The manufacturing industry is undergoing a practical transformation—driven by the necessity for improved efficiency, enhanced security, and a future-ready infrastructure. While there is a lot of excitement surrounding artificial intelligence, the core investments Connection sees manufacturing customers make is in the modernization of their factories and critical business processes as a steppingstone for what comes next.
According to Connection’s Biannual Manufacturing Survey, 98% of manufacturing leaders believe modernization is crucial1 for differentiation and growth. Without these investments, businesses risk falling behind and becoming unable to execute their strategies effectively.
Networking: The Digital Backbone
Networking forms the fundamental layer of factory modernization. The integration of factory devices, industrial control systems, robotics, and sensors requires a robust and scalable networking infrastructure with cybersecurity layered throughout. This connectivity enables real-time data collection and analysis, pivotal for optimizing production processes. According to Cisco, connected factories see a 21% increase in operational efficiency—so there’s no doubt why 46% plan to use OT data to improve quality, while 43% will optimize their processes.
High-speed, low-latency networks are essential to support the vast amount of data generated by modern manufacturing equipment and systems. It’s also about networking designed to support industrial environments and their unique challenges. This includes networking designed with zero trust, micro-segmentation, real-time monitoring of traffic, industrial deep packet inspection, asset and route visibility, and the ability to detect and alert on anomalous activity in the environment. Oh…and of course, these networks also need to support the diverse heterogeneous manufacturing technologies that drive plant facilities, production equipment, and a broad range of functional stakeholders, making the value engine of manufacturing operate.
Cybersecurity and Industry Security Compliance
With increased connectivity comes an escalated need for robust cybersecurity measures. The manufacturing sector has become a prime target for cyberattacks, making it the number one most attacked industry. In addition to the threats themselves, the impacts on businesses have also increased, turning cybersecurity from an “it may happen” risk avoidance scenario to a hard financial impact that requires attention.
In our recent customer survey, 59% of manufacturers experienced higher cybersecurity insurance premiums, 27% were struggling to comply with existing or new insurance requirements, and 14% were dropped altogether.2 On the regulation front, new financial regulatory mandates require publicly traded companies to report incidents to the market, bringing greater investor scrutiny and public visibility to the threats most manufacturers face. We are also seeing investment into new cybersecurity capabilities related to standards such as the NIST, ISO, and CMMC Cybersecurity Frameworks. These standards ensure that data protection and privacy measures are consistently applied, reducing the risk of breaches, assisting with cybersecurity insurance, and a key focus with investment stakeholders.
As a result of the increasing impact and focus on cybersecurity, manufacturers are rethinking traditional operational technology norms and the use of cybersecurity within these domains. This is driving manufacturers to adopt comprehensive cybersecurity strategies that include asset visibility, flow monitoring, industrial deep packet inspections, firewalls, regular security audits, and new sensor technology that monitors both IT and industrial packets flowing at lower levels within the Purdue model.
Composable Architectures
Composable architecture refers to a modular approach to system design, where components can be easily configured and reconfigured to meet changing demands. This flexibility is vital for manufacturing plants that need to adapt quickly to new products or changes in market conditions. According to Gartner, by 2023, 60% of new digital business solutions will rely on composable architecture.3 This trend allows manufacturers to innovate rapidly without the constraints of rigid, monolithic systems.
Third-party Remote Access
The ability to provide remote access to remote employees, third-party vendors, and service providers is becoming increasingly important. This capability enables experts to troubleshoot issues, perform maintenance, and update software without being on-site. It’s also not a new concept, with various legacy approaches to third-party access that provide external access to targeted devices and often entire networks, increasing the potential security risks in a predominantly at-risk environment. 51% of organizations have experienced data breaches caused by third-party remote access and 66% have not implemented least privileged access.4
To mitigate these risks, manufacturers should implement modern secure remote access solutions. This includes zero-trust network access across the various layers of the Purdue model to provide methodical integration with low-level industrial control networks and devices. It should also include an inventory of all third parties, auditing of all transactions with fine details, minimizing how files are exchanged, and a means to speed compliance with auditing regulations.
Readying the Factory for Future Technologies
A forward-thinking approach involves preparing the factory for future technological advancements. This readiness includes integrating data from various sources, automating processes, and incorporating AI capabilities.
Data Integration
Data integration is the process of combining data from different sources to provide a unified view. This integration is critical for enabling advanced analytics and informed decision-making. According to Accenture, manufacturers that leverage integrated data can improve business growth by 30 percent per year.5 Data lakes and cloud storage solutions are often employed to facilitate this integration, allowing for scalable and flexible data management, but many are also deploying new strategies around data orchestration from low-level plant operations to business systems of record to cloud platforms. Tapping into the data-rich environments will fuel manufacturers’ ability to gain a competitive advantage.
Automation
Automation is no longer a futuristic concept but a current necessity. By automating repetitive tasks, manufacturers can reduce human error, increase production speed, and free up employees for more complex tasks. For example, industrial companies are expected to invest 25% of their capital in industrial automation over the next 5 years.6 Automation technologies include robotic process automation (RPA), autonomous mobile robots (AMRs), and advanced manufacturing execution systems (MES). Our teams are also seeing other technologies—like Agentic AI—transform how actions are taken on behalf of employees, customers, or AI atop of AI insights or triggers.
Artificial Intelligence
AI is transforming the manufacturing landscape by enabling predictive maintenance, quality control, and supply chain optimization. Predictive maintenance uses AI algorithms to predict when equipment is likely to fail, allowing for timely interventions that prevent costly downtime. In quality control, AI systems can detect defects more accurately and quickly than human inspectors. For supply chain optimization, AI can analyze vast amounts of data to forecast demand, optimize inventory levels, and improve logistics efficiency.
Two popular use cases that align to the growing demand for GenAI and LLMs is small language models (SLMs)—trained on data-rich manufacturing environments and optimized with impactful prompt engineering to make it easier to identify risks and opportunities and aim organizations towards continuous meaningful improvements—and (eventually) agentic AI, where action is taken based upon human and AI engagement.
Conclusion
The modernization of manufacturing factories is not just a trend but a critical necessity for staying competitive in today’s market. Manufacturers can achieve significant gains in efficiency, security, and flexibility by investing in networking, cybersecurity, composable architectures, and future-ready technologies. These investments are essential for differentiation and growth, enabling manufacturers to execute their business strategies successfully and remain resilient in the face of evolving challenges.
Engage our Manufacturing Practice today to learn how to get started!
3 https://www.gartner.com/en/doc/465932-future-of-applications-delivering-the-composable-enterprise
5 https://www.accenture.com/nl-en/blogs/insights/data-driven-enterprise
6 https://explodingtopics.com/blog/robotics-industry-stats
