Changes that Manufacturing Industry is Embracing

As the manufacturing industry builds up despite significant labour and supply chain challenges, manufacturers must navigate emerging trends to maintain this momentum.

FREMONT, CA: The global manufacturing industry, emerging from the pandemic, is observing positive economic indicators paired with historical labour and supply chain challenges. The recovery gained momentum during the vaccine rollout and rising demand. As industrial production and capacity utilisation exceeded pre-pandemic levels the previous year, there was a strong increase in new orders for all major sub-sectors, signalling growth.

Optimism around revenue growth is held in check by caution about ongoing risks. Workforce shortages and supply chain instability are decreasing operational efficiency and margins. Business agility is crucial for organisations operating through the turbulence of an unusually quick economic rebound and to compete in the next growth period. As leaders focus on strengthening their defence and defending against disruption, there will be new trends for manufacturing.

Preparing to Resolve Talent Scarcity

Higher numbers of unfilled jobs will limit productivity and growth. To attract and retain talent, manufacturers should pair tactics such as reskilling with recasting their employment brand. Shrinking the industry’s public perception gap by making manufacturing jobs a desirable entry point is critical to meeting hiring needs. Engaging with a wider talent ecosystem of partners to achieve diverse, skilled talent pools helps offset the retirement wave and voluntary exits.

Manufacturing executives need to balance goals for retention, culture, and innovation. As flexible work is spreading in offices, manufacturers should discover ways to add flexibility across their organisations to attract and retain workers. Businesses managing through workforce shortages and rapid change today can go ahead.

Remaking Supply Chains for an Advantage Beyond the Next Disruption

Supply chain challenges are acute and still being discovered. Manufacturers encounter near-continuous disruptions globally, adding costs and testing capabilities to adapt. Purchasing manager reports reveal systemwide exacerbations from high demand, rising raw material and freight costs, and slow deliveries. Transportation challenges will include a driver shortage in trucking and congestion. Higher costs will pass on to customers as demand outpaces supply.

The extended supply chain instability is a result of overreliance on low inventories, supplier rationalism, and the hollowing out of domestic capability. Supply chain strategies are extended to be multipronged, and supply networks and data analytics are powerful enablers for more flexible, multi-tiered responses to disruptions.

Speeding Up Digital Technology Adoption

Manufacturers interested in capturing growth and protecting long-term profitability should embrace digital capabilities from corporate functions to the factory floor. Smart factories, including greenfield and brownfield investments for many manufacturers, are the keys to driving competitiveness.

More companies are progressing and observing outcomes from more connected, reliable, efficient, and predictive processes at their firms. Emerging and evolving benefits continue to scale from isolated in-house technology projects to entire production lines or factories with the right vision and execution. These trends are building back the manufacturing sector and preventing plant disruptions.