The industry cloud is the next step in connected manufacturing. What is it and how could it give you the advantage?
Just as you were getting to grips with cloud computing, there’s a new phenomenon making waves in manufacturing: the industry cloud.
Having said that, an industry cloud isn’t new; supply chains have been migrating to the cloud for the past few years. But now adoption is rapidly gaining pace. According to a recent forecast by global market intelligence provider International Data Corporation (IDC), by the year 2020, three in four of all manufacturers will participate in industry clouds, and around 80% of supply chain interactions will happen across cloud-based commerce networks. (Industry clouds were also a mega-trend predicted for 2018 by our experts – you can read about it in this article).
We believe industry clouds warrant further investigation. Here’s the lowdown:
What is an industry cloud?
Industry clouds, also known as vertical clouds, are formed when groups of companies within a sector come together to leverage cloud technologies by sharing best practices, costs and risks.
These collaborative clouds are distinct to the needs of a specific industry vertical, whether that’s food processing, car manufacturing, healthcare or even education. Organisations can store and share massive amounts of data, and use it to build intelligent business models. Of course, the participating companies don’t directly compete.
Here’s IDC’s definition: “An industry cloud is an industry-specific, cloud-based, pre-integrated, elastic, scalable, set of capabilities / resources / information that complies with industry information security level requirements, offers APIs, and is delivered as-a-service.”
One example of an industry cloud is Europe’s Cloud Collaborative Manufacturing Networks (C2NET). Formed in 2017, C2NET has brought small and medium-sized manufacturers together to create a series of cloud-enabled tools with the goal to optimise manufacturing and logistic supply chains. C2NET will be designed to cover the entire supply chain considering all stages of manufacturing, distribution and sales. C2NET offers all the advantages of an industry cloud:
- Access to data analytics in real-time
- Access to supply chain management information from mobile devices
- Security for collaboration and sharing of best practices
Industry clouds are a big part of digital manufacturing. In digital manufacturing, digital technology connects physical assets to capture and optimise the flow of information passing through each stage of design and production. Huge masses of data are generated, collected and communicated automatically at every stage of the product-development cycle. And it all has to be stored somewhere, which is why cloud computing is one of the key technologies driving Industry 4.0 (as we explain in this article).
However, rather than holding this data under lock and key, industry clouds open the door for manufacturers to share and analyse this information with supply chain partners and like-minded businesses. In this way, industry clouds put an emphasis on partnerships and collaboration for greater innovation.
Benefits of industry clouds
Lower entry barrier: One of the biggest benefits is for those manufacturers who are unsure how to capture the value of cloud computing. With an industry cloud, manufacturers can invest in the cloud without taking on the usual costs and risks, and without needing to maintain the infrastructure to support it.
Industry specific: Industry clouds enable manufacturers to share data and storage resources that have been tailored for the needs and challenges of their specific sector.
Better collaboration: Industry clouds improve collaboration throughout the supply chain. The best manufacturers are obsessed with making themselves as easy as possible to work with from a supply chain perspective, and industry clouds can help make this a reality. Manufacturers can use industry clouds to identify supplier delays, check delivery status, source new suppliers, and more.
More transparency: Supply chain transparency is no small matter. Partners right along the supply chain are under constant pressure to understand exactly where their products’ materials and components come from. While this has traditionally been tough for manufacturers, industry clouds make it easier to share and access this information. As journalist Heather Clancy noted in her Greenbiz article: “New technologies such as sensors, data analytics and the so-called Internet of Things are enabling companies to more easily and affordably account for the environmental and social impacts of their materials and products — all the way upstream to farms, forests, mines and individual factories.”
Demand planning: The increase in personalised products makes it challenging for manufacturers to forecast demand. How can they be sure they have the right inventory to supply all possible configurations? Industry clouds lets manufacturers work with channel partners, distributors and retail outlets to apply predictive analytics and algorithms that forecast demand with more confidence and ease. One of the projects within C2NET, for instance, provides suppliers and customers with a centralised hub of information for forecasting.
It’s all too easy for manufacturers to become absorbed in their own challenges, processes and internal forces. But this is a dangerous way of doing business. Industry clouds take the focus off the individual business and place it firmly onto collaboration. Sure, it offers a shared-cost, low-risk option for manufacturers embarking on the journey to digital transformation, and that’s a substantial benefit. But more importantly, industry clouds open the door for whole industry verticals to work together to create a better way of doing things. That’s a powerful concept, and a major opportunity for manufacturers of all shapes and sizes.
Looking for highly informative case studies, whitepapers and infographics for manufacturing? Or videos showing solutions in action and lots of detailed of brochures? Find all that and more in Matthews’ large resource library. It also has presentations we’ve done to industry bodies and articles from our thought leaders. Plus, it’s all free to download!
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