Digitizing manufacturing processes is important for the creation of digital supply networks that seamlessly communicate, allowing U.S. supply chains to remain competitive and recover quickly during disruptions. A research team at Morgan State University, in conjunction with the Diverse Manufacturers Supply Chain Alliance (DMSCA), recently conducted a digital readiness assessment, focusing primarily on small-to-medium sized manufacturing enterprises (SMEs), as part of the SecureAmerica Institute’s nationwide initiative to empower a resilient domestic manufacturing base.
“Small-midsized manufacturing suppliers must learn how to be competitive in digitalized supply chains that connect everywhere to everything all the time,” said David Burton, president of DMSCA.
To digitize means an organization must convert business processes from analog (manual processes) to digital (computerized). Digitalization goes one step further to examine the organizational strategy, governance, technology and workforce processes needed to adopt digitization. The Morgan State University/DMSCA project assessed more than 200 manufacturing businesses to develop scenarios for guiding an SME’s strategy toward digital readiness.
“This tool couldn’t come at a better time. The pressure for SMEs to quickly adopt more strategic technologies like digitization is heavily outweighed by the need to produce parts optimally,” said Chris Holshouser, SAI’s director of applied programs and strategic partnerships. “The inability of SMEs to modernize is a challenge outlined by the Reagan Report on the decline of small manufacturers. Our national competitive advantage lies in the strength of our SMEs and their innovative approaches. Advancing new technologies in this sector is critical.”
Two different survey instruments were administered: a Self-Assessment Survey and the Smart Industry Readiness Index to determine how ready a supplier was for digitalization; what workforce, technological, or financial resource challenges an SME might face when moving to digital practices and to bring awareness to SMEs about existing gaps in their technology and the urgency of developing plans to bridge these gaps.
“Our goal is to gain a more robust view of how ready manufacturers and supply chain participants are in regards to digitalization,” said Dr. Gregory Ramsey, associate professor of information sciences and systems at Morgan State University. “Digitalizing processes encourages the free flow of information and prevents operations silos, so all pieces of the supply chain are talking to one another.”
SMEs make up approximately 75% of manufacturing firms in the United States and play significant roles in efficient and productive U.S. supply chains. Many SMEs may participate in multiple competing supply chains. This matters because large multinational enterprises need smaller supply chain participants to manufacture components for the bigger pieces and products they sell.
“All supply chains must be responsive and resilient to disruptions arising from world events, such as pandemics, component shortages, logistical bottlenecks, natural calamities, cybersecurity breaches, wars, and trade disputes,” said Dr. Abirami Radhakrishnan, associate professor of service and supply chain management, information science and systems, and project management at Morgan State University. “Digitalization of supply chain processes is the key to being responsive and resilient to disruptions,”
“During the past few years, we have witnessed Covid-19 and shortages in PPE, the stranding of the ship Ever Given and disruptions to commercial shipping, and semiconductor chip shortages due to mismatch between supply and demand. SMEs usually have fewer resources to tackle issues that come about in supply chains,” said Dr. Sanjay Bapna, chair and professor of information science and systems at Morgan State University.
In fact, most suppliers are realizing that in order to stay competitive, digitalization is no longer optional. Most large companies require a certain level of digitalization to contract with them. If an SME cannot meet those expectations, they will not be able to bid on certain types of work.
“Our hope is this project will result in tools and procedures that will allow SMEs to gather input on their current processes and take actionable steps to advance down their path to a digitized future,” Ramsey said.
SAI and its network of partners are committed to leveraging technology solutions to address nationally impactful challenges. Please contact chief technology officer Dr. Darrell Wallace at firstname.lastname@example.org to discuss how we can work together to develop, integrate and deploy technology solutions to ensure the security and resilience of the domestic manufacturing base.