In this blog, the University of Sheffield AMRC’s senior theme lead for digital, Gavin Hill, says ignoring the digital thread could leave you behind the curve on data reporting, product development and regulatory compliance.

In our last blog I talked you through some simple definitions of key buzzwords and topics in the digital thread space. In this edition, I am going to put some flesh on the bones, explaining why you should care. Adopting digital thread technologies empowers manufacturers with faster product development, real-time efficiency gains, proactive quality control, regulatory compliance and supply chain resilience. It drives customer satisfaction, sustainability and competitive advantage, while avoiding costly disruptions and inefficiencies.

Great, you might think. But how does the digital thread deliver these outcomes, you ask?

Depending on your mindset, you may look at the digital thread as an opportunity or a threat. For the early adopters it poses a significant competitive advantage, as the availability of data allows you to offer unparalleled visibility and confidence to your customers and supply chain. It gives you the information you need, providing data immediately, to pinpoint issues and make fast decisions to optimise your business output, giving you a competitive advantage.

By utilising the digital thread you can provide not just data, but contextual insight to both your internal stakeholders and customers. Instead of telling customers that their order will be with them in ten days due to a production delay, you can allow them to access granular updates that help them understand why that delay exists, and what their options might be to mitigate or avoid knock on effects. For example, if my heat treatment system is broken and it’s going to delay delivery of product to you by a few days, by enacting a transparent digital thread you can understand that expected delay ahead of time and could change tactics. You could instead choose to receive your, un-heat-treated products today and use your own heat treatment capability instead of mine, making sure you meet your customer timelines.

However, if you are a more risk averse organisation, preferring to follow technology adoption rather than be an early adopter, the equation looks a bit different. You will start to see that your customers demand some of the data that a digital thread enables, particularly as they see other, early-adopting, suppliers offering it as standard, which they see bringing advantages to their business. In this instance you will have to either provide that data or lose out on business. This will be coupled with regulatory requirements which may take you out of an industry altogether. We are slowly seeing this coming through already with Digital Product Passport (DPP) regulation on battery technology expected to be live in the EU from February 2027 with consumer electronics, fast fashion and others set to follow soon afterwards. This will push wider and affect more products, industry areas and geographical regions.

Refusing to adopt the digital thread will also make it increasingly harder to report on required environmental, social and governance metrics. You will see yourself losing business to competitors because your customers can get more data and insight elsewhere, potentially at a lower price point due to business optimisation activities enabled through digital thread adoption.

A holistic digital thread gives you data and insight into how your product is actually used in the wild, not how you think it is being used through focus groups, spot tests, or user stories. It allows you to get feedback on what your next version of that product should look like and how it should perform - which could mean you make fewer colour variants, because the only thing driving sales of certain colours are price reductions or special offers. Or you could reassess safety factors of a component due to real world usage, potentially making different versions of a product for different types of users.

The knowledge from a digital thread allows you to make adjustments that can result in speed and efficiency gains. Whether it’s the faster introduction of new products, or faster feedback loops from various product lifecycle phases/ tiers of the supply chain with more pertinent information, resulting in quicker delivery times. The digital thread gives you insight into what you and your supply chain contribute to the story of a product.

For a lot of us, a more contextual description helps to hit things home. To help with that, I’ve created two example user stories, showing how aspects of the digital thread can be implemented to overcome current day to day business challenges. These use cases are from a larger set of examples which will be released from the AMRC later in the year.

Supplier who is losing business with established customers

Clara works in procurement and scheduling for your biggest customer. You have had a long standing relationship with Clara but she has been letting you know that they have lowered your net promoter score (NPS) over the last 12 months, as other suppliers have been more reactive to her requests for information. As such, she is reluctantly looking at reducing order quantity with you. You can't seem to be able to improve your NPS using the traditional routes without incurring an unacceptable additional overhead.

By embracing digital thread technology through a supply chain management software, alongside a scheduling and planning system, you could improve your NPS significantly, while also reducing the bottlenecks of your production process and reducing overall work for the team. The digital thread enables you to update Clara on the status of her orders with a single click, sending automated messages to her at the earliest possible moment if changes to schedule occur. As a result of your strong and trusted relationship with Clara, you have even given her access to see data about her orders herself within your system, meaning that she is happier with your service. Transparency in the relationship has increased and, as a result of the more automated system, both you and Clara have significantly reduced non-value added tasks such as making phone calls and chasing down order status updates.

Maintenance team that is being asked to do more with less

Delores runs the maintenance team for an automotive supply chain manufacturer. Her managing director has told her that maintenance costs need to be reduced by 15 per cent this year, without an increase in downtime. Delores’ team is constantly busy and does routine maintenance on all machinery as per the machine builders guidance, meaning that there are very few unexpected downtime instances which occur from missed maintenance. However, she is aware that a lot of the time the parts that she and her team replace look like they have a significant amount of run time left in them - she simply doesn’t have the information available to make better decisions about when to continue running machines for longer periods of time between maintenance.

Delores has secured funding to add a maintenance management module to their existing manufacturing execution system (MES) and shop floor connectivity system, fleshing out their digital thread infrastructure. It has resulted in Delores being able to understand more granular information about machines, like how much they have been used and at what speeds, rather than just how many hours there are in a work day, which was her previous metric. Due to this, she has increased the time between scheduled maintenance intervals for most rotating assets. In addition, the information has helped cut down the need for on hand spare parts, as well as reducing planned downtime. The team is doing less overtime and, effectively, Delores is doing less work to keep the equipment running more.

In the next blog, I’ll talk about what the general infrastructural building blocks are for a company wanting to adopt a digital thread approach. Whilst it will mainly focus on the technical aspects, we will also give a nod to the cultural component - often the larger roadblock to adoption and implementation of any change.