Four Ways To Succeed In Manufacturing… With Video-Enabled Collaborative Decision Environments

Author: David Mario Smith
Date: August 8, 2014
Topic: Collaboration
Research Note Number: 2014-32

Issue: What collaboration technologies and architectures should enterprises leverage?

Summary: Manufacturing enterprises are using video to create collaborative decision environments for competitive advantage. Here are four key benefits video can provide

Over 95 percent of companies we speak with say innovation via collaboration is important to their business. Our research indicates that a manufacturer can potentially increase its bottom line by up to 20% through innovations developed in collaborative decision environments. This research note discusses the value of video in these decision spaces for manufacturing firms (see Figure 1).

Video In Collaboration

For years, video has been a great medium for collaboration when distance or geography poses a barrier. However, while demand was high, its use did not increase to match the need. We believe one reason is that beyond travel cost reduction, which is very important, traditional video conferencing providers didn’t always message the real business cases for video.

Some of the lagging uptake has been due to technical and operational challenges that represented a barrier to entry for both purchasers and users. These include cost, connection quality and reliability, operational complexity, unfamiliarity or discomfort with the process, lack of experience in conducting business in real time on a global scale, and simple anxiety over new technologies and procedures.

However, some professions have no doubt about the value of video, particularly those whose success depends on personal interactions. Education, law, healthcare, sales and marketing are enthusiastic about the medium. Among other cohorts that have started to embrace it for specific value propositions, we can include manufacturing.

Video Collaboration In Manufacturing

The overall manufacturing industry includes many sub-segments such as food, chemicals, automotive, aerospace and defense. However, the demands are similar across all segments. All are charged with growing the business, cutting costs, communicating and collaborating with partners, reducing time to market, competing effectively in the marketplace, streamlining production, and acquiring and retaining the talent to do this. Video helps in all of these areas.

In manufacturing, video supports real-time collaboration in ways that do more than just cut travel, but also – more importantly – raise productivity, improve innovation and reduce time to market throughout the product development cycle. In looking at data from our clients, we find that manufacturing organizations can reduce time to market by 15% to 25% using video technology. For highly successful manufacturing firms, video collaboration directly affects their bottom line, while firms that cling to traditional collaboration models are at a disadvantage.

The global manufacturing industry has grown, albeit modestly. In the US alone, according to the U.S. Bureau of Economic Analysis, manufacturers contributed $2.08 trillion to the economy in 2013, up from $2.03 trillion in 2012 (see Note 1).

However, with globalization and growth, enhanced collaboration becomes ever more important, to keep pace and interact with partners, suppliers and customers in various geographies. Companies that find their supply chains growing with new suppliers need better management and foresight.

Note: This is part of Aragon’s archived research. To find up to date information, please visit the Collaboration page.