13 Jul A pulse check on 2021’s predicted manufacturing trends
Believe it or not, 2021 is more than half over. After a pandemic, widespread economic turmoil, and a host of other crises, sometimes it still feels like we’re trying to put 2020 behind and turn the page. And in manufacturing, the ripple effects of all these events are certainly still resounding loud and clear as companies slowly regain their footing with profit margins, staffing, and innovation. Manufacturers are starting to take tangible steps to learn their lessons and reimagine their operations in light of high-level trends like servitization, customer-centricity, and technology adoption.
At the beginning of 2021, we shared our forecast on manufacturing predictions for the year. Now, halfway through, we thought we’d check in on the big-picture trends shaping the industry and how they’ve lined up with reality thus far. We’ll look at the impact of everything currently on the rise, from production localization, forecasting, data, and loyalty to supply chains, eCommerce, remote work, and emerging technologies.
We started the year expecting production to continue to shift to localized reshoring options, and this has proven true. There is an increased investment in commercial real estate with multiple manufacturers trying to build out their own localized production sites rather than using third-party providers.
In addition, we’ve seen the rise of digital twins, where the service provider creates a virtual twin of any given product so customer service reps can service where they are rather than going on-site. This further confirms the production localization trend, as manufacturers extend with virtual twins and 3D printing to allow servicing as local as possible: right where you are.
We also predicted a continued emphasis on refining forecasting in the industry. Though few may admit, every manufacturer has at some point struggled with forecasting accuracy (or maybe still is struggling). Forecasting solutions are always relevant in the industry, and with the product shortages we’ve seen in the past year and a half and continue to see, it’s clear that forecasting is still an opportunity to optimize internal processes for many. We predict more and more manufacturers will turn to the platforms and integrations that give them the greatest control and visibility into future supply chain modeling.
The turn to customer-centricity has been slower than other industries, but it’s certainly picking up momentum in the manufacturing industry now. Industry-specific platforms like Manufacturing Cloud are refining their offering to provide more outlets for customer-focused initiatives: rebates easily integrated with Revenue cloud, critical enhancements to loyalty management, etc. Manufacturing companies are looking for any and all strategies that will give buyers a reason to stay long-term, and the technology is responding to that demand.
Data dependency for supply chains
It’s been a rough year for supply chains, and so it’s no surprise that manufacturers are doubling down on data to build greater resilience moving forward. Having a centralized place for business intelligence and data warehousing is very hot right now, and we are confident it will continue to be as manufacturers try to figure out how to store not only their sales/transactional data but also crucial machine data. The key underpinning this trend is making sure the data is usable and actionable. It’s not just about collecting massive piles of data, but ensuring the data is fit for purpose and used in a relevant, strategic way. Having the proper integrations to send data where it ought to be is the first step to this.
White space for manufacturers in eCommerce is still massive. eCommerce spending in the market is going off the charts, and manufacturers that pivot accordingly will reap the rewards. Critical paths for manufacturers to properly prepare are exposing their quoting process completely online, building out user-friendly PRM portals, and breaking down data silos between sales, marketing, service, and engineering.
The pressure to go green is ever-present, and manufacturers have long carried the brunt of that. But with the pandemic economic recovery and return to work still underway, we’ve seen other trends accelerate more quickly than sustainability. This is especially true in North America. The focus is on getting operations back to pre-pandemic levels and establishing the new normal. That said, sustainability roles and departments are increasingly becoming more prevalent in manufacturing organizations and have survived a pandemic where 20 years ago they might have otherwise been cut under that type of strain. What will drive sustainability innovation forward is external forces like government rules, agency regulations, customer demand, etc.
We predicted a continued dispersed workforce, and it’s been overwhelmingly true: the amount of people going back to a five days a week 9-to-5 in the office is slim to none. Many manufacturing managers are going into the office two or three times a week, and some not at all: the anywhere employee is taking off and some companies are choosing to cut back on office space altogether. And still, others are developing hybrid models that cut back on office time and space but still maintain some physical HQ. Whatever the change, the fact remains: things have changed. The manufacturing workforce will never be the way it was before, and accepting that fact will allow innovative workplace management models to emerge faster.
The factory floor continues to be the exciting testing ground for several new technologies: AI, robotics, and IoT. While the disruption of the pandemic has maybe slowed down the widespread adoption of these technologies in the industry, cutting-edge manufacturers are still pursuing and looking for ways to integrate them with their larger customer-centric strategy. The past year has in many companies even proven the case for emerging technologies, showcasing how these tools can accompany human stuff and supplant the need for always being in person.
While many of these trends are long-term and sure to stay, we’ve also learned there is always the possibility of something around the corner no one was quite ready for. To stay future-proof and resilient in the face of inevitable industry surprises, we know it’s important for manufacturers to have a customer-first mindset as the foundation for all IT operations. Learn more about this pivot and how you can partner with Simplus to navigate the future with ease with our white paper. Or, reach out to our team today.