5G on the Manufacturing Floor: What This Technology Revolution Means for Your ERP

When you think of technological innovation in the manufacturing industry, what comes to mind? 

Obviously, improvements to hardware assets like shop floor machinery can lead to greater efficiency and productivity. Advances in robotics might also revolutionize factory operations for those who choose to adopt them.

Then there’s the information technology (IT) side of the house, where advanced software applications and robust ERP solutions enable process automation and data-driven decision-making.

But there’s another area of technology that’s moving ahead by leaps and bounds, in ways that have huge implications for the manufacturing sector: mobile networking.

The arrival of 5G technology has created massive opportunities for every industry that uses network connectivity in its operations. In this post, we’ll explore the importance of 5G for manufacturing companies, and how it ties in to the road ahead for ERP. 

The New Frontier in Business Connectivity

Businesses today are increasingly dependent on the internet for basic operations. From tablets on the shop floor to business applications on our smartphones, wireless connectivity has become pretty much indispensable in our working lives. 

And that’s exactly why 5G is such a game changer.

5G refers to “fifth generation” mobile network technology. It operates at much higher spectrum frequencies, which results in some significant advantages.

First, it provides low latency — basically, data travelling between nodes gets there much faster than it does on current networks, so there’s less transmission delay. 5G also offers much higher bandwidth, so more data can be transported at the same time. 

Think of it like a wide super-high-speed highway: More data can get to where it’s going, in less time. 

Even more significant, 5G can support a far greater number of devices than its predecessors. And it also allows network operators to divide the network into dedicated subsections (in a process called “network slicing”), and tune those sub-network parameters to specific application requirements.

With all of these technical characteristics, it’s no wonder that 5G is considered the “connective tissue” for the Internet of Things (IoT). In the world of IoT powered by 5G, devices and software systems can easily collect and share data with each other in real time, without the need for human intervention. 

This has wide implications for pretty much every industry, from automotive to medical to agriculture. But the manufacturing sector is a prime candidate for reaping the enormous benefits of this kind of technology. 

The Rise of the Smart Factory

While 5G may not have arrived on the factory floor just yet, it’s certainly headed there quickly.

Last year, Swedish telecommunications manufacturer Ericsson announced that it was building 5G base stations at its facility in Lewisville, Texas, a factory that is itself linked to a 5G network. 

This story is interesting because 5G isn’t yet widely available to the public — mobile network operators are still in the process of building out the infrastructure necessary to support it. As such, the idea of a “smart factory” (one powered by 5G technology and all the functionality that it enables) was a still-unproven concept. 

But Ericsson put its money where its mouth was, so to speak, and brought 5G into its own manufacturing operations. The results? By introducing automation technologies, Ericsson saw a 120% improvement in employee output, and 65% reduction in manual material handling. 

Ericsson’s achievement was so remarkable that the World Economic Forum (WEF) awarded them with the WEF “Global Lighthouse” award to recognize the new facility as a global leader in the so-called Fourth Industrial Revolution. 

I think there’s a powerful lesson here for the manufacturing sector. In addition to the obvious advantages of automation, 5G dramatically improves a manufacturing company’s capacity for data collection. More data, delivered to the right systems and right people in real-time, leads to more accurate and efficient inventory monitoring, predictive maintenance cycles, and greater flexibility on production lines. 

When it comes to 5G in the manufacturing world, the future looks bright. 

Richer Data Makes for a Smarter ERP

Obviously, not every manufacturing business needs (or wants) to start using robotic devices on the production line or putting self-driving vehicles in its delivery fleet. But I think the opportunities that 5G creates for gathering data are a compelling reason to sit up and pay close attention to this new technology.

Here at Syte, we’re big believers in data as a business asset, not just as “raw input.” Good data leads to better business processes and workflows. Your ERP is a critical hub in processing and making sense of that data, enabling your business units to streamline workflows and identify bottlenecks. So the more relevant operational data you can feed into your ERP, the better equipped you’ll be to assess what’s working and what could use improvement.

Part of that equation is connecting your various business systems together so that mission-critical information is processed and shared appropriately. (This is actually a big part of the pivot towards Digital Operations Platforms, another important trend for the manufacturing sector to watch.) 

Another part of the equation is the kind of data you’re gathering, and how it’s getting into your ERP system. With 5G on the manufacturing floor — think IoT sensors on equipment and AI-driven processing built into production line systems, for example — manufacturing companies will have an unprecedented opportunity to gather rich data from day-to-day operational tasks, in real-time. 

The combination of timely, accurate manufacturing floor data and a properly designed ERP solution will empower manufacturing businesses to be both efficient and nimble in responding to changing market conditions. And they’ll be able to bridge the front and back ends of the business that might otherwise continue to operate as silos. 

The 5G Revolution Is (Almost) Here

The promise of 5G may take some time to become a reality in the manufacturing sector, but the business innovations it will make possible are going to be game changers. If you’re a manufacturing leader, you should start thinking now about how you might take advantage of 5G when it becomes available, and how to ensure your ERP is ready for it. 

Are you ready for the 5G revolution? I have a few complimentary collaborative consulting sessions open, and I’d love to help you assess where you are on your ERP journey, and where you can go next. Schedule your time right here.