The Future of Digital Transformation

First, a Little Background

A 2018 PwC study of CEOs found that 74% of CEOs see driving operational efficiency as a priority. To this end, many manufacturing businesses have engaged in digital transformation by focusing on improving IT infrastructure and consumer-facing systems over the last decade.

There is now a growing interest in what digital transformation means for the factory floor as manufacturers want to become more agile, productive and innovative. Agility and productivity should be the end goal to improve the ability of manufacturers to meet market demand competitively. Innovation is a key success factor in long-term sustainability and is positively correlated with shareholder returns.

Threats and Opportunities of Digital Transformation for Manufacturers

For many, this challenge can be met by realising a transition; goodbye to disconnected islands of paper-driven manufacturing process management and isolated software applications; hello to digitally operated and digitally connected manufacturing systems that integrate both manufacturing plant and IT systems with operations planning, execution and analysis in a seamless way.

ATS Global works with manufacturers to apply a range of digital technologies and expertise to build digital solutions. In response to supply chain issues I expect we’ll be supporting manufacturers in re-thinking how they manage their manufacturing operations. We’ll also enable them to commence or accelerate digital transitions that target high-priority opportunities for ‘quick wins’.


Armin Fahnle

Armin Fahnle, head of the Australian and Indonesian divisions of ATS Global, looks at how digital transformation opportunities are shaping the future of manufacturing.”

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Challenges and Threats Facing Manufacturing industry in 2022

A major challenge over the last two decades has been the lack of genuine productivity growth in manufacturing. The gains in labour productivity due to increased capital intensity have been offset by the cost of that capital investment. This has meant that multi-factor productivity has barely moved. Limiting the aspiration of investment to labour savings, a purely financially driven perspective, is a mistake. It overlooks the opportunity for manufacturers to be truly innovative, find new business opportunities and adopt new business models.

The question I often ask is:

  • Can Australia rebuild a culture that values manufacturing?
  • Can we rebuild a community of industrialists — owners and executives — who have a passion for making things, rather than taking things?
  • Is it possible for publicly owned companies to make the long-term investments in technology, innovation, skills and expertise that are typical of the large privately held Mittelstand in Germany?
  • And what is the cost of the loss of engineering expertise from public boards? Has it created an unsustainable focus on finance and risk rather than wealth creation?

Impact of COVID-19 and Business Strategies for 2022

As digital transformation enablers we have been able to do most of what we normally do, working from home. Most of our customers have continued operations and permit us to work on-site, when necessary.

Remote access has been important, but in most cases was already in place. Commissioning from home rather than on-site has been the most difficult challenge — nothing is as good as being ‘on the spot’.

There is no doubt, however, that there are limits to working from home. There is a significant impact on the sense of being a team and the effectiveness and fluidity of collaboration. This is essential to quality engineering and innovation.

Post-COVID-19 and The ‘New Normal’

As we move to COVID-normal we will continue to refine our remote working processes. We have created regular online gatherings of smaller teams that allow for unstructured interaction. This provides an aspect of sharing excitement at what’s happening in our lives, what challenges are troubling us in our work, and how we can support each other.

Although we will return to the office, we have all come to better appreciate the potential for loneliness and abandonment that people working from home may feel. Our mental health and motivation are priorities. Therefore, we look to come out of the other side of the pandemic as an organisation that communicates better than it did and supports every team member well.

Developments in Artificial Intelligence in Advanced Manufacturing

AI is certainly starting to make an impact amongst ATS Global customers. The challenge we see with AI is one of confidence in what it produces. It is that it is often difficult to understand how the AI makes its decision and difficult to build confidence that the decision is reliable.

ATS is collaborating with Rulex, which has developed Explainable Artificial Intelligence that makes room for creativity, human knowledge and collaboration. I expect that artificial intelligence that is explainable and behaves like a member of a team will begin to win more confidence in the core technology and improve adoption.

For our business there are applications in supply chain activities like scheduling, in process performance optimisation, and in general manufacturing decision support that we have already seen produce substantially performance improvements.


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