Predictions for global manufacturing in 2021 and beyond

Cloud adoption for shopfloor production data will gain significant momentum but that is just a fraction of what is in store in 2021, says Jason Chester, Director of Global Channel Programs, InfinityQS.

It is that time of the year when we get asked to provide our predictions on what the manufacturing sector can expect in the year ahead. At the end of 2019, I suggested manufacturers would continue to face numerous challenges:

• Changing consumer trends, continuing to drive demand for better, faster cheaper products.
• Consumers being more sensitive to ethical business practices, such as waste, environmental impact, ethical manufacturing, re-use, recycling, upcycling.
• Increased competition as a result of social media, online marketplaces review and rating sites, creating a more promiscuous, fickle and mobile consumer.
• Advances in global logistics breaking down geo-competitive boundaries, making global markets for manufactured goods frictionless and more competitively intense.
• Significant increases in demand volatility and uncertainty across multiple markets.

2020 – a year of crisis   

What I failed to predict, as did pretty much everyone, was that by March the whole world – and the manufacturing sector – would be turned upside down in ways that were simply unimaginable a few months previously. If I would have made that prediction I would probably have been branded a crackpot and readers would have been spared the column inches.

Practically overnight the industry changed. In some sectors, demand skyrocketed as consumers stockpiled goods, only for demand to then drop off significantly as inventory shifted to people’s homes, marking the start of highly unpredictable demand cycles.

Although no one predicted this ‘black swan’ event, it provided evidence that major events can have significant impact on manufacturing operations. As the impact of COVID-19 progressed, it exposed all of the weak points in outdated systems and processes, and this had a significant impact on how they were able to respond. Since the crisis began, those in the sector have continued to fight fires on multiple fronts in order to protect their businesses, strengthen supply chains and support consumers.

Comment: PTC’s Tech trends predictions for 2021

Remote manufacturing in the cloud

Access to data, information, intelligence and analytics has been a major challenge for manufacturers in 2020 and many have been impeded by the fact that the data required to make critical decisions quickly has not been available when they needed it most. If it is available, it is usually isolated on the shop floor, on an HMI/SCADA interfaces or on a legacy system that is not easily accessible off the shop floor. Therefore, the need to access critical production and quality data remotely has become a critical requirement.

Secure cloud-based solutions solve many of these problems and can be adopted rapidly, scaled as needed, and operated remotely. Cloud pricing models also ensure that the subscription-based pricing can easily scale as adoption increases (or decreases) to support the manufacturers business needs. These proven benefits far outweigh the perceived negatives of cloud solutions and as we progress through to 2021, cloud adoption for shopfloor production data, will gain significant momentum as manufacturers pivot from a position of ‘would consider cloud’ to a ‘cloud-first’ strategy.

Tactical digital transformation 

Many predictions often cover large scale, longer-term trends which actually span many years ahead and the race is on to fix those fundamental weaknesses quickly, before the next crisis might have time to emerge. In 2021, I believe the single most important challenge for manufacturers will be to re-engineer their systems, architectures and operating models to ensure they are better prepared to respond to any future risks.

We are seeing the pace of digital transformation projects increase dramatically and many commentators have posited that 5-10 years’ worth of digital transformation progress (measured on 2019 scales) will be achieved in the next 12-18 months (measured on 2020 scales). What was once seen as the exclusive domain of enterprise-wide, strategic goals will see digital transformation becoming a tactical priority throughout 2021, where manufacturers attempt to solve very specific challenges and areas of weaknesses on a case-by-case basis using digital transformation approaches.

I believe 2021 will be the year data becomes widely accepted as the single most critical feature of the journey to the ‘new normal’. Not just data in and of itself, but how data is captured, stored, accessed, analysed and utilised to ensure manufacturers remain as agile, efficient, productive and cost effective as possible. It will also be the year of the cloud in manufacturing.

2021 – the year of sustainable resilience

My ultimate prediction for 2021 in manufacturing is that it will be the year of data and the cloud being used to deliver rapid and tactical digital transformation projects in the areas where it is most needed. This will enable manufacturers to truly transform themselves from the rapid response and firefighting modes of 2020, to sustainable resilience in 2021 and beyond.

Having being part of the manufacturing community for many years, I continue to be amazed at how the industry has responded to the challenges of this year. From front line operators to senior executives and all those allied to the manufacturing sector in the products and services they provide, it is a community that I am proud to be a part of.

Jason Chester, Director of Global Channel Programs, InfinityQS