Is Manufacturing Upside Down?

  • April 18, 2023

Inflation is driving end-user prices up, but the cost of goods sold is wiping out margins for manufacturers across the board. See how to reverse the trend.

Inflation’s impact on manufacturing

Inflation has caused price increases across the board, and consumers are struggling to keep up. Despite higher prices, manufacturers’ bottom lines are rapidly getting closer to the red. Even as price tags try to keep up with the Cost of Goods Sold, consumers — from enterprises to individuals, and everyone in between — are running out of money.

Most manufacturers, even at the enterprise level, can't influence the cost of the raw materials they need. They can, however, influence the cost of doing business. The key to lowering the cost of doing business is business automation.

Can automation take you to the next level?

Automation is vital; you are synchronizing multiple parts of multiple companies across teams and geographies. However, ‘business automation’ is synonymous with ‘easier said than done.’ Point solution pollution is leading manufacturing professionals to trade manufacturing challenges for technological challenges.

Automation helped you solve the problems that were stopping you from growing to the point where you are now. Before unprecedented inflation ballooned your bottom line, the cost savings from the automated parts of your business more than paid their costs, at least in benefits, if not gross returns.

Inflation now presents a new field to navigate. You need your automation in place so that you don't backslide. But manufacturers now find themselves tied into a vicious cycle of ‘can’t make money with it, can’t make money without it.’ How, then, do you solve the automation challenges that are stopping you from growing to the next level?

Fighting inflation by defeating redundancy

Your automated systems aren’t costing you any money. You have them because they’re making you money. Redundancy in your automation is to blame. Resolving redundancy is one of the most effective, and the most difficult, ways to fight inflation. That is because the process of finding redundancy is itself replete with checks and re-checks to find it.

Manufacturers are resolving redundancy by implementing a virtual butler — an automation that manages automation — which is driving down costs at every stage from raw materials to client delivery.

The idea of a virtual butler to manage automation has been about for more than a decade in the form of business intelligence. At the core of business intelligence was a dashboard where a person could look at information from across myriad sources, and react based on what they find. And while that’s a dramatic improvement over signing into multiple systems and diving into spreadsheets, it’s still not automatic; because your point of sale system and fulfillment center data aren’t triggering purchase orders to manufacturers. Supply chain issues aren’t triggering incremental price increases on distribution channels. You get the alerts, but you often still lack context.

The need to resolve redundancy in your supply chain and in your decision-making process is driving the next evolution of Business Automation.

The next level is already here

NTT DATA is driving business automation that helps manufacturers fight inflation by resolving redundancy in supply chains. Manufacturers are using NTT DATA to manage a broad and ever-growing suite of technologies that keep their business running.

Manufacturers can use this digital butler to build low-code and no-code applications to support collaborative monitoring, extended troubleshooting, problem-solving, and in-depth situational analysis.

While the idea is strong and the benefits obvious, execution may be dubitable for many executives. They have already traded their manufacturing challenges for technological challenges and they aren’t all trained in writing code — nor do they want to be.

The next phase in business automation has to address technology challenges by making the solutions more accessible to the non-developer audience, like executives. When strategists have ideas and want to test them, they need the autonomy to spin up a test, watch the results and pivot at will. Executives are too often beholden to the development teams to execute, which takes time; and while the development team is undeniably valuable, the organization leaders need slightly more parity with them regarding platform testing.

The more that manufacturing leaders can execute on their own ideas, the less redundancy and cost of doing business the organization suffers.

NTT DATA and ServiceNow can be your virtual butler

All these concepts we have discussed up to now — inflation causing upside-down manufacturing costs, redundancy in business automation, upgrading business intelligence, and making technology more accessible to the public — all brought NTT DATA to become a premier partner of ServiceNow. NTT DATA empowers organizations to automate their automation, synchronize disparate parts of the business, and significantly lower the cost of doing business.

To make it all possible, NTT DATA became an Elite Partner of ServiceNow, the technology that makes the automation you already have more efficient.

The benefits and features of ServiceNow are incredible, and too much to cover here. How your organization will benefit from its use will be unique to your organization. But the inflation problems you are facing are ubiquitous, and the need to reduce redundancy is common to every single company.

If your organization is looking for ways to recapture margins from uncontrolled inflation, reduce redundancy and increase platform efficiency. then NTT DATA with ServiceNow may be your step up to the next level. Download our fact sheet to learn more

Contact us to discuss how NTT DATA with ServiceNow can rescue your manufacturing supply chain.

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Grant Pulver

Grant Pulver boasts 20+ years of experience in technology, consulting, and management. He leads a team walking hand in hand with Client Leadership teams to ensure their business outcomes are imbued into their technology and platform strategies. Grant previously served as Program Manager at Fruition Partners and Vice President of End User Technology at AIG, Inc.


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