Index Insider: Work Smarter, Not Harder – Productivity Leads Objectives for Smart Manufacturing

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Hi, this is Alex Bakker and John Lytle with your weekly briefing of what’s important in IT and business services.
  
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WORK SMARTER, NOT HARDER

When ISG first studied the adoption of smart manufacturing a year ago, we found enterprises were most interested in using the technology to reduce cost and waste. This was when organizations were reacting to the rapid inflation of material-input prices and the pervasive supply shocks of 2021-22. This year, cost savings and supply chain resilience remained priorities but no longer topped the list. The data show that productivity (in a manufacturer’s plant, processes and people) is now the highest-rated motivation, with overall equipment effectiveness also moving up the chart.
 
This draws some parallels to our recent cost optimization study, which highlights that, despite an overall focus on cost optimization and savings across industries, specific transformation programs are still on the critical path for many businesses. The data suggest smart manufacturing is no different.
 
Our study shows that most manufacturers have built their smart manufacturing programs to be explicitly cross functional and, despite relying on technology, rarely report into the IT departments. For manufacturers, these initiatives are business-critical and the data below show the same story. (See Data Watch). This is not about scaling back costs as much as working smarter and making more products with what you already have.
 
If this topic is interesting to you, please join us at ISG TechXchange: Smart Manufacturing next month, May 22-23 in Chicago. And if you are interested in seeing more data from this study, please let us know.

DATA WATCH

https://info.isg-one.com/rs/257-STB-379/images/Index-Insider-Chart-111-Export_2023-04-20_v1%402x.png

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About the authors

Alex Bakker

Alex Bakker

Alex leads the Primary Research Team where he focuses on study design, panel research, and interview based research for ISG. In addition to leading the Primary Research practice at ISG, Alex also serves as the lead analyst on provider pursuit effectiveness, and helps IT service providers understand how they can improve performance in the competitive process. 
 
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John Lytle

John Lytle

John has 40+ years of providing global enterprises with practical, yet strategic vision to drive meaningful change through complex programs, which extend business value through the effective use of today’s exploding Digital capabilities. John is a senior leader for many multinational enterprises in Capital Goods manufacturing. John leads the North American Industrial Manufacturing segment for ISG and is regarded as a global thought leader, regularly advising on emerging technologies and operating model changes to drive innovation.