Winning Manufacturing Strategies

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CIOs, get ready with go-to-market strategies!

In today's business environment, if you are the CIO of a manufacturing company, what is your biggest concern? Not the IT infrastructure, which is running fine. Not the finance and procurement processes - they are more automated and function smoother than ever. And definitely not plant automation or manufacturing execution systems or reporting! Actually, there seem to be no pressing concerns.

CIOs have done more than enough to streamline B2B processes. Today, IT can help capture demands early and accurately. Process automation helps manufacturers plan the entire source-to-ship cycle. As a result, the relationship between manufacturers and their partners is stronger, and the increased transparency has translated to better working capital and more successful partnerships.

In the past, making procurement and manufacturing efficiency the name of the game has pushed aside CIOs to make way for executives doing more 'important' business functions. But nothing lasts forever! With business models changing around the world, the manufacturing industry must scale up, again. And CIOs must rise to the occasion.

Manufacturing CIOs must now take on a more strategic role to figure out the business models of the future. They have to define the role of IT in enabling these business models and building go-to-market strategies. And the best place to start looking for new business models might be closer than you think ¬- banking, energy, logistics and healthcare are just a few of the many other industries that might inspire the next best business model in manufacturing.

While discussing this change with CIOs from many leading companies that work with us, I have identified some common trends that stand out from the rest.

  • A sustainable revenue mix

Industrial equipment and capital goods manufacturers are no longer satisfied selling the equipment they make, they want to know who buys them and for what. They have identified that the after-sales service and repairs for the equipment provides a more long-term and sustainable source of revenue.

  • Metered services

As markets shift east towards developing nations, volumes and small ticket size have become the style, with 'pay per use' and 'pay for output' merging as more attractive models.

  • Customer-centric transformations

Car manufacturers are seeing the industry go through some fundamental changes. On one hand, non-traditional fuels like hydrogen, bio-fuels, and electric sources are changing the engineering and design processes. On the other hand, they are reinventing ways to connect with the actual user.

One thing is certain: the scope of manufacturing CIOs has extended beyond infrastructure and automation - they need to take lead, delve into the business, and shape it to face the challenges of tomorrow.

In my next blog post: a day in the life of the CIO, in 2015...

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