W H I T E PA P E R

Manufacturing 2025:
Bolder Vision, Stronger Purpose

In association with
SPONSOR PERSPECTIVE

The manufacturing industry is undergoing an unprecedented digital-led

transformation. This opportunity is empowering manufacturers to innovate
with new products and services, accelerate top-line growth, create a
superior customer experience, and streamline operations.

Software-defined products are radically transforming business models

and the consumption experience. The automotive sector is developing
software-defined vehicles—hyperconnected supercomputers on wheels
with active safety, infotainment, and advanced autonomous capabilities
that provide a more personalized automotive experience. Industrial Ashish Saxena
manufacturers are exploring as-a-service business models with connected Vice President & Sector Head,
products that last longer, operate more predictively, and engage users Manufacturing, Americas
across the life cycle. Cloud engineering principles are enabling frequent Wipro
over-the-air updates, effectively creating for customers what feels like a
new product every day.

Digital-led manufacturing is transforming factory floor data into valuable

enterprise knowledge. Real-time insights from the shop floor and
connected supply chains are enabling resiliency, predictability, efficiency,
agile decision making, and cross-functional collaboration. Artificial
intelligence is driving overall equipment effectiveness improvements by
deriving the most optimal set of control variables for running operations.

Sustainability was always a priority for manufacturers and is now a

defining purpose for the industry leaders. With an equal emphasis on the
planet, people, and profits, manufacturers can create sustainable value for
environmental, social, and governance stakeholders; become resilient; and
discover cocreation opportunities with customers. Manufacturers must
identify greenhouse gas and carbon reduction opportunities across the
product life cycle and company operations.

The manufacturing industry is on the cusp of an unparalleled opportunity

to create new business models that operate at the intersection
of commercial success and environmental sustainability. C-suite
sponsorship, proactive talent reskilling, and a clear articulation of
the vision and strategy are key to this digital transformation. Wipro is
excited to be in association with Harvard Business Review Analytic
Services to bring insightful and engaging perspectives from the
manufacturing industry and academia to organizations on this digital
transformation journey.

Read on.
Manufacturing 2025:
Bolder Vision, Stronger Purpose

Digital technologies are emboldening manufacturers HIGHLIGHTS

to embark on enterprise-wide digital transformations
that are changing the nature of how their businesses
Forward-thinking manufacturers
operate. Innovative manufacturers are leveraging are embracing enterprise-wide
greater connectivity and increased analytical capability digital transformation to redefine
their value propositions, pioneer
to drive fundamental shifts beyond the shop floor— new business models, generate
transforming every aspect of the business, from product new revenue streams, and
improve operations, and they
design to customer experience, as well as advancing are transforming the customer
their sustainability goals. Such efforts are helping experience in the process.
manufacturers optimize processes and operations and
generate new revenue streams through digitally enabled Manufacturers are scaling
products and services. connected capabilities on the shop
floor to deliver flexible and self-
adapting processes, and they are
Many manufacturing firms are adapting to today’s volatile operating embracing artificial intelligence,
environment by pioneering new business models, says Steve Evans, professor particularly when applied to
at Cambridge University and director of research in industrial sustainability predictive maintenance.
at the British university’s Institute for Manufacturing. “A business model is
largely defined as the value logic of the company,” says Evans. “And changing
the value logic of a company is harder than changing the digital strategy of Ultimately, manufacturers that are
the company, as it is embedded in everything that the company does. But reaping the benefits of digitally led
those companies that have seriously invested in business model innovation business transformations are often
have done so because a customer or a competitor has caused that to happen.” those that align their technology
Enterprise-wide digital transformation provides opportunities for objectives with sustainability, a
spirit of innovation, and investment
manufacturers to redefine their value proposition either through the
in their people.
development of software-defined products or with new business models, one
example being servitization, in which customers pay a fee per unit of a service
consumed instead of purchasing a product that provides that service. Such

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changes can also usher in a new era of customer centricity hesitant to make the changes necessary to transform their
through a focus on new, personalized products and better processes and operations. Getting the balance right—making
customer experiences across all stages of the product life cycle. sure the investment is proportionate and delivers change—
Manufacturers can also improve operational efficiency requires cultural transformation in tandem with technology
and drive cost savings. Examples of such efforts include transformation.”
leveraging data analytics to perform predictive maintenance This report examines how manufacturing companies can
or adopting “smart factory” trends. According to Simon Floyd, benefit from such transformations, with a particular focus on
director of discrete manufacturing industries at Google Cloud, the industrial, automotive, chemical, and processing sectors.
manufacturers are drawing on a smart factory approach to It highlights best practices and success factors necessary
realize benefits on the production floor and to accelerate for the journey. It also explores strategies and technologies
business transformation. “Essentially, smart manufacturing companies have employed to increase productivity, forge new
describes the combination of various technologies that can business models, improve customer experience, manage the
lead to a more flexible and self-adapting process,” he says. talent transition, and boost sustainability.
“The key is to harness the untapped wealth of data that
manufacturers already have, set systems in place to capture
new forms of data, and, more importantly, build historical New Business Models, Better
learning from these data streams.” Customer Experience
But the prospect of digital transformation poses challenges, Forward-thinking manufacturers are embracing enterprise-
as well as opportunities, for manufacturers. Paul Calver, wide digital transformation to redefine their value propositions,
founder and digital manufacturing director of The Data pioneer new business models, generate new revenue streams,
Analysis Bureau (T-DAB), a British data science and data and improve operations, and they are transforming the
engineering innovation company specializing in machine customer experience in the process.
learning and artificial intelligence (AI) solutions, notes Some manufacturers are adjusting their business models
that while many manufacturers are quick to adopt new by turning to servitization. According to T-DAB’s Calver,
technologies to increase productivity on the factory floor, servitization can be game-changing for manufacturers and
they may struggle to extend transformation efforts across their customers. This model involves a mindset shift in
the organization. “The most common barriers to digital how products are sold and serviced. “Servitization may be
transformation are that manufacturers are unclear on how capital-intensive, as it requires manufacturers to develop
to generate return on investment from data, they are reluctant their products without the promise of a sale,” says Calver.
to move data, and they have concerns about data privacy,” “The financial flows are different, but it is profitable. The
he says. Many manufacturers have overcome these concerns important shift is that products need to be better designed
by undertaking a mindset shift necessary for enterprise- to last longer.”
wide transformation. Others have taken up the challenge He points to how servitization would alter the home
of redesigning processes, hiring new talent, or training appliance market—washing machines, dryers, and other
employees in digital competencies. so-called white goods—where there is planned obsolescence.
As Cambridge’s Evans notes, changing a company’s Servitization would change that. “Manufacturers used to
business model or basic value proposition is a mammoth make their money by designing products that would need
task, particularly when a focus on sustainability is part of to be replaced after eight to 10 years,” Calver explains. “In
that value proposition. Sustainability, however, is often a a servitization model, an appliance could last for many
common denominator for all digital initiatives. Ultimately, more years and still perform brilliantly. But this demands
manufacturers that are reaping the benefits of digitally new capabilities to service, upgrade, and modify products,
led business transformations are often those that align thereby keeping products in the market and securing
their technology objectives with sustainability, a spirit of subscription revenues.”
innovation, and investment in their people. Stellantis, the world’s fourth-largest automotive
Digitally led business transformation requires a clear vision, manufacturer, is reaping the benefits of a transformed
multifunctional collaboration, and strategic alignment on value proposition, investing in new software capabilities to
business objectives, particularly for technology investments. transform its products and generating new revenue streams.
“Successful digital transformations often occur when Mamatha Chamarthi, head of software business and product
companies match the technology investment with clear management, is leading Stellantis’ transformation from a
outcomes,” says Google Cloud’s Floyd. “Some overinvest traditional automotive manufacturer to a customer-centric
in technology without a clear outcome, which leads to enterprise that focuses on reducing environmental impact and
underutilization. Others may underinvest because they are increasing driver safety. “In 2021, we began our transformation

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“Successful digital transformations

often occur when companies match the
technology investment with clear outcomes.
[...] Getting the balance right—making sure
the investment is proportionate and delivers
change—requires cultural transformation
in tandem with technology transformation,”
says Simon Floyd, director of discrete
manufacturing industries at Google Cloud.

based on two strategic pillars—electric vehicles (EV) and medium-, or long-term auto rentals (from a few minutes to
software—and committed around €30 billion in investment several days or months) and car-sharing.
into these two areas,” says Chamarthi. Customer centricity is at the heart of the company’s
Stellantis created a dedicated software entity that also transformed business model. “Customer expectations have
works closely with the engineering function in product design shifted, especially for connected products. People expect the
and helps the organization formulate new business models ability to add customized features to their cars in the same
and revenue streams. Among the latter are subscription way that they do for their smartphones,” says Chamarthi.
services such as enhanced navigation, which consists of Accordingly, Stellantis offers value-added services and features
features on demand that car owners can access even 10 tailored to specific customer desires. For instance, customers
years after purchasing the car, and aftermarket services like who purchase off-road vehicles want an adventurous driving
diagnostics. “This unit focuses on software-defined vehicles, experience, but they may not have the technical ability to
including developing software for electrification—for instance, navigate trails. “Our features offer these customers training
predicting when a car needs to be charged so as to reduce and advice in real time. We support them on how to navigate
range anxiety for the driver—and software for autonomous difficult terrain,” she explains. “And through our partnership
driving, including augmented driver intelligence to prevent with Amazon, we can ensure they have items they need for
accidents,” says Chamarthi. “We also develop software for their journey, such as water or camping supplies. If necessary,
our connected vehicles to provide customers with value- supplies could be delivered right to their location.”
added features such as stolen-vehicle alerts, automatic SOS Chamarthi credits the success of the company’s
emergency calls, maps, and desirable customizable features.” transformation and its ability to respond to customer needs
In 2021, Stellantis had 12 million monetizable connected to its agile approach. “We had to implement agile at scale,” she
cars in the market, and it plans to have 26 million by 2026 asserts. “From a product perspective, we shifted quickly from
and 34 million by 2030. “We define monetizable as the first an automotive manufacturing product life cycle of between
five years of life of the car, as that is where we recoup the five and seven years to a software development life cycle that
maximum revenue,” Chamarthi explains. “Essentially, we takes place in iterative cycles of a few months. That’s a massive
now view cars as data platforms.” shift in thinking, and it required everyone, at all levels of the
Additionally, Stellantis created a mobility-as-a-service company, to collaborate, adapt, and innovate.”
company, Free2Move, that offers a range of services to satisfy Meanwhile, one industrial manufacturer, Schneider
the multiple travel needs of its customers, including short-, Electric, has embarked on a transformation program

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WIPRO INSIGHT

Unlock Customer Lifetime Value with the Cloud Car Ecosystem

Modern vehicles are becoming hyperconnected “SDVs will leverage AI and ML to constantly gather data,
supercomputers on wheels, utilizing 30 to 40 technical provide valuable information, and, eventually, make
platforms and being powered by more than 100 million autonomous decisions. Unlocking the true potential
lines of code. As software becomes increasingly of SDVs will require moving them to the cloud,” says
complex, automakers are challenged to not only Thomas Mueller, chief technology officer, engineering
innovate in order to remain competitive but also meet and R&D services, Wipro Ltd. “We are fast-forwarding to
evolving safety and security standards. Automotive that future by making the cloud car ecosystem available
manufacturers must effectively integrate with the cloud to every automotive company in the world today.”
car ecosystem if they want to bridge the skills gaps in Implementing cloud engineering principles will enable
software development, especially when it comes to data automakers to design, launch, and update vehicles
security, artificial intelligence (AI), machine learning with greater agility, effectively creating for customers
(ML), and 5G. what feels like a new vehicle every day. Automakers
Software-defined vehicles (SDVs) must transition need to provide updates over the air—much like how
toward a centralized computing platform enabled by the smartphones are automatically updated—to launch new
cloud to decouple the hardware-software relationship. features, new services, and even hot fixes without ever
requiring the vehicle to leave the owner’s driveway. This
Furthermore, with this approach, critical apps are
convenience is only possible by integrating products
isolated for faster certification and maintenance,
and services from equipment providers, network
while noncritical apps can take full advantage of agile
operators, and cloud hyperscalers.
software development using microservices, containers,
and edge computing. The central processing unit Powered by continuous DevOps and cloud services,
aggregates this data to generate powerful insights for OEMs can quickly identify, create, and deploy new
original equipment manufacturers (OEMs) and owners software that will keep cars digitally relevant for 10
using AI and ML. years or more.

that not only improved operational efficiency but also their operations—we either provide customers with data
leveraged internet of things (IoT) technology to build and from their products or analyze it for them. We also offer
deliver next-generation products and services. The French service agreements where we monitor the devices and can
multinational provides digital solutions for energy efficiency fix problems before they occur.”
and sustainability in homes, buildings, data centers, Schneider Electric’s value-added digital services are a source
infrastructure, and industries. The company’s industrial of competitive advantage. “This business model complements
manufacturing division encompasses 200 factories worldwide our traditional manufacturing scenario—once a product is
and produces, among other connected products, devices for sold, we are able to provide much more in terms of insight,
low- and medium-voltage energy distribution, such as circuit optimization, and predictive maintenance,” says Weckesser.
breakers and contactors. Another company that adapts product specifications
By manufacturing connected products that produce data, and value-added services to meet customer needs is Trane
Schneider Electric offers customers improved services by Technologies Co. LLC, a global heating, ventilation, and air
helping them make the most efficient use of energy and reduce conditioning manufacturer based in Dublin. Barry Bonar,
maintenance costs. “Currently, we have six million assets director of emerging technology and architecture governance
connected to our ExoStruxure platform,” says Peter Weckesser, at Trane Technologies, describes how the Thermo King
the company’s chief digital officer. “This platform is at the division that builds transport refrigeration units (TRUs) offers
heart of our IoT system architecture and is the foundational customers additional connected services. “Our TRUs have a
technology backbone on which our solutions are built and subscription service, where the owners can access a portal
delivered. It enables connectivity and intelligence and allows from their mobile phones that provides real-time temperature,
us to deliver digital services to help customers optimize location, and reporting data for an entire fleet,” he notes. “This

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“From a product perspective,
we shifted quickly from an
automotive manufacturing
product life cycle of between
five and seven years to a
software development life cycle
that takes place in iterative
cycles of a few months. That’s a
massive shift in thinking, and it
required everyone, at all levels
of the company, to collaborate,
adapt, and innovate.”
Mamatha Chamarthi, head of software
business and product management, Stellantis
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“We have high aspirations for growth, and

our digital business transformation should
ensure we reach these goals by providing our
customers—and their customers—with superior
products that are suited to the application that
customers need them for. Our transformation
has customer centricity at its core,” says
Matthew Abbott, vice president of digital and
data analytics at Chemours.

service gives customers greater visibility into the cold chain inspection, is significantly more efficient, and is flexible.
and helps them to deliver food, at the right temperature, from The improvement in processes and quality procedures can
farm to fork. It can also be very helpful in other areas, such transform entire operations—manufacturers can look beyond
as the pharmaceutical space.” one machine or one process and start to think holistically
Chemours, the Wilmington, Del.-based chemical producer, about the entire system. For instance, they may begin to look
focuses on providing its customers with very specific product at a digital representation, or a digital twin, for the entire
solutions. Chemours delivers customized solutions with a factory or assess how to better utilize their equipment across
wide range of industrial and specialty chemical products multiple factories.”
for the coatings, plastics, refrigeration, air conditioning, Manufacturers are scaling connected capabilities on the
transportation, semiconductor, clean energy, and advanced shop floor to deliver flexible and self-adapting processes,
electronics manufacturing sectors. “We have high aspirations and they are embracing AI, particularly when applied to
for growth, and our digital business transformation should predictive maintenance. For many manufacturers, predictive
ensure we reach these goals by providing our customers— maintenance is the starting point of their digital transformation
and their customers—with superior products that are suited journey, since it can deliver immediate cost savings. “Globally,
to the application that customers need them for,” says manufacturing firms could be losing up to $1 trillion a year
Matthew Abbott, vice president of digital and data analytics in unscheduled maintenance,” says Calver.
at Chemours. “Our transformation has customer centricity Predictive maintenance has a clear ROI and can provide
at its core.” both a quick win and tangible results. “Calculating ROI on
predictive maintenance projects can be quite simple,” Calver
asserts. “Companies can estimate how much downtime they
Building the Factory of the Future are likely to have on a machine, how much more product they
Floyd believes that manufacturers often invest in technological could produce, and how much waste could be avoided and
transformation after seeing the benefits of new technologies on measure this against how much it would cost to implement
the production line, specifically in quality control and process machine learning or AI for predictive maintenance.”
optimization. “AI, such as computer vision, brings immediate Chemours recently experienced the benefits of predictive
improvement in quality control by detecting conditions that maintenance. The company established a new enterprise-
are good, bad, or anomalous,” he explains. “This type of wide digital and data analytics team in September 2021, and
technology can be more cost-effective than traditional quality predictive maintenance was one of the first areas it explored.

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Chemours’ Abbott notes that an initial predictive maintenance

WIPRO INSIGHT
proof-of-value project yielded immediate results. “In our
Titanium Technologies business, it was discovered that a
particular valve was clogging up as the product flowed through
Liberating Factory Data to Enhance
it,” he recounts. “A collaborative team of process control
Overall Equipment Effectiveness
engineers, front-line operators, and data scientists analyzed
the data and built a model to predict when and how the flow Manufacturers have started to rapidly scale their
degraded over time. Using the data available to us, we can now digital transformation initiatives that passed
proactively change out the valve prior to it clogging and have the pilot-to-integration transition in lighthouse
saved approximately $1 million in future maintenance costs.” factories to all their production facilities in order
Chemours’ digital transformation is in its early stages, and to enhance overall equipment effectiveness.
Abbott is considering how the organization will scale such The latest wave of digital technologies can help
pilot projects. “We’re still at the proof-of-value stage in many liberate factory floor data to enable predictive
instances,” he asserts. “What we need to avoid is getting stuck maintenance, higher productivity, and greater
asset uptime.
in ‘proof-of-concept purgatory’ and keep repeating small
proofs of concept everywhere. We need to meaningfully pursue “The structure and multiplicity of data sources
value that is quickly scalable across the company.” for factories have challenged manufacturers
The problem of scaling proof of concept is a common in their quest to obtain a unified view of their
one. According to Calver, it is estimated that around 80% of machines, material, and methods,” says Ankur
companies struggle to scale successful data analytics or AI Pawa, manufacturing domain head, Wipro Ltd.
pilot projects and to do so at reasonable cost. “The reason they “Today’s cognitive and advanced technologies
can’t scale is because they lack a machine learning operations enable manufacturers to convert factory floor data
infrastructure, including a set of practices for collaboration into valuable enterprise knowledge, leading to
between data scientists and operations professionals, to improvements in quality and productivity.”
handle data analytics across the organization,” he explains. By leveraging disruptive technologies, real-time
“The companies that manage to scale successful initiatives data from multiple machines and methods can be
are often the ones focusing not only on the technology but on fed into a single data model to generate a unified
how it can change their entire organization. Often, they work view of the factory floor. For a truly connected
in a non-siloed way, where people across the organization factory ecosystem, manufacturers must rapidly
collaborate to meet digital transformation objectives.” evaluate, deploy, and scale digital twin technology,
Chemours plans to scale its transformation by focusing collaborative manufacturing platforms, and
on how digital transformation and advanced data analytics autonomous plant capabilities.
enable the overall business strategy and drive key performance
A digital twin can feed data into algorithms that
indicators. As a first step, Abbott plans to improve factory can help detect anomalies, predict the quality of
performance through greater use of predictive analytics and the finished goods, and suggest corrective and
the deployment of integrated planning systems to prevent preventive actions to improve the cost of quality
bottlenecks in supply chains. He also plans to make better use and asset uptime.
of the data the company already has on customer preferences
and product formulations. Further, collaborative manufacturing capabilities
enable automated knowledge transfer, including
“As an organization with more than 200 years of legacy, we
of best practices and algorithms across factories.
have data that goes back decades, but we have never unlocked
A mature artificial intelligence capability set,
it in a meaningful way to use as a competitive advantage.
including reinforced learning and cognitive
Now we have the cloud computing power to do just that,” he
computing, ensures continuous learning from
says. “But our transformation will only succeed if we’re ready
sensors and enterprise and external data to build
to make that cultural shift of actually using data to make an autonomous plant.
informed decisions about how we work with customers, how
we manage the supply chain, how we run our manufacturing To realize the full potential of digital
plants, and how we create and innovate new products and manufacturing, organizations need to focus on
deliver against our sustainability goals.” building shared teams and capability models,
Schneider Electric’s recent transformation program aimed to allowing enterprise-wide implementation of
improve operational efficiency and gain better visibility across
processes and technologies.
its supply chain. Weckesser, the chief digital officer, notes

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“To improve productivity and efficiency, we

invested in a full integration of our product life
cycle management and enterprise resource
planning platforms. This gives us greater
visibility across our supply chain, allowing
us to better predict and manage component
shortages,” says Peter Weckesser, Schneider
Electric’s chief digital officer.

that the program is still ongoing but has shown encouraging Many manufacturers are taking an organization-wide,
results. “We saw room for additional efficiencies across holistic approach to their digital transformation endeavors,
product design and product manufacturing,” he explains. including fostering a culture of innovation, investing in people,
“To improve productivity and efficiency, we invested in a and aligning business models with their sustainability agenda.
full integration of our product life cycle management and The secret to kick-starting or scaling digital transformation
enterprise resource planning platforms. This gives us greater across the organization, according to Calver, is for organizations
visibility across our supply chain, allowing us to better predict to believe in the art of the possible. “Manufacturing firms need
and manage component shortages. We also have far more a digital transformation champion, someone who has been
visibility into where our products go, which is complex, as trained in the art of the possible,” he asserts. “This person
the end consumer doesn’t buy directly from us—we have knows what technologies are out there and can help the
multiple distributors, systems integrators, and electricians organization assess how various technological advances are
that purchase from us and then sell to the end user.” applicable to their business, for instance, in solving logistics
and supply chain issues, increasing productivity, streamlining
processes, or better serving customers.”
Aligning Digital Transformation Trane Technologies makes such technology intelligence
with Sustainability gathering a corporate priority. “We look at what emerging
“Organizations can use technologies that provide more technologies are in the global landscape, right from an
data, more connectivity, and more analysis and combine embryonic stage, and assess when and how they could be
these to deliver sustainable change in three waves,” Evans applicable to our business capabilities,” says Bonar, emerging
explains. “The first wave is around productivity, essentially technology and architecture governance director. “For
doing more with less, such as using data to drive material or instance, we categorize each technology according to whether
energy reduction through technologies such as AI and IoT. we can adopt it, assess it, trial it, or explore it.”
The second wave builds resilience by harnessing technologies This approach has helped Trane Technologies spearhead
to deal with disruption, essentially being able to operate innovation across the organization. “The emerging technology
under a wider range of conditions, such as mapping material role is connected to all aspects of engineering, supply chain,
flows or exchanging waste. Ultimately, the goal is the third product innovation, multiple IT groups, and business units,”
wave—making sure society can live within the means that he explains. “Essentially, this function increases awareness
the planet offers.” of what is possible, and that is a catalyst for company-wide

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“We look at what emerging
technologies are in the
global landscape, right
from an embryonic stage,
and assess when and how
they could be applicable to
our business capabilities.
For instance, we categorize
each technology according
to whether we can adopt
it, assess it, trial it, or
explore it.”
Barry Bonar, director of emerging
technology and architecture
governance at Trane Technologies
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innovation. No one exclusively owns innovation; we are all

WIPRO INSIGHT
responsible for it—and for finding new ways to meet our
strategic objectives.”
For instance, Trane Technologies found a way to prove that
A Digital Path to Sustainable
blockchain can be used in an energy-efficient, sustainable way
Manufacturing
without using heavy computing power like that required for
Ambitious net-zero targets can only be met through cryptocurrency operations. “Most people think of blockchain
a balanced emphasis on the planet, people, and in relation to cryptocurrencies, but it can be applied in our
profits. Sustainability is now essential to the future business context, specifically in refrigerant management,”
competitiveness and growth of manufacturing says Bonar. A specific problem when trying to reduce
organizations. However, to accelerate progress carbon emissions relates to tracking and accounting for all
toward environmental, social, and governance (ESG) refrigerants, detecting and recording leaks, and reporting all
goals, digital technologies must be widely adopted this information in a compliant manner. “We identified and
across the manufacturing industry value chain. created a concept to prove that blockchain could solve this
This effort includes leveraging the digital, problem. Blockchain provides an auditable record of all this
decarbonized, and dependable (3D) sustainability information in a sustainable way using an energy-efficient
framework to create sustainable value for ESG consensus mechanism,” he says.
stakeholders, become resilient, and discover Trane Technologies is committed not only to reducing
cocreation opportunities with customers. Taken carbon emissions but to sustainability, as well, and these
separately, each of the 3Ds requires organizations efforts are at the core of its value proposition. “Trane
to take a specific approach that contributes to the Technologies has become a pure-play climate company,
sustainability as a whole. focused on combating climate change through the way we
heat and cool industrial buildings and homes and how we
The digital effort requires organizations to transition
help our customers transport essentials such as food and
to smart and connected factories and supply
medicine,” says Bonar. “We also design products to track and
chains that gather and analyze data through cloud
potentially help to improve indoor air quality, especially now
computing, as well as adopt internet of things and
simulation technologies to further enhance process that the Covid-19 pandemic has brought health and safety
efficiency and optimize resource utilization. measures to the world’s attention.”
In October 2021, the company was awarded the Reuters
Decarbonization, meanwhile, involves identifying Responsible Business Award in recognition of its having
carbon reduction opportunities across the a business model that focuses on sustainability and the
product life cycle and company operations with achievement of carbon-neutral operations and zero waste
a circular economy approach. It also entails to landfill. Trane Technologies is addressing climate change
adopting alternative energy solutions and carbon-
through an ambitious goal of reducing its carbon footprint
neutral materials.
and that of its customers by a gigaton by 2030. Efforts to meet
Last, dependability requires prioritizing employee this goal include developing next-generation products such
safety and well-being to create a reliable working as refrigerants designed for lower environmental impact
environment. It also involves adoption of data-led and higher efficiency, as well as investing in monitoring and
predictive maintenance to enhance equipment maintenance technology to ensure that buildings can be
uptime and reduce rework. maintained, retrofitted, and managed to reduce greenhouse
gas emissions.
Leveraging digital technologies for ESG compliance
gives manufacturing organizations the impetus to
achieve their sustainability goals and drive value
creation. Manufacturers are transforming their The Digital Competency Gap:
legacy plants into intelligent factories by scaling Train or Hire?
technologies to identify risks, ensure compliance, Investing in digital capabilities to support new business
and enable accurate ESG-related reporting, while models demands new skills that manufacturers traditionally
deployment of connected sensors enables real- lack. Increasingly, manufacturers need digital natives—
time tracking of asset and resource utilization folks who have grown up in the Information Age and who
to understand the environmental and financial can consume and interpret digital information quickly and
implications. effortlessly. “These are two great, very different disciplines:
digital and manufacturing,” says Evans. “Of course, the Venn

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“It may be more efficient to find people in

your own workforce who have the potential to
become digital natives rather than recruiting
digital natives who have the potential to
understand manufacturing,” says Steve Evans,
professor at Cambridge University and director
of research in industrial sustainability at the
Cambridge’s Institute for Manufacturing.

diagram of people with those competencies overlaps, but meanwhile, offers an accelerated development program to
manufacturing firms are facing a digital competency gap.” college graduates, providing them with work experience
Evans believes that manufacturers would do well to upskill that involves doing rotations through different areas of the
their people to overcome this talent challenge. “There are company. Trane Technologies also provides training programs
plenty of data analysts out there, but they don’t understand for employees who want to learn more about innovation and
manufacturing,” he says. “It may be more efficient to find new technologies.
people in your own workforce who have the potential to At Chemours, Abbott believes in upskilling all employees
become digital natives rather than recruiting digital natives as an integral part of the company’s transformation program.
who have the potential to understand manufacturing.” “With 6,400 employees, it is clear to me that we must invest
Floyd has a different perspective, believing that a young, in training and digital upskilling. Training doesn’t have to
digital-savvy generation holds the key to the manufacturing be about coding or using sophisticated software tools, but
sector’s talent crunch. “The ‘Great Resignation’ is evident everyone across the company needs to understand how data is
in manufacturing, and it’s hard to recruit people because presented to them, to be able to interact with it and incorporate
there is a critical discrepancy between the career objectives it into their daily routines and decision making,” he says.
of the new generation and the jobs available,” he asserts. “For instance, our chemical operators and engineers could
“This discrepancy is partly due to the legacy technical better understand how to adjust machinery settings based
and IT environments that are still operational in many on relevant, real-time data about the production process—
factories. Cloud platforms can help manufacturers innovate temperatures, pressures, defects, and so on. Of course, a small
both business processes and models while attracting new group of data scientists and highly trained data analysts will
developers that are more comfortable with low-code and tackle the really high-value projects, but I think there’s even
no-code platforms and analytical tools. Furthermore, there more value to be realized with the whole organization making
are plenty of digitally savvy graduates who want to bring their data-driven decisions.”
skills to bear on many aspects of manufacturing, from product
design to solving problems within production processes,
supply chains, or logistics.” The Future Is Data-Intensive
Manufacturers have taken a variety of approaches to secure In today’s world, data is ubiquitous, and manufacturers
the talent they need. Stellantis created a software and data are reaping the benefits of enhanced digital capabilities in
academy to reskill or upskill its engineers. Trane Technologies, production and across the organization to make better use of

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 Harvard Business Review Analytic Services

all the data they have—and to harness new data streams, which Although some manufacturers may be hesitant to embark
only continue to emerge. Manufacturers are already scaling on similar bold initiatives, the dangers of not doing so not only
emerging concepts such as blockchain, dedicated software outweigh the time, effort, and investment required to catalyze
entities, and smart factory concepts, including digital twins change but also pose a risk to the survival of the business.
and the use of predictive maintenance to respond to market Customers’ expectations are changing, and companies
conditions by improving operations. And many have gone that harness the power of digital to provide better customer
further by forging new business models and enhanced value experiences may pull ahead.
propositions that provide new sources of revenue and elevate “Companies that embark on digital-led business
the customer experience. transformation may find that it’s not as hard as the fearmongers
Experts and practitioners agree that most manufacturers thought it would be,” Evans says. “But neither is it as easy as
are facing a digital competency gap that organizations are the evangelists might suggest. Companies have to get a lot
taking steps toward addressing by hiring new talent and of things right—and in the future, right is different. But one
upskilling their people. thing is certain: the future is data-intensive.”

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ABOUT WIPRO
Wipro Ltd. is a technology services and consulting company focused on
building innovative solutions that address clients’ most complex digital
transformation needs. Leveraging our holistic portfolio of capabilities in
consulting, design, engineering, and operations, we help clients realize
their boldest ambitions and build future-ready, sustainable businesses.
With over 240,000 employees and business partners across 66 countries,
we deliver on the promise of helping our customers, colleagues, and
communities thrive in an ever-changing world.
ABOUT US

Harvard Business Review Analytic Services is an independent commercial research

unit within Harvard Business Review Group, conducting research and comparative
analysis on important management challenges and emerging business opportunities.
Seeking to provide business intelligence and peer-group insight, each report is
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