Emerging technologies and the next manufacturing boom in Asean
By Jessie Quek November 24, 2015
- Asean has the potential to replace China as Asia’s manufacturing powerhouse
- But the industry has to harness emerging technologies to achieve that potential
THE Association of South-East Asian Nations (Asean) has always been an exciting region for investors, showing great growth and potential, and its manufacturing industry is set to accelerate Asean’s already impressive development.
A recent report by Singapore’s Economic Development Board commented that Asean has become the “new investment hub of [Asia] seeking to equal if not replace China as the region’s manufacturing powerhouse.”
The report also noted that foreign investments in Asean are at an all-time high, with the majority going towards manufacturing and services.
One of the biggest reasons for this is the rapid adoption of the latest technological trends amongst Asean’s emerging economies.
The manufacturing sector is inextricably tied to technology, a relationship made most evident by the Industrial Revolution which arguably marked the genesis of the modern manufacturing industry.
A recent McKinsey report predicted that the employment of disruptive technologies would produce US$220 billion to US$625 billion in annual economic impact for South-East Asia.
As such, careful attention should be paid to the four biggest technological trends of the moment – big data, cloud computing, mobility and social media – and how these will affect Asean’s crucial manufacturing industry.
Big data promises to help companies glean valuable insights from data analysis that can be applied to business strategies.
Companies particularly value big data for its ability to help predict trends, allowing them to stay ahead of the curve.
As with cloud computing, big data requires the use of stable and powerful enterprise hardware to collect and analyse the massive influx of data.
The analytical capabilities of big data can help businesses to critically examine every aspect of their operations, with benefits like the optimisation of production processes and distribution chains.
Companies in the manufacturing business also benefit from the predictive capabilities of big data, which have been harnessed into driving improved processes, faster product development, reduced redundancies, and increased yields.
Through the customer insights provided by big data, companies can anticipate customer needs and focus their research and development efforts on creating create products which their customers will find truly useful.
With the advent of high-speed Internet connections, IT functions – such as the storing and processing of data – which have previously been performed by on-site hardware and physical connections, can now be done remotely over the Internet, freeing up physical space and reducing costs.
Companies have begun to migrate their intranets to the cloud, and IT departments can now support users from across the globe, leading to more secure networks and an easier deployment of software changes.
Generally referred to as cloud computing, this trend necessitates the use of stable and reliable enterprise hardware to facilitate the transfer of data, especially in conjunction with the collection and analysis of the massive amounts of data involved in big data analytics.
Cloud computing has proven to be a massive boon to businesses with multinational operations, as is often the case with businesses that set up manufacturing centres in Asean while keeping other aspects of their businesses, such as the design and engineering teams, in other countries.
Cloud computing has ensured that these teams working across different continents are completely synchronised with one another, reducing redundancies, and improving productivity.
Over the last two decades, personal computers have become progressively smaller and more portable, unchaining users from the immobile desktops of yesteryear.
Tablets and smartphones have exploded in popularity, enabling media consumption on the go.
At the same time, most mobile devices on the market were designed for media consumption and entertainment rather than productivity, and do not support enterprise applications.
This has led to a demand for products built specifically for business users for maximising productivity while retaining the mobility offered by portable devices.
This can be seen in the manufacturing sector, which allows employees to perform stock-keeping and inventory management through real-time data updates.
Powerful enterprise devices also allow users on the go access to functions which require intense computing capabilities, such as modelling software for the design and engineering teams.
Social media has dramatically altered the relationship between customers and businesses, and customers are now able to share their opinions and feedback on companies and their products with a global audience.
Shrewd companies have recognised and harnessed this trend for the benefit of both their customers and themselves.
Through the analysis of social media, companies are able to receive authentic and honest feedback from consumers as well as discover trends, which manufacturing companies can then translate into the creation of better products.
In other words, social listening tools driven by the powerful computing capabilities of enterprise hardware become an extremely important type of research and development, especially in conjunction with the predictive and analytical capabilities offered by big data.
This is especially important in the Asean region, which is a melting pot of different cultures.
Companies need to be extremely sensitive to customer sentiments and avoid triggering cultural sensitivities. Social media is thus one of the best ways of measuring customer reactions, allowing businesses to respond quickly and appropriately so as to keep customers happy.
It’s all about emerging technologies
With the right choice of technology, manufacturing enterprises can optimise productivity, reduce operational costs, improve customer experience and grow faster.
A recent report from IDC predicts that intra-Asia trade for the manufacturing sector will continue to grow in 2015, while the emergence of new governments in some countries and investor interest from other countries including China will help this trend to continue.
Business leaders within Asean’s manufacturing industry are becoming increasingly aware of the importance of the latest technologies in enabling them to take full advantage of this business trend, and are deploying them to great effect.
IDC reported that 37% of Asia Pacific manufacturers are already using big data and analytics technologies to improve production quality management.
The Asean region is enjoying a surge in investor interest, but businesses will need to continue investing in the technology needed for these emerging technologies to maintain their competitive advantage.
Jessie Quek is country general manager at Lenovo Singapore, having spent more than 20 years in the IT industry, including stints HP and Microsoft.
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