In recent blogs we explored how analytics in manufacturing is more effective when delivering insights focused on specific industries, and when it’s easy to run a custom analysis to derive an answer to a certain question. Let’s now consider predictive analytics, which go a long way in helping manufacturers make accurate predictions, and then make decisions based on that window into the future.
With predictive analytics, manufacturing teams can vastly improve their ability to produce the right amount of quality products at the right time in order to efficiently fulfill the needs of customers. In this blog, we examine three key areas in which manufacturers can leverage analytics to anticipate challenges and turn them into opportunities.
#1 – Demand Forecasting
For manufacturers, the need to optimize their demand forecasting is more pressing than ever. Raw materials are more expensive, growth has slowed, and traditional methods for boosting productivity have been exhausted. With modern analytics solutions, they now have the chance to take advantage of the massive amounts of data flowing in from every direction. Per IDC, by the end of 2020, one-third of manufacturing supply chains will use analytics-driven cognitive capabilities, increasing cost efficiency by 10%.
Analytics can also be used to simulate future market scenarios and overlay the likely impact on current products and planned product changes. In one such case, a heating and cooling systems manufacturer forecast an increase in product orders by combining customer retention, net promoter score, and wallet share data. Using predictive analytics, the manufacturer was able to devise successful rebate campaigns that drove an increase in revenue.
#2 – Supply Chain Efficiency
Managing an efficient supply chain requires knowing well in advance the quantity of components a supplier will deliver, and if the components will arrive on time. Only then can manufacturers ensure proper inventory availability. In order to obtain that insight, the supply chain manager needs to analyze information such as supplier delivery history and cost history. This newfound knowledge allows managers to make decisions about operations over the next year, and also strengthens their position during vendor negotiations.
|The Industrial Internet of Things (IIoT) will climb to more than 25 billion devices by 2025. This increase represents a 500 percent increase from the number of devices in 2015. Major manufacturers are working to utilize predictive analytics via sensor technology to improve product quality and keep production lines running at optimal capacity.
Managers can also combine historical supplier data with world event data to run what-if scenarios to model supply chain risks. For instance, using geo-analytics an automobile parts manufacturer was able to predict if component deliveries would be at risk due to weather disasters or political turmoil, saving $8 million in the process.
#3 – Product Quality
To ensure the delivery of a high-quality product, manufacturers can leverage sensor data analytics, which helps
them evaluate equipment effectiveness and lifecycle duration. With that information, manufacturers will know when maintenance will be required and be able to plan accordingly.
Another way manufacturers can use predictive analytics to improve quality is to know the details around the availability of components to assembly line workstations. For instance, a large automaker used analytics to achieve 98.5% accuracy in the delivery of components for production, ensuring the right materials arrived at the conveyor belt in the right quantities, in the right order, at the right time.
Gain a Deeper Visibility into Your Business
By using predictive analytics, you have the ability to see into your day-to-day operations and understand how external forces may impact your business. With that visibility, you can simulate potential scenarios that might occur in the future. The result is making the right decisions about which products to develop, the most efficient way to produce them, and how to ensure they continue to meet customer expectations.
Choosing an Analytics Consultant
There are few industries as complex and data intensive as manufacturing organizations. The Copley Consulting Group knows there are several factors to determine the right fit for your organization. When working to implement your analytics solution, Copley can provide the technology and support needed for your specific industry and business. To discuss an analytics solution for your organization, complete our contact form, call us at 855-884-5305, or email us at firstname.lastname@example.org.