May 16, 2020

Deloitte: 2020 manufacturing industry outlook

Technology
Digital Transformation
Georgia Wilson
2 min
Deloitte Logo
Manufacturing Global gains insight into Deloitte’s top four trends for the manufacturing industry in 2020.

Continuing into 2020, it is predicted that...

Manufacturing Global gains insight into Deloitte’s top four trends for the manufacturing industry in 2020.

Continuing into 2020, it is predicted that the industry will continue to experience uncertainty, as manufacturers provide mixed outlooks for the industry. Currently 67.9% have a positive outlook for the industry, while 32.1% have a negative outlook - a 26% decrease in positivity compared to 2019 at 93.9%. Deloitte expects this mixed view to prevail in 2020. 

Portfolio optimisation 

A continuation from 2019, is showing companies “getting their diversified houses in order’. A large proportion of companies are working to streamline their core operations to realign businesses around key markets and customer segments to drive results and value. “Some are turning to mergers, acquisitions and divestitures to get their houses in order.”

Digital 

With industry 4.0 progressing at a fast rate, manufacturers are facing challenging to maintain momentum when it comes to their digital journey. As a result of early successes there has been an increase in companies looking to further explore and invest in digital. 

However, with current uncertainties companies are shifting their efforts towards digital projects that will drive agility and scalability to manage risks in the current business climate.

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Supply chain ecosystem

In order to effectively improve agility and scalability within the industry, Manufacturers are turning to partnerships to maintain the momentum. Deloitte reports that the need to build strong ecosystems, is proving to be an effective strategy for manufacturers, highlighting that there will be a twofold approach to this trend over the next year.

First phase - actively mobilising partnerships that can drive targeted business goals, adding new capabilities. 

Second phase - leading manufacturers are expected to continue to expand their ecosystem in order to satisfy their strategic vision with the right resources. 

Social responsibility

Over the last decade, there has been an increased importance placed on corporate social responsibility (CSR) across all industries. Currently in manufacturing over one-fourth of organisations are ‘social supers’, who show a genuine commitment to improving the world.

Deloitte predicts that this trend will continue through 2020, with companies experimenting with renewable energy resources for current and future operations, strengthening their commitments to green and clean energy.  

For more information on manufacturing topics - please take a look at the latest edition of Manufacturing Global.

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May 12, 2021

Gartner: Leaders Lack Skilled Smart Manufacturing Workers

SmartManufacturing
DigitalTransformation
DigitalFactory
ConnectedFactory
2 min
57% of manufacturing leaders feel that their organisations lack the skilled workers needed to support smart manufacturing digitalisation

With organisations rapidly adopting industry 4.0 capabilities to increase productivity, efficiency, transparency, and quality as well as reduce cost, manufacturers “are under pressure to bring their workforce into the 21st century,” says Gartner.

While more connected factory workers are leveraging digital tools and data management techniques to improve decision accuracy, increase knowledge and lessen variability, 57% of manufacturing leaders feel that their organisations lack the skilled workers needed to support their smart manufacturing digitalisation plans.

“Our survey revealed that manufacturers are currently going through a difficult phase in their digitisation journey toward smart manufacturing,” said Simon Jacobson, Vice President analyst, Gartner Supply Chain practice.

“They accept that changing from a break-fix mentality and culture to a data-driven workforce is a must. However, intuition, efficiency and engagement cannot be sacrificed. New workers might be tech-savvy but lack access to best practices and know-how — and tenured workers might have the knowledge, but not the digital skills. A truly connected factory worker in a smart manufacturing environment needs both.”

Change Management

Surveying 439 respondents from North America, Western Europe and APAC, Gartner found that “organisational complexity, integration and process reengineering are the most prevalent challenges for executing smart manufacturing initiatives.” Combined they represent “the largest change management obstacle [for manufacturers],” adds Gartner.

“It’s interesting to see that leadership commitment is frequently cited as not being a challenge. Across all respondents, 83% agree that their leadership understands and accepts the need to invest in smart manufacturing. However, it does not reflect whether or not the majority of leaders understand the magnitude of change in front of them – regarding technology, as well as talent,” added Jacobson.

Technology and People

While the value and opportunities smart manufacturing can provide an organisation is being recognised, introducing technology alone isn’t enough. Gartner emphasises the importance of evolving factory workers alongside the technology, ensuring that they are on board in order for the change to be successful.

“The most immediate action is for organisations to realize that this is more than digitisation. It requires synchronising activities for capability building, capability enablement and empowering people. Taking a ‘how to improve a day in the life’ approach will increase engagement, continuous learning and ultimately foster a pull-based approach that will attract tenured workers. They are the best points of contact to identify the best starting points for automation and the required data and digital tools for better decision-making,” said Jacobson.

Long term, “it is important to establish a data-driven culture in manufacturing operations that is rooted in governance and training - without stifling employee creativity and ingenuity,” concluded Gartner.

Discover Gartner's Five Best Practices for Post COVID-19 Innovation' in manufacturing.

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