5 Things to Know About Observability for Industrials, Materials, and Manufacturing
By: Arnie Lopez, Chief Customer Officer at New Relic
Industry 5.0 is on the horizon, heralding the broad adoption of artificial intelligence (AI), sustainable product development, human and AI collaboration, and lean production practices. It follows the fourth Industrial Revolution, which centered on technology such as the Industrial Internet of Things (IIoT), robotics, additive manufacturing, digital twin simulations, and virtual reality.
The proliferation of AI creates more complex ecosystems, necessitating more system visibility, insights, and security. Observability is the key to wrangling the array of technologies used by industrials, materials, and manufacturing companies.
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Observability isn’t just a “nice to have.’’ It’s become vital to limiting outages and downtime, and it can save a significant amount of money – the median annual cost of outages for the industrials, materials, and manufacturing industry was $4.63 million in 2023.
For IT decision-makers in the industry who seek to implement or upgrade their observability strategy, here are five things from the 2023 State of Observability for Industrials, Materials, and Manufacturing to keep in mind.
Security is the #1 driver for observability
There are a plethora of safety and compliance standards, including digital security requirements, required of the manufacturing industry by a variety of government and professional organizations. It is no surprise that the top technology strategy or trend driving the need for observability among industrials, materials, and manufacturing companies is an increased focus on security, governance, risk, and compliance (50%). Security monitoring is also the most widely deployed capability by these organizations, with a 78% deployment rate – slightly higher than the average for all industries (75%).
AI is a priority
Many organizations have already added AI to their tech stack, and this trend doesn’t show signs of stopping. As these companies capitalize on Industry 5.0, they find themselves requiring more insight into their increasingly complex data sets. Observability, then, is vital to a successful AI implementation because it helps engineers understand the telemetry, quickly discovering the origin of problems like hallucinations. This decreases the mean time to resolution (MTTR) and minimizes downtime. As a result, 44% of companies in the manufacturing sector cited their adoption of new AI technology as their reason for needing an observability solution.
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Tool consolidation is trending
As a sector, industrials, materials, and manufacturing companies are using fewer tools to address the 17 core capabilities of observability. 61% used four or more observability tools, which is slightly lower than the all-industry average of 63%. The number of companies using eight or more tools was also lower than average: 16% compared to 19% across industries.
The industry is also reducing the number of tools it uses for observability overall, with the average number used per company dropping from six to five from 2022 to 2023. Further, there was a slight growth in companies using a single observability tool, rising from 3% to 4%. While these numbers may seem small, they indicate where the industry is trending as it experiences such rapid changes in technology.
Observability helps prevent supply chain disruptions
The ripple effect an outage can have on a carefully constructed supply chain can be far-reaching and severe. The results of these outages, such as delays, can strain a company’s bottom line and reputation. However, observability provides companies with tools to quickly detect and react to an outage. More than three of five industrials, materials, and manufacturing companies experienced an improved MTTR after adopting observability. Further, 24% of those who achieved full-stack observability experienced a 25% improvement.
Productivity, performance, and collaboration improve with observability
The impact of observability goes beyond the numbers associated with mean time to detection and resolution. A significant number of IT decision-makers for industrials, materials, and manufacturing companies reported that observability made their jobs easier (43%). For the IT professionals on the front lines of dealing with outages, nearly half said that the increased ease and speed of finding and resolving issues made their job easier (47%). Additionally, 31% felt observability tools decreased the amount of guesswork in their roles. Because of this, 45% of the surveyed manufacturing IT professionals felt collaboration across teams had improved since adopting observability.
To summarize, the ever-increasing adoption of and reliance on technologies like IoT, edge computing, and AI in the industrials, materials, and manufacturing sectors create more sophisticated and complex systems to contend with. In order to make these new developments manageable, the ability to monitor, reduce downtime, and respond to issues is critical. Observability will empower these organizations to take charge of their tech stacks and streamline operations.
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