Open for business? Manufacturing, ERP, digital transformation post-COVID
The coronavirus pandemic has arguably had more impact on society and business than any event since the Second World War. Entire countries closed and some truly staggering political interventions have occurred – perhaps none more economically staggering than those in South Africa. As countries move tentatively out of their respective lockdowns, the employment- and investment-intensive manufacturing industries have become critical indicators of how businesses will adapt to a post-COVID global economy.
Manufacturers suffered a huge shock to the system as the early economic impact of COVID-19 hit. “At Infor, we saw many businesses in all industrial sectors freeze both ongoing projects and planned investments,” confirms Phil Lewis, Infor VP Solution Consulting, EMEA.“Interestingly, however, this did not last.”
Paralysis and fear quickly evolved into an attitude of learning and adaptation, driven by an acceptance of any changes forced by COVID-19. “Indeed, of all the business sectors we serve, we saw manufacturers and supply chain businesses realise that they had to keep moving and substantially embrace change to survive and grow. Many of these companies sought to come out of the pandemic stronger than before – and saw their investment in technology as a key part of this strategy,” he adds.
Within the timeframe of the lockdown, for many ongoing projects, a lot of the internal resources and stakeholders minimised the impact of ERP and digital transformation projects on day-to-day operations.The net result was that this led to some quicker implementations.
A key factor in this has been the manufacturing sector – and other industrial markets – embracing the possibilities of remote working. The aggressive increase in the use of collaboration tools and platforms (and the realisation that projects can be completed successfully in a remote context) will deliver huge change to both the manufacturing and technology industries going forward.
“The customers embracing collaboration and the other benefits of the cloud will see a big return on their investments,” confirms Lewis. “This includes fast and easy access to business-critical software beyond Zoom or Teams. Increased remote access to data, ERP apps and systems offers not only business continuity and a reduction in risk, but better agility and responsiveness. The first two facets are part of a survival strategy, but the latter two demonstrate the opportunity for manufacturing technology to drive growth, even amid large-scale, ‘Black Swan’ events.”
Moving into a phase of growth is what customers are looking forward to. There is a palpable mindset shift. COVID-19 has forced an appreciation and acceptance when it comes to cloud within manufacturing. The appetite has increased, as has the expectation of faster ROI.
“Of course, there are other factors that have got manufacturers to this point regardless of COVID-19. The main reason is choice, as cloud enterprise applications are now truly fit for purpose. Traditional ERP applications can often be an inadequate foundation for going digital in complex businesses such as manufacturers – and intelligent, extensible software, based in the cloud, is now a reality for those organisations,” he adds.
The role of the IT department is also changing within manufacturers. IT leaders are now more aligned to what happens in the business. Their choices are much more strategic, grounded in business processes rather than being led by technological functionality. Taken together with industry-specific solutions, this leads to a much faster impact.
There have been some other interesting and novel impacts of this continued investment, specifically linked to the post-Coronavirus world. The idea of COVID-secure workspaces increases the demand for auditing and traceability when it comes to the office, factory and warehouse. There is a growing governance and compliance driver that will necessitate the use of technology to track which facilities and assets are cleared for use. This has led to updates to EAM software, tracking and tagging the cleaning of workplaces. Continued investment in technology will help companies emerge from COVID faster, in better shape, and will also play a role in keeping people safe in a post-COVID world.
“We are also realists and recognise that there will be some contraction for the manufacturing sector,” concludes Lewis. “There have already been substantial job losses, but there are also a lot of positive conversations that should offset some of the Armageddon-style figures predicted. Successful customers are taking a long-term view, focusing on which technology will have the greatest impact on the ‘other’ side of the pandemic, and are still investing.”