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15 Dec 2015

Value Realization of Past Technology Investments and Plant Modernization Are Top 2 Priorities for Asia/Pacific Manufacturers in 2016, Says IDC Manufacturing Insights

Singapore, 15 December, 2015 – IDC Manufacturing Insightsreveals that value realization of past technology investments and plant modernization would be the top two technology priorities that will receive the most attention this 2016 in Asia/Pacific (excluding Japan)(APeJ).

"Organizations will take decisions on which existing applications to support, upgrade or sunset and in that process, prioritize investments in emerging technologies," said Christopher Holmes , Managing Director at IDC Insights Asia/Pacific.

"Innovation" is a top business priority in the region but companies face challenges to fund investments in innovation processes due to unclear return-on-investment (ROI), preferring instead to invest in factory automation with tangible benefits. Basic infrastructure continues to be a show stopper causing APeJ to lag behind the adoption off global technology trends.

"Technology has started to play an integral role in digital transformation as businesses adopt it in order to deliver business growth," said S Ramachandran , Principal Research Manager at IDC Manufacturing Insights Asia/Pacific. IDC also believes that "Operating Model Transformation" will be the most impactful change as companies realize that "connected assets" can be leveraged beyond just performance feedback and predictive maintenance to new and creative revenue streams and business models that are service based across the entire life-cycle of products.

These insights are part of the top ten technology predictions for manufacturing recently published by IDC and titled IDC FutureScape: Manufacturing 2016 Predictions - APeJ Implications (Doc #AP40534215). These predictions summarize the key IT initiatives in the region driven by digital transformation, namely:

#1: Customer-centric investments. Companies will start leveraging digital channels for closer customer connect in both B2C and B2B scenarios to gain 2-3 percentage points increase in market share.

#2: Global standards. APeJ will not just be an adopter of global standards but collaborate and start broadcasting best practices from enterprises that are local to the region and multinational.

#3: Value realization. Organizations will be under pressure to realize value from past investments to prioritize spending on emerging technologies, with new metrics such as percentage of connected assets.

#4: Operating model transformation. Technologies such as Internet of Things will lead to enterprise-wide connectivity of products, people, and processes enabling business models such as product-as-a-service.

#5: Modern logistic networks. 50% of manufacturing companies will leverage upcoming technologies such as 3D Printing, warehouse automation, robotics and micro logistic networks for postponement strategies.

#6: Supply chain resiliency. Real time market insights and visibility will make short term forecasting obsolete and a gradual shift towards pull based models based on actual demand.

#7: Innovation Platform. Innovation Platform, the next phase of PLM, will be integrated with other enterprise systems among 60% of top manufacturing companies with "product quality" as the key driver.

#8: Digital twin. 40% of companies will use virtual simulation models from products to processes and facilities with real time feedback of performance in the next 1 to 2 years.

#9: Innovation in shop floor. 50% of manufacturing companies will create mash-ups of emerging technologies from mobility to cloud, analytics, and the Internet of Things for shop floor digitization and modernization.

#10: IT Talent. New multi-disciplinary roles such as process analyst/architect will emerge to understand, consolidate and meaningfully consume insights from the vast amount of data for quick decision making.

"Market leaders in APeJ will be innovative in overcoming regional challenges to keep the lights on while leveraging their inherent strength, partnerships and local advantages to get multiple stake holder buy-in, prioritize funding and implement impactful mash-ups of the 3rd Platform and Innovation Accelerators integrated with the other enterprise systems for digital transformation," ended Mr. Ramachandran.

To ensure IDC Manufacturing Insights provides relevant insights to the market, its syndicated research program in 2016 will focus on these trends in APeJ. The Manufacturing 2016 Predictions – APeJ Implications will be soon followed by IDC FutureScape – Product and Service Innovations 2016 Predictions, IT spending forecasts and patterns, country-specific research reports, and technology deep dives starting January next year.

For inquiries on the FutureScape documents and the IDC Manufacturing Insights syndicated research, please contact your IDC account manager or Shari Jane Jansen at sjansen@idc.com . For media inquiries, please contact Alvin Afuang at aafuang@idc.com .

About IDC FutureScape

IDC FutureScapes are used to shape IT strategy and planning for the enterprise by providing a basic framework for evaluating IT initiatives in terms of their value to business strategy now and in the foreseeable future. IDC's FutureScapes are comprised of a set of decision imperatives designed to identify a range of pending issues that CIOs and senior technology professionals will confront within the typical 3 year business planning cycle.

About IDC Manufacturing Insights

IDC Manufacturing Insights assists manufacturing businesses and IT leaders, as well as the suppliers who serve them in making more effective technology decisions by providing accurate, timely, and insightful fact based research and consulting services. Staffed by senior analysts with decades of industry experience, our global research analyzes and advises on business and technology issues facing asset intensive, brand oriented, technology oriented, and engineering oriented manufacturing industries. For more information, please visit www.idc-mi.com, email info@idc-mi.com, or call +91 99860 91908. Visit the IDC Manufacturing Insights Community at https://idc-community.com/manufacturing

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Contact
For more information, contact:

S Ramachandran
sramachandran@idc.com
+91 99860 91908

Alvin Afuang
aafuang@idc.com
+63917 797 4586