The Business Value of the Digital Thread

The disruptions over the past year or so made it clear that companies with an existing focus on building digital capabilities had a significant advantage in their ability to adapt and respond. The pace of change has only increased, while shining a glaring spotlight on inefficient, siloed processes, systems and data for the way companies innovate and how products are developed, manufactured, sold and serviced.

The future of product development is powered by the digital thread – a seamless flow of data that connects business processes, systems, products and equipment across the value chain to deliver business growth, operating efficiency, cost reduction, resiliency and risk mitigation.

Here are some examples.

Drive Business Growth: Accelerate Innovation and Sustainability

Early in the value chain are activities associated with the way companies discover and create new products. R&D teams must design and simulate products and production processes virtually, connecting the dots between data and processes associated with consumer insights, research, ideation, product requirements, concept development, product design and development. The early design decisions on materials, component products, and suppliers will dramatically impact the ability for companies to impact scope three sustainability compliance in the coming years.

In this phase, the digital thread can help companies accelerate innovation by creating a seamless collaboration environment, where teams can simultaneously develop parts of the same product in context of the same overall goal. This collaboration and connection of data, along with applied analytics, reducd product development cycle times, optimizes product and plant design, and streamlines decision making.

Reduce Product Development Cycle Times

By connecting people, data and processes along the digital thread, companies can drive value by speeding design and product testing and by reducing the need for physical prototypes. They can increase real-time, global collaboration and streamline design efforts with 3D design tools and digital product creation.

They can drive reuse, reduce rework and speed approvals by synchronizing data across functions, applying advanced analytics and the value chain with product lifecycle management (PLM) as the backbone.

Optimize Product and Plant Design

Optimization (and the collaboration enabled by a digital environment) drives significant benefits for both products and plants, even before any products are manufactured. For example, companies can create differentiated products based on data-driven insights. They can decrease commissioning time for new lines by validating manufacturing processes prior to physical implementation. And they can help meet sustainability goals, reducing material use, waste and energy consumption by reducing physical prototypes of products and plants.

Automate Decision Making

Whenever data is connected via the digital thread, it can be turned into insights that drive results. Companies can predict the impact of product development on key business metrics like demand, cycle time, cost, quality, compliance, manufacturability and supply chain efficiency. They can quickly resolve quality, safety and downtime issues by prescribing actions based on real-time production analytics. And they can run production lines with optimal speed and quality by automating decisions with predictive control models.

Improve Operational Excellence by Maximizing Performance and Workforce Productivity

As products move into production at scale, manufacturing and operations teams can benefit from connected processes and data across compliance, logistics, manufacturing, production planning and quality processes.

The digital thread can add value by improving asset and machine performance, enhancing labor effectiveness, and increasing capacity and yield.

Improve Asset Performance

Manufacturing assets are expensive, so optimization is key. Companies can increase uptime with machine health monitoring and smart production scheduling. They can reduce unplanned downtime by predicting faults before they occur, and they can reduce planned downtime with smart maintenance scheduling.

Enhance Labor Effectiveness

The digital thread can help companies optimize allocation of resources with smart shopfloor planning and scheduling for labor, materials and tooling. They can also decrease operator training time and improve efficacy with low-risk, high-fidelity virtual reality environments.

Increase Production Capacity and Yield

When the factory floor is connected via a digital thread, companies can increase production yield with AI-enhanced process control optimization. They can minimize production losses by building predictive supply chain models, and they can reduce quality incidents, rework and scraps with predictive analytics.

Enable Risk Mitigation by Ensuring Business Continuity, Agility and Resiliency

The last year has certainly exposed the risks of poor inventory management and broken supply chains. As products move into the market, the digital thread can help companies increase supply chain transparency while improving product quality and regulatory compliance.

Increase Value Chain Transparency

The digital thread can help companies ensure customer/consumer safety and limit product recall costs by enabling supply chain traceability with blockchain and sensors. Companies can improve inventory management by detecting and evaluating demand in real time, and they can predict weak points and prescribe recommendations to optimize supply chains.

Improve Product Quality and Regulatory Compliance

A closed loop quality process that connects to in-market products can minimize reputational risk and decrease the cost of quality and noncompliance fines by reducing product recalls. Connecting in-market data back to the product development process closes the loop to improve quality, safety and efficacy for products under development.

The Bottom Line

There are many opportunities to drive improvements across the value chain with the digital thread. Companies can centralize product data and insights from across business functions with the digital thread to improve and automate decision making during every phase of the lifecycle.

The challenge ahead is to think strategically about the people, process and technology aspects of digital transformations to create a scalable, unique roadmap that drives the greatest impact and resiliency as we move into the future.

*Original article published July 2021. Updated November 2023