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In the article and exhibits presenting in How Software and Big Data are Changing Manufacturing in the United States, the author lays out a vast array of benefits manufacturers can experience when they incorporate big data analytics into their processes and decisions.  The manufacturing sector represents just 12% of the US GDP, but the actual dollar amount is $1.2 trillion of exported goods.  Furthermore, the US manufacturing sector has increased output 30% since the global financial crisis of 2009.  Any advantage manufacturers can gain going forward translates to incremental dollars in sales and cost savings.  Big Data is the key that is allowing manufacturers to save money, grow, and compete in an international marketplace.

Some of the distinct advantages big data gives manufacturers are in productivity, product development, and simulation based approach test new products.  The conclusions drawn by an Ohio University study suggest that manufactures could boost productivity by 30% by utilizing more flexible production techniques along with big data analytics.  Manufacturers could experience up to a 50% decrease in production development costs which translates to a 7% reduction in capital assets.  Another interesting path big data paving is a simulation based approach to testing new products.  An example of this is Volvo integrating customer data into its forecasts to understand if a new design will appeal to customers.

Finally, big data also creates value in the supply chain and is spurring change in the management of manufacturing.  In the supply chain, big data is predicted to be able to save 15-20% on transportation costs and help reduce inventory by 20%-30%.  Big data is changing the way manufacturing enterprises are managed as well.  Big data is creating a huge number of jobs, estimated at 1.5 million.  Managers now must understand what data is relevant and how to use this relevant data.  Not adapting to the big data world will result productivity decreases and manufacturers falling behind competitors who do utilize big data.  Its management’s job to become familiar with big data techniques and hire those who specialize in the data so that companies can stay ahead of the curve.


Will big data finally allow manufacturers to bring manufacturing jobs back to the US?

Do you think the future of big data is in the simulation side?

Do you think that current managers can differentiate between what data is useful and what is not?