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If one thing has always been true of manufacturing, it has always been closely associated with evolving technology. As digital transformation marches forward, now is the time to ensure your manufacturing business stays on the leading edge of the technology changes by keeping on track of both trends and advancements that are becoming available for manufacturers.
Prior to the COVID-19 pandemic, manufacturing companies saw plenty of time to adopt new technology. However, COVID-19 has radically changed our lives over the last year and accelerated the need for the speed of digital transformation in the manufacturing industry. Companies who take advantage of these new opportunities by balancing investment intelligence, strategic planning, and cost management will bring success and sustainability to their future.
Know your acronyms.
Leading manufacturing technologies in the digital transformation can be overwhelming with the number of acronyms. Artificial Intelligence (AI), Internet of Things (IoT), Software-as-a-Service (SaaS), and Augmented Reality (AR) with the cloud and enterprise integration is enough to make an implementation decision difficult. However, it is essential to remember that as these technologies grow, they can drastically improve efficiency, productivity, and overhead.
They can also provide a robust and positive return on your investment. Wireless connectivity such as 5G, WiFi, and Bluetooth are additional advancements that allow for developing production schedules and supply maintenance and performance assessments from anywhere with an internet connection.
How old is your tech?
Using technology only a little over a decade old, collaborative mobile robots, or cobots, are now found in several parts of the world. These robots are AI-enabled, making it simple for them to work alongside human employees. As technology continues to improve, robots are becoming more affordable and versatile than industrial robots, partially because AI makes it possible to adapt to tasks. They can apply pressure, weld, fasten, make cuts, and do similar tasks consistently. This makes your products and processes better while improving efficiency and productivity, reducing potential safety hazards, and making it easier to find labor without eliminating human jobs at factories. It is expected that the cobot market globally, which was $680.3 million in 2019, will grow by 38.5% to $9.3 billion by 2027.
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AR apps can make it easier for machine operators to see general maintenance issues, fuel levels, and similar information in real-time. They can even provide simple repair instructions on the spot. A network of sensors using IoT technology allows your machinery to communicate with cloud software, making it easier to access equipment performance insights, how employees work with their equipment, and similar details.
Pros and cons of COVID-19
The remote workforce caused by COVID-19 has made enterprise software integration and cloud solutions essential for manufacturers to connect user-friendly apps and pertinent data across a range of both in-house and remote devices.
Unfortunately, the COVID-19 pandemic has caused numerous manufacturers to focus on digital transformation for short-term survival. This has required significant cost-cutting for many businesses. What if you could turn these now-meticulous cost-management actions into solid gains in the long run? Because you may have already minimized the number of expenses, you may find yourself with more resources available as the pandemic begins to wind down.
Employee Tax Credits can help businesses in 2021
For many months, you have minimized travel expenses and overnight delivery as people begin to plan out their workweeks more sensibly. Employee expense reports may be more carefully scrutinized to make sure they fall under your reimbursement policies. Check whether your contractual obligations deliver the best possible value for equipment leasing, utilities, and similar expenses. Negotiate pricing with vendors and suppliers to help cut costs. Look for additional opportunities to reduce costs and improve efficiency.
Have you been tracking your COVID-19 costs? You can use documentation of these expenses for some grants and tax credits. Stay up-to-date on legislative options to help your business, including the Emergency Injury Disaster Loans, Employee Retention Credit, or Paycheck Protection Program. Watch for future tax breaks, including 100% deductions for business-related food and beverage expenses in 2021 and 2022. Carefully tracking these expenses now allows you to benefit later.
Next steps
If your business is still struggling, start by reducing or eliminating discretionary spending. Using financial statements such as cash flow projections and business forecasts can help you stay ahead of potential shortfalls and deficits. Stay on top of your liquidity needs, assess your borrowing capacity and leave room in your budget to make smart investments in digital transformation that will leave you ahead of the game when the pandemic is a faded memory.
By keeping your spending in check and researching the potential of digital transformation technology, you'll be ready to make smart investments in your business both now and long into the future.
Lane Gorman Trubitt can help your manufacturing company leverage new digital technology opportunities.