Complexity In Manufacturing Enterprises Is Potentially More Insidious Than Ever?

Why an economic downturn is the most critical time to streamline operations

By?Steven P. Silver?| November 2022??

Much new challenging economic news has emerged as we approach the end of 2022, with bellwether firms in high-tech, manufacturing, automotive, and other sectors announcing hiring freezes, layoffs, or reorganizations. The great resignation and quiet quitting of 2021 and early 2022 have made way for the latest business environment shift buffeting every industry.??

Whether it was the disruption of the COVID-19 pandemic, the effects of both the graying of the manufacturing workforce that pre-dated it, the impacts of the war in Ukraine further disrupting supply chains or the continued battles for tech-savvy talent waged in industrial and high-tech cities and towns across the globe, one thing has not changed this year. Inside every enterprise, the difficulty in getting the work done that delivers critical business outcomes, given the resource constraints everyone faces, is only made more challenging by the complexity of operations and experiences. This complexity has put even more pressure on already stressed- or burnt-out workforces on factory, office, or home office floors.?

How is this manifesting??

A recent study by Pegasystems asked thousands of workers from across the globe for their insights on the increasingly complex intersection of technology and the workforce. The results recently published in “Demystifying complexity in the modern workforce” shed some light. They reveal:?

• 3 out of 4 workers believe their jobs are becoming more complex?
• One-third of workers believe hybrid work makes business more complicated?
• 90% of workers are experiencing "information overload" at work?
• 98% of workers believe technology is important to their position?

Ironically, 42% of workers – and 46% of hybrid workers – feel digital transformation efforts have made their job more complex. But what makes day-to-day business "complex" for workers???

Respondents identified several key elements that impact their ability to execute their jobs successfully, including business, technology, and organization dynamics. Many of these challenges have been accelerated by the increase of digital-first, remote work following the COVID-19 pandemic. Business challenges that add day-to-day complexity include:?

• Managing information overload – 90%?
• Navigating internal processes and bureaucracy – 89%?

In manufacturing enterprises, we see this phenomenon in addressing critical changes to the customer, supplier, dealer, or employee experiences – in days and weeks versus months and years. We see it in making updates of any fidelity to key end-to-end processes – e.g., Order to Cash; Procure to Pay; Hire-to-Retire, Quality Management, Aftermarket Services, etc. – constrained by antiquated systems of record like ERP, CRM, and the proliferation of one-off apps for everything under the sun. These same organizations and their workers experience this complexity when creating new "as a service" business models to generate incremental revenues and supercharged margins. But these new businesses must run in parallel with existing manufacturing operations and experiences governed by the spaghetti-like complexity of legacy business and technology architectures.??

Manufacturing enterprises must commit to streamlining operations … and the legacy technologies that power them.?

While technology is just one piece of the complexity puzzle for manufacturing enterprises, it's a root cause that gets referenced repeatedly in discussions with executives and rank-and-file employees alike. According to the same Pega survey, workers want systems that integrate easily with other technologies, access to better training, and technology that's easier to use. Rapid, disorganized implementation of new tech has left workers with whiplash; only half are very or extremely confident that they can pick up the latest tech skills needed for their jobs.?

Workers know what they want: to make technology less complex. They see a clear cause and effect between lack of training and their ability to adapt to new technology.??

One potential solution to streamline enterprise operations and simplify and remove the system of record and ERP handcuffs adding to this complexity is what Pega refers to as ERP Modernization.?

The problem isn't that manufacturers have too many legacy ERP systems. These systems weren't built to provide the insight, support, and evolution needed to fulfill your company's objectives. Manufacturers need a low-risk way to leverage ERP investments, improve operations, and collaborate – all to drive outcomes. A truly future-proof platform is agile and scalable through low-code development and end-to-end automation.?

Doing nothing in the face of compounding complexity, leaner workforces and continued disruption is not the answer.? The workforce that sustains and emerges from the disruption of the pandemic and recent economic upheaval is clear about its destructive impact if the complexity status quo persists.???

• Damaged work-life balance?
• Severe difficulty managing projects, teams, or people??
• Lack of resources to get the job done?

Leading organizations tend to invest in a downturn to reap the rewards of a recovery.??

Before organizations and their workforces reach the breaking point affecting their abilities to deliver on their customer and brand promises, firms across the manufacturing spectrum need to ensure the employees that are part of their plans for a future of simplified operations are a priority. While winter is yet to arrive in the northern hemisphere, focusing on customers, profitability and growth starts with a proverbial spring cleaning of enterprise operational complexity. A downturn, recession or just quiet before the next wave of growth – there is no time like the present.?

Where are you finding operational complexity to attack in your enterprise in 2023??

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AUTHOR

Steven P. Silver?is Managing Director, Automotive, Transportation & Mobility at?Publicis Sapient.?At the time of publication, he was Vice President, Industry Market Leader for Diversified Industries at?Pegasystems.