Challenging times spark digitalisation push

22 September 2020

Tim Faulkner believes that the challenges posed by 2020 have resulted in greater determination from many manufacturers to start their digital journey to ensure they remain competitive.

So far 2020 has thrown us some very unexpected challenges which has resulted in many manufacturers now taking up the digitalisation gauntlet in a bid to help them build a more resilient and successful future by tailoring solutions to meet customers’ needs, driving efficiency through connected services and enabling automation of many low value-added tasks.

In times of economic downturn and rapid change resilience is key. It is critical to rethink business models and find flexible solutions and relayr has have seen an increasing push to connect assets as the benefit of remote monitoring and digitally enabled services has become more evident, in particular by equipment manufacturers and service organisations. There is also evidence of an emerging interest in the use of robots and automated guided vehicles (AGV) to improve working conditions in large facilities and distribution centres. 

However, digitalisation for equipment manufacturers is not easy as it is not just about the introduction of an online ordering system or virtual meeting software. It goes deeper into the DNA of the organisation and implies a transformation. Careful consideration of the scale and scope of operations in the prevalent trading conditions is necessary.

Generally speaking, those industries closer to end customers and under most pressure – such as retail, electronic and automotive – have adapted to the changing industrial landscape faster due to business need and an existing digital maturity level.

Digitalisation in the industrial space can introduce operational improvements with smart manufacturing projects. These investments need to be reviewed carefully within an environment where operational efficiency has long been monitored and honed. Digital technologies can be used as an enabler for building new revenue streams and increasing profit margins. 

Project acceleration
Since the onset of the Covid-19, relayr has seen an acceleration of digital projects by some customers. In one case, a customer was forced to shut down operations which gave them the bandwidth to engage with us in planning a stronger future. On the flip side, not every business has the luxury to plan ahead, so we have also seen some projects at an early stage put on hold. 

Will companies get back to digitalisation when we get back to ‘business as usual’? We fully expect so, hopefully with greater clarity of purpose and added impetus. More businesses will consider a digital platform as a path to building a recurring revenue base which is more resilient in downturns, offers added value, customer intimacy and increased wallet share.

Manufacturers can expand their services and reach new markets by moving away from the limitations of the capital expenditures (CAPEX) model. Switching to operating expenses (OPEX) offers greater flexibility and scalability. OPEX decreases costs in maintenance and servicing, increases revenue streams, and builds stronger customer engagement. 

Tim Faulkner is director of sales EMEA at relayr.

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