How digital transformation can harmonise the opposing trends of global manufacturing
By Raffaello Lepratti, VP of industrial manufacturing at Mendix
Until recently, IT managers had to weigh the risks and benefits of the buy-or-build decision repeatedly: was off-the-shelf software worth the risk of not fitting perfectly;would in-house, targeted development balloon in cost? Today, this balancing act is no longer necessary. Low-code software development allows for customisation using existing visual models. Specific digital templates targeting different areas of the manufacturing industry serve as a blueprint for each organisation’s personalised solution.
To some extent, the digitalisation of industrial production is undergoing expansive modernisation through low code as it helps solve the enormous challenges now facing the manufacturing industry. It’s not just the increased volatility in supply chains that demand greater speed and flexibility in the production of individual enterprise software, it’s also the need to connect people, products and processes with a growing amount of information emerging from technologies such as AI, data analytics, and sensors.
Scalability vs. flexibility?
Global manufacturing companies are currently facing a double challenge: On the one hand, they must continue to produce as efficiently as possible at a scale to meet increasing demands, while also building resilience and flexibility within the enterprise for possible further disruptions. The global cross-linking of industrial production is powered by solutions such as IoT and edge computing, Manufacturing Execution Systems (MES), and enterprise wide ERP systems helping make production at scale more efficient. This coincides with a trend towards localization that has not been seen for a long time: Global supply chains are decoupling, production is moved closer to the place of consumption, and local factories have to get embedded into their regional legal, economic and technical environments. Platforms like Mendix help unite the initially contradictory requirements for globalization and localization, for complexity reduction and diversification. They help to link data across divisions and locations and to build tailored and role-specific applications from it in series.
In Control of One’s Own Digital Development
Recent trends have clearly demonstrated how quickly manufacturing companies must react to external events. IT plays a special role here. New processes have to be mapped, structures set up, specifications adapted, and new suppliers integrated within a very short time. Low-code simplifies this process tremendously. Customised applications for the manufacturing industry can be created at record speed, partly based on prefabricated templates. This gives companies full control over their own digital development and allows them to adapt solutions to their specific needs.
The link we’re looking for: low-code as the connecting element
At the same time the low-code platforms have expanded beyond the sole use of creating mission-critical applications. Increasingly, they are serving as a connecting link — a kind of intermediate layer or software stack that links disparate systems. In this way, they provide an abstraction from the existing IT systems and, building on them, enable the targeted creation of role-based apps. At best, this transforms the diversity and complexity of a production landscape from a burden into a scalable, responsive digital ecosystem. And that’s a real competitive advantage.
For example, peripheral machine apps, existing legacy systems, and innovative extensions can be linked to the core systems, linking external data sources with the push of a button. Local knowledge and functioning production processes are retained without the company having to forego digitalisation, enabling comprehensive networking and consistent implementation of innovations in all functional areas.
The Composability Trend: Flexibly deployable elements
The ability to easily and flexibly link existing shop floor programs with production software and customize them for different functional areas illustrates the idea of the company as a composable enterprise. According to this concept, enterprise solutions or even entire industries consist of process-related building blocks that can be reassembled, exchanged, expanded, renewed individually or as a whole, and flexibly adapted. If new structures are to be built, existing units can often be reused with minor alterations. This principle of modularity (composability) enables business teams to use existing digital capabilities to develop new solutions without having to start from scratch each time. This increases agility in digital transformation, relieves pressure on the IT team, and generates more time for innovation.
Packaged Business Capability: Transferring Complex Content
Composable thinking allows a wide variety of assets and structures to be stored as a Packaged Business Capability and made available as a resource within the company. For instance, the result of a complex engineering process is stored as a 3D model in a single file and made available to other business units of the enterprise, such as the purchasing department. Purchasing then uses the model for material procurement, placing the data in a completely new context. While the item’s physical properties played a central role in the earlier phase of development, the digital asset can now be leveraged for supply chain availability, transport capacities, and price negotiation.
The universal language of digital transformation
Imagine the advantage when every party involved can drag and drop project specifications into the low-code platform, sharing this with their own software to continue working with it. With this degree of permeability on the one hand and adaptability on the other, multiple software environments in different departments no longer pose an obstacle to communication, regardless of departmental boundaries. The thoroughly complex low-code models already serve as a kind of universal pictorial language that can be understood by IT experts as well as by management and technically oriented employees in specialist departments.
Leading role in production
In this way, low-code is evolving from a supporting role to a leading role in production. Nearly one-third of manufacturing executives, according to a finding in Mendix’s “State of Low-Code 2022” study, see legacy IT modernization and production monitoring as their biggest challenges. For 39%, the most important benefit of low-code technology in manufacturing is real-time process visibility, as well as data visibility for 38%. In the future, respondents expect low-code to provide even more manufacturing-specific application templates, access to legacy systems on the go, and further integration of low-code with new technologies, including AI capabilities, with IoT applications. But low-code is already an integral part of manufacturing operations management, especially when it comes to surfacing and regulating access to previously scattered data.
Standardised connectors and specific templates
Standardised digital connectors, which can be simply dragged and dropped into the respective app, allow a new level of digital networking within the company and beyond. The efficiency of industrial production can thus be further increased, accelerating the adaptation of new technologies. At the same time, there is room for individual and local solutions without damaging critical core systems. In this respect, low code takes the digital transformation of industrial production to a completely new level. Agility and collaboration are strengthened, and necessary process changes can be implemented more easily.
When supply chains are disrupted in the future, chaos is sure to rise again. That will hardly be avoidable. But it will not last. With this new generation of digital tools, chaos can now be controlled and, perhaps, even tamed.
About the Author
Dr. Ing. Raffaello Lepratti is Global Vice President at Siemens subsidiary Mendix and responsible for the Industrial Manufacturing business of the low-code market leader.
