Why Are CFW Applications Becoming Manufacturing's Must-Have Solution?

Connected Frontline Workforce (CFW) initiatives have emerged as an essential means to achieve operational goals through frontline teams' support, engagement, and empowerment. The emerging CFW Applications market shows a trend towards manufacturing newer technology solutions designed for and used by frontline teams. As workforce challenges have exponentially increased, data shows that CFW technology spend, adoption rates, and business value have significantly increased.

Merger and Acquisition (M&A) activity has been picking up in the rapidly evolving technology space. As CFW Applications look to become manufacturing's next must-have solution, industrial organizations must be able to navigate the sea of "connected worker solutions," and solution providers must focus on their go-to-market strategy. LNS Research has focused on defining the plethora of diverse, dynamic, and fragmented solution offerings and developing consensus with the first-ever CFW Applications Solution Selection Matrix™ (CFW SSM) recently published.

This blog will unpack what's happening in the market and why manufacturers must look to Future of Industrial Work (FOIW) best practices to select the right CFW solution.  

Does Manufacturing Need (Yet) Another Application?

Software solutions have historically been business-process specific, with people needing to "get on board." CFW Applications are flipping the paradigm to provide software designed for specific personas that span many business processes. These proven solutions are configurable, flexible, can scale, and provide immense value to not just the people but also the business and are a breath of fresh air.

Workers are tired of navigating complex systems to find information, switching in and out of 5 or more applications to complete a task, and eventually leaving work not knowing if they've won or lost. Most traditional solutions such as MES, MOM, and ERP applications quite frankly struggle to provide the workforce, a specific user persona, with what is needed to do the work. The unfolding labor crisis and lack of skills manufacturers had come to rely on with new hires require a new technology that understands the incoming workforce and existing business needs.

The next generation of workers isn't just demanding technology but intuitive and seamless technology. Leaders are significantly more likely to see the value CFW solutions bring to the manufacturing workforce. However, CFW Applications don't correspond to a specific, widely recognized acronym or term today, and it can be challenging for end users to select the proper solution to implement. The LNS Research CFW SSM enables true and objective comparisons today as the market develops consensus around CFW Applications.

The Evolving Market Landscape

Traditional manufacturing technology has left both a wide-open void as well as opportunity. Solutions historically focused on business problems and corporate needs. Recent research indicates some struggle with integrating MES systems across the enterprise. It's important to realize that the complexity of operations often doesn't warrant a full MES system. Legacy automation and software vendors have been unable to meet frontline needs when it comes to an overall wrap and extend to streamline connectivity, thus creating an opportunity for this developing new CFW software category.

LNS Research sees a need for MES and CFW applications rather than an either/or, as it is comparing apples and oranges. In just three years, the market has seen the number of manufacturers with "No plans" for CFW initiatives cut in half, from 32% in 2020 to 16% in 2023. The quickly growing landscape of CFW Application vendors includes a range of early-stage start-ups backed by venture capital to well-established publicly traded global tech giants.

There are some commonalities noted across types of players within the CFW solution space:

• • • Enterprise Technology Providers: Companies such as SAP, Oracle, Microsoft, and Cisco have products that can be used to build a CFW solution rather than a ready-made solution designed for and easily used by the frontline. That said, these enterprise solutions provide collaboration tools and enable the deployment of third-party CFW Applications like those included in the LNS Research Solution Selection Matrix.

    • Industrial Software Providers: Automation vendors that include AVEVA, Hexagon, and Rockwell typically have various products in the portfolio that can enable CFW use cases. However, significant customization and systems integration work is generally done to develop the LNS Research defined CFW Application.

    • Growing Software Providers: Recent market moves are just the beginning, and we expect HRM providers are looking closely at the QAD acquisition of Redzone and the IFS acquisition of Poka. LNS Research identified CFW technology as an attractive opportunity for global software providers. M&A activity proves that market consolidation will likely accelerate as the strong trend toward newer technology designed for and used by frontline teams builds.

There will always be a place for powerful digital tools designed for back-office needs. However, the frontline workforce, typically 80% of the company's workforce, requires technology capable of flexibly meeting new and changing use case requirements. Industrial organizations are seeking solutions that enable frontline worker connectivity to and among the multiple elements of the operation, with M&A activity and partnerships expected to rise.

Navigating the CFW Application Space

Software solution selection is a complex undertaking that demands multi-level, multi-regional, cross-functional, and inter-departmental collaboration. The selection process can present even more pitfalls and challenges when end-users must navigate the dynamic and emerging space. The emerging CFW Applications solution space started with "wearables" and has since matured significantly.

Industrial organizations face intense pressures to solve critical labor shortages and skills gaps in frontline operations. Within the following year, 71% of manufacturers are looking to have a CFW Solution implemented to digitally enable the workforce and build a future-ready frontline. It is critical for industrial organizations to better understand CFW Applications as a technology category to achieve the success, scale, and business value that Future of Industrial Work (FOIW) Leaders have proven.

LNS Research identified 15 Connected Frontline Workforce application vendors that provide solutions that can be readily rolled out to any manufacturing facility for immediate value. The CFW SSM ratings and rankings, backed by research, are the culmination of a comprehensive product offering evaluation. For those undertaking the selection process, the Guidebook and Vendor Compendium identify which platforms and solutions are best for each industry vertical and/or specific use case based on key solution characteristics.  

Recommendations for Future-Proof Operations

LNS Research highlights some foundational workforce challenges industrial organizations must figure out soon to sustain operations. Industrial Transformation (IX) is far from a new concept, yet we continue to see high failure rates across manufacturing. The challenge hasn't been the technology per se but the organization's readiness, governance, skills, and change management aspects.

The manufacturing community and LNS Research members are fighting many of the same challenges daily with the burning platform, often the workforce crisis, and a need to digitally transform for sustainable operations. The CFW SSM defining the evolving CFW Applications space provides clarity and context to help determine the capabilities that should exist in a comprehensive and holistic solution.

• • • You just aren't that special – I promise. A company, each business, and/or individual operating site often believes, "I am unique and different; therefore, that won't work for us." In a world where value preservation can often trump value creation, manufacturing can sometimes turn away proven practices in exchange for DIY solutions and/or pour money into solutions not intended for a particular use case. Manufacturers are carrying around something LNS Research is calling "organizational debt." Akin to technical debt, some have an inability to leave outdated practices behind, whereas Leaders implement solutions developed by vendors with the resources and strategic commitment to the manufacturing frontline.

    • Select a CFW Solution that transforms your operations. There is no "standard" or "typical" vendor at this stage of development in the CFW Applications space. A proven methodology can be applied to confidently eliminate issues around alignment, time, cost, and risk in your operations' solution selection. The LNS Research 2023 CFW SSM Guidebook is now available to help select a CFW Application for frontline transformation. While it's not feasible to be an exhaustive vendor list, we recognize there are solutions that can provide this capability for other manufacturing uses, such as Atheer.

    • Isolated initiatives mean incremental improvement. Step change transformation isn't possible without fully addressing practices across people, process, and technology. Steer clear of shiny objects (numerous point solutions) and identify solutions that can be applied throughout operations and the value chain. Strive for an enterprise CFW solution to achieve the success others have in operating performance across the dimensions of safety, quality, and productivity.

• • • Focus on the future for sustainable success. Fielding a future-ready frontline workforce is a strategic imperative. IX creates new hiring, training, and retention challenges with no "one size fits all" technology solution for manufacturers. CFW Applications are proven solutions to support, engage, and empower employees and teams to future-proof the frontline and operations. The LNS Research FOIW Framework provides the means for manufacturing to attract, train, and retain a quality workforce.

CFW Applications provide attractive solutions for a front-end user interface that extends the usability of back-office solutions, such as ERP, MOM, and MES, to the frontline. Given the considerable venture capital and private equity to date and how dynamic and promising the CFW Applications space is, manufacturers should expect even more solutions offered in this emerging space. Future LNS Research CFW SSM updates will provide manufacturers and industrial solution providers with insights to transform how we operate today into future-proofed operations.