Using tech to unlock manufacturing value

Keen to find out how local manufacturers are leveraging digital innovation, Brainstorm chatted to them about emerging technologies, their response to the Covid-19 pandemic and what they’re doing to prepare for Industry 4.0.
Read time 6min 20sec
Kgomotso Molefe, CIO at PPC.
Kgomotso Molefe, CIO at PPC.

Across the world, manufacturers are being asked to reduce costs, improve customer experience and up profitability. Increasingly, they’re utilising digital solutions and smart technologies to do so.

Technology has been, and continues to be, a business enabler, notes Amrod CTO, Yoav Tchelet. Today, what is different is the rate of change and the fact that these fast-paced innovations and new business models enable businesses to scale faster and more effectively, he says. But technology on its own is rarely the key to unlocking value, adds Louise van der Bank, CIO at Afrisam. It’s only when you combine technology with innovative ways of doing business that you create significant business value.

So, how are local manufacturers using digital to unlock value?

Here’s what tech execs at various South African manufacturers had to say when asked about emerging technologies, their response to Covid-19 and how they’re preparing for the Fourth Industrial Revolution.

What trends and technologies have had the most impact on your business in 2020 thus far?

Smart manufacturing continues to be the key driver, says Kgomotso Molefe, CIO at PPC. The difference now, though, is that it is complimented by AI, IoT and machine learning (ML). When integrated with devices that were previously considered ’dumb’, these emerging technologies add value by unlocking insights around core manufacturing processes.

While the industry appreciated the merits of banning alcohol during the initial lockdown, the consequences for a broad segment of the country’s manufacturing industry are likely to be catastrophic if the alcohol ban continues for an extended period.”

Johan du Plessis, Consol Glass

Tchelet agrees. Smart manufacturing continues to make the biggest impact in the short to medium term. It’s important to recognise the magnitude of the term smart manufacturing, he adds, as it isn’t just a single ’thing’. It encompasses everything from AI to robotics and cyber security. Something like AI on its own – especially in an integrated manufacturing environment – requires an ecosystem to support it, with data being an important piece of the puzzle.

“At the start of the year, we were focused on robotic process automation (RPA), leading into ML and moving towards AI sometime in the future, with some IoT in our outbound supply chain,” says Johan du Plessis, senior executive for information systems and technology at Consol Glass. While the company is still on track with its RPA and IoT pilots, the onset of the pandemic necessitated new ways of working focussed around digital collaboration. “Covid-19 has actually been a great digital transformation accelerator, as we sought new and innovative ways to connect with our employees during the nationwide lockdown,” says Du Plessis. Creating a data-free, mobile-based employee engagement platform has allowed Consol Glass to quickly and effectively communicate during this time of crisis and to answer any questions employees may have.

What impact did Covid-19 have on your manufacturing processes? What procedures did you put in place to mitigate disruption?

“Covid-19 definitely provided us with the opportunity to expedite our move towards a mobile workforce,” says Van der Bank. “Since our industry was hugely impacted by the lockdown, the immediate focus for us was on ensuring that we provided our users with support anywhere, anytime and on any device in a secure work-from-home environment so that they can perform their duties. This has had a huge effect on how we view and manage mobile data.”

Local manufacturers feel the pinch

Covid-19 has not been kind to the manufacturing industry.

According to Statistics South Africa (Stats SA), manufacturing production in South Africa decreased by 49.4% year-on-year in April. The largest contributor to this decline was motor vehicles, parts, accessories and other transport-related equipment, where output decreased by massive 98%.

The iron, steel, nonferrous metal products, metal products and machinery sector experienced an output decrease of 65.4%; the wood and wood products sector, including paper, publishing and printing, declined by 49.2%; and the manufacturing of petroleum, chemical products, rubber and plastic dropped by 41.5%.

For a brand like Consol Glass, the impact of national alcohol restrictions has been substantial. “While the industry appreciated the merits of banning alcohol during the initial lockdown, the consequences for a broad segment of the country’s manufacturing industry are likely to be catastrophic if the alcohol ban continues for an extended period,” notes Du Plessis.

During the initial lockdown (Level 5), Consol was able to produce containers related to essential products and services, being food, pharmaceutical and non-alcoholic beverages, but this only makes up around 15% of the company’s total sales. At Level 4, the company was allowed to operate at full capacity, but the liquor industry – which makes up 85% of sales – remained in lockdown and unable to receive glass containers.

The announcement by the President of the immediate reinstatement of the ban on local alcohol sales at the beginning of July again left many companies and suppliers within the alcohol industry – which includes Consol Glass – facing serious challenges that could result in permanent structural damage to the industry. “The risk of permanent failure of certain suppliers and the closure of glass packaging capacity in the South African market is becoming a reality.”

Looking back, is there anything you would have done differently? Are you making any changes to your business continuity and disaster recovery plans?

Amrod was fortunate as it had already started a large-scale digital transformation project in 2019. As part of this, the company put extensive employee collaboration capabilities in place. According to Tchelet, this enabled the company to move almost all administrative and sales staff to a work-from-home environment while being fully enabled remotely.

For Molefe, the situation forced PPC to fast-track the optimisation of its connectivity capabilities to enable the business to fully operate remotely, where necessary. The situation also fast-tracked the adoption of virtual and online collaboration tools and technologies. The IT team had to skill up quickly to support the needs of a more distributed workforce. End-user tools like tablets and laptops suddenly became key for business continuity purposes, he adds. “This changed our acquisition strategy and our landscape will be more mobile going forward.”

What’s your take on the 4IR? How are you preparing for the change?

“The pace of technology evolution and the impact of the 4IR on our business and lives are priority discussions that need to take place on a strategic level. The challenge is the ability of business leaders and ICT teams to creatively respond to rapid change,” notes Van der Bank. CIOs must connect the dots and be change leaders. “We must challenge ‘business as usual’ and plan for disruptive technology,” she says.

“In my view, it’s an inevitable revolution and to a great extent, Covid-19 has catapulted us forward,” says Molefe. The adoption of core 4IR technologies, like cloud, was fast-tracked and even organisations that were previously reluctant to migrate basic productivity tools suddenly found themselves rushing these workloads to the cloud.

Tchelet is more sceptical of the trend. “The term Fourth Industrial Revolution is a contentious one for me as I don’t believe we can term this an industrial revolution. Most of the technology being touted as part of the 4IR has been around for many years. This is more of an evolution than revolution.”

Du Plessis agrees. In capital-intensive manufacturing industries, one takes a more evolutionary rather than revolutionary approach when it comes to adopting new technology, he says. “The world is rapidly moving towards digital, but melting and forming glass is still a physical process. Building digital twins will come down the line for improved modelling, but the pure chemistry and physics involved probably outweigh the perceived benefit of melting and bottle-forming at this stage.”

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