Smarter Edge Industrial Manufacturers Need To Serve The Segment Of One

David Parrish

Part 4 of the “Intelligent ERP-Driven Industries” series

Industrial machinery and components (IM&C) manufacturers are a mission-critical force for companies in both advanced and developing economies. Vital to the ongoing operations of their customers, IM&C providers must clear a high bar of expectations, ranging from real-time asset availability and high-quality production to real-time proactive service. But as long as maintenance processes remain reactive, they will never realize the full potential of an always-on, always-available services model.

For years, most manufacturers have digitalized their operations with the Internet of Things (IoT) to connect machines and create point solutions that solve smaller isolated problems. However, this limited use of IoT technology in no way measures up to its full potential. Instead, businesses must integrate and augment the right blend of cloud solutions and embedded IoT sensors to open revenue streams that offer faster, more-efficient, and high-quality services through predictive analytics and cognitive decision support.

Innovating processes to drive intelligent industrial manufacturing

Up to this point, growing adoption of digital technology has enabled IM&C providers to streamline and simplify a variety of manufacturing processes. Asset data captured by IoT sensors provide real-time analytics that identifies and alerts the plant floor when an assembled good is defective or damaged. Although the concept is simple, this capability has become a critical part of reducing production cost and waste.

Then came Industry 4.0 in 2016, which challenges businesses to further exploit the IoT to create an interconnected factory running with online equipment and making processes and machines intelligent and capable enough to automate decision-making. This hybrid approach to mass customization allows manufacturers to react to consumer demand quickly, efficiently, and cost-effectively.

But something has changed since the first introduction of Industry 4.0. More than ever, customers expect the industrial products they procure to be simple to use and to support the degree of mobile access and connectivity they need to innovate faster, create software-enabled products, and generate service-based revenue. Furthermore, manufacturers must deliver products and services that give their customers an edge that grabs the attention of consumers in new and groundbreaking ways.

Providing solutions that precisely fit the needs of customers is not something that can be done through mass production. Instead, industrial manufacturers are beginning to realize that they have to retool their processes to mimic those of a traditional engineer-to-order environment. By combining insightful monitoring of individual customer requirements with best practices in mass customization, they can give customers exactly what they want, when and where they want it.

Spearheading a smart edge to rise to the expectations of the segment of one

Serving the segment of one requires more than engaging and understanding each customer intimately. In fact, the entire business must change – starting with five functions that play a fundamental role in delivering this level of service:

  1. R&D: Individualized product development requires a move from an engineer-to-order mindset to configure-to-order and made-to-order processes. Extending a portfolio of custom products helps the business manage modular product concepts and integrate more software-enabled capabilities with physical products. Plus, R&D teams can collaborate seamlessly with production teams to manufacture for a lot size of one.
  1. Marketing: Engaging with a single customer in the right context and through relevant channels helps marketers define targeted customer segments with precision and run campaigns that directly address customer requirements.
  1. Sales: Sales representatives can personalize their interactions with customers by accessing a full view of the customer’s information to turn individual needs into opportunities and orders. Configuring products and solutions helps ensure every offering is the right – and best – offering for the customer.
  1. Production: Smart, integrated, and flexible – these are the attributes the factory floor must own to produce individualized product offerings in a cost-efficient way. The key is to manage an adaptive and responsive supply chain for the provisioning of the required parts and components.
  1. Aftermarket service: Catering to the segment of one does not end when the product is delivered and put into use. Customers still need the personalized support of customized and equipment-specific services to condition equipment, and data use to build and optimize their own individual service offerings.

Successfully embracing these opportunities that the latest technology offers is the first step towards a foundation of growth. But more importantly, industrial manufacturers must reconsider their business and their use of digital technology to create business models, products, processes, and work experiences that deliver the outcomes your customers need and expect.

 Check out how the industrial machinery and components manufacturers are deepening their digital transformation with the Internet of Things. Access our library of keynote and session replays from the Intelligent ERP Industry Virtual Summit to hear from top customers and experts as they discuss how intelligent ERP, industry roadmaps, and implementation can guide your business throughout its digital journey.


David Parrish

About David Parrish

David Parrish is the senior global director of Industrial Machinery & Components Solutions Marketing for SAP. Before joining SAP, he held various product and industry marketing positions with J.D. Edwards, PeopleSoft, and QAD going back to 1999.