Ramasubramaniam R, CIO, TTK Prestige in a recent interaction with CIOTechOutlook magazine, shares his views on the most significant challenges manufacturers face in implementing digital innovation to transform manufacturing, how they can address the high initial investment costs associated with implementing digital technologies and more.

Digital transformation in manufacturing is not merely about adopting new technologies; it involves a complete overhaul of traditional processes. What is the most significant challenges manufacturers face in implementing digital innovation, and how can they be overcome?

The manufacturing industry is embracing digital transformation in order to acquire new customers & maintain excellence market, in today’s digital era. While manufacturing, especially in India is competing globally by leveraging digital transformation as a tool in order to thrive in a competitive environment, there are numerous challenges that manufacturers face. These include the adoption of new technologies which is often capital-intensive, making it too difficult for SMEs to implement. Furthermore, the rapid pace of technological transformation demands skilled talent however, there is a shortage of skilled talent in the industry.

Also, the present infrastructure also lags behind the requirements of digital transformation which has led to the creation of significant gap between current capabilities as well as the modern requirements. Also, new technologies come with new risks specifically cyber security threats.

Manufacturers can use OPEX-based technology models in order to address these challenges, allowing SMEs to partner with technology providers. Also, it is imperative for organizations to assess the lifecycle of technologies in order to refrain from obsolescence & manage risks. To protect against threats, cyber security practices which include cyber hygiene & resilience strategies are highly essential. Lastly, up skilling the current employees with the necessary skills and collaborating with industry experts can help in closing the talent gap & ensuring competitiveness in the digital age. Manufacturers can navigate the challenges of digital transformation successfully by leveraging these strategies.

One of the significant challenges in transforming manufacturing with digital innovation is the high upfront costs, how can manufacturers address the high initial investment costs associated with implementing digital technologies?

Both the business models as well as IT landscape are shifting at a rapid pace, post pandemic. Manufacturing industries invested heavily in on-premises infrastructure earlier, but today cloud computing is gaining traction. Manufacturers can also scale as required without significant upfront infrastructure costs with numerous options which include IaaS (Infrastructure as a Service), SaaS (Software as a Service), & PaaS (Platform as a Service). These solutions help in mitigating investment challenges.

Furthermore, through POC trials, long-term technology adoption can be approached and this allows the manufacturers to test solutions prior complete implementation. Industries can access tailored solutions as well as decrease capital expenditures with a robust ecosystem of service providers & startups while addressing specific requirements. And this shift helps in opening up several opportunities for overcoming conventional investment challenges.

With the increasing reliance on digital solutions in manufacturing, ensuring robust data security and privacy becomes a critical challenge, how can manufacturers ensure data security and privacy when integrating digital solutions into their systems?

As technology rapidly advances, so do cyber threats and risks. Digital transformation has opened several new doors to cybercriminals, which has made cybersecurity an important priority. Organizations should develop comprehensive cyber strategies as well as resilience frameworks to counter these risks and it is important for them to review and adapt them to align with the evolving threats.

With the CEOs and the top management focusing on robust cyber security practices, a top-down approach is crucial. Strong cyber policies are highly important for avoiding business disruptions & reputational damage for the manufacturing industry as the interconnected manufacturing lines in this industry are vulnerable.

Also, updating cyber policies regularly and conducting annual reviews are fundamental. It is important to provide training and awareness programs that target both administrators and employees which also include third-party resources. These programs should help ensure the understanding of cyber risks & protocols that are supported by timely audits & remediation.

Threat intelligence & networking with peers facilitate the industries to stay informed regarding emerging risks. Integration of cyber security risk management helps prevent vulnerabilities while designing new solutions or processes.

Monitoring & reviews both operational as well as executive should be ongoing and data privacy requires dedicated policies specifically for sensitive information. Regular updates, patching & email security should be prioritized as well as communicated clearly to all the IT users which include partners & third parties. Lastly, adopting boundary-less best practices will also facilitate in minimizing and mitigating cyber threats across the organization.  

(The views expressed in the article belong solely to the author and are not representative of their respective organization.)