Technology for operational efficiency in the packaging industry
On Tuesday, November 24, 2020, at 5 p.m. (Paris time), a webinar was held on the subject of technology for operational efficiency in the packaging industry.
Organized by the PackIOT team, led by the excellent Adam Peek and with speakers Cristiano WUERZIUS, CEO of PackIOT, Sergei CIACHIR, CEO of Open Packaging Network and our CEO, Thomas OTHAX, it brought together no less than 40 manufacturers based in all four corners of the globe: United States, Latin America, Europe, India, Africa.
Topic: technology for greater operational efficiency among packaging manufacturers
Improving daily operational efficiency is a universal goal in the industry, a focus of every working day.
However, new technologies offer operational performance improvements because they solve problems that are unsolvable "humanly" by automating, simplifying, and streamlining certain operational tasks. This applies to all departments within the company: marketing, sales, pre-production, quoting, engineering, production, logistics, and even support functions.
The objective of this webinar was to propose an open, uncomplicated, and informal discussion on this topic and address some questions related to the theme of the day.
What are the main obstacles to the digital transformation aimed at greater operational efficiency?
This was the first question posed by Adam Peek during this webinar. While it is accepted that digital tools help improve operational efficiency, why are many manufacturers hesitant and not launching their digital transformation?
Here are some key points suggested by Cristiano WUERZIUS, Sergei CIACHIR and Thomas OTHAX:
- The fear of not mastering new technologies, particularly software and digital tools. Indeed, when you are a printer, you may be less apprehensive about integrating new printing technologies because they relate to your core expertise, than new technologies for optimizing workflows, for example. Paradoxically, they are much more complex to grasp and represent much larger investments than software and other optimization tools. This fear is the primary barrier to change.
- A lack of agility in mindset. The packaging industry appears to be one of the most conservative and least accustomed to so-called 'agile' processes. Indeed, speakers emphasized that implementing new technologies to maximize operational efficiency should not be done using long and costly V-model cycles. It is entirely feasible to proceed incrementally, through successive iterations, to test solutions in real-world situations as quickly and inexpensively as possible. This practice, while not widespread in 'traditional' industries, nonetheless allows companies to begin their digital transformation.
- Is the desire for change strong enough? The packaging industry, unlike the printing industry, is a higher value-added industry. It is more complex to compare prices, and projects are more complex to develop. The wave of web-to-print has not yet hit the packaging industry. But for how much longer? Speakers emphasized the importance of anticipating market developments and generational changes that imply new usages. Everyone agrees that executive management must strongly and convincingly champion this change in processes and technologies.
Transparency and data: risk or opportunity for the company?
The implementation of new technologies, as we know, structures the company around 'data'; in other words, the collection and exploitation of data become key elements for companies.
But do we really want to know everything, say everything, be transparent internally and externally?
Cristiano WUERZIUS, while presenting PackIOT's solutions – machine sensors for collecting and analyzing the performance of machines and operators on machines – highlighted two important elements:
- Gathering information is not a new phenomenon. Many operators have to fill out time sheets "by hand." This is simply tedious and a source of errors. Whereas a digitized and automated process simplifies low value-added data entry.
- Data is reported to management (industrial, general) but rarely flows back down to the operators. Providing digital tools that allow operators to track their performance, the gap with the forecast, and self-assess is a tremendous source of motivation and empowerment.
Thomas OTHAX pointed out that he often heard the following remark: "I don't want to display my prices online."
This fear has many consequences:
- Not offering an e-commerce experience is inconceivable today, knowing that 25% of B2B orders are now placed online, with an annual increase of 16% in value!
- Opacity in price calculation breeds customer distrust. Customers may feel cheated and overcharged.
Considering that a B2B buyer is primarily a B2C consumer, now accustomed to digital technology and e-commerce, sourcing and comparing prices from a smartphone, and desiring more transparency from retailers and brands, how can it be otherwise in their professional relationship with their suppliers?
What are the 2 biggest challenges you face when implementing your digital solutions with manufacturers?
Our CEO, Thomas Othax, mentioned the "unicorn" excuse and the challenge of knowledge management.
The "unicorn" excuse seems relatively common in the industry to justify complexity that can only be managed manually. It is certain that in custom manufacturing, it is sometimes necessary to manage complex projects with a specific study. At Packitoo, when HIPE was created, more than 7 million data points in the processing of flat cardboard were analyzed, and it turned out that only 20% of the data truly referred to what some call "unicorns." In other words, 80% of the information analyzed corresponded to manufacturing processes that can be understood and apprehended in a digital system, such as HIPE.
Finally, the packaging industry is a highly technical industry, and often, the trade is learned internally. Knowing that the generation of "knowledge holders" is closer to retirement than to the beginning of their careers, that the new generation is volatile and does not capitalize on long experiences within organizations, how can internal know-how be preserved and shared?
Digital tools contribute to this. It is important to store trade know-how there because digital tools forget nothing and offer collaborative solutions that simplify knowledge sharing.
Ultimately, the webinar didn't focus so much on the topic of increased operational efficiency through new technologies, but this open and informal exchange shed light on resistance to change, and data transparency as a new challenge both internally and externally. Further articles and discussions more closely related to the webinar topic now deserve to be organized.