Darshana Thakkar, Founder, Transformation – The Strategy HUB.

What is the current state of digital transformation in process industries?

The process industries are at various stages of digital transformation, with some leading the way and others still in the early phases. Integrating advanced technologies is driving significant efficiency, productivity, and sustainability improvements. However, challenges like legacy system integration, cybersecurity, and workforce skills need special attention to realise the full potential of digital transformation. As companies continue investing in digital initiatives, those who can successfully navigate these challenges will likely gain a competitive edge in the evolving industrial landscape.

What key technologies are driving digital transformation in process industries today?

Digital transformation in process industries revolutionises operations, improves efficiency, and enables new business models. Companies that successfully integrate these technologies can expect improved efficiency, reduced costs, enhanced product quality, and greater agility in responding to market changes. The convergence of these technologies is paving the way for smarter, more connected, and highly optimised industrial operations.

A few technologies playing critical roles are:

1. Industrial Internet of Things (IIoT)

• IIoT connects sensors, machinery, and systems to collect and exchange data, enabling real-time monitoring and control.
• Data helps to optimise operations, predict equipment failures, and reduce downtime.

2. Artificial Intelligence (AI) and Machine Learning (ML)

• AI and ML algorithms analyse historical data to predict maintenance needs before breakdowns.
• AI-driven analytics adjusts real-time variables, improving efficiency and product quality. ML models detect product defects and anomalies, ensuring higher quality standards with reduced human intervention.

3. Digital Twins

• Digital twins are virtual replicas of physical assets, processes, or systems that allow for real-time simulation and optimisation operations.
• Digital twins provide deep insights into equipment performance, enabling better decision-making and proactive maintenance.

4. Robotics and Automation

• RPA automates repetitive tasks, increasing efficiency and reducing the likelihood of human error in administrative and operational processes.
• Cobots work alongside human operators, enhancing the productivity of assembly, packaging, and material handling.

5. 5G and Connectivity

• 5G technology provides faster and more reliable communication between devices, enabling real-time data transmission and remote control.
• The low latency of 5G networks supports time-sensitive applications, such as autonomous vehicles and real-time process control.

6. Blockchain

• Blockchain technology provides a secure, immutable ledger for tracking the movement of goods.
• Blockchain enables the automation of contract execution with smart contracts, ensuring compliance and reducing the need for intermediaries.

7. Cloud Computing

• Cloud platforms offer scalable storage and processing power, allowing companies to handle large volumes of data with remote monitoring and control.

8. Edge Computing

• Edge computing allows data to be processed closer to the source, reducing latency and enabling real-time decision-making by processing data locally.

9. Cybersecurity Solutions

• Advanced cybersecurity tools use AI and ML to detect and respond to potential threats in real-time.
• Encryption and blockchain secures data communication and storage.

10. Additive Manufacturing (3D Printing)

• 3D Printing allows for the rapid creation of prototypes.
• Additive manufacturing enables the production of custom parts and components, reducing lead times and material waste.

What role does data analytics play in the decision-making processes within these industries?

Real-time data analysis is crucial for quick and effective decision-making. Edge computing or cloud computing should be selected based on the organisational requirements and preference for data storage and retrieval.

Data analytics is integral to decision-making in process industries, providing the insights needed to optimise operations, reduce costs, enhance quality, manage risks, and drive innovation. By leveraging data analytics, companies can make more informed, evidence-based decisions that lead to improved performance and a stronger competitive position in the market.

Major pain points where data analytics plays a crucial role:

• Strategic planning and innovation

• Process optimisation

• Predictive maintenance

• Quality control and assurance

• Supply chain optimisation

• Energy management and sustainability

• Cost reduction

• Risk management that includes operational and market risk

• Regulatory compliance, and

• Customer insights and personalisation.

What are the biggest challenges or barriers to digital transformation in process industries?

Digital transformation in process industries is essential for staying competitive, but it requires overcoming significant challenges related to technology integration, costs, cybersecurity, skills, and organisational culture. Companies that proactively address these barriers with a clear strategy, strong leadership, and a focus on building a digital-first culture are more likely to succeed in their digital transformation efforts. Here is summarising a few significant challenges faced by process industries for digital transformation:

• Many process industries operate with outdated systems, and integrating these systems with new technologies like IoT, AI, and cloud computing can be complex and costly.
• Legacy systems often lead to data silos, where information is isolated within specific departments or systems, making it difficult to achieve a unified view of operations.
• To choose the right technologies and vendors.
• Capital Investment is the upfront costs of implementing digital technologies, including hardware, software, and infrastructure upgrades, which can be significant, particularly for small and medium-sized enterprises (SMEs).
• Return on Investment (RoI) is the most significant concern, especially in industries with tight margins.
• Lack of Digital Skills and Upskilling the existing workforce or hiring new talent with data analytics, AI, and cybersecurity expertise can be challenging and costly.
• Process industries, particularly those in pharmaceuticals, energy, and chemicals, are subject to stringent regulations. To comply with these regulations can be complex and time-consuming.
• Integrating IoT devices, cloud computing, and remote access can create vulnerabilities and increase cyber security risk.

How are sustainability and environmental concerns influencing digital transformation strategies?

Sustainability and environmental concerns are becoming central to digital transformation strategies, driving companies to adopt technologies that enhance efficiency, reduce waste, and minimise their ecological impact. By aligning digital initiatives with sustainability goals, companies are meeting regulatory and societal expectations and positioning themselves for long-term success in an increasingly eco-conscious market.

The expectations and demands from various stakeholders, including Government, customers, the public, and investors, are becoming central forces for companies to adopt digital technologies. Increasing consumer awareness about environmental risk and global competition enables technology adoption.

ESG Reporting is something that influences a company’s digital transformation decision. There is growing pressure from investors, consumers, and the public for companies to demonstrate their commitment to environmental, social, and governance (ESG) criteria. Digital transformation enables more effective ESG reporting and transparency.

Sustainable branding helps companies attract eco-conscious consumers. Companies are leveraging digital transformation to build and promote their sustainability credentials, which can enhance their brand reputation and attract consumers.

What advice would you give to companies just beginning their digital transformation journey?

Before starting the digital transformation journey, companies need to do due diligence on various factors. That includes setting up the goal and vision for digital transformation. Selection and investment in the right technology align with your goals and provide better RoI.

Teamwork is the key to success. Include and empower team members, provide appropriate training, and encourage them to adopt the change.

Further, digital initiatives that improve customer experience and satisfaction should be prioritised. Understanding and addressing customer needs should drive your transformation efforts.

Digital transformation is an ongoing process, not a one-time project. Continuously monitor progress against your goals and be prepared to adapt your strategy as needed.

(The views expressed in interviews are personal, not necessarily of the organisations represented)

Darshana Thakkar is an MSME Transformation specialist and Founder of Transformation – The Strategy HUB. With an electrical engineering and MBA in business operations background, she has 28 years of hardcore industrial experience in transforming Small businesses. She helps MSMEs define growth paths, derive marketing strategies, improve business operations, adopt digital transformation, and increase profitability. Darshana Thakkar is an author, speaker, and TV panelist. Her achievements, journey, and interviews have been featured in several newspapers, premium business magazines, and TV.

She has won several regional, national, and international awards and is famous as an MSME activist and women's business leader. Her consulting venture, Transformation, was listed among the most trusted consulting companies in 2022 and among the top 50 consulting companies for MSME in 2023. She holds a few honorary positions in industry associations.

Major achievements:

·         Winner of Global Women Leader -2023 by Global Women Leadership Award

·         MSME Honor award-2022 -Champion of Cause by Tally Solutions

·         Winner of Gujarat Women's Leader Award – 2021

She is associated with a few other premier institutes as

·         Certified Women Director & Independent Director by IICA, MCA, GoI.

·         Member of the Board of Management at Makarpura GIDC Industrial Estate Cooperative Bank Ltd.

·         National President: WICCI-Entrepreneurship Development Council

·         Trainer, Startup mentor, & Jury member at CED, Government of Gujarat.

https://www.linkedin.com/in/darshanamthakkar/

darshana.transform@gmail.com 

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