How manufacturers are overcoming the digital innovation deficit

Nick Pike, VP of UK&I at OutSystems, looks at how manufacturers can counter the digital innovation deficit to become faster, more agile and more open.

Manufacturers are facing an unenviable sea of challenges as they bid to realise the opportunities of Industry 4.0. The businesses achieving the greatest gains in productivity, growth and inventory control are those that are successfully leveraging data-driven insights, adopting digital platforms and developing enterprise and customer- facing apps that draw on that data to give them a competitive edge. However, a shortage of digital engineering skills, lengthy IT backlogs, and legacy technology act like an anchor dragging on the ship of progress.

Navigating these choppy waters requires an evolution in mindset and the adoption of tools that facilitate innovation without needing uncomfortable levels of investment risk.

The challenge of transformation is particularly acute for mid-sized manufacturers. Giant multinationals have vast resources to devote to innovation, and small youthful businesses haven’t yet acquired significant legacy technological complexity.

Firms in the middle have the worst of both worlds and typically face four major barriers that combine to slow digital innovation: complex, slow-to-change ERP systems; the scarcity of web and mobile development skills; a collaboration shortfall between IT, engineering, and business staff; and risk-averse IT sourcing practices.

These four factors create an environment that is overstretched and slow to adopt new ways of working. Recent research we conducted found that 64% of manufacturing businesses complain about IT backlogs, and only 31% of these respondents said that the backlog had improved in the past year.

As a result, important innovation efforts, digital transformation programs, and Industry 4.0 initiatives risk getting snarled-up in lengthening IT queues. Such delays pose the risk that more nimble competitors will overtake you. What’s needed is a shift in mindset away from the tried and tested continuous improvement practices of the past.

Manufacturers, many with decades or even centuries of history, are now being challenged to act like start-ups and adopt an agile approach that follows the “fail fast, fail forward” maxim. For an industry that’s grown accustomed to lengthy and costly ERP implementations – where even minor changes seem to take forever, and cost a fortune – the idea of experimental IT that’s fun, fast and low-risk must seem fanciful.

One of the solutions to this conundrum is low-code application development. Low-code rapid application development platforms allow manufacturing businesses to build robust enterprise-ready mobile applications up to ten times faster than traditional coding and makes it possible for a much wider range of employees to collaborate with IT in jointly-staffed development projects.

With respect to the four challenges of digital innovation mentioned before, the contrast of low-code rapid application development is that typical projects take 6 – 12 weeks, instead of multi-month or multi-year ERP projects. Engineers, business analysts, and process specialists can be quickly trained to help with application development. The collaboration gap between business and IT is bridged by forming co-creative teams, reducing the risk of shadow IT. And the firm’s appetite for digital experiments increases.

Looking to the future

Adding AI into the mix can help manufacturers to innovate and build new apps even faster. OutSystems’ new application development, AI co-pilot, suggests next-best-steps to developers based on a deep learning analysis of over 12 million anonymised development patterns.

Results from the early-access-program include 25% faster development for experienced developers, and new OutSystems developers become proficient more quickly, thanks to the interactive AI assistance.

Developments like this are yet another way that manufacturers can de-risk technology investment and counter the digital innovation deficit to become faster, more agile and more open to new approaches that will deliver the competitive edge essential to survival in today’s commercial environment.

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