LIVE FROM MOBILE WORLD LIVE UNWRAPPED DIGITAL INDUSTRIES: IBM expert Priya Kurien highlighted how AI represents a transformative $300 billion opportunity for the manufacturing sector and service providers, but cautioned the former needs to focus on business outcomes.

She explained AI is expected to impact manufacturing by 2 per cent to 3 per cent, translating to the $300 billion opportunity based on the industry’s $14 trillion global size.

“So that is what we’d expect to see as the impact that it will have on the manufacturing industry,” said Kurien, research director, IBM Institute for Business Value. “It wasn’t like it was something that should surprise anyone because manufacturing covers so many industries.”

Kurien noted the manufacturing industry is advancing from early AI experimentation to strategic integration, with many plants utilising connected machine data for operations and predictive maintenance, and a significant portion implementing autonomous operations.

IBM’s research with 2,500 manufacturing managers found 65 per cent of the plants extensively use data from connected machines for continuous improvements, while 35 per cent have some autonomous operations in place. 

“Data is the starting point for AI and the fact that there are this many of them using this is creating an interesting starting point,” she said.

She noted a yearly study by IBM found manufacturing CEOs prioritise productivity, profitability, forecast accuracy, supply chain performance, and talent retention, all areas where AI can provide significant improvements. 

“AI can help on that forecast accuracy, but that is tying into one of the top challenges that manufacturing CEOs talk about, which is supply chain performance,” Kurien said. “In a view of recent disruptions, how can you ensure that you don’t disrupt your manufacturing is one of the key elements CEOs are looking at.”

AI also plays a key role across employee and talent retention for manufacturers. Kurian explained in an industry faced with an aging workforce, AI can augment employee tasks and promote safer environments to help them be more productive.

CAIOs 
IBM research also emphasised the need for manufacturing companies to hire a chief artificial intelligence officer (CAIO.) She said CAIOs are becoming the glue across industries because they enable cross-functional collaboration.

“Dedicated chief AI officers provide an approximately 10 per cent better return on their AI investment,” Kurian said. “This is cross-industry, but it’s because the CAIO is translating the exec strategy to technical implementation.”

CSPs
She explained communication service providers (CSPs) play a crucial role by enabling advanced connectivity and services such as AI visual inspections to support quality control and real-time decision-making in manufacturing.

Operators should communicate in meaningful terms with manufacturers, such as how to reduce unpredicted downtime, to effectively support outcomes through connectivity and AI.

Manufacturers should focus on business outcomes, starting with efficiency improvements like reducing downtime and enhancing quality, then expanding AI integration across supply chains for transformational impact.

“You do need to start with business outcomes,” she said. “You need to have some specific metrics that you want to achieve so that you can track that this has been relevant and successful.”

For more on the key challenges for implementing and benefitting from AI, watch the video interview here.