracing innovation in the coming years. Regardless of what solution an organisation implements, it is important to recognise that business issues cannot be solved by putting new software solutions on sub-optimal processes.

Before implementing any new technology, it is crucial for firms to first assess internal processes and determine ‘the perfect state’. They must then work through change management to transition processes to a more desired state. Only then, after these crucial steps are completed, should technology that drives enhanced productivity improvements and value be implemented.

With good technology partners, companies can work through the entire process and embrace the right innovation, at the right time, and achieve optimal results.