Brave new world

As the world enters 2013, three 'big picture' trends are shaping up to dominate manufacturing industry's IT agenda over the next few years. The good news? Those manufacturers who gear up to meet and manage the challenges that these trends bring can expect to see significant improvements in operational performance and profitability. The not-so-good news? Well, as the saying goes, history is written by the survivors – and those manufacturers ignoring what's happening, or responding too late, are lengthening the odds of them being counted as such. All of which, at any rate, is the blunt assessment of Antony Bourne, global manufacturing industry director at ERP vendor IFS, and a long-standing veteran of IT in manufacturing. And the three trends in question? Getting straight to the point, Bourne brusquely ticks them off on his fingers. "First, the cloud: it's becoming mainstream, and it's going to transform how manufacturers look at infrastructure," he says. "Second, analytics. It's always been important, but now it's becoming essential: businesses have had the data, but they haven't always had the tools to mine that data for transformational insights, and then distribute those insights in order to make them actionable. And thirdly, mobility: handheld devices offer IT functionality on an order unimaginable a few years ago – and now, that functionality is reaching the manufacturing workplace." What's more, he stresses, this isn't IFS's own reading of the runes. Citing some of the biggest names in the IT analysis marketplace, Bourne makes it clear that this is the view of some of the finest minds in the business – minds, moreover, which are firmly anchored on a wealth of empirical evidence drawn from manufacturing surveys. Take, for instance, some recent research from analysts at Aberdeen Group, looking at the top imperatives impacting on manufacturers' ERP strategies. Top of the list: the need to reduce costs, closely followed by the need to improve customer response times, and the need to reduce delays in decision-making caused by a lack of timely information. Or, for that matter, some equally hot-off-the-press research from IDC Manufacturing Insights, examining manufacturers' business priorities. High on the list: improving productivity and efficiency. Almost as high: reducing operational costs, and improving margins. "What's very clear is that manufacturers are saying, 'what can we do to work our IT investment even harder?'," sums up Bourne. "Growing the top line is important, but it's a speculative investment. Driving out costs, boosting efficiency, and serving their customers better delivers a more certain impact on the bottom line." All of which, he points out, is very much front-of-mind as manufactures evaluate the cloud – the first big trend shaping manufacturers' agendas today. It's an evaluation tinged with more than a little wariness and circumspection, he emphasises, but the tide is turning the cloud's way. "Cloud is becoming mainstream," he sums up. "It's been predominantly used for 'point' solutions rather than ERP – although pioneers are using it for ERP – and with a sense of nervousness. But the facts speak for themselves: the cloud is a way of quickly gaining access to niche capabilities, and offers rapid ROI without the ties of a long-term lock-in. Manufacturers don't want to trailblaze – and the cloud offers the future, but in bite-sized chunks." What's more, he adds, not only do those bite-sized chunks not have an impact on a manufacturer's IT infrastructure burden, but they also offer functionality without being tied to that infrastructure, thereby enhancing the ROI even further. "Rather than software as a service, think of it as 'software plus services'," he urges. "Powerful applications, delivered on a plate, direct to your desktop – and because they're hosted in the cloud, they can be accessed from anywhere, rather than just from within the confines of the corporate infrastructure. In that sense, collaboration has never been easier." Next up: analytics. Again, says Bourne, analytics aren't new: like the cloud, analytics and business intelligence have been on manufacturers' radar screen for some years. What's changed, says Bourne, is that in parallel with a process of consolidation in the vendor marketplace, there has been a sea change in the power and usability of analytics. In today's world, he explains, analytics aren't just for power users: instead, intelligence has been democratised, making it available to all levels of the organisation. The result: insights that are genuinely actionable, and more so than ever before. "What's happening is a process whereby companies perform the analytics, locate the levers that they wish to pull, and then roll out the analytics as a pre-digested application or dashboard," he says. "Right away, management can see the status of the metrics in which they're interested, and be able to 'drill down' to understand what lies behind the figures that they're seeing – without needing to be a power user with skills in analysis." Better still, he adds, rolled out as an application or dashboard, management are receiving the information in time to intervene and act on it – a stark contrast to traditional ways of data-driven improvement, where problems are highlighted as a means of avoiding a recurrence, rather than solving them in the here and now. "We're not talking about a chart on a noticeboard that's a week out of date, or a print-out that arrives after the event," Bourne stresses. "We're talking real-time data that can be presented to management while there's still time to influence the outcome." Enhanced mobility And, what's more, can be presented to them even while they're on the factory floor – which is one reason why Bourne points to the third trend presently shaping manufacturers' IT agendas, namely enhanced mobility, as something of an over-arching 'enabler'. Not just for analytics, but for niche cloud-based applications, and a broad swathe of collaboration tools. "People are more mobile than ever before, and want to stay in touch and do things while they're on the move – and handheld devices offer IT functionality that is on an order unimaginable a few years ago," he notes. "Put the two developments together, and what you've got is a perfect match of capability and requirement. No wonder mobile devices are fast becoming ubiquitous." Indeed, he points out, IFS supports all three major mobile platforms – Apple's iOS, Google's Android, and Microsoft's Windows Mobile – and is encountering a growing demand for both 'ERP on the move', and niche applications aimed at specific needs. And what's especially interesting, he stresses, is how mobile devices can transform factory floor operations with their immediacy. "We've a quality app, for instance," says Bourne. "You can be walking around the factory floor, and see some non-conforming material: there and then, you can photograph it or video it, register it, append an explanatory voicemail to the record, and raise a 'quality hold' on the batch number – all which you can do while you're standing in front of it. People think of mobile in terms of a compromise, and that mobile devices offer less functionality – they don't always see that you can also do more with them than you can with a traditional desktop." Roll it all together – the cloud, analytics, and mobile devices – and what emerges is a very different way of leveraging IT for competitive advantage. "Tomorrow's winners are already fine-tuning their strategies," sums up Bourne. "The rest are playing catch-up."