Faced with significant and ongoing disruption in the industry, manufacturing companies have known for years that digital transformation is essential to maintain a competitive edge. COVID-19 has only accelerated the need for digital transformation. The pandemic has disrupted supply chains, created an increasingly distributed and remote workforce, caused significant changes in demand, and increased the challenges of providing field service. To address these changes, manufacturing companies have accelerated their investments in digitization. According to McKinsey, advances in this area are now ahead of schedule by three to four years.1
With digital transformation, many companies are investing in optimizing individual functions— an approach that falls short of goals or is ultimately unsustainable in two-thirds of cases.2 The conventional wisdom is that if you invest in each part of the value chain, you’ll optimize the entire value chain. But in truth this just engenders competition: In an Accenture study, 75% of manufacturing executives surveyed said that business functions are competing against each other on digitization efforts.3 And this creates redundant costs:
“Cross-function competition is causing redundant investments in digital projects—with executives expecting a 6.3% increase in costs as a result.”4 In addition to increasing costs, siloed efforts create siloed data, which means employees are prevented from getting the information they need from other functions and collaboration is hampered.
In PTC’s recent State of Digital Thread survey, 74% of leaders said that improving their ability to leverage data across the enterprise would be effective or highly effective at addressing