This article first appeared in the Autumn 2016 issue of The Record.

Manufacturers are increasingly taking advantage of opportunities enabled by ‘systems of intelligence’, where increased volume of data, along with improved analytical capabilities, deliver better insights that can be converted into intelligent action.

“Digitisation is driving greater efficiencies in business processes,” says Sanjay Ravi, worldwide managing director, discrete manufacturing at Microsoft. “Companies can gain deeper insight into their business networks – be it their global supply chains or their engineering processes – with smart connected products. This is driving new levels of optimisation across their business networks.”

Product design is one of the areas undergoing a transformation. Engineers get close loop real-time feedback from smart connected products, and can gain new insights into how their designs are being used and how they are performing.

“These insights can be used to make products more efficient and even create new high value offerings based on direct insights on how the product is being used and how it is performing in real-life situations” Ravi says. “Feedback is that much richer, and business processes can be transformed in accordance with this insight.”

With better insight, manufacturers can drive new kinds of service level agreements and profitable business models. Ravi points to an example in the automotive industry, where companies are moving from simply manufacturing, marketing and selling a vehicle to delivering what he describes as ‘smart mobility services that deliver rich ongoing connected customer experiences’.

“For automotive companies to drive revenue in the future, they need to succeed in delivering smart mobility services like shared car usage, services for large fleet operated vehicles, and generally providing consumers with context-specific experiences and mobility services based on their situational needs,” Ravi says.

All this is leading to new territories beyond traditional industry boundaries.

“Automotive companies are increasingly working with insurers, content providers and smart infrastructure service providers,” Ravi says. “Members of a traditional industry want to differentiate themselves from a customer experience standpoint. This transformation is being fuelled by technology.”

And data – ‘the new currency,’ according to Microsoft CEO Satya Nadella – is key to this transformation.

“Every manufacturing company is evolving to become a digital business, and to do that you need to have a lot of strength in managing and getting insights from data,” Ravi says. “You have a very large number of connected devices which create data that is growing exponentially. Cloud platforms play a critical role here and deliver the hyper scale that is required to process the large amounts of data, with a cost structure that makes it practical to process this data in real time.”

Systems of intelligence allow for a very direct close-loop connection with customers, as manufacturers are better placed to track product performance and deliver rich, ongoing customer experiences. Systems of intelligence can also be used to empower employees, who can gain new, meaningful ways to make faster and more efficient decisions. Company operations can also be optimised, as sensors and connected devices make inefficiencies easier to spot.

“Systems of intelligence are also allowing organisations to bring new services-driven offerings to the market,” Ravi says. “Rolls Royce, for example, is delivering new digital services to  its customers. These digital services allow its customers to optimise fuel consumption and proactively manage maintenance issues, which is saving money and improving the customer experience. Rolls Royce is evolving from being a manufacturer selling a jet engine to one that is also delivering new transformative digital services.”

But which Microsoft technologies are behind the shift?

“It’s a combination of three important elements that work together,” Ravi says. “Everything starts with getting data and being able to process it at scale. The Microsoft Azure cloud environment is critical in providing the underlying infrastructure and set of rich services required to collect and process data at hyper scale.”

“The second is the Cortana intelligence suite, which provides the brain behind all of this. People are getting drowned in data, and the way we can get intelligence and insight on a real-time basis is via services like Azure Machine Learning, which is part of the Cortana Intelligence Suite. It provides the insight that employees can then use to create new business models and services.”

Ravi describes the final area as “the internet of people.”

“You have to empower the people to use this data and insight and then drive intelligent action,” he says. “This is where Power BI and new personal computing experiences enabled by HoloLens can be used. You can drive visualisations and help people make a final decision based on the data available.”

Ravi adds that it is also crucial to support the ‘ecosystem of intelligence’.

“No one company can operate in a silo and be successful,” he says. “They need to operate in an ecosystem, and intelligence from the broader ecosystem is going to be critical. To enable this, Microsoft is partnering with a number of standards organisations. We are a member of the Digital Manufacturing and Design Innovation Institute in the US, and we are also working closely with standards organisations like OPC. Our partnership with OPC allows manufacturers to connect more than 37 million devices used in industrial environments to the cloud.”

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