Digital and Physical: The Merger That Can no Longer Wait

Digitalization is today’s most important industrial challenge and integration is the key.  While information technologies are merging into operational technologies, there are more opportunities to achieve USMCA(OEE), allowing companies to stand on their competitiveness advantages.

Digital transformation impacts every corner of a company, from operations to logistics, from design engineering to customer satisfaction, from machinery and devices to asset management. The dream of bringing real-time information from the wide range of processes occurring in a company to decision-makers on the executive board is now materializing due to internet technologies; hence, many other digital tools are coming aboard in a feasible manner, such as 3D printing, digital twins, machine learning, advance planning and predicting systems, as well as a wide scope of robotic applications.

The effects of internet technology on industrial activity are immeasurable and can be found in several fields. One approach would consider four basic drivers: logistics and fabrication, asset management, sustainability and infrastructure.

Logistics and fabrication itself consider a broad vision of a company following a product all the way from raw material to the end-user. Here, the concept of traceability plays an important role because of affording visibility and cost reduction all along the supply chain.

New World, New Defiance

After the supply breakdown caused by COVID 19, big challenges appeared, manufacturers had to downtime their production lines causing supply chain interruptions everywhere. Visibility became critical and companies are now generating their own efforts to acquire the systems for getting real-time information regarding products or components that must be addressed.

Traceability must be seen from different perspectives, such as asset typology, operational environment, impact dimension and optimization management. When using digital tools and information technology systems, companies become more efficient and, therefore, more able to reduce cost and improve the bottom line. Furthermore, companies become flexible and better focused on customer needs.

Integration between digital and physical technologies connects two different worlds: machinery and device platforms and information and communication technologies.

The first level is where data acquisition systems collect data information from processes, which is used to synchronize operations and automate tasks. It is a dance between hardware and software giving life to operations.

On top of this, there is a layer formed with management software systems, such as ERP, MES, CMMS, QMS and WMS, where a complex variety of functions that help top executives and decision-makers to improve business performance (from suppliers to customers) considering advanced planning, operational visibility, OEE, energy efficiency, quality control, customer satisfaction and any other key indicators required for company success.

In the middle of these two layers there is another critical line of solutions, the one that will definitively shape the competitiveness of today’s, and tomorrow’s, enterprises: analytics.

With real-time data, advanced analytics plays a mesmerizing role that allows decision-makers to have a clear view of the demand, the operation, the company's performance, and customer satisfaction, closing a complete virtuous circle.

Analytics tools must consider a wide range of analytical systems, such as supply chain planning and scheduling, activities monitorization, labor and control for improvement in times and movements, and predictive solutions, such as demand (for production efficiencies) or maintenance (for a better asset management), traceability and quality systems. Better data analytics that provide a holistic view can serve to help leaders make better business decisions.

This multilayer perspective assumes the integration of physical and digital technologies throughout advanced analytical solutions that might be applied to nearly any type of industry, including automotive, aerospace, energy, construction, food and beverage, medical devices or logistics.

Ready To Restart?

Mexico is among the countries with the greatest opportunity to exploit these advantages. An M&A report indicates that the country ranks 28th globally in terms of production, so its operational modernization needs will prevail in the coming years. 

Along with the restart of operations in the automotive industry, one of the main pillars of the USMCA, manufacturing plants must be prepared not only to increase production but also to face the puzzles that the new electric and hybrid models will require.

As a highly exporting country, Mexico must invest to acquire technology not only in infrastructure but also for logistics processes management, implementing traceability and analysis systems, as well as management solutions to ease the flow of merchandise while looking to eliminate bureaucracy.

Another area is energy. Modernization must reach its entire infrastructure. In the country, according to SENER, there are more than 112,736km of lines for electric transmission and distribution, 797 generation plants with a capacity of 75GW and 1,000 energy marketers.

Modernization of the entire infrastructure will be key to facilitating industrial and economic growth and development, especially at a time when trade and production chains are being reconfigured around the world, largely due to the pandemic, as well as trade adjustments between the US and China.  The merger of digital and physical can no longer wait.