Hiren Kanani

Hiren Kanani

August 28, 2023 14 minutes to read

Digital transformation in manufacturing

Digital transformation in manufacturing

The world is changing at a remarkable pace. This revolutionary pace of the world is significantly affected by a lot of factors, and one of them is technology. Unlike the olden days when you had to wait for weeks and months to get your new car, today, you can get it in minutes. How? Technology has paced the manufacturing processes.

And it is not just for the automotive industry. Almost every manufacturing industry has been impacted by technology to some extent. However, not all companies have evolved to the stage where digital transformation seems worthy to them. The inability to understand the necessity of digital transformation poses several challenges, such as decreasing customer base, rising competition, extended manufacturing time, and loss of revenue.

Very few manufacturers were ready to adopt digital technologies a few years back. However, after COVID-19, around 67% of the manufacturers have started focusing on digital projects. Moreover, as the value of digital transformation in the manufacturing market is racing towards the $767 billion mark by 2026, it has motivated many other industrial enterprises to adopt digital transformation.

Here in this article, we will uncover everything related to digital transformation in manufacturing.

What is Digital Transformation?

The term digital transformation means when a manufacturing industry or any other industry begins integrating digital technologies into its workflow. Whether it is in-factory workflow or in the field, digital technologies like AI, AR, and/or IoT play a key role in it.

The process of digital transformation can be a one-time job, or it can be divided into a subset of tasks. Irrespective of the way it is done, the benefits of implementing digital transformation are imperative. Statistics suggest that reduced costs and better data visibility are the common benefits that the manufacturer expects from the transformation process.

Here are some of the prime benefits of digital transformation!

Reduced Downtime: Downtime is the aspect that is the prime contributor to revenue loss in manufacturing. As per stats, a downtime of one hour can lead to a revenue loss of $300,000. With digital transformation technologies in place, downtime can be reduced significantly.

Better Quality: Quality is what puts your business on top, whether it is consumer electronics, automotive, food, garments, or any other. With digital transformation technologies like Augmented Reality, you can verify the quality of a produced part within seconds, ensuring quality.

Improved Safety: With the use of digital technologies, you can provide better training to your workers, which directly improves safety. Moreover, providing digital work instructions to the workers makes them work with the machine in an ideal way. Therefore boosting safety and reducing the chances of injuries.

Cost Saving: Digital transformation technologies can help you save a lot on your operations. For instance, if you are using AR for your operations, it can speed up the remote troubleshooting process while saving industry experts round trips to the location of the issue. Statistics suggest that using AR for remote troubleshooting can reduce the overall cost by 11% for service teams.

What are the Prime Drivers of Digital Transformation in Manufacturing?

Digital transformation is not a jack-in-the-box thing that happened abruptly. It took a lot of time for the technologies to develop and disrupt the market, and many factors led to the advent of Industry 4.0.

Let’s read ahead and analyze those factors!

Technological Advancements

In the past decade, numerous technologies have surfaced and have been adopted by tech giants across the globe. AR, AI, VR, ML, and IoT are some of them. These technological advancements have pushed businesses to a point where they have to adopt them or run for their money.

Therefore, technological advancements are the key driver of digital transformation, with 70% of businesses having a digital transformation strategy ready or they are working on one.

Global Competition

As the manufacturing market is expected to reach up to $14.83 trillion in 2023, the competition has surged more than ever. And it is not just locally, globally also.

The key reasons for the stiff competition are economic factors, lack of skilled labour, supply chain instability, etc. The paradox is the thing that elevates the competition is also what will help businesses surpass it technology. The lack of skilled labour is due to technological advancements, and businesses must train their staff to make them skilled and cope with the competition.

Customer Expectations

When a brand launches a new product, the market runs to save money by producing competitive products. An example of that is the Tesla electric car. Since Tesla launched its car in 2008, automotive companies have been investing more in electric vehicles. This is what raises the market competition and, consequently, consumer expectations. To fulfill these expectations, industries tend to invest in digital technologies.

Robotics and automation are the primary technologies for car manufacturing.

What are the Challenges to Digital Transformation in Manufacturing?

Though digital transformation has become imperative for the manufacturing industry, it is not that simple. If you are one of those business owners who plan to implement digital technologies into your manufacturing workflow, there are things that you need to take care of.

Legacy Systems

Old and legacy machines are not going to do the job anymore. If you use the same old lathe machines to produce metal or plastic parts, the market competition will crush you and put you out of business. Hence, you need to deal with it as soon as possible.

Before your competitors realize the need for digital transformation, you have to equip your labour with advanced machinery like CNC (Computer numerical control ) and other automated machines that reduce production time and increase productivity and output. On top of that, it is also crucial to invest in the right technology.

Integration with Existing Systems

Once you decide to get new machinery for the plant, the next challenge is integrating it into the existing infrastructure. If you have been using machines with manual controls, it would be tough to use them with automatic machines. As new machines tend to communicate via data, it can be tough to use them with legacy machines.

However, if you can look into IoT sensors, they can help communicate with legacy systems.

Investing in the Right Tech

Technology is the primary part of digital transformation, and firms face challenges in picking the ideal one. Make sure to choose the right tech for your manufacturing business, or the consequences can be severe. Industry 4.0 has introduced several technologies to the world, and almost each of them is beneficial for the manufacturing sector.

You can go for AI, robotics, AR, VR, ML, big data analytics, and many others in collaboration with each other to get the best out of the manufacturing process.

Reskilling the Staff

When a business undertakes digital transformation, it is imperative that your staff needs to be trained. As per the World Economic Forum, around 54% of the employees will require reskilling due to digital transformation. Now, the issue is not just training the staff; it escalates to the fact that your staff may need to be more enthusiastic to adapt to the new equipment.

To solve this issue, you need to make the reskilling or training process immersive and interactive. And when it comes to enhancing the training process, leverage the power of AR. Augmented Reality has the power to enhance the training process.

Data Security and Privacy

Technology enhancement happens at a remarkable pace. Therefore, if you are using a system that has yet to witness security updates in some time now, you need to take it seriously. As cyberattacks are becoming more fine, precise, and dangerous day by day, powerful data security and privacy measures need to be in place.

Data privacy and security is an everlasting challenge for any firm dealing with online data.

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Technologies to Implement Digital Transformation in Manufacturing

So far, we have analyzed almost everything about digital transformation in manufacturing. Now, it is time to discuss the most important aspect of digital transformation and the technologies that are a part of it. So, here are the technologies that have the power to take your business to the next level.

AI and ML

AI and ML are two of the most important technologies that can be used to improve and streamline industrial operations. Several companies like IBM, Intel, and Rockwell Automation use them to streamline operations, track business trends, and anticipate potential risks.

With AI, automation, and ML technologies in place, you can capture and analyse data swiftly. The data can be analyzed for trends and patterns to improve quality, find out workflow bottlenecks, and make the process more efficient. Further, automating tedious processes can help manufacturing businesses become smarter.

Rockwell Automation’s smart devices capture and analyze critical data from the factory floor to optimize productivity.

IIoT Sensors

Industrial IoT is an exceptional technology that deals with the interconnection of all industrial machines via IoT sensors. IoT is expanded as the Internet of Things that deals with IoT sensors attached to every machine or device in the manufacturing plant. These sensors are meant to sense numerous critical aspects of the machines, like temperature, pressure, gases, humidity, etc.

The sensed data is sent to the central gateway for processing, and based on the analysis, necessary actions are taken if required.

For instance, if a metal cutting machine witnesses an abnormal increase in temperature, it can be sensed by the sensors and reported. Further, necessary repairs or maintenance can be done to avoid any machine downtime. IIoT is best for field service, too.


Collaborative robots or Cobots are robots that are pre-programmed to work with humans in a friendly way. They are lightweight as compared to other industrial robots and can perform simple and monotonous tasks like assembling, packaging, and picking products.

These robots can take away a lot of laborious and repetitive work from the workforce so the frontline workers can focus on more important tasks. As cobots can handle 3D jobs (dirty, dangerous, and dull), they can be a utilitarian element on the manufacturing floor.


Blockchain is a pivotal element of modern-day digital transformation. It is not only for cryptocurrency but can also be used by manufacturers for various tasks. The key feature of a blockchain platform is that it maintains an immutable record of transactions. Further, it is tamper-proof, protected against fraud, and transparent.

Therefore, for manufacturers, it can be an excellent way to gain real-time visibility into transactions and the complete history of their work relationships. An example of this is Hidalco Industries. The firm deployed a blockchain that helped in coordinating work-order progress across the network. It also allowed the firm to gain real-time visibility into vendor inventory.

Big Data

As its name suggests, big data is the data businesses collect from all the sources in their plant. This data is of various types and is captured from several machines. Businesses must analyze this data to see trends and patterns for future decisions. The use of big data analytics plays a critical role in making decisions about product development, supply chain management, and more.

Augmented Reality

Augmented Reality is a revolutionary technology that merges real-world elements with the virtual world by superimposing computer-generated elements onto the real-world environment.

This technology is worthy of being used in various processes in manufacturing, such as quality control, remote assistance, repair and maintenance, troubleshooting, etc.

AR is an excellent technology to be used in training. One of the examples of AR used in manufacturing is BMW.

3D Printing

3D printing may not seem like a digital transformation technology for manufacturing, but it is. It is a technology that uses digital data to create 3D objects by printing layers of material. The best use of 3D printing is seen in the prototyping of manufacturing machines or devices. You see, a lot of cost and effort is involved in producing machine prototypes. But, the cost is negligible in the case of 3D printing.

Hence, 3D printing can be useful in producing and testing device prototypes without any heavy investment.

Predictive Maintenance

Predictive maintenance is a process in which a device or machine is constantly monitored to analyze its performance parameters during regular operations. Based on the analysis, these machines and devices are maintained to reduce the chance of failure or breakdown.

Smart Manufacturing

It is an interconnected system with automated processes and machines. These machines automatically handle and self-sustain all the manufacturing, troubleshooting, assembly, and other processes.

All these technologies working in collaboration with each other constitute digital transformation in Manufacturing.

What are the Benefits of Digital Transformation in Manufacturing?

The adoption of digital transformation in manufacturing yields several benefits, including better efficiency, streamlined operations, predictive maintenance, quality control, cost saving, and Innovation & growth. The below diagram highlights the comprehensive benefits that digital transformation brings to the manufacturing industry.

digital transformation in manufacturing

Better Efficiency and Productivity

Using digital transformation technologies is surefire to boost productivity and efficiency. With these technologies, the chance of errors will be less, and operations will be smooth, leading to better output in less time.

Streamlined Operations

Through digital transformation, important data insights are used to detect errors, reduce redundancies, and improve operations. As a result, manufacturing operation runs smoothly, reduce waste, and enhance productivity.

Predictive Maintenance

With technologies like AI and machine algorithms, every machine’s maintenance needs and performance can be viewed from a single dashboard, reducing downtime and preventing costly breakdowns.

Quality Control

Quality is the aspect that can make or break your business. Using technologies like AR, you can assure and ensure the quality of the produced goods in a minimum time. The pre-made digital images of products can be compared with the actual products to find and rectify any irregularity.

Cost Saving and Optimization

The installation cost of these technologies is by all means high, but it is a one-time cost. Once these technologies are in place, you can save a lot of money. Digital transformation can help firms save a lot on post-sales repairs, field visits, downtime, maintenance, printing, and storage expenses & improves first-time fix rates.

Innovation & Growth

Digital transformation in manufacturing promotes innovation by creating an environment where important data can be easily shared, analyzed, and reacted instantly. As a result, this eases collaboration between different departments and enables quick resolution of the problem. Digital transformation keeps manufacturers competitive and promotes sustainable growth.

Future Trends and Case Studies

The future trends of these technologies are nothing but their use on a large scale.

However, if we talk about the case studies, there are many!

Airbus and Microsoft

Airbus is a renowned leader in the aerospace industry that produces military and commercial aircraft. The firm partnered with Microsoft to help its assembly workers accelerate the process.

Airbus workers used Microsoft HoloLens 2 AR glasses for guidance with visual data to simplify complex assembly processes. The glasses displayed step-by-step instructions for the workers to follow.


DHL is a logistics company that partnered with Ricoh and Ubimax to design a vision-picking solution.

The solution included smart glasses that guided the workers in the warehouse using graphics displayed on the smart glass. This was to speed up the picking process and decrease errors. DHL boosted the picking process efficiency by 25% thanks to the solution.

How can Plutomen Help in Digital Transformation?

Plutomen is a proud maker of state-of-the-art AR products. It takes immense pride in crafting ingenious AR tools that go beyond the realm of manufacturing remote assistance, extending their utility to training and seamless work procedures. Delve into the exciting range of these cutting-edge tools:

Plutomen Connect: Empowering technicians with seamless connectivity, Plutomen Connect facilitates real-time video conferencing to seek expert assistance in the field.

Plutomen Workflow: Enabling flawless execution of tasks, Plutomen Workflow provides digital work instructions to the working staff. With precision-guided workflows, every job is accomplished with utmost accuracy and efficiency.

Plutomen Assist: Transforming training; Plutomen Assist delivers an immersive learning experience to new staff through AR. Trainees can now easily grasp complex concepts and gain practical expertise in a dynamic, interactive environment.

Don’t Get Left Behind In The Digital Revolution!

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The four major areas of digital transformation are process transformation, business model transformation, domain transformation, and cultural/organisational digital transformation.

There are various reasons to enable digital transformation in the manufacturing industry, such as reduced costs, streamlining the supply chain, speeding up processes, and improving output quality.

There are five Ds to digital transformation in manufacturing: digital devices, digital media, digital platforms, digital technology, and digital data.
Hiren Kanani

Hiren Kanani

CTO, Cofounder of Plutomen

With 10+ years' experience of Hiren Kanani has helped Plutomen ensure smooth communication between the company and the client for swift project delivery with fewer iterations. He is CTO & founder at Plutomen.

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