A lot of trends are impacting the world economy and the manufacturing sector in 2020. We don’t always get to choose our circumstances, but we do choose how we react to them.
The following is a rundown of the four biggest trends affecting manufacturers today. Knowing how to meet these challenges — and when a problem is an opportunity in disguise — could be the key to survival in increasingly competitive markets.
Here’s how companies can weather ongoing and future changes and come out the other side stronger than ever.
1. Domestic Sourcing and Manufacturing
Multiple reasons exist for why domestic sourcing and manufacturing are trending right now in the United States. One is the environment — shorter supply chains lead to smaller carbon footprints. Another is ongoing trade tensions making international freight more complicated than it needs to be.
To figure out if switching to domestic sourcing of materials and local manufacturing makes sense, businesses have some questions to ask themselves. Domestic production is making a comeback because of higher buyer control and potentially lower costs. However, determining real-world ROI is more complicated. It requires an understanding of factors such as:
- How large is a typical run for your company? Overseas manufacturers often require larger batches. This process, in turn, requires the storage of more inventory than you might want.
- Is the product light or heavy? Transporting cumbersome items over a distance is more resource- and labor-intensive than shipping smaller ones.
- How much collaboration do you require with your suppliers and manufacturing partners? Speaking the same language and having the option to visit a factory are major advantages.
2. Additive Manufacturing (3D Printing)
Additive manufacturing has the potential to change the game for small and large companies completely. The ability to quickly prototype new product designs or fabricate replacement parts in-house is exceptionally enticing for manufacturers. However, these are just a hint of the advantages.
Research points to a potential 41 to 74% energy savings for 3D printing compared to traditional large-scale manufacturing techniques, such as injection molding. Manufacturers that incorporate 3D printing into their operations may also reduce waste and improve productivity and efficiency.
Not every company produces the types of consumer goods for which 3D printers are best suited. Several questions should come up before adopting additive manufacturing, including whether 3D printing-based “manufacturing-as-a-service” is a better way forward.
Is the part highly complex? Does it require post-processing? Current 3D printers don’t always play well with highly convoluted shapes and may require post-processing that would occur in CNC machining anyway. How much assembly is required? It may be tempting to 3D-print one consolidated part instead of assembling five separately machined ones. However, 3D printing large pieces can be much more expensive than manufacturing them separately and assembling after.
Is the company not yet ready to purchase a 3D printer? Manufacturing-as-a-service could be the path forward for many companies that lack capital but not creative vision. Rolls-Royce was one of the first to offer industrial services on a per-use basis, but 3D printing is revolutionizing the concept thanks to collaboration tools, such as the easy exchange of digital blueprints.
3. The Industrial Internet of Things
The Industrial Internet of Things, or IIoT, is bringing smart manufacturing to the masses. Smart manufacturing refers to networks of digital and physical systems that make industrial data available anywhere and anytime it’s needed.
Many examples exist of how the IIoT delivers value to manufacturers. These instances include gathering equipment data in real-time to spot trouble and avoid downtime, tool monitoring to maximize product quality and consistency and the means to track and reduce energy usage across a facility or supply chain.
Choosing and implementing the right connected equipment and IIoT products isn’t always straightforward. It requires close attention to factors. Compatibility and interference, for instance, bring new connected devices onto the factory floor and require input from engineers who understand how different devices connect as well as how they can interfere with one another. LCD screens are standard in human-machine interfaces, but choosing low-quality components can introduce interference and other unpredictable behavior.
Physical and cybersecurity is also a point of concern. Not every IoT vendor takes safety seriously. Connected factory equipment requires new levels of training and vigilance. Physical assets should have reliable access controls to avoid purposeful or accidental tampering. Plus, all data transmitted off-site should be encrypted first.
4. The Skilled Labor Shortage
Estimates claim that around 2.4 million skilled and semi-skilled manufacturing positions could remain unfilled by 2028. This trend will continue to impact companies throughout the coming years if they don’t figure out how to turn the situation to their advantage.
If manufacturers find their way back to the apprenticeship model and other forms of onsite training, they can attract not just potential talent, but engaged expertise. Studies show that workers are likelier to stay with companies that invest in their development.
Manufacturers can also set themselves apart from the competition in the eyes of job-seekers by working closely with universities and trade schools. This strategy could open the door to students earning credits and degrees onsite instead of in classrooms. Jim Nelson, a VP at the Illinois Manufacturers’ Association, says, “Every job should have a pathway to a bachelor’s degree. But not every job starts there.”
Plus, smart automation on the factory floor can pick up the slack during downturns in talent availability without displacing existing workers. Robotic inspections outperform human inspectors while allowing management to lift employees into more rewarding, more challenging, less repetitive positions.
Manufacturing in Flux in the Wake of New Trends
More than ever, success in manufacturing requires a careful balance of humanity, culture and technology. Companies with the right approach can benefit from these positive trends and learn to see the less-favorable ones as opportunities for reinvention.