Why 82% of Manufacturers Struggle to Measure Smart Factory ROI—and How to Fix It
Discover why most manufacturers can't track smart factory ROI effectively and learn proven strategies to measure, optimize, and maximize your technology investments.
Schapira Team
Team leader of Finance
January 23, 2025
7 min read
Smart factories powered by IoT sensors, AI analytics, and automation promise huge productivity gains and cost savings. Yet, in 2025, about 82% of manufacturers admit they can't accurately measure the return on these expensive technology investments.
Without clear ROI tracking, companies risk overspending on projects that don't deliver the expected benefits.
The ROI Measurement Challenge
Many manufacturers invest hundreds of thousands to millions in smart factory technology—including sensors, AI platforms, and system integration. However, the problem is twofold:
Siloed Data
Data is difficult to integrate across machines, systems, and departments.
Inconsistent KPIs
Key Performance Indicators lack consistent, real-time monitoring.
This leads to guesswork rather than data-driven decisions, making it hard to justify further investment or optimize existing deployments.
What Successful Manufacturers Do Differently
Top-performing plants embrace these best practices:
Unified Data Dashboards
Real-time KPI tracking for Overall Equipment Effectiveness (OEE), downtime, defect rates, and energy usage—all in one place.
Automated Alerts and Predictive Maintenance
AI flags anomalies before failures happen, preventing costly downtime and boosting uptime.
Clear ROI Methodologies
Before investing, companies define measurable goals and timelines for smart factory initiatives, linking them directly to financial metrics like cost savings and revenue gains.
Cross-Department Collaboration
IT, operations, and finance teams work together to interpret data and continuously improve processes.
Success Story Snapshot
An automotive components manufacturer invested $4.2 million over 18 months in smart factory tech. The outcomes included:
Defect Reduction
Manufacturing defects reduced significantly
Downtime Drop
Unplanned downtime reduced dramatically
OEE Boost
Overall Equipment Effectiveness improved
Annual Revenue
Additional revenue generated annually
This success was driven by a robust ROI tracking system that tied technology investments directly to operational and financial results.
Actionable Steps for Manufacturers
Centralized Analytics Platforms
Implement platforms that integrate all production data for comprehensive insights.
Tailored KPIs
Establish KPIs tailored to your specific manufacturing goals and objectives.
Automated Reporting
Develop automated reporting for management reviews and continuous improvement.
Staff Training
Train staff on interpreting smart factory data and using insights to optimize workflows.
Conclusion
Measuring smart factory ROI is not just a technical challenge; it's a strategic necessity. Manufacturers who invest in proper data integration, real-time monitoring, and clear financial metrics can unlock the full value of their technology investments—turning costly experiments into sustained competitive advantages.
Ready to Master Smart Factory ROI?
Our manufacturing experts can help you implement effective ROI measurement systems, optimize your smart factory investments, and ensure every technology dollar delivers measurable returns. Contact us to discuss how to transform your smart factory ROI challenges into competitive advantages.
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