The first wave of the pandemic brought global economies to a screeching halt, but at the same time, it acted as testing grounds for businesses to assimilate their preparedness in the face of a calamity. France, in particular, was the second most affected country in Europe after Spain; however, May 2021 marked the fastest month-on-month growth for the French manufacturing sector in the last 20 years
Needless to say, in the initial stage of this learning curve, manufacturers of all sizes were impacted, albeit with varying degrees and problem areas. Despite carrying a legacy, it was pioneers, especially automotive manufacturers who struggled more and/or longer. Even at a time when lockdowns were lifted and movement restrictions relaxed, car manufacturers were unable to make a sizable revenue, owing to their heavy reliance on showrooms and in-store buying paradigms.
This can be attributed to the digital demands of today’s customer base. A few years back, online product configurators were all that manufacturers needed, where websites allowed visitors to customize their product on the screen before they could make a choice. While it still makes sense for many manufacturing verticals, these technologies have been obsolete in triggering the envy of buying a car online, for a long time now. But today’s consumers want to choose their final car configuration, book doorstep test drives, and experience cash-and-carry facilities directly from their smartphones or tablets. Customers also want the ability to imagine and visualize their future car from their living room through AR/VR technologies, with external gear, or directly on their smart devices. From maintaining a comprehensive online catalog complete with immersive experiences to enabling last-mile delivery at the convenience of the customer, manufacturers stand to gain a lot in pushing a prospect into the conversion funnel.
Digital Buying is Here to Stay
During the pandemic, digital-native organizations across the value chain – be it suppliers, OEMs, dealers, distributors, or logistics firms – that adopted a digital-first approach suffered relatively minimal disruption. As of 2021, millennials account for 30% of France’s population and the purchasing power of this demographic is largely accustomed to 100% online transactions. For manufacturing leaders, never before has the need for digitalization been reinforced with such significance and more specifically, perfecting the digital buying experience, at speed. One of the key milestones in this journey is cloudification.
Large manufacturers must embrace the elasticity of the cloud and its ability to allow future scale across their value chain. Most commercial off-the-shelf (COTS) as well as bespoke line of business (LOB) applications come with a cloud-based architecture. These include enterprise resource planning (ERP), customer relationship management (CRM), product lifecycle management (PLM), Human Capital Management (HCM), to name a few.
When it comes to the IT infrastructure, however, most manufacturers depend on legacy systems, such as on-premise data centers. This creates bottlenecks in operational efficiency, regulatory compliance, and most importantly, restricts future scale, agility and innovation. While setting out on realizing their rapid IT modernization initiatives, manufacturers question the viability, and rightly so. For most large manufacturers, challenges arise in selecting the right type of cloud setup from public, private, or hybrid, choosing the cloud service provider, and planning the execution. Onboarding their IT infrastructure onto the cloud without downtimes and disruptions to their production lines can be a deal-breaker.
Lead and Not Follow
Europe’s second biggest economy has more than 18,000 manufacturing companies with over 380,000 employees. In the face of an unforeseen event, manufacturers cannot afford to wait for the clouds to clear, which can cost them their business. Production growth rate in France fell to -34.8 in three months (April 2020 on February 2020). This number not only represents a halt in production, but also insolvency and subsequent closure of business to many. Digital transformation is no longer an afterthought; it completes and complements the shop floor.
From government support during the pandemic, in the form of solidarity funds and deferral for social contributions to the more recent stimulus package that puts manufacturing at the centerstage of economic recovery, the country has become a hub of accelerated progress. A completely digital buying experience is closer than manufacturers want to think, and they must partner with the right experts who can help become early adopters in their respective segments. Tech Mahindra with its 35-year legacy in the IT and services industry can help manufacturers on their pursuit of innovation. Through NXT.NOW™, manufacturing companies in France, can now leverage this accrued acumen into bridging the age-old gap between production and consumption.
