The roaring 2020s didn’t exactly start off as we all hoped. Instead of celebrating economic growth and prosperity, manufacturers have been in survival mode because of COVID-19’s ongoing logistical side effects — most notably supply chain instability, transportation challenges, worker shortages, and inflation.
Although the pandemic has been the challenge of a lifetime for most manufacturers, it’s forced many to adapt by fast-tracking digital transformation initiatives across all domains. Technologies like cloud computing, robotic process automation, low-code development, and others are at the center of this digital evolution, giving manufacturers endless opportunities to explore new solutions.
But what does that look like in practice? Read on for a look at the top seven global manufacturing trends for 2022.
Predictable, consistent supply chains
Industry 4.0 and the digital economy
How manufacturers can accelerate digital transformation
7 manufacturing industry trends for 2022
Consumer demands shift just as fast as technology evolves, which makes it difficult for manufacturers to act quickly to provide in-demand products and services.
At the very least, modern customers expect same-day delivery, personalized products and services, and transparent delivery processes. But differentiating your business and staying globally competitive requires high levels of agility and flexibility that traditional business models don’t support.
Instead, consumer-driven manufacturing focuses on anticipating the needs of those using your products. But how is that possible? By integrating new technologies and capabilities — such as data analytics, the internet of things (IoT), artificial intelligence (AI), and countless others — into your existing systems and software.
Manufacturers can implement strategies like digital quality control, asset location monitoring, and automated replenishments of materials to increase operational efficiency and more quickly deliver products to consumers. With these technologies, users and stakeholders can choose their own digital engagement experiences.
Manufacturers are dealing with a time of dynamic fluctuation in market supply and demand. Deloitte notes that the majority of purchasing managers continue to experience system-wide complications from high consumer demand, rising costs of materials and freight, and slow deliveries.
Disruptions are common and costly, but many manufacturers are working on models to make supply chains and logistics more predictable. Replacing manual tasks with technology like AI, data analytics, and sensors can help supply chain managers identify patterns, predict purchasing demands, and better manage inventory. As Deloitte says, “digital supply networks and data analytics can be powerful enablers for more flexible, multi-tiered responses to disruptions.”
As technology enhances business operations, it’s also changing what manufacturers can offer their customers.
Connected services are additional offerings that are based around internet-abled products such as healthcare devices, vehicles, hand tools, machinery, and even turbines. In an assessment of connected services in manufacturing industries, Capgemini states, “We see business models shifting to pay-per-use and pay-per-output, in which customers do not pay for the actual product but for the benefits that the product brings.”
The opportunities for connected services are endless, but some of the most well-known examples include:
- vehicle telematics
- remote control over equipment and machines
- predictive maintenance
- smart home solutions and automation
Offering connected services creates a better experience for customers and an opportunity for manufacturers to differentiate from the competition. Data gathered at every point in the customer journey can be used to continuously improve the quality of the products you manufacture as well as their associated services. Connected services also create regular revenue streams and higher margins.
Also called digital factories or intelligent factories, smart factories incorporate highly automated and self-adapting equipment and machinery to enhance efficiency and flexibility. Sensors track products and inventory while cloud-enabled machines and equipment provide real-time insight into maintenance needs.
Adidas is just one example of forward-looking manufacturers. Aiming to create a factory of the future, Adidas’ “speed factory” is equipped with 3D printers, robotic arms, laser-cutting robots, and IoT tools to quickly create mockups and digital replicas. With automation and robots assisting humans, Adidas can print prototypes quickly to meet shifting consumer demands with shorter lead times.
We’re living in the fourth industrial revolution, or Industry 4.0. While the third industrial revolution brought us the first digital technologies, Industry 4.0 is distinguished by hyperautomation, IoT, smart factories, and big data. These advancements have inspired a global economy based on digital technologies, known as a digital economy.
TechTarget explains that “The fourth industrial revolution builds on the digital revolution as technologies today continue to bridge the physical and cyberworlds.” Technology is rapidly evolving, and manufacturers have endless opportunities to adjust business models, improve operations, and execute tasks faster and better than ever before.
The digital economy includes companies, products, and services that would not exist without modern digital technologies — like Netflix, Spotify, Airbnb, Uber, and Lyft. And as technology evolves, the competitive landscape shifts. Remember Blockbuster Video? Netflix was ahead of the digital curve by offering streaming services while Blockbuster lagged far behind. Today, Blockbuster is only remembered by those who were around in the 1990s, yet everyone seems to have a Netflix account.
In the manufacturing sphere, consider advancements in healthcare devices. Blood glucose meters were once battery operated, analog devices with no internet capabilities. Now, most of these devices are fully connected to the digital world. Manufacturers can gain better insights, users can keep track of their health, and healthcare providers can better serve patient needs.
Manufacturers are expected to deliver products at speed and scale around the globe, which inevitably puts pressure on our environment. The World Economic Forum reports that U.S. manufacturing is responsible for 23% of the country’s direct carbon emissions, while European manufacturing emits 880 million tons of carbon dioxide annually.
This is because manufacturers have traditionally followed a linear “take-make-waste” model, which relies on fossil fuels, overproduction, and excessive waste. But more and more manufacturers are turning to a circular economy, a sustainable model that optimizes efficiency at every production stage.
The circular economy leverages technologies like AI and machine learning to automate processes, streamline operations, and increase efficiency. Recycling, refurbishing, and remanufacturing processes are applied to each stage of manufacturing to reduce waste and cut costs, thus diminishing a company’s carbon footprint. Digitalizing processes also provides real-time insights to support quick decision-making that keeps manufacturers on top of sustainability goals.
One of Gartner’s Top Strategic Technology Trends for 2022 is hyperautomation, “a business-driven, disciplined approach that organizations use to rapidly identify, vet and automate as many business and IT processes as possible.”
Hyperautomation is powered by an orchestrated use of technologies like AI, sensors, machine learning, robotic process automation (RPA), low-code development platforms, and business process management (BPM) tools. This trend is used across traditionally siloed operations, such as engineering, manufacturing, and IT management of systems and software.
The manufacturing industry operates in highly siloed environments and many organizations still rely on manual, time-consuming processes. Hyperautomation takes over human-run tasks and makes operations more transparent. While technology handles the repetitive, yet crucial workflows, your human workforce can focus on more complex tasks, like driving innovation.
The transformation to a hyperconnected, digital-first enterprise can’t happen overnight. Digital transformation is a significant undertaking for any business, especially for manufacturers with manual processes, legacy systems, and siloed operations and data. But low-code development and multiexperience platforms can fast-track the transformation process.
For example, Mendix for Manufacturing Industries provides tools, services, and support to help manufacturers quickly develop custom applications, portals, core systems, and other domain-specific solutions. Since low-code and Mendix cause less disruption to core systems than alternative solutions, the process of connecting people, machines, devices, systems, and workflows is rapidly accelerated. Mendix can also be used to modernize legacy systems and augment custom software development and systems integration projects.