Over 30 years ago in an engineering college near the city of Ranchi, a group of us, young aspiring mechanical engineers watched a demonstration of muscle power and skill in the foundry and forging workshop, where a workshop demonstrator pulled a red hot piece of iron from the fire and hammered and shaped it into a perfect ?job? by judicious use of a 20 pound hammer. This experience which every manufacturing manager would have gone through in engineering school is today enshrined in the ?Hammering Man? a large statue that raises and lowers its arm to perform the same feat in front of the trade fair area in Frankfurt Messe in Germany. An April issue of The Economist, in a timely article titled ?A third industrial revolution? calls this very statue a ?celebration of the worker using his hands and mind? even as all future directions in manufacturing point to a world of new ideas and capabilities with no reliance on brute force skills!
The new revolutions in ?additive manufacturing? where virtually anything can be built by depositing layer upon layer of material rather than pressing and bending material to the desired shape is just one departure from traditional manufacturing that created the first industrial revolution in aggregating the British textile industry and the second, through Henry Ford and his assembly line production in the US automobile industry. The ?feeling? machines which can sense and make continuous corrections in cutting processes, new materials bound by new viruses that will form the core of any manufactured product, extensive digitisation in manufacturing that will enable mass customisation of production, with the ?lot size of one? becoming a reality in all areas of manufacturing?all these are inventions and innovations happening in front of our eyes that will change the definition and the process of creating products for the world forever.
While all this is exciting in its own right and will change forever the look and feel of the factories of the future, there will be many other outcomes that can define the way the IT services industry thinks of its role in the future of the world. The need to manufacture in low cost countries with large groups of labour may disappear and the economies of scope will overtake the economies of scale with fast changing demand driving the relocation of factories to locations near the sources of demand. Does this augur well for the continuation of countries like the US and Germany as economic superpowers and signal a potential return to supremacy of the Japanese economy? Maybe not entirely because large demand pools will now be in the BRIC and other economies as well, but surely an exciting set of opportunities present themselves for the future.
Indian software consulting firms that have chosen manufacturing or in some cases the vertical group of manufacturing retail & distribution (MRD) are quickly redefining their offerings to current and future clients and discovering that revenue and profits can now be extracted from multiple points in the manufacturing value chain. The foundation capabilities of implementing large scale end-to-end enterprise resource planning (ERP) systems in large manufacturing and retail enterprises and the new ?edge? capabilities that both software product and consulting firms have built in the last decade?optimising global supply chains, managing demand chains, enabling the management of ?big data? with state of art business analytics and business intelligence solutions will continue to form the core of virtuous partnerships between the IT and manufacturing community.
The new service and profit opportunities are already emerging in the business to consumer interface with enterprise mobile apps and use of enterprise social media innovations providing exciting options to engage with customers. The rapid adoption of cloud transitions with the ability to have ?software as a service? applications will change the way future business to business transactions are conceptualised.
The real breakthrough applications are of course still cooking. The new focus on manufacturing execution systems and product lifecycle management has already brought Indian IT firms to the shop floor as design, manufacturing and shop floor management become core focus areas for all providers. As a manufacturing analyst from Aberdeen Research has pointed out, the key priority for manufacturing firms is now to use an ?industrial ethernet? approach to integrate manufacturing data and applications from the shop floor to the enterprise. The need for improved visibility and the resultant benefits of end-to-end process reengineering to anticipate and meet customer demand faster will be the key driver of this.
For the Indian IT industry, the real excitement will break free when products and templates are created for the third industrial revolution and we will hopefully see the transition of many medium and large IT firms and thousands of new product developers to becoming key players in this new arena and shape the way manufacturing is managed in future!
The writer is CEO of Zensar Technologies and chairman of the National Knowledge Committee of the CII