Cisco: Overcome Obstacles in Manufacturing Computing to Advance Digital Transformation

The desire for change in the manufacturing sector

When you think about everything that goes into transforming a traditional manufacturing plant into the smart factory of the future, several factors determine its success or failure. Forbes recently reported that up to 84% of digital transformation initiatives are likely to fail.1 When trying to figure out how to create success, it’s easy to focus on technology and cost, when often the most important factor is people and their buy-in.

Corporate culture drives the organization and its actions. It reflects how leaders lead and how employees think, act and feel. To better understand how the impacts of culture change, let’s look at the mindset of manufacturing companies.

Manufacturing has always been a “keeping the lights on” industry. They have an aversion to vulnerabilities, and for good reason. The average cost of unplanned downtime is $532,000 per hour or $172 million per plant per year.2 With a single warranty or recall costing manufacturers up to $600 million,3 these organizations are hyper-focused on quality and understand that their brand reputation depends solely on the products they create.

As a result, the culture of manufacturers was previously comfortable with the status quo, such as legacy systems, processes, policies, and operating procedures. He protected the IT/OT divide and resisted the cultural changes needed to implement connected smart factories.

So why change now? The pandemic, competition, and outside forces are causing manufacturers to re-evaluate their “tried and true” methods for several reasons:

  • Collaborative hybrid work. With the pandemic, remote or hybrid working in manufacturing has exploded with increased use of digital collaboration tools, cloud and wireless technologies. And it’s not going away. In a Manufacturing Leadership Council survey, 85% of respondents expect the increased use of digital collaboration to be permanent.4
  • Competitors go digital first. Consumers accustomed to buying online expect to do the same for business-to-business (B2B) purchases from manufacturers. IDC predicts that 50% of industrial manufacturing companies will engage in B2B digital commerce by 2024.5 This implies the need to integrate digital processes throughout manufacturing.
  • Exposed vulnerabilities. In 2021, the manufacturing industry has become the most attacked vertical, dethroning financial services and insurance for the first time. Ransomware attackers have attempted to “fracture” the backbone of manufacturing supply chains,6 demonstrating that legacy network and data security systems aren’t strong enough.

Overcome Obstacles to Manufacturing Evolution with Business Critical Services

Evolve culture to enable change

Bain & Company surveyed a group of pharmaceutical manufacturers about the top barriers to digital innovation in manufacturing. The top three responses were the effort to implement the change, the behavioral changes required to do something different, and the lack of skills required in employees to transform old habits.7 Conversely, companies that focused on culture were five times more likely to achieve breakthroughs than companies that neglected culture.8

To focus more on culture change and business management, manufacturing leaders may need help offloading some of their technology and change management responsibilities. They must balance protecting their legacy operations with accelerating transformation, while evolving worker behavior and practices to enable continuous change.

Let Cisco Business Critical Services be the change for good

Cisco Business Critical Services can help manufacturers evolve your culture and your factory. Leveraging capabilities such as our security expertise, automation and AI-based insights and best practices, consulting services (e.g. architecture, engineering) and training can help make your organization more resilient and adaptive to change while working to transform your business.

Cisco Business Critical Servicesor your Cisco partner representativework with your THIS team for evolve your culture traditional manufacturing to a true smart factory.

Sources:

  • Wire CMS, 2020

  • Automation, 2021

  • trievr Reminder Management, 2021

  • Manufacturing Leadership Council, 2021

  • IDC FutureScape: Global Manufacturing, 2021

  • Smart DSI, 2022

  • Bath & Company, 2020

  • Wire CMS, 2020

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