Learn more about two issues facing manufacturing’s ability to excel in the fourth industrial revolution.
Throughout the first three industrial revolutions, manufacturing, in its essence, has been product driven. But deep in the midsts of the Fourth Industrial Revolution—which is centered on intelligence, data, AI—manufacturing is taking on a new position in the global economy.
For a few years now, manufacturing has been shifting from performing in a way that is directed solely by supply and demand strategies to something that is controlled by the end user.
“For most of its history, our industry has been focused on getting product out the door in the most efficient way possible,” said Cindy Bolt, Senior VP of Manufacturing, Energy, and Consumer Goods Industries at Salesforce. “And once the sale was complete, the job was done. This way of doing business is no longer enough, as technological innovation in our daily lives has completely changed customer expectations.”
“Most manufacturers are moving away from product-centric strategies toward becoming customer-centric organizations,” said Achyut Jajoo, an automotive and manufacturing veteran who is now an integral part of Salesforce’s global industry team leader for the automotive and manufacturing industries.
“This is predominantly driven by their intent to become more services-oriented, by the addition of sensors to their products, and development of software to take advantage of the connected data. So the future manufacturer is differentiating on software and hardware solutions for their customers.”
If you’re in this industry and have been paying attention to the seismic shifts, this isn’t a surprise. Many of you are probably well on your way to revamping your systems to reflect the changes coming with the Fourth Industrial Revolution.
But consider this a call to those who haven’t yet: the consequences for not keeping up with the shifts in customer service in the manufacturing industry could prove to be disastrous.
Salesforce: A Voice for the Manufacturing Industry
Despite this industry only being a sliver of Salesforce’s overall business, the company has been involved on the customer service side of some of the world’s biggest manufacturers in the automotive, energy, discrete, and process markets for nearly two decades.
Dreamforce 2017—Salesforce’s conference highlighting new products and the companies that swear by them, as well as industry trends for the coming years—reflected the increasing presence of the Fourth Industrial Revolution and customer-centric models with its rising focus on manufacturing at the conference. This year’s event featured a keynote on Salesforce’s involvement in the customer service side of manufacturing, including testimony from KONE, Michelin, and Emerson.
We’re not here to sell Salesforce’s platform. The company is, however, presenting itself as a leader in the customer service side of the manufacturing field, and it could be detrimental to ignore its insights.
Over 3,000 manufacturing professionals attended this year’s Dreamforce, and according to the IDC, more than 630,000 manufacturing jobs will be created by 2022 with companies’ use of Salesforce platforms. It doesn’t make Salesforce the highest authority in the land, but it does establish the company as a significant player.
Two Issues Plaguing Manufacturing’s Customer Response
“Customers today expect manufacturers to know everything about the relationship—what they’ve bought, predicting when they need a replacement part, their personal preferences and more,” said Bolt. “Unfortunately, many manufacturers are either stuck in the wrong mindset or have siloed and outdated systems, making customer-centricity difficult or nearly impossible to manage.”
Here are a couple of issues manufacturing companies need to address to get out of the rut and on a path congruent with the Fourth Industrial Revolution.
Issue One: Connectivity to Customer Information
Saleforce’s Jajoo made it clear that manufacturers can no longer think of sales and customer relationships as purely transactional anymore.
“Customer-centric manufacturers need to collect and analyze all kinds of customer data—from sales interactions, to service history, to marketing touches, to product usage data and more. And they need to unify all that customer data in one place, analyze it, and try to understand the full potential lifetime value of that customer. And their customers demand this from the manufacturers.”
But it’s not easy to make the transition from legacy technology and paper-based systems. While the media highlights the success stories of field service agents now equipped with tablets and smart devices to eliminate hard copies, the reality is that there are many members of the industry still slogging through paper.
According to Jajoo, only 46 percent of executives say agents have the ability to access customer information if not connected to the internet or WiFi, meaning important customer data may be out of reach in times of need.
Issue Two: Buried Under Data
Even for the companies that have caught on to the move towards data-centered strategies and customer-centric models, the Internet of Things has overwhelmed many.
According to Jajoo, some are stuck under the sheer amount of data, unsure of how to proceed. Others who are collecting data don’t know what is helpful or part of trend, and what is noise.
“Caught up in the IoT wave, they’ve placed sensors on heavy equipment, plant machinery, and even their shipped products (jet engines, trains, etc.). And the mass of IoT data has manufacturers unable to analyze the information for use in their day-to-day businesses,” he said.
This data then, too, might not be able to talk to other data. This siloed information makes it difficult for business leaders and strategists to have a full, comprehensive view of the business, and what customers really want and need.
“From a historical perspective, when you were the customer service person, it was very difficult to understand everything that was going on. They weren’t able to answer the customers’ questions because they didn’t have the information,” said Michael Williams, VP and Global Head of Service Field Solutions Development at KONE Corporation.
Williams and his company, an international engineering and service company employing some 52,000 personnel worldwide, were featured at Dreamforce’s manufacturing keynote in November.
With 200,000 people moving into cities every day in the world, consumer trends are changing almost as quickly. KONE’s elevators and escalators provide nearly a billion rides every day, and the company’s been in business for over a hundred years. But even this mainstay knew it could learn more.
“We realized we weren’t in the elevator business, but the people business,” said Williams.
With a Salesforce Platform, KONE’s customer service people now have a 360-degree view of the customer. Dispatchers can see where the technicians are, who has the shortest journey time to get there, who has the right skill for that type of equipment, and so much more.
“Digital disruption is bringing an enormous amount of opportunity,” said Henrik Ehrnrooth, President and CEO of KONE.
This is just one of hundreds of companies Salesforce has brought a ERP platform to—and other organizations are doing the same with their customers. Companies have to be willing to see digital disruption as an opportunity, not as a roadblock.
Hundreds of Data Points
A transaction with a customer can give a manufacturing company hundreds of data points, dozens of which can help the company predict future trends, address customers’ needs better, and, ultimately, run leaner and increase revenue. With the help of AI, you and other decision makers can understand what the data is trying to tell you.
“In manufacturing, AI helps you get closer to your customers,” said Jajoo. “AI is having a huge impact in how you research, develop, manufacture, and distribute your products. And it has implications for all parts of business operations, from sales and service teams all the way to your back office. Companies are investing in this because they want automation through intelligence, and the rapid growth of data requires them to look at and focus on these technologies.
Bracing for Change
But you have to accept change, and be willing to pursue the path the Fourth Industrial Revolution has put so many manufacturers on, to reach these insights.
Is your team ready to not just change processes, but revolutionize the way it does business? It has to be.