Why are Manufacturers Slow to Adopt Smart Manufacturing?

why are manufacturers slow to adopt smart manufacturing

New technologies can give manufacturers the ability to improve efficiency, safety, productivity, and more. These new advancements are moving faster than ever before, with a wide range of opportunities. However, many businesses are not taking advantage of these new opportunities as quickly as expected. Why are so many manufacturers slow to adopt Smart Manufacturing?

What is Smart Manufacturing?

First, what is Smart Manufacturing? Smart Manufacturing refers to an array of technologies, including automation, predictive analytics, devices and sensors connected to the internet (also known as the Internet of Things or IoT), artificial intelligence or AI, 3D printing, digital twins, and more. The term Smart Manufacturing was used to describe these technologies around the early 2000’s, which is around the same time that these technologies started to enter manufacturing facilities.

These technologies provide businesses with valuable data and insights about how machines are working, what maintenance is required and when, energy consumption, and what changes or improvements are likely to yield the best results. These technologies also allow machines to work faster, create better products, and work with less (or even without) human supervision.

Is Smart Manufacturing Adoption Slow?

The adoption rate of technology is somewhat relative; what might be slow to some is considered quick to others. However, surveys indicate that fewer than half of manufacturers have fully adopted many of these technologies. This includes some of the largest manufacturers with the most resources, like auto manufacturers. For small and mid-sized companies, the adoption rate is smaller still. A survey by Auburn University found that less than a third of manufacturers had adopted critical smart manufacturing technologies. Predictive analytics and artificial intelligence had adoption rates of only 7% and 6%, respectively.

Reasons Manufacturers are Slow to Adopt Smart Manufacturing

are manufacturers slow to adopt smart manufacturing

Cost and Capital

Cost and available capital are two primary obstacles to adopting Smart Manufacturing technologies. Smaller enterprises, in particular, can find it challenging to secure the necessary capital for technology adoption. For many businesses, putting capital aside to start adopting new technology can be difficult. Business loans or technology grants can be helpful, but this process also takes time and energy.

Talent Acquisition

Manufacturing has been experiencing a talent shortfall for some time. The Manufacturing Institute and Deloitte predicted that 2.1 million manufacturing jobs would go unfilled by 2023. This has also made it more difficult to enable Smart Manufacturing technology. Implementing sensors, predictive analytics, automation, and other technology requires high-level skill sets, like engineering and computer programming.

Manufacturers can off-set this obstacle by offering training programs and advancement opportunities to their top-performing employees. Working with technical schools can also be helpful and positive for both students and businesses. Students will have the opportunity to gain hands-on work experience, and businesses will gain valuable ties with talented potential employees.

Difficult to Gather Data

Adopting new technology generally means learning about it first. It’s difficult to implement and use new technology if manufacturers don’t have a clear idea of what it’s for, how it can help them, or specifically how it applies to their facility and products. Many businesses have cited the lack of data as a roadblock to adopting Smart Manufacturing technology. In Auburn University’s study, lack of awareness and lack of business cases were among the top reasons businesses gave for slow adoption.

Decision Paralysis

As technology options multiply, manufacturers face the difficult task of navigating through a wide range of options and choices. This can lead to decision paralysis, hindering the effective adoption of new technologies. It can be difficult to first choose which technologies to focus on, including which to gather data about. Then, businesses must choose which are best to implement, how, and the ROI of each. These layers of decision-making, as well as the array of technology options available, can create decision paralysis. The weight of decisions, and the possibility of making a costly error, can cause many manufacturers to simply operate with business-as-usual.

Adopting Smart Manufacturing technologies can provide many benefits, however there are also many obstacles. Implementing small-scale pilot programs before committing to large-scale adoption can allow companies to test technologies in a controlled environment, facilitating informed decision-making. Training programs can help to further grow talent that already exists, and fill talent shortfalls. With an organized plan and the right information, manufacturers can speed up their Smart Manufacturing adoption, and gain important competitive advantages over competitors.