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Importance Of Smart, Low-Cost Automation For FMCG Success
FMCG players have identified low-cost automation as a crucial element in their digital transformation plans to radically increase production and productivity, while also ensuring greater cost-efficiency and reduced time to market
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According to a recent report, the global fast-moving consumer goods (FMCG) market is poised to be worth $15.36 trillion by 2025, up from $10.02 trillion in 2017. The forecast period will see the market grow at a CAGR of 5.4%. While the recent pandemic-caused challenges have negatively affected the global economy, it has also provided an opportunity for enterprises to revisit their business strategies with a focus on accelerating digital transformation. It is fair to say that the pandemic is playing the role of a catalyst in organizational endeavors to implement technological innovations to not only guard against future contingencies but also stave off competition in a saturated market.
The FMCG market is set to take big strides in the post-pandemic “new normal.” While the pandemic has confined consumers to their homes, their need for retail products has increased over the last few months. This has created avenues for enterprises to offer omnichannel experiences to their customers with an eye on increasing revenue opportunities. FMCG players have identified low-cost automation as a crucial element in their digital transformation plans to radically increase production and productivity, while also ensuring greater cost-efficiency and reduced time to market.
Seizing The Digital Transformation Opportunity
The last decade has seen a continued growth in labor costs, fueled in part by the increased emphasis on workplace safety and employee welfare. The pandemic has only added to the significance of both those organizational aspects. This is encouraging business leaders to make steady investments in machine-based operational innovations, such as in the domains of artificial intelligence (AI), robotics, and intelligent automation. And even though emergent technologies demand a sizeable implementation cost, they are getting cost-efficient as the technologies mature and will certainly reap positive dividends and quick return on investment (ROI) for organizations in the future.
The need for contactless operational mediums in the new normal will further add impetus to enterprise-wide migration to automation. In fact, even before the pandemic, enterprises were automating non-critical, repetitive tasks to improve productivity and reduce costs. Now, with much of the workforce confined to remote locations, the focus is on developing a robust process of remotely operating machines with the help of smart automation, well-rounded dashboards, and intelligent APIs.
FMCG organizations are also aspiring to turn the personalization of consumer offerings into a remarkable opportunity. Human errors often lead to unanticipated customer demands and by failing to personalize products for them, FMCG enterprises fail to optimize their customer experience, which is fast having a make-or-break impact on revenues and profits. This gap can be ably plugged using innovations in the field of big data and analytics as well as by optimizing the capabilities of AI/ML, and AR/VR.
By taking a leaf out of the logistics and supply chain domain, FMCG organizations can utilize intelligent automation to optimize existing datasets. This will not only enable them to forecast demand, inventory status, and delivery challenges better but will also help them design personalized products and offers for their existing customers. With time and based on positive outcomes, FMCG enterprises will increasingly use smart automation for more critical and time-sensitive tasks, thereby increasing penetration across regions that form the value chain. Product design, assembly, maintenance, inventory management, sales analytics, and product promotions are some of the other important areas reinforced with the help of low-cost, intelligent automation.
Taking Advantage Of Low-Cost, Intelligent Automation
FMCG enterprises are already witnessing encouraging outcomes of low-cost, intelligent automation. One of the foremost benefits of automation is increased uptime and standardized output. In that pursuit, autonomous mobile robots (AMRs), various forms of customer-facing bots, and automated processes are adding great value to FMCG organizations. Constant use of sensors and cameras, in conjunction with the internet of things (IoT), are helping companies generate and analyze important machine data. This is keeping the operators and controllers a step ahead of an unforeseeable outage or machine failure. Intuitive interfaces and holistic consoles offer real-time, data-driven insights that ensure continued uptime and predictive mitigation of unscheduled downtime.
Similarly, low-cost, intelligent automation also offers greater adaptability and scalability. Smart robots are increasingly becoming self-reliant and adapting to human processes using algorithms and sensors that enable these bots to learn from human actions as well as gain a better understanding of locations and terrains. The adaptability of intelligent robots is also offering greater scalability to FMCG enterprises in their pursuit of strategizing their short- and long-term objectives.
Finally, everything leads to cost optimization and revenue intensification. By the virtue of fast learning, intelligent automation is facilitating enterprises to fast track their revenue goals. Automation is preventing recurring costs while developing capabilities to operate around the clock. While mitigating production bottlenecks and human errors, the shortage of skilled workforce is also being addressed using intelligent automation. Going forward, low-cost, intelligent automation will create safer work environments and ensure complete compliance. FMCG businesses are at the cusp of truly revolutionizing their operational models and processes with the help of low-cost, intelligent automation.
The author is Subrat Tripathy, Chief Business Officer, L&T Technology Services
Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.
Chief Business Officer, L&T Technology ServicesMore From The Author >>