Have you ever thought about how the products you use every day are made?

From the clothes you wear to the phone you’re reading this on, a lot goes into the production process.

But manufacturers are facing a number of challenges that can make it difficult to be as efficient as they’d like to be.

From rising economic pressure to the need to be more sustainable, there are a lot of factors at play.

And with supply chain disruptions and a shortage of skilled workers, it can be tough to keep up with demand.

Traditionally, companies have tried to improve efficiency by using certain methods.

But according to Francisco Betti from the World Economic Forum and Daniel Keeper from Boston Consulting Group these methods are becoming less effective.

This is because of new challenges like the COVID-19 pandemic and increased geopolitical uncertainty.

These challenges have made it more important for companies to have flexible and resilient supply chains.

One way that companies can address these challenges is by using artificial intelligence (AI).

AI is a type of technology that allows systems and machines to do tasks in a smart way.

There are four main ways that AI can help manufacturing companies:

1. Improving productivity: Companies can use AI to increase the amount of products they make and reduce the cost of making them. This can be done through things like predictive maintenance (which helps improve the efficiency of equipment), self-optimization of machine and process parameters, and machine vision (which uses cameras to check the quality of products).
2. Enhancing sustainability: AI can help companies be more environmentally friendly by reducing their emissions. For example, AI can be used to predict energy consumption and emissions, and to identify equipment that uses a lot of energy. AI can also help determine the best way to make products in a more sustainable way.
3. Increasing flexibility: In the face of supply chain disruptions, AI can help companies be more agile and adapt to changes. This can be done through advanced demand forecasting, improved network optimization, and advanced production planning.
4. Supporting the workforce: AI can help companies address their shortage of skilled workers by automating repetitive tasks. This frees up workers to focus on more valuable tasks. AI can also support workers in their daily tasks, like decision-making processes or working with robots.

While AI has a lot of potential to help manufacturing companies, many have had difficulty scaling up their AI pilot projects to see significant benefits.

One way that companies can overcome this is by investing in data infrastructure and working with AI experts.

Implications for countries in Southeast Asia:

As AI becomes more common in manufacturing, it will be important for countries to invest in data infrastructure and work with AI experts.

This will help them stay competitive and take advantage of the benefits that AI can offer, like increased productivity, sustainability, flexibility, and support for the workforce.

This can ultimately help these countries grow and develop.

Source: Betti, F & Keeper, D, 2023, 4 ways artificial intelligence could transform manufacturing, World Economic Forum, January 9, website: https://www.weforum.org/agenda/2023/01/4-ways-artificial-intelligence-manufacturing-davos2023/