5 smart factory challenges and how to address them with ERP solutions

Smart factories are growing in prominence as continued supply chain disruptions and pressures from the 4th Industrial Revolution make embracing technology a necessity for manufacturers. For manufacturers to remain competitive, adopting more IoT technologies into their supply chain is key.

Although this increased digitalization comes with many benefits, the interconnected network of machines, communication mechanisms, and computing platforms that make up a smart factory system do not come without their challenges. Many of these challenges stem from the technologies themselves.

Fortunately, ERP systems offer a solution to some of these challenges. This blog will look closely at the 5 most pressing challenges posed by smart factories and how an ERP system can help you overcome them.

Challenge 1: Dealing with a fragmented system

Fragmentation is a key issue in the IoT industry. Designing and developing an IoT system for the manufacturing industry involves lengthy lists of partnerships between vendors. This wide array of systems often results in a disjointed approach in which business departments struggle to communicate and collaborate effectively, often creating data islands or silos within the organization.

ERP systems can overcome this challenge by integrating all business processes and systems into one centralized environment. By doing so, data from all departments is brought together, making information easily accessible across the entire organization. This also gives decision-makers the freedom to choose which systems suit their business needs without concerns over fragmentation.

Challenge 2: Consistent real-time feedback

Many smart factories require a wide array of devices to run. Failure to pick up when a device is not running at optimal levels can have a significant negative effect on operations. As such, real-time monitoring of all devices is essential. An ERP system will be able to provide this real-time feedback, equipping decision-makers and managers from all departments with the insights they need to identify and resolve malfunctions before they cause disruptions.

Challenge 3: Protecting the production line

Protecting your network is not only important for data security reasons. In a smart factory powered by IoT devices, ensuring the security of each of these machines is key. If the network were to be hacked, malicious groups may be able to access individual machines, interfering with production or even resulting in a complete halt. This creates a need for extensive protection of your entire network, both from inside and outside threats.

ERP security measures can be configured to your needs, offering customizable protection of your network. By centralizing all business processes and systems, an ERP system becomes the core of your business, ensuring you have sufficient oversight and control of transactions and operations within the business. The ability to monitor and document information flow and business transactions offered by an ERP system help detect and prevent change that might lead to business compromise. What is more, ERP providers have access to security resources which most businesses do not provide, making an ERP system a secure choice.

Challenge 4: Finding skilled workers

With a predicted skills gap of approximately 2.1 million unfilled jobs by 2030, finding the necessary talent to implement and maintain a smart factory is a challenge faced by all in the manufacturing sector. Even once designed, developed, and implemented, smart factories require a huge amount and range of technology talent to maintain. This skills gap, coupled with the undeniable need for smart factory technology, has resulted in many looking internally for a solution. This requires extensive and ongoing retraining of staff to ensure they are equipped with the knowledge needed to solve high-level technical problems using critical thinking.

One of the key advantages of an ERP system is its ability to improve efficiency and free up human capital from mundane and time-consuming tasks. Therefore, although having an ERP system may not provide you with the technical staff you need, it does free up current members of staff so that they can focus on their core duties while still having the capacity for retraining and upskilling programs. Importantly, this can be achieved while maintaining optimal overall efficiency.


Challenge 5: Acquiring financing

Migrating to smart technology is an expensive process that often cannot be achieved overnight. Due to the cost involved, convincing stakeholders to fund trials and full deployments can be challenging without solid evidence of success. Gathering and displaying the benefits of already-deployed systems or potential benefits for migrating legacy systems when done manually is challenging and can often require procuring information across departments.

An ERP system’s ability to provide real-time insights and reporting from across all business processes can help speed up this process and provide more accurate results, more clearly showing the correlation between operational improvements and the bottom line. This reporting may be deployed to convince stakeholders of the benefits of smart machines.

As the need for resilience in the supply chain increases, it is important that manufacturers embrace the digital age and move towards smart factories. However, to do so effectively, manufacturers must find ways to overcome the challenges faced when implementing smart technologies. Investing in an ERP system from a trusted provider can be an effective way to do so, offering smart solutions to digital-age problems.

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