Four Ways Artificial Intelligence Could Transform Manufacturing
The manufacturing sector faces many challenges, including a skills shortage, the need for sustainability, and geopolitical instability. Here’s how AI can help.
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Manufacturers need to optimize for increased productivity, improved sustainability, greater resilience, and a stronger workforce. How can they harness the latest technologies to realize these goals?
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The growing significance of data and advanced manufacturing technologies, such as artificial intelligence (AI), offers fresh avenues for companies to improve production efficiency and flexibility as well as to promote sustainability and empower their workforce.
Many manufacturers have already integrated AI into their operations. However, a BCG survey, conducted in 2023, found that only one in six of these companies have met their AI-related objectives to date. This shortfall predominantly arises from inadequate organizational and technological foundations, which are essential for scaling AI solutions throughout production networks.
At the same time, AI’s evolution continues unabated, with powerful innovations such as generative AI emerging on a regular basis. Generative AI presents additional opportunities to reimagine certain operational processes and transform how employees work in plants. For example, manufacturers can use this technology to give employees detailed work instructions, including visualizations and the required spare parts, for specific maintenance incidents. Such capabilities remain largely untapped but can be successfully adopted with the right implementation approach.
To support manufacturing companies on their AI journey, BCG collaborated with the World Economic Forum, operations and technology executives, and academic experts to develop a guidebook for harnessing the AI revolution. This effort drew upon insights from our exploration of the untapped potential of AI in industrial operations and the variety of AI applications that manufacturers currently deploy.
The guidebook consists of five sections. The first three represent the different stages of a manufacturing company’s AI journey, while the latter two describe the building blocks needed for successfully implementing and scaling AI:
Recognizing that an AI journey is not a one-time effort, the guidebook empowers manufacturers to continually adapt to the rapid advancements and innovations of AI applications in industrial operations.
The world of industrial operations is changing, and manufacturing companies are facing considerable challenges—including rising economic pressure, the sustainability imperative, volatile resource prices, and supply chain disruptions as well as increasing capability challenges and talent shortages. In this complex environment, the expanding role of data and advanced manufacturing technologies such as artificial intelligence (AI) offers companies new opportunities to address these challenges and to significantly augment industrial operations.
To evaluate the current state of AI within industrial operations, BCG conducted a global survey of almost 1,800 manufacturing executives. The survey covered seven different industries across 15 nations worldwide.
Here are five key takeaways from the survey:
Among our other findings: Manufacturers in China and India lead those of other nations in terms of AI maturity, while among industries, technology equipment manufacturers are most mature in their use of AI. Quality control, robotics and production automation, production alert systems, and inventory optimization are some of the leading AI use cases for industrial operations, according to the study. But even the most common use cases were relatively immature—25% or less of the companies surveyed had fully rolled out those applications.
When it comes to the barriers to scaling AI throughout their production networks, 88% of executives named a lack of AI-related technology infrastructure as a major challenge, with data processing (34%) and visualization infrastructure (34%) being the most common areas of concern. Meanwhile, 92% of executives said the lack of an AI-related people and organization foundation was a challenge, with a shortage of digital skills and capabilities (39%) and the lack of an AI strategy and roadmap (33%) being cited most often.
The survey results underline both the relevance and potential of AI for industrial operations. Manufacturers who act now to incorporate AI solutions can gain a significant advantage in addressing today’s challenges, while those who delay risk falling further behind.
The manufacturing sector faces many challenges, including a skills shortage, the need for sustainability, and geopolitical instability. Here’s how AI can help.
Read the full article
Technology breakthroughs, including generative AI, present industrial companies with fresh avenues to navigate through turbulence and offer opportunities to substantially boost their operational performance.
Read the full article