Here’s how AI and data are changing the way we manufacture

Here’s how AI and data are changing the way we manufacture
We may earn a commission from links on this page.

Manufacturing’s new frontier

Automation has always been a part of the factory, but now, innovative manufacturers have the opportunity to take it to a whole new level. Through the application of artificial intelligence and the increasing sophistication of cyberphysical systems that can combine physical machines and business processes, automation increasingly can include complex optimization decisions that humans have traditionally made. This can allow manufacturers to integrate shop floor decisions and insights with the rest of the supply chain and the broader enterprise—an integration colloquially known as the smart factory.

The smart factory represents a leap forward from traditional automation to a connected and flexible system—one that can use a constant stream of data from connected operations and production systems to learn and adapt to new demands. A true smart factory can integrate data from system-wide physical, operational, and human assets to drive manufacturing, maintenance, inventory tracking, digitization of operations through the digital twin, and other types of activities across the entire manufacturing network. The result can be a more efficient and agile system, less production downtime, and a greater ability to predict and adjust to changes in the broader network.

What does a smart factory look like?

The below infographic depicts the smart factory and some of its major features: connectivity, optimization, transparency, proactivity, and agility. Each of these features can play a role in enabling more informed decisions and help organizations improve the production process.

Together, these features can afford manufacturers greater visibility across their assets and systems, and allow them to navigate some of the challenges faced by more traditional factory structures. Ultimately, this can lead to improved productivity and greater responsiveness to fluctuations in supplier and customer conditions.

Getting started

When manufacturers embark on the smart factory journey, it needs to be defined, planned, and executed at a pace suitable to the organization and the challenge. Company leaders can consider starting with the following steps:

  • Think big, start small, scale fast…

Building and scaling the smart factory can be as agile and flexible as the concept itself. Manufacturers can get started down the path to a true smart factory at any level of their network—value creation can begin with and scale from a single asset, and use an agile approach to iterate and grow.

  • …but stay grounded

A company’s manufacturing strategy and environment will determine which specific issues to address and the way to unlock value through smart factory solutions. Customizing the approach to each scenario and situation can help ensure the needs of the manufacturer are met.

  • It’s not just about the technologies

The smart factory journey requires more than just a set of connected assets. Manufacturers would need a way to store, manage, make sense of, and act upon the data gathered. Moreover, companies would need the right talent to drive the journey and the right processes in place.

  • Think outside the four walls

The smart factory is a holistic solution, joining what happens within the four walls with what happens across the entire digital supply network. An organization embarking on a smart factory journey should consider the full array of supply chain partners and customers from the start. Actions in one node, or for one stakeholder, can impact the others.

A smart factory is an ongoing evolution rather than the “one and done” factory modernization approach of the past. It’s an evolving solution—one that taps into multiple features such as agility, connectedness, and transparency. The true power of the smart factory lies in its ability to evolve and grow along with changing organizational needs. As such, a smart factory capability can enable manufacturers to differentiate themselves and function more effectively and efficiently in an ever-more complex and rapidly shifting ecosystem.

Look again. Read more about the future of manufacturing and smart factories with Deloitte

This article was produced by Deloitte and not by the Quartz editorial staff.