Tech debt often surprises manufacturers in how it hinders innovation. Here are tips for solving it.
The biggest challenge in getting a digital transformation off the ground at a manufacturing facility isn't only a limited IT budget or a workforce that lacks digital skills -- often, it's tech debt. A lot of leaders may try to sweep it under the rug, but it is ever-present, and sometimes wreaking havoc on their operations.
Tech debt is a literal and virtual smorgasbord of outdated infrastructure and code. Deloitte's 2024 Tech Trends report found 70 percent of technology leaders view technical debt as a hindrance to their ability to innovate, and the number one cause of productivity loss. Most often, tech debt is caused by investments that have lingered past their expiration dates.
These were not "bad" tech decisions - they may have been the perfectly right decision when they were implemented - but now, they're slow, disparate, and often expensive tools that don't add any value to operations. For manufacturers, tech debt can greatly affect production, and tackling it has many financial and workforce implications.
There are several types of tech debt that span infrastructure, software and architecture. In manufacturing facilities, legacy hardware (PLCs), servers, and end-user devices (such as virtual desktops) are big culprits, as well as disconnected operating systems, outdated terminals, industrial protocols, and communications cabling.
Modern software is not compatible with these systems or legacy infrastructure, which means they require physical modifications. This trickles down to decreased data visibility across operations and a huge problem for manufacturers who need to deliver data quickly from the shop floor to the C-suite. Other tech debt includes investments in new assets or emerging technologies intended to deliver greater value (and ROI), often put in place to solve ad-hoc challenges or to have the latest technology incorporated into operations.
However, many times, these projects are forgotten/left behind, especially when they're not connected to the broader strategy and day-to-day business functions.
Over the years, the assumed answer to tech debt has been application and system modernization coupled with migration of databases to cloud or modern alternatives. But 2024 is bringing new challenges that are forcing manufacturers to deal with investments of the past and forge a new approach to how they integrate technology strategically.
For instance, as Generative AI (Gen AI) AR/VR, and other industrial metaverse applications become growth differentiators for manufacturers, leaders need to move quickly to develop a more software-defined tech stack that supports these capabilities. This means implementing dynamic software systems to control, manage, and optimize manufacturing hardware - a big shift from the manual operations of the past. In the short term this will create faster access to invaluable data and greater facility capacity and long-term, core systems can age gracefully, with built-in supports and checkups to allow them to fulfill their purpose.
So how can they get out of this debt? Manufacturers should face old decisions and projects head-on, and then commit to a constant process of enhancing their capabilities, workforce, and tools.
To create a strategic approach to tackling tech debt, manufacturing leaders should first work with their engineering teams to determine a current state of their OT:
By getting answers to determine their organizations' holistic strengths and weaknesses, manufacturing leaders can begin making strategic decisions around core modernization and future strategy.
In our experience with our clients, we see organizations struggle with balancing emerging tech complexity and their desires for a future state in an increasingly competitive sector. A back-to-basics approach - especially one that broadens the concept of core modernization in tandem with enhancing operations can help avoid future pileups of debt.
This means examining a wide range of systems in tandem with infrastructure to prepare for a future defined by edge computing, 5G, Wi-Fi 6, and AI.
In addition to core modernization and infrastructure decisions, organizations should ensure their teams have the right people, and they are equipped with the right tools and budgets to remediate the accumulation of tech debt and work to reduce or block decisions that would lead to future debt in the process. As IT and OT are converging more rapidly, it will be especially important that manufacturing leaders promote open communication, long-term stability, and a shared vision of what success looks like across their tech workforces.
This includes setting vision at the business level, and investing in employees who can translate the needs of the business into technical outcomes for both OT and IT. They'll have the foresight to set sustainable code standards that avoid the instantaneous tech debt of customized code - a "solution" that can work initially but cause bigger integration problems down the line. In 20-30 years, having that IT understanding baked into the business can make all the difference, and those that prioritize ongoing tech wellness over piecemeal assessments - taking a sustainable approach to data modeling and code modularization - will reduce their tech debt.
Manufacturers that have prioritized the management of tech debt are now able to capitalize on emerging technologies like AI, digital twins and AR/VR within their operations, with the confidence that their tech stack can handle these advanced applications. They can even use the tools to further maintain tech wellness by speeding up diagnostics checks to pinpoint areas of the tech stack that need the most improvement.
Meanwhile, those who haven't may be tempted to quickly jump on the emerging tech bandwagon even without a solid backbone to support, risking server overload and the potential for compounding technical issues.
Manufacturers are at a crossroads: either they tackle technical debt or continue focusing on the "shiny new object." But as shiny new objects become more complex, manufacturers that continue to ignore technical debt may lack the proper infrastructure to integrate new tools with legacy systems.
Technology for technology's sake never moves the needle long term. What does is a well-funded and prioritized IT program that understands how to both manage existing infrastructure and leverage new tools.
Adopting a long-term tech wellness approach may be the most underrated way for manufacturers to gain competitive advantage. Organizations should consider moving technical debt to the top of their priority list to help capacity grow and systems age more gracefully.