5 benefits every data-first manufacturer enjoys

By Vibhu Kapoor, Regional Vice President – Middle East, Africa & India, Epicor

According to the World Bank, UAE manufacturing stood at around 10% of GDP in 2021 with the share having continued to climb during the pandemic, suggesting that the sector is relatively robust when compared to its industrial peers. Operation 300bn and other government-backed initiatives call for manufacturing to continue on this trajectory. And they all suggest that technology is one of the ways to do it. In a McKinsey report examining the advantages of Industry 4.0, the analysts explicitly stated it was “not uncommon” among adopting manufacturers to see 50% reductions in equipment downtime, 85% surges in the accuracy of forecasts, and up to 30% increases in productivity.

What is the secret to such successes? Data. Data-first, technology-forward manufacturing companies are trailblazers in today’s digital economy. They look to their challenges — soaring costs, skills gaps, supply-chain breakdowns, and the rest — and see opportunities for business transformation. They overcome the present and arm themselves for the future.

When leaders use data to drive decision-making, the first casualty is uncertainty. When they gather data from across finance, marketing, operations, customers, and sales, they can analyse it more holistically, generating clear-eyed insights that can impact the whole business rather than a single department. Teams feel empowered by this and tend to become more willing to innovate when they have the means to evaluate and justify any decision. And these capabilities go beyond the day-to-day routine. Business cases for permanent change in policies or procedures can be made more convincingly using comprehensive, homogenised data.

What follows are examples of the benefits the region’s manufacturing innovators are already enjoying because they embraced the data-first approach.

1. Enhanced employee experiences

Attracting talented people and keeping them in place has become tantamount to success across the GCC and beyond. Data-first strategies provide better work environments through insights that influence planning and operations, allowing people to remain efficient and productive. Automation can alleviate arduous workloads, which also leads to enhanced satisfaction and engagement.

Epicor’s recent report, Voice of the Essential Manufacturing Worker, found that 60% of employees would accept a pay cut to work at a more technology-driven factory. This is the latest of many such indicators that payroll budget alone will not be enough to stem talent attrition. For digital natives, technology is like a fifth limb. While it would be natural for boomers and Gen-Xers to insist on using their arms and legs to do their job, should we not expect similar demands from millennials and Gen Z when it comes to digital technology? In manufacturing, tech like automation, machine learning, digital twins, and predictive analytics can streamline processes and empower employees.

2. Faster time to value

When an organisation embarks on a programme to streamline processes, change comes more rapidly when stakeholders can see operational bottlenecks at a glance. Separating the “working” from the “hardly working” requires data. Another study from McKinsey suggests that companies that “maintained their innovation focus” throughout the 2009 financial crisis went on to “outperform the market average by more than 30%”. None of this would have been possible without first taking a deep dive into the data.

3. Enhanced customer experiences

Customers in the UAE and across the region are bearing the brunt of a series of global issues, most of them outside the control of manufacturers. But with rich enough data at their beck and call, the concept of control takes on new meaning. Manufacturers may be powerless to fix the underlying issues affecting supply-chain stability, but they can manage the situation through data that offers customers self-service facilities like order-tracking. They can supplement this with data feeds and analysis that allow them to predict when a supply crunch is coming and switch to a Plan B.

Customer satisfaction and loyalty are naturally enhanced by orders being on time every time, but failing that, information is critical. Many customers will forgive a late delivery if they have been consistently informed of its progress.

4. Reduced costs

Talent acquisition has, for decades, been the natural first step in process-improvement for manufacturers. But data-first businesses need not resort to lengthy, expensive recruitment drives by default. They can turn to analytics to see what other improvement avenues are available. A digital solution may improve outcomes for customers, employees, and the balance sheet in a single bound.

A prime example for the manufacturing space is the use of digital twins. Firms can test-run any conceived scenario to understand cost levers associated with materials and waste, without ever incurring those costs in the real world. And predictive modelling can paint a clear picture of operational timelines, supply chains, and other areas to allow planning with regard to materials and personnel, which can greatly alleviate budget pressures.

5. A more sustainable business

In the face of intensified interest in ESG (environmental, social, and governance), manufacturing data is the only way to approach a sustainable future for the business and the communities it serves. The standard prerequisite of improvement is the ability to accurately track a range of data points. Where are business costs concentrated? Where does the greatest waste occur and how can it be eliminated? It is worth mentioning here that automation is an essential cog in managing and monitoring sustainability programmes.

Let us not forget that sustainability has been compellingly linked to employee engagement. Our report also found that 60% of factory workers would take a pay cut to work at a more sustainable factory, suggesting that employees are not only more likely to remain in place if they regard their employer as a sustainability leader; they will be more likely to be vocal advocates of their company.

Data thirst

If challenges are really just opportunities, then it is data that will turn it around for the enterprise. Manufacturers who put it front and centre will emerge as leaders.