Thomas Alongi UHY LLP
6 MiMfg Magazine April 2018
Keynote Conversation
Thomas Alongi UHY LLP
Q :
Looking back 10 years , what has changed in the industry in how we use technology ? Alongi : Without a doubt , the biggest change has been the widespread availability of stable , low cost , high speed connectivity via the web . Today when I tour middle market manufacturing plants , I see increased use of automation , electronic digital KPI data trackers , collaborative robots and cloud-based software solutions which allow for real-time decision making . This level of integration simply was not possible 10 years ago .
Q :
How will Industry 4 . 0 be a disruptor or game changer ? Alongi : Industry 4.0 is already a disruptor and game changer in many sectors . Remember , not too long ago , we actually went out and rented movies from Blockbuster and now we stream them from Netflix whenever and wherever we want . We hailed a cab and now use a ridesharing service . We purchased goods at retail stores that we now order on our phone and have it on our doorstep within hours . These are just a few examples of how the fabric of our daily lives is being meaningfully changed by this level of connectivity . Disruptive businesses embrace the challenges of continuous connectivity and capitalize on innovation and speed to market to effectively capture market share . Manufacturing is no different as the market now favors those with less capital asset-intensive processes driven by technology . This bodes well for smaller manufacturers as Industry 4.0 tends to lead to more customizable products and more localized production as speed to market is critical .
Q :
What opportunities does Industry 4 . 0 bring ? Alongi : With great change comes tremendous opportunity . Industry 4.0 creates more high paying jobs , expands our educated workforce and ultimately increases our standard of living . In my opinion , Industry 4.0 will be a time of significant change that must be embraced by all manufacturers large and small . With the enactment of new federal tax legislation , manufacturers have the opportunity
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11Leader of UHY ’ s National Manufacturing Practice . 11Member of the National Transaction Services Group ,
where he performs financial and operational due diligence and has led a significant number of transactions over the past several years .
11Licensed CPA and CMA in the state of Michigan with an extensive background in business strategy and costing that separates him from the typical CPA .
to use the tax savings from reduced tax rates , 100 percent deduction for capital acquisitions , and other tax changes to really invest in their future . What is the biggest opportunity for your company ? Every company is different as to where they are on the Industry 4.0 continuum . Ask yourself where you can get the biggest return on investment given where your organization is in its lifecycle — is it a cloud-based software solution , capital equipment with embedded data analysis , collaborative robots , 3D simulation software , 3D printing , or augmented reality ? Whatever direction you take there is no time like now to drive your business forward ! Create a plan , engage all stakeholders and go for it because doing nothing is not an option .
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The fabric of our daily lives is [ already ] being meaningfully changed by [ Industry 4.0 ].
Q :
The bulk of MMA members are small to medium manufacturers , with fewer than 200 employees — how will Industry 4.0 impact them ? Alongi : As Professor Klaus Schaub , chairman of the World Economic Forum , has stated “ There has never been a time of greater promise , or greater peril .” I have been advising middle market manufacturing clients for more than 20 years and agree that the professor ’ s comment is spot on . Having walked the shop floor of hundreds of small , medium and large manufacturing companies , each one has its own culture and vision of the future and where they fit in . But the greatest impact will not be in machine capabilities as much as how you can digitally connect your organization internally and through the supply chain . The speed of change in the coming years will be the biggest surprise to those companies that have not invested in their IT structure . 6