The manufacturing industry is at an “innovation impasse,” therefore manufacturers have a desire to innovate and drive transformation, but legacy IT systems have the potential to constrain their ability to do so. The opportunity for manufacturers to welcome digitization efforts including “Industry 4.0” initiatives can break the impasse, but executives must put attention on new opportunities to create value and not only prioritize traditional business operations. Manufacturing organizations face the constant challenge of trade-offs: they are under pressure to meet contemporary productivity and operational goals in a progressively more global and highly competitive marketplace, but they also need to invest in future growth.

 

This challenge has created a demand for new technology solutions that assists balance the trade-off between existing and long term goals. IT leaders in manufacturing must avoid the beaten path of finding short-term fixes for escalating revenue; preferably, they should look to long-term solutions that enable automation, enhanced use of data and improvements in customer experience. The Enterprise Cloud Index findings indicate that manufacturing leaders are strongly utilizing new technology to embrace modernization instead of getting left behind with legacy systems. The distributed cloud model offers a solution that delivers speed, flexibility, and localization, allowing manufacturers to ensure effectiveness without compromising quality.

 

While 91 percent of survey respondents claimed hybrid cloud as the ideal IT model, today’s global average hybrid cloud penetration level is at 18.5 percent — the disparity due in part to problems of transitioning to the hybrid cloud model. Manufacturing industries said barriers to implementing hybrid cloud that mirrored global roadblocks, including limitations in application mobility, data security/compliance, performance, management and a shortage of IT talent. Compared to other industries, manufacturers reported greater IT talent deficits in AI/ML, hybrid cloud, blockchain, and edge computing/IoT.

 

Other key findings of the report include:

 

(a) 43 percent of manufacturers interviewed are at the present time using a traditional data center as their primary IT infrastructure, slightly outpacing the global average of 41 percent

 

(b) However, manufacturers at the moment use a single public cloud service more frequently than any other industry. 20 percent of manufacturing companies reported using a single cloud service, compared to the global average of 12 percent — a testament to the fact that manufacturers are beginning to turn to the cloud as a solution, given that they deal with legacy IT systems and cannot handle workloads on-prem.

 

(c) Manufacturers are also developing the movement to the private cloud: 56 percent of manufacturers surveyed said that they run enterprise applications in a private cloud, outpacing the global average by 7 percent.

 

(d) Manufacturers are scrambling to control cloud spend. One motivation for deploying hybrid clouds is enterprises’ need to gain control over their IT spend. Organizations that use public cloud spend 26 percent of their annual IT budget on public cloud, with this percentage estimated to enhance to 35 percent in two years’ time. Most remarkable, however, is that significantly more than a third (36 percent) of organizations using public clouds said their spending has exceeded their budgets.

 

(e) Manufacturers picked security and compliance slightly more frequently than companies in other industries as the top factor in selecting where to run workloads: while 31 percent of respondents across all industries and geographies named security and compliance as the number one decision criterion, 34 percent of manufacturing organizations chose security and compliance as the top factor.

 

The bullish outlook for hybrid cloud adoption around the world and across industries is reflective of an IT landscape expanding significantly automated and flexible enough that enterprises have the choice to buy, build, or rent their IT infrastructure resources based on fast transforming application requirements.

 

“Manufacturers are investing in modernizing their IT stack, and utilizing industry 4.0 solutions to keep up with ever-changing business demands in areas like production and supply chain management,” said Chris Kozup, SVP of Global Marketing at Nutanix. “A hybrid cloud infrastructure gives manufacturers an alternative approach to modernizing legacy applications and services, enabling manufacturing IT leaders to focus on their long-term investments in big data, IoT, and next-generation enterprise applications. While the manufacturing industry is still facing barriers in transitioning to multi-cloud use, this study shows us that manufacturing organizations are ready to accelerate growth and take the lead in IT innovation in the future.”

 

This article is originally posted on tronserve.com