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By Alithea De Jesus
The way the business was done pre-pandemic has abruptly changed when the coronavirus pandemic disrupted the whole world and inevitably resulted in unforeseen challenges created by COVID-19.
While many companies realized the necessity of technology or embracing digital transformation in their business, there are still some skeptical business leaders who are still trapped into analysis-paralysis syndrome as to whether investing in smart technology is worth it. True, the pandemic may have provided valuable insights for business owners to consider and see the opportunity in the idea of digital transformation in their company to be competitive and resilient. But the fact remains that adoption of the available technology becomes an option, but not a priority across all sectors.
Realistically speaking, the need to speed up the adoption of digital technology is easily thought than done given the fact that this would entail substantial investment on the part of the business owner. Hence, those who are in the quandary try to weigh down if the adoption of digital technology is truly worth it.
Consequently, experts being cognizant of the dilemma of some business owners theorize this, “Knowledge does not ensure the likelihood of businesses acquiring smart manufacturing technologies given the weak correlation between awareness and adoption.”
According to Dr. Anthony C. Sales, DOST-XI Regional Director, who’s also a member of the research team that conducted the study on the “Level of Awareness of Smart Manufacturing Technologies and its Nexus to Adoption among Micro, Small, and Medium Enterprises in the Philippines.”
Awareness on the smart manufacturing (SM) technologies does not necessarily translate to technology adoption, based on the survey of 496 out of the 7,497 cooperators of the Department of Science and Technology’s (DOST) Small Enterprise Technology Upgrading Program (SETUP), a government initiative that assists micro, small, and medium enterprises (MSMEs) in upgrading technologies to improve operation and increase competitiveness.
The study further reveals that medium-sized companies have a higher level of SM awareness and adoption than micro and small businesses. SM technologies are the advanced digital, intelligent, and connected systems that emerged from the Fourth Industrial Revolution (FIRe), which replaced the manufacturing sectors’ traditional technologies that has revolutionized the sector’s operations.
The research, which aims to identify how aware the Philippine MSMEs are in terms of SM technologies and their level of adopting these technologies, focused on the nine SM technologies, namely the following: the internet of things (IoT), cyber-physical systems (CPS), artificial intelligence (AI), radio frequency identification (RFID), robotics, big data analytics (BDA), cloud computing, 3D printing, and augmented reality (AR).
Among the nine SM technologies, cloud computing and 3D printing were the most important technologies that can explain the variability of awareness and adoption among MSMEs, based on the study.
“One of our recommendations is for DOST SETUP 4.0 program to prioritize medium-sized companies, as they are more willing to provide more investments in adopting SM technologies – especially cloud computing and 3D printing,” Dr. Kenneth D. Barroga, also member of the research team, said.
The research team also believes that the government institutions should strengthen technological awareness through scaling up knowledge on FIRe and SM knowledge-building activities in terms of facilitating national awareness programs, and developing informational materials to improve MSMEs’ awareness, value perception, and financial access to adopt new technologies.
Despite the numerous advantages of SM, MSMEs are still at the beginning of this transformation, as shown in a related global study conducted in over 25 countries, in which few MSMEs have fully implemented approaches towards FIRe, and the majority are in their development stage.
Earlier studies cited that among the constraints that hinder MSMEs shift to SM technologies are knowledge, financial constraints, undeveloped capabilities among staff, and owner and employees’ awareness about the importance of the technology.
In the context of the Philippines, said barriers were also observed as characterized by a lack of knowledge and skills competencies, weak technology base, and poor infrastructure.
The good news, though, is that the research team already collaborated with the Asian Productivity Organization (APO) and proposed a specific framework for SM in the Philippines, which the policymakers can use to drive SM transformation in the country and entice more MSMEs to embrace these emerging technologies to be at par with their competitors here and abroad.