It’s a data-overloaded world and manufacturers are doing their best to navigate it. However, according to Forrester research, a staggering 98 per cent of manufacturers are struggling to make use of their data. Are you nodding your head because this rings true for your experience? You’re not alone– the amount of data leaders must manage is accelerating at an alarming rate with almost 50 per cent surveyed saying their data has doubled and that in the next five years, by 2030, they expect it to triple. But the problem isn’t just the surplus of data, it’s a lack of effective analytics.
In manufacturing, data isn’t just a resource—it’s the catalyst to unlocking unprecedented productivity and profitability. McKinsey and Co. asserts the transformative power of analytics in the sector. Previously, manufacturers have lagged in IT capabilities, but utilising advancing analytics enables them to put their data to work like enhancing their processes from the sourcing of raw materials to the sale of their finished products.
Advanced analytics also assist manufacturers to solve formerly hidden problems, such as concealed bottlenecks or unprofitable production line but just as importantly, analytics allows manufacturing leaders to leverage real-time insights to make facts-based decisions and drive transformation.
Subpar analytics hinder manufacturing operations, lead to poor decision-making, and stifle innovation by failing to address critical data challenges. A Deloitte study highlights nearly 70 per cent of manufacturers identify issues such as data quality, contextualisation, and validation as major obstacles to AI implementation, but robust analytics is essential for overcoming these obstacles.
Understanding the main manufacturing analytics challenges of today
The last time the manufacturing industry experienced this much change was the introduction of automation in the mid-20th century, which effectively revolutionised production and the industry as a whole. Today, analytics is at the forefront of another revolution, holding the power to turn overwhelming data into actionable insights, transforming the manufacturing sector from the shop floor up. Unfortunately, the amount of data in manufacturing is expanding at a rapid pace accelerated by AI, and this is exacerbating an already significant problem- too much data, not enough time or, at times, know-how to analyse it.
A Manufacturing Leadership Council report found that almost three-quarters of manufacturers still depend on spreadsheets (!!!) to enter data manually, while another 68 per cent still use them to analyse data. There’s also the problem of whether the data is trustworthy to begin with. For many, the answer is “no,” with only 25% of manufacturers having high confidence in their data. Additionally, other data challenges include different systems housing data (53%), difficulty in accessing data (28%) and lack of skills to analyse data effectively (28%).
These challenges are not going away and highlight the critical need manufacturers have of advanced analytics. Robust analytics tools can work at speeds no spreadsheet or human can match, empowering manufacturers to streamline data integration and ensure data quality. Forbes reports that data should be the foundation of the future of manufacturing. The right data combined with sophisticated analytics allow manufacturers and various stakeholders to make more informed decisions, ensuring their business is not only future proof but capturing opportunities and minimising weaknesses.
Why analytics-driven strategies are key to success – your top 5 essentials
Advanced analytics can present both challenges and opportunities, but the benefits are significantly greater when leaders successfully unlock true transformation in essential areas of operations that were previously unimaginable. This includes enhancing quality, improving performance and yield, reducing costs, and optimizing supply chains. Here’s how executives can leverage these strategies to tackle data challenges:
1. Ditch the spreadsheets and take a unified, analytics-powered approach:
Outdated spreadsheets cannot keep up with the demands of modern manufacturing. Analytics thrives when there is a unified approach to data. Gartner believes manufacturers must have an “orchestrated framework and process to develop, curate, update, and offer structured and unstructured data”, but we take it one step further, asserting every strategy be unified. Advanced analytics ensure all working off a single source of truth, breaking down silos and improving all operations.
2. Stop using outdated processes and invest in advanced analytics and AI:
Deloitte says that a prerequisite for AI adoption is access to quality data, and three-quarters of respondents say that they have made a shift to boost investment around data life cycle management to support their generative AI strategy. Analytic platforms are also key as they can be leveraged predictive and prescriptive analytics to uncover patterns, optimise processes, and anticipate future challenges, enabling data-driven decision-making.
3. Fix data distrust, use analytics to ensure data quality and governance:
Gartner research indicates that manufacturers need to ensure that they build a scalable, value-driven data exchange process to unlock use of diverse IT and business data to drive business decisions. “By applying principles of data and analytics governance, CIOs can provide the data quality needed to enable data exchange across complex ecosystems.”
4. End the siloed chaos with analytics-driven visibility:
When data is fragmented across silos, quality control, for instance, can be affected making it difficult to execute thorough analyses, making it challenging to find root causes of defects and inefficiencies. Delayed decision making can also be an unwelcome by-product. Advanced analytics can ensure data silos no longer affect operational efficiency, taking disjointed information turning them into cohesive insights to ensure better-quality products, streamlined processes, and faster, smarter decision-making.
5. Less thinking, more automating and real-time monitoring:
Advanced sensors, machine monitoring tools, and automated reporting systems, allow manufacturers to capture and analyse data in real-time, but analytics transforms this data into actionable insights that optimise processes and predict issues before they arise. This combination of real-time data and analytics allows for manufacturers to improve efficiency, reduce downtime, and fix challenges quickly.
From strategy to reality: how one client unlocked millions with advanced analytics
In this data-driven world, analytics can have transformative effects, turning data strategies into actionable results. According to Deloitte, Daimler Trucks Asia partnered with the firm to implement a proactive sensing platform that analysed structured and unstructured data, enabling the prediction and prioritisation of quality issues 13 months earlier. Within two years, this analytics-driven approach saved the client $8 million in warranty costs, highlighting how powerful analytics can be, ensuring manufacturing leaders uncover insights previously hidden, solve challenges proactively, and unlock measurable business value.
Act now or fall behind – why adopting an analytics-driven mindset is critical
With data pouring in at an alarming rate, manufacturing leaders are at a critical crossroads, requiring them to not only face challenges head-on but seize this opportunity with the power of analytics. The window for action is narrowing meaning that executives must act now to capture the potential of their data through advanced analytics to stay competitive. By implementing advanced analytics, business leaders can unlock insights to allow for faster decision-making that drives strategic investments, shapes policies, and optimises the adoption of innovative technologies.
After partnering with a smart manufacturing expert like INCIT, manufacturing leaders can utilise analytic solutions like XIRI-Analytics after a digital maturity or ESG assessment by Smart Industry Readiness Index (SIRI) or Consumer Sustainability Industry Readiness Index (COSIRI) to uncover new data-driven insights, allowing manufacturing businesses to unlock pathways to continuous improvement. XIRI-Analytics empowers manufacturers with data-evident decision-making, global benchmarking, cost profiling, and GHG profiling to enhance efficiency, competitiveness, and sustainability.
The platform will generate and aggregate relevant data for in-depth analysis, emerging as a transformative tool with far-reaching benefits for enterprises and diverse stakeholders, including governments, policymakers, private firms, financial institutions, and equity companies. To learn more, visit the INCIT website.
