Beyond our Bearings: Leaning into automation to drive productivity

The adoption of Industry 4.0 technology in manufacturing and distribution (M&D) remains a heated debate for many. Referring to the digital transformation of the M&D space, Industry 4.0 technology represents a significant shift in the fusion between physical and digital systems and how they can revolutionize the way companies manufacture, improve and distribute their products. By decreasing downtime, reducing labor and material costs, and using real-time data to make more informed decisions, industry leaders are harnessing the capabilities of automation to drive productivity in their facilities and processes. 

Integrating this technology into manufacturing processes, particularly those that are already well-established and highly productive, can bring challenges. The cost and downtime of implementation, for example, is often a significant obstacle for companies already facing challenges with labor shortages and increasing raw material prices. Cybersecurity threats have also been on the rise in recent years, and investing in appropriate testing and response protocols may be a deterrent for those already hesitant about new technology.

Despite the obstacles with implementing Industry 4.0 technology, manufacturers who delay digital maturity over time will struggle to remain competitive in an evolving world. When considering making the shift to automation, manufacturers and distributors should take several important steps: 

1. Define your business objectives.
Establishing clear business outcomes is arguably the most important decision when developing a viable digital strategy. Whether your company is seeking to increase productivity, achieve more efficient processes, and/or use technology to augment the labor shortage, each goal is based on different metrics and technologies to achieve success. Identify your facilities’ current shortcomings, detail specific objectives for improvement and set parameters for a feasible budget.

2. Evaluate relevant technologies.
An overwhelming volume of Industry 4.0 technology is on the market, and it can be quite challenging to determine which solutions are applicable for your needs at a reasonable cost. Depending on the size and structure of your company, any of the following may be applicable for growth and efficiency:

• Cloud computing
• Bar code scanners
• Big data / business analytics
• Process automation
• Machine learning
• Human-machine interfaces
• Artificial intelligence
• RFID
• 3D printing / additive manufacturing
• Robots

While you may be tempted to overhaul all of your existing processes, it is OK (and might even be better) to start small. Consult system integrators and plant managers to identify low-hanging fruit in your operations that could benefit from automation. Sustainable change will be most effective in the long run.

3. Establish efficient data processes.
Modern technology requires a blend of historical and real-time data to drive accurate insights that many legacy manufacturing and distribution processes are not able to capture or support. To measure the key performance indicators (KPIs) of your newly defined business objectives, it may be time to explore additional ways to gather new data or use existing data. Robots, for example, have proven to be an effective use case for data gathering and management in the manufacturing space.

4. Initiate a pilot test.
Many companies are reluctant to take the first step in digital transformation because it is overwhelming. Rather than perform a full-scale implementation, test the effectiveness of new technology for certain tasks by running a pilot project. Successful pilot projects can build confidence and acceptance among employees as well as stakeholders.

Looking Forward

Manufacturers interested in pursuing the use of Industry 4.0 technology should carefully weigh the benefits and risks of doing so. No-code or low-code solutions along with utilizing cloud storage are some of the many ways to minimize the costs and downtime associated with adoption.

Companies should consult trusted advisors to help evaluate potential technologies and determine a feasible and financially viable path forward into digital maturity. Remember, there is no one-size-fits-all solution for digitalizing manufacturing processes, but an ideal solution can be achieved with enough planning, preparation and consideration.

Aprio’s Manufacturing and Distribution services assist manufacturers and distributors across the U.S. in navigating competitive market conditions by embracing innovation and advanced technology. Moving beyond traditional tax and assurance, Aprio provides strategic services such as financial benchmarking, process improvement, and transaction advisory, tailored to drive growth and manage risk. As active participants in the manufacturing community, Aprio also offers access to valuable industry resources, including the Georgia Manufacturing Survey and Next Generation Manufacturing forum.

Aprio is the brand name under which Aprio, LLP, and Aprio Advisory Group, LLC, deliver professional services. Since 1952, clients throughout the U.S. and across more than 50 countries have trusted Aprio for guidance on how to achieve what’s next. As a premier business advisory and accounting firm, Aprio Advisory Group, LLC, delivers advisory, tax, managed and private client services to build value, drive growth, manage risk and protect wealth, and Aprio, LLP, provides audit and attest services. With proven experience and genuine care, Aprio serves individuals, entrepreneurs, and businesses, from promising startups to market leaders alike. Aprio has grown to 2,000+ team members providing solutions to clients in industries including manufacturing and distribution, non-profit and education, professional services, real estate, construction, restaurant, franchise and hospitality, government contracting and technology and blockchain.