Time for New Technology?


Information technology (IT) spending will grow from $2.46 trillion in 2015 to more than $2.8 trillion in 2019, with the United States and Canada comprising the largest share of global IT spending. Discrete manufacturing and process manufacturing will be among the top industry spenders.

Looking at the state of technology within U.S. manufacturers, it’s no wonder.

For many functions — asset management, human resources, supply-chain management, customer service/support — a majority of manufacturers have ineffective IT applications and systems (see infographic). Sadly, smaller manufacturers are in even worse shape. For example, only 25% of SMEs have effective IT applications and systems for logistics/distribution; 23% for supply-chain management; and 18% for asset management.

This is a looming crisis among SMEs. Hobbled by antiquated IT systems, they’ll be challenged to retain market share or growth because:

  • Poor-quality operations information leads to production errors, delays, and environmental, health, and safety (EHS) issues.
  • Enterprise functions fail to act in a synchronized, collaborative manner, leading to delays and waste.
  • Customer and supplier businesses are bottlenecked, unable to share critical data and information (demand forecasts, production schedules, product specifications, design drawings, etc.).

Legacy IT often makes a digitized supply chain difficult or impossible. It also hurts manufacturers’ abilities to adopt new technologies, such as 3D printing/additive manufacturing or the Internet of Things (IoT). Only 10% of manufacturers have a network infrastructure capable of IoT machine-to-machine communications; barely 13% have network infrastructure currently capable of IoT machines-to-enterprise communications. Many manufacturers report “network overhaul required.”

For SMEs, the statistics are even worse.

You may not be able to replace your IT overnight, but you can start planning — and investing —today. Identify where legacy IT creates risk in your organization — to worker safety, data security, customer satisfaction — and prioritize where to spend first. Adoption of cloud-based IT solutions, whether alone or alongside legacy on-site systems, can help.

Is your company ready to compete in an era of digitization?

Posted by Liz Fox in MPI

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