Enterprises in the consumer-packaged goods (CPG) space are looking to digitise manufacturing operations to usher in the next era of connectivity. Further, the prospect of moving towards connected factories is being explored, to digitise operations, and benefit from automation, and increase uptime and efficiencies. Experts from leading CPG enterprises share their views on the level of digital maturity in the segment, current digital initiatives, deployment challenges and future focus areas…
What is the level of digital maturity among CPG enterprises?
The whole CPG industry is built upon four pillars. The first is the growth pillar, which is sales and marketing; the second is operational excellence; the third is transaction systems; and the fourth is innovation, which prompts research and development.
There has been extensive work on the growth pillar in the CPG industry. The operational efficiency pillar is also getting significant attention. With respect to these two pillars, we are already ahead of the curve. With respect to the third pillar, transaction systems, we are mature. But we are seeing a lot of change with respect to the innovation pillar in terms of go-to-market strategies, making turnaround times shorter, new product development, development of existing products, etc. Across all these pillars, we see the digital world playing a role.
What are the current digital initiatives or technologies that you are adopting in the manufacturing and supply chain space?
At the beginning of the year, everybody has an annual business plan charted out. While this plan used to be static, things are changing. Now, we can use machine learning models that use external data such as weather and climate to predict what needs to be manufactured and what needs to get into the market. This enables us to create a balance between the cost, output and availability. We have been working on this for the last four or five months and are trying different model situations.
We are using simulation models to make decisions regarding new products, new machines and plant expansion. We expect these to be used in the next two to three months. We are doing a lot of work with respect to how we look at manufacturing data to increase productivity. We are also moving towards demand forecasting.
What role can connected plants play in the CPG space? What are the key benefits? Is your organisation looking to move towards connected plants?
Firstly, a connected plant means more data connectivity. Secondly, using a connected plant, if you use similar machines, the same original equipment manufacturers (OEMs) you can create a model of excellence in one plant that can be replicated in another. The third area that we are looking into is optimising the overall operational cost or service cost. We have already connected all our plants to the OEM’s digital hub. We are also doing a lot of experimentation on the IoT side.
What are the key challenges faced in the digitalisation of manufacturing?
The challenge of having the right people is the biggest one today, from all perspectives. From the competency perspective to the inertia perspective, it is important to have the right people. If people are taken into projects without giving them some kind of leadership exposure or business exposure, it will definitely not lead to desired outcomes. Therefore, offering digital transformation training to people across different strata of the organisation is important. Another challenge is cost considerations.
What will be your digital focus areas for the next year?
We want to focus on our throughput and on increasing our OEE. Further, we want to induce process optimisation and increase efficiency throughout the process of manufacturing to warehousing. This is where we have a lot of scope to optimise operations.
