The Future of Manufacturing Is Digital

The following article first appeared in the Insights section of Marcum LLP’s website. It is reposted here with permission.

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While manufacturing still largely consists of making something and selling something, technological advances are changing the way we think about the industry.

For example, sophisticated enterprise resource planning systems can help manufacturers:

• Establish widespread use of data analytics
• Determine production costs in a timely and accurate manner
• Increase data security

These advancements have transformed the way many companies operate.

Technology tends to bring about many questions, but it can also provide the resources necessary to move into the future and thrive in a world of unknowns.

ERPs

Thanks to new ERPs, inventory control is as easy as it has ever been.

These systems automatically track the ins and outs of raw materials, work in process, and finished goods.

Many of the top ERPs available today allow for real-time tracking; automations; scrap level monitoring; forecasting and budgeting; and cost analysis—all of which can lead to increased productivity and better company margins.

While tracking inventory is a base service for many ERPs, the real opportunities for manufacturers stem from technological advances and data analytics.

Competitiveness

Taking advantage of the latest technology is critical to remaining competitive.

The increasing automation of the manufacturing industry is one opportunity for business owners to utilize the latest technology.

Automation in manufacturing can reduce expenses by maximizing labor efficiency, reducing training time, and matching the talent to the task.

In a time when many companies are experiencing staffing challenges, automating certain processes can give employees more time to focus on other tasks.

Data-Driven Approach

This new technology enables manufacturing companies to take a more data-driven approach to managing and monitoring their business.

Historically, companies worried about how much they could sell a product for, not what it cost to make that product.

While profit margin is still the main driver behind most business decisions, technology allows for different ways to attain the overall goal of a profitable company.

Whether it’s through automation, real-time tracking to increase productivity and reduce costs, or analyzing supply chain management and inventory tracking, it’s important to understand what can be improved upon with modern technology.

Cybersecurity

Newly updated systems can also protect you and your business from cybersecurity threats.

Every day seems to bring more stories of vulnerable systems being exploited, hacked, or held for ransom.

For all of the good technology has done for businesses and individuals, it has also put your company data at risk.

With that said, most ERPs are now cloud-based, allowing for constant security updates to patch new vulnerabilities.

Mitigating Risk

Technology has given us with ability to do so much, and many are unaware of the ways technology can transform the manufacturing industry—but it comes with risks.

The key to accomplishing digital transformation while mitigating risks is to be well-informed about the latest technology.

The industry is changing, and companies must evolve to thrive in our technologically advanced world.

Take a look at the feedback in our Manufacturing Survey, which polled industry leaders about the industry, challenges, and exciting trends in manufacturing.

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About the author: Ben Cook is an assurance services supervisor with Marcum LLP.