Future of the Global Manufacturing Industry
|✅ Paper Type: Free Essay||✅ Subject: Technology|
|✅ Wordcount: 4112 words||✅ Published: 8th Feb 2020|
According to the World Economic Forum 2018, “the First Industrial Revolution in the late 1700s used water and steam power to mechanize production. The Second, during the early 20th century, used electric power to create mass production. The third after World War 11, used electrics and information technology to automate production. The Fourth Industrial Revolution or Industry 4.0 however, is characterized by a fusion of technologies that is blurring the lines between the physical, digital and biological spheres” and is upon us now (World Economic Forum, 2018).
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It is impossible to forecast the future, but it’s predicted that over the following decade we will live with more net-related devices, including computers, telephones, appliances, vehicles and robots. As reported by McKinsey & Company 2018, digital disruption is all around us. What’s underpinning such changes of remarkable scale and scope is the rapid proliferation of technological improvements, and the growing receptiveness of people, mainly millennials, in the direction of them.
This report seeks to explore the global manufacturing industry and how the future of manufacturing is entering an era of radical change. Research from the World Economic Forum 2018, reports that manufacturing is being driven by rapid technological development, and manufacturers are having to work smarter, operate more efficiently and be prepared to innovate, as part of the changing nature of the Fourth Industrial Revolution.
Deloitte Insights, 2018 emphasise that organisations must improve their products as well as productiveness to preserve their marketplace share. The long term success of an organization requires investments in technology due to the fact that new technologies can improve efficiency and productivity.
The aim of this report will be to examine where exactly these opportunities will likely come from and identify what it means for the future of manufacturing man vs machine in the digital era ahead.
As identified by McKinsey & Company 2018, The Fourth Industrial Revolution is essentially a digital revolution, and a revolution of technological breakthroughs, such as Robotic Process Automation, Artificial Intelligence, Block Chain and the Internet of Things. Its impact will be far-reaching as it has capacity to upset nearly all enterprise globally, whether emerging or developed. As quoted by Deloitte “Manufacturing 4.0 is poised to transform every function and aspect of the manufacturing enterprise – from the plant floor, to leadership roles and business models” (Deloitte 2018). To acknowledge these developments and stay aggressive in this environment, acceptance towards these processes is particularly vital for success.
Here we discuss how these new technologies are rapidly changing the manufacturing industry and transforming our future lives.
Future Disruptive Technologies
From Man-Power Intensive to Technology-Centric
As reported by Schwabb 2016, this tech-driven revolution will force many businesses to exchange their working paradigm, from being manpower-intensive to being technology-centric. This new manner of questioning is clearly a manifestation of a digital-first method. From humans following procedures and supported with the aid of new engineering, to new engineering following processes and supervised by human beings. The role of people in businesses, and the roles that they do will evolve, essentially from ‘doing’ to ‘thinking’. This additionally creates a further point of attention- what will our future labour look like with all this virtual disruption all round us?
Automation Of work Knowledge- Productivity Changing The Work Force Landscape
Automation is closely associated or connected to trends in robotics, and soon production approaches are bound to be completely computerized and gadget mastering will permit new era skills and processes to correct itself without external help- making the complete production enterprise both instant and cost-effective (McKinsey & Company, 2018) According to the World Economic Forum 2018, approximately 50% of Flex’s manufacturing strategies are already completely automatic. In conjunction with robotics, automation will alter the workplace scene, as people in general will unlikely need to carry out fundamental responsibilities. Paid positions as a substitute will suitably be directed around programming, controlling, and keeping track of these areas of interest (World Economic Forum, 2018).
Internet of Things (IIoT)- More Powerful Than Ever
As stated by CBISIGHTS (2018) Investment within the IIoT is anticipated to climb to an incredible $267 billion by 2021, thus creating the ability to create fierce tendencies and moments of fortuities. Amidst an array of facts and resources easily obtainable, the IIoT will join diverse gadgets and structures to increase real-time selection making and enhance production tactics. As sensor generation, cloud computing and technologies begin to occur more regularly, the IIoT will enable manufacturers to accumulate information in real time, taking into account short recognition and evaluation of overall presentation and extremely high assurance standards. Ultimately, the IIoT will assist manufacturers decrease procedure inefficiencies, manage dangers and become aware of any overall performance issues to rectify (Deloitte, 2018).
Advanced Robotics- The Rise of the Machines
International spending on robotics as reported by The World Economic Forum 2017, is predicted to attain around $67 billion by 2025, with more than a third of this investment is anticipated to be in the business manufacturing region. Alongside modern technologies in conjunction with voice and facial recognition, the growth of smart data, and advanced programming, android machines are accomplishing an increasing number of complex responsibilities with a small amount of mistakes. In place of compromising jobs, machines aim to supply possibilities to remove human involvement in excessively hazardous assignments, which include coping with, and transporting hazardous materials. Robots will be used to complement, not replace human beings and as an end result we’ll be able to add to our output. As a further result, The World Economic Forum estimates that close to 15million jobs could be created in the US. over the following decade, which is equal to ten% of the workforce. (World Economic Forum, 2018)
Image: Reuters The Rise Of Machines, World Economic Forum. (2018). 5 trends for the future of manufacturing. [online] Available at: https://www.weforum.org/agenda/2017/06/what-s-going-on-with-manufacturing-b013f435-1746-4bce-ac75-05c642652d42/
Virtual Reality- Augmented Reality (AR) and 360 Technology To Boost Collaboration
McKinsey & Company 2018, indicate that digital technology now permit manufacturers, distributors, engineers, and buyers to work together and exchange information, in a way that has never been possible before. Introduction and use of VR goggles and 360 imaging, allow creators and investors to observe a workplace virtually, having never to depart the country. This technology allows for more prevalent information, analysing and solving of any serious problems and for reporting on tasks. As highlighted also by The World Economic Forum, 2017 ‘this allows an engineer in China to consult with an engineer in the US. on a technical issue and receive feedback in real time through wearable Augmented reality glasses, expediting problem solving and significantly reducing travel costs’. (World Economic Forum, 2017). AR can also help manufacturers simulate and visualise designs while not having to literally construct prototypes, cutting down time during the improvement segment. (World Economic Forum, 2017).
3D Printing- Manufacturers Saving Time and Money
3D printing is becoming more sophisticated with worldwide revenue in the area expected to reach $28.9 billion by 2020, as stated by (Research Briefs 2018). As the 3D printing sphere becomes more advanced, manufacturers can start to utilise this technology to quickly create prototypes on a budget- allowing for more flexibility and speed in the product development process.
Advanced Materials- Sustainable Manufacturing
According to the new data suggested by The World Economic Forum 2018, ‘fibre- based packaging, is expected to be valued at over $385 billion by 2025, and sustainable textiles will continue to be an area of innovation for the coming years and beyond’ (World Economic Forum, 2018). Producers are also searching for approaches to refine recycling processes, to lessen waste in the enterprise. An ever-increasing popularity in the sustainable manufacturing department is evident, as modern materials and new clinical findings continue to evolve (World Economic Forum, 2018).
CBISIGHTS (2018) show that Global Energy leader BP, is at the forefront of realizing the opportunities big data and (AI) has for the energy industry. They use technology to drive new levels of performance, improve the use of resources and safety and reliability of oil and gas production and refining. From sensors that relay the conditions at each site to using AI technology to improve operations, BP puts data at the fingertips of engineers, scientists and decision-makers to help drive high performance (CBINSIGHTS, 2018).
McKinsey 2017, also indicated that disruption is additionally arriving from innovative gamers, habitually moving away from current industries, which can be geared up to take benefit of recent technology developments. Modern-day examples of this consist of Amazons access into brick-and-mortar retail with pop-up shops promising greater and more efficient spending sprees, IBM’s attack in healthcare technology with the invention of IBM Watson health, and Ubers progression into food delivery with the release of Uber Eats. (McKinsey & Company 2017).
Over the following few years, Deloitte (2017) also validates that the Australian Government is making a greater investment in the production area. The commitment of over $100 million dollars to an Advanced Manufacturing Fund from the 2017-2018 budget, will be used to reinforce innovation, talents and recruitment. As further transformation takes place all over the world in the production enterprise, this number is both prone and predicted to increase. As a result, government authorities are paying closer attention to an extensive variety of measures that may be capable of reversing lingering and customary traditions supporting manufacturing system selections. The most distant, are various suggested adjustments in corporate-tax structures, with likelihood of major consequences for manufacturers. Furthermore, primary procedure modifications in international exchange are influencing understandings of production groups, whose selections are greater publicly, and consequently far-more restricted. And new regulatory provisions governing troubles in the form of minimum wages and employee mobility upload other minor difficulties to any strategic making plans. (Deloitte Insights 2018).
Industry 4.0 Challenges & Risks
According to Deloitte 2018, as we move toward a trend of automation and data exchange in manufacturing technologies, which include cyber-physical systems, the Internet of things and cloud computing, Industry 4.0 creates what has been called a ‘smart factory’ (Deloitte, 2018). However with all these smart enhancements, what are the challenges that they now pose and what impacts will they have on the business model moving forward?
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Cyber-Security and Privacy- The increasing number of attacks in the Industrial Internet of Things are significant. Cyberattacks can have a detrimental effect on systems when compromised. An alarming statistic was stated by CBINSIGHTS, How Technology is Transforming Manufacturing 2018, when stated that ‘28% of manufacturers saw a loss of revenue in the past year, due to cyberattacks, yet only 30% committed to an increase in IT spend’ (CBINSIGHTS, 2018).
The future manufacturing and global value chain will be highly dominated by technological and business innovations to cope with the accelerating pace of changes in consumer behaviour and global business environment (Chowdhury et al. 2017)
With the progression of time, the function of manufacturing is evolving; nevertheless, manufacturing still stays exceptionally fundamental to both the creating and the created economies. As identified by Mile and Agarwal (2018), worldwide manufacturing has experienced a tremendous change driven via computerization, advancement, high adaptability, dexterity and higher productivity. Because of the quicker pace of mechanical change and competitive pressure, the future assembling field should be especially technically knowledgeable, powerful and productive. Flourished by digital physical frameworks, “big data” and analytics, Internet of things, wider and more extensive utilization of mechanical technology and artificial intelligence our future manufacturing world will possibly have the capacity to take care of and exceed purchasers’ futures demand (Chowdhury et al. 2017).
Evidence also presented by (Deloitte 2018) and (McKinsey 2018) show that the dynamical economic science of manufacturing and production, together with changes in consumer requests and the arrival of ‘smarter’ systems are urging businesses to investigate considerably fresh ways of creating and securing worth. Manufacturing is now not exclusively solely around creating physical goods, adjustments in customer inquiry, the character of the goods, the economic science of manufacturing and therefore the economics of the delivery link, has caused a basic shift inside the ways that organizations trade. Customers’ desire systemization and personalization as the channel amidst customer and designer still blur. Combined sensors and integration circulate goods lacking intelligence into ‘smart’ ones, even as goods more and more transform into structures- or perhaps flow into the domain of offerings (McKinsey & Company 2018).
McKinsey & Company 2018, state that as automation continues to rise at a rapid rate, obstacles to entry, commercialisation, and gaining knowledge are deteriorating. Modern marketplace competitors amidst connection to modern devices are able to function at a considerably lesser extent, permitting them to establish services, before exclusively the function of leading occupants.
Whilst big scale production will constantly dominate a few segments of the price chain, innovative manufacturing models- disbursed small-scale local manufacturing, loosely coupled manufacturing eco systems and agile production are arising to take advantage of these new opportunities (McKinsey & Company 2018).
As virtual transformation and the Fourth industrial Revolution persist to redefine production jobs in the 21st century, management and workers alike will be required to embody a labour environment that is predicted to use a combination superior technological and digital capabilities with uniquely human talents, to yield the highest stage of productiveness. Comprehending how jobs could possibly become different, can assist the enterprise as a whole prepare for a destiny that promises to be transformative (World Economic Forum, 2018).
Manufacturing is an industry that has seen constant growth and change over the past few centuries. The industry itself has had to make drastic shifts that will shape its future forever, CBINSIGHTS (2018).
This report analysed and presented the results of how technology in manufacturing is changing our society. We have uncovered how disruption is changing the world around us, which has fundamentally been reinforced by technological innovations.
Based on findings by McKinsey 2018, the rising technologies of the Fourth Industrial Revolution (4IR) have the tendency to essentially revamp the globe in all-inclusive forms of actions – many that will prove ideal and others that will not. Degrees to which profits are magnified and liabilities reduced will rely upon the traits of governance – the regulations, benchmarks, requirements, enticements, organizations, as well as added devices that form the improvement and operation of all specific high tech modes of production.
As stated in an interview by Global Vice President of the Manufacturing Leadership Council, David R. Brousell. “The opportunity to use information to speed and tailor production, engage more intimately with customers, and create new products and services previously unimagined, is almost limitless. Now, the challenge for manufacturing executives is to lead their companies into this brighter future.” (Brousell, 2015)
Industry 4.0 and the technologies it represents may be ‘disruptive’ however these disruptions will be constructive and positive changes to our manufacturing systems and in turn, our lives (McKinsey, 2017).
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