Manufacturing: Getting Technology “Right” with Factory Expansion

Ryan Spurr

Demand for manufacturing in the United States is at its highest point in fourteen years, and with strong demand comes a need for top-line business growth. For manufacturers, meeting that demand will drive focus to the supply chain and operations, all with the single goal of capitalizing on the positive economic conditions. If your company is embarking on factory modernization or expansion, it’s time to consider how enabling technology fits into your growth strategy, budget, and planning process.

Reasons for Growth

Just about all manufacturing industry projections indicate the return to or a continued increase in growth. Strong consumer sentiment, order backlog, supply chain shortages, and customer demand are driving the need for all industries across the value chain to increase capacity to supply a growing economy. Positive economic conditions in their own right are sufficient to plan for growth, but other external drivers are triggering further call to action for manufacturers.

The Tax Cuts and Jobs Act of 2017, taking effect in 2018 and available through 2023, provides companies with a temporary 100 percent expensing of capital expenditures in a single year, providing a significant financial advantage. Companies are leveraging this opportunity to increase the level of capital expenditures and advance much-needed or long-delayed manufacturing investments.

While global manufacturers are cautious, repatriation of overseas held funds is also occurring and represents yet another incentive for growth and investment in large scale initiatives within the U.S.

All together these policy incentives are set to drive significant investment into new facilities, factory infrastructure, process equipment, and technology modernization. Make sure your company is ready and deploys some simple best practices to ensure success.

Best Practices

With business fundamentals at an all-time high and incentives compelling investment, let’s explore how to leverage this opportunity by implementing some best practices and ensure technology is not an afterthought.

  • Alignment—Ensure your company has alignment with respect to the budgeting process (especially capital) and objectives. It’s important to have all necessary stakeholders as part of the process from start to finish. This includes engineering, production, facilities, and—yes—the information technology (IT) organization. Lastly, don’t forget to consider other resources, such as external third parties like Connection who can work as an extension of your IT staff to provide valuable insight, support, and guidance to meet your strategic needs and goals.
  • Planning—Identification of stakeholders and clear objectives is the first step to a successful initiative, but don’t forget to engage all parties in early and continuous planning sessions. It’s important for downstream organizations like IT to understand the business strategy, objectives, and reasons for growth and modernization. If they are not included in early planning, they will lack an appreciation for what the business is embarking upon or perhaps miss a technology enabling component entirely. Engagement mishaps such as this are all too common and result in less capable technology and long-term value, unplanned cost overages, and most importantly delays in achieving production capacity goals.
  • Technology—In today’s manufacturing environment, technology is pervasive and critical to all business processes and roles. Selecting the right mix of technology is more important than ever to attract and retain top talent, optimize business processes with modern technology, and to achieve the capacity objectives originally set forth. Equally important is planning for the future to ensure that this sizeable investment will support emerging technologies like a mobile workforce, the internet of things (IoT), highly available production networks and predictive maintenance capabilities to improve operational equipment effectivity (OEE), and prepare for the future factory equipment the business will add over time.
  • Execution—You have a strong team, clear objectives, and the right technology identified and budgeted. Scheduling and resources are the next critical component to a successful factory initiative. Don’t forget to identify and left-shift long lead items like wide area networks, data center and cloud integration, or arranging for third party staffing and consultancy. For example, efforts like laying fiber to a new building take time to plan and typically have long lead times, so don’t make assumptions. You will want to engage the right resources early and often to align the schedule and resources to your business goals. Connection has experienced data center, network, cloud, and security experts who can assist or even augment a stretched organization or its skillsets.

The Right Manufacturing Technology Partner

Your company’s growth and success are important. The factory is the value creation center of your business, and making sure you have the right enabling technologies to realize operational excellence will be the key to success. Connection is invested in helping your business grow and is available to partner with you throughout the investment planning cycle. We have the products and services to support your technology expansion and modernization efforts, as well as manufacturing experts available to help you ready for future growth.

Contact an Account Manager to learn how we can help your early planning and budgeting cycles by advising, supporting, or quoting solutions.

Ryan Spurr is the Director of Manufacturing Strategy at Connection with 20+ years of experience in manufacturing, information technology, and portfolio leadership. He leads the Connection Manufacturing Practice, go-to-market strategy, client engagement, and advisory services focusing on operational technology (OT) and information technology that make manufacturers more digitally excellent.