What Every Company Can Learn from the Best Smart Manufacturers

The Next Generation of manufacturing holds a great promise—and profit.

The ability for everything to communicate with everything else is another potential disruptor. “If the material you’re using to build something can talk to your systems and talk to your equipment, you can think about very different manufacturing models than you have today,” says Comstock. “This is an evolution from bar-code spanners to RFID tags to intelligent materials and machines in the future.”

“A big machine tool will talk to the system and say, ‘Hey, I need to be maintained. I’m beginning to go out of tolerance.’ ”

Machines will have “intelligence” thanks to a proliferation of different types of sensors. “A big machine tool,” he says, “will talk to the system and say, ‘Hey, I need to be maintained. I’m beginning to go out of tolerance.’ ” Managing such a world requires dramatically different computer systems because it demands multiple flows of data in different directions, rather than simply the flow of data from the assembly line to a centralized computer system. “If all the materials and all the machines in manufacturing are [communicating] and producing data, you’re talking about a model that will be difficult to manage with traditional systems,” says Comstock.

Clearly, billions of dollars are being spent on transforming American manufacturing and many more billions will be spent as different technologies hit the plant floor. The new face of manufacturing will be far more productive and efficient, while allowing for greater tailoring of products, a trend called “mass customization.” Will it be a monopoly of large companies? Not necessarily. Big companies can afford IT departments and the brightest experts and consultants, but their sheer scale makes it difficult to quickly apply dramatic new ideas. Smaller and medium-sized companies may be able to embrace some aspects of Next Generation manufacturing more rapidly, giving them a first-mover advantage.

“This is all about entrepreneurism,” says BCG’s Sirkin. “Small companies are figuring out how to do this and growing because [when they] figure it out, they can show others how to do it.” The bottom line? New technologies are transforming and improving manufacturing at companies of all sizes—making keeping up with the pace of change a competitive imperative.

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