Indore (Madhya Pradesh): Manufacturing firms can significantly improve operational performance—such as reducing inventory, lead times and costs—by strategically integrating big data and cloud computing into their existing ERP systems, according to a study by Indian Institute of Management Indore.
Published in Technological Forecasting & Social Change, the research by Dr Sanjay Choudhari and Jeetendra Kumar Saraswat (EDPM 2020) provides rare real-world evidence of how managerial foresight, organisational readiness, and incremental learning drive successful digital transformation.
The study focuses on a case from the automotive manufacturing sector, demonstrating how a company leveraged its existing ERP data, hosted securely in the cloud, to create real-time dashboards for inventory control.
The result was a 23 per cent reduction in work-in-progress inventory, 15 per cent improvement in lead time, and a 10 per cent reduction in overall costs. The researchers highlighted that the transformation succeeded not merely because of technology adoption, but because of deliberate managerial choices in capability development, culture building, and change management.
For managers, the study underscores several key takeaways. First, big data initiatives are most effective when built on existing ERP infrastructure, allowing firms to extract value without large-scale system overhauls. Second, cloud computing offers a cost-efficient and secure pathway to host analytical tools if managed carefully through one-way data integration and strict access controls.
Third, success depends less on technical prowess alone and more on cultivating managerial competencies, such as cross-functional collaboration, data-based decision-making, and project management discipline.
The researchers argue that leadership commitment plays a decisive role in aligning people, technology, and processes. Top management must foster a data-driven culture and form interdisciplinary teams that combine manufacturing, IT, and supply chain expertise.
The research also shows that smaller, incremental digitization projects can build confidence and skill among employees, making organizations more agile and resilient in their digital journeys.
The study’s implications extend beyond the manufacturing floor. By demonstrating measurable performance gains alongside enhanced decision speed and organizational learning, it provides managers with a practical roadmap for Industry 4.0 adoption. It shows that data-driven transformation is not just a technological shift but a managerial one, requiring cultural continuity, employee engagement, and strategic patience.
This study offers manufacturing leaders concrete evidence that strategic integration of digital tools, guided by sound managerial principles, can convert information into performance and position firms for long-term competitiveness in the Industry 4.0 era.
