For small and medium-sized manufacturers, digital transformation can seem like an especially harrowing task. But smaller organizations can be uniquely positioned for success in implementing firmwide digital strategies.
Small but mighty: Just look at Graphicast, a 25-person precision metal parts company in Jaffrey, New Hampshire.
- “Because the cost of data collection and analytics is getting lower and lower, even as a small company we can collect data at a rate that gives us meaningful information we can act upon,” said Graphicast President Val Zanchuk. “For example, we created a linear programming model of our business. If we’re growing at a certain rate, I can use it to determine the most economical next steps, such as whether we should hire more people, work overtime or purchase more equipment.”
A workforce solution: Graphicast, which counts Fortune 100 companies among its clientele, has used cloud computing, AI-based systems and more to help it succeed, according to Zanchuk.
- The manufacturer is also looking into the use of collaborative robots as a potential solution to the labor force shortage.
- “When it comes to Manufacturing 4.0, we think about what our customers will be looking for from us in terms of digital collaboration,” said Zanchuk, adding that some of the business’s larger customers are “transforming at a different rate than we are.” That means it’s up to Graphicast to consider client expectations and see how best to meet them given “what’s financially and operationally feasible” for the company.
The MLC helps out: To aid in Graphicast’s digital transformation, Zanchuk joined the Manufacturing Leadership Council, the NAM’s digital transformation division.
- “The MLC is the only place I know where I can discuss broad industry trends in an open fashion, where small companies like mine and large companies like Ford or GM can all be involved in the discussion,” said Zanchuk, who serves on the MLC Board of Governors.
- “Being part of the MLC lets us know if we’re on the right track and how we can make adjustments,” he continued. “It connects us to a group of incredibly talented, intelligent and experienced people who are focused on many of the same operational challenges we face.”
The Manufacturing Leadership Council—the NAM’s digital transformation division—has announced the finalists for the 2023 Manufacturing Leadership Awards, the industry’s premier awards program for achievements in digital manufacturing. You can read the complete list of finalists here.
The ceremony: The finalists will be honored at the Manufacturing Leadership Awards Gala in Marco Island, Florida, on June 28.
- Also announced at the gala will be winners for all project and individual categories, winners of the Manufacturing in 2030 Award, the Manufacturing Leader of the Year, the Small/Medium Enterprise Manufacturer of the Year and the Large Enterprise Manufacturer of the Year.
Rethink: Certain award winners will also present at Rethink, the industry’s leading event for exploring manufacturing’s digital era, which will also take place in Marco Island on June 26–28.
The categories: The awards are divided into nine project categories to recognize company achievements:
- Artificial Intelligence and Machine Learning
- Collaborative Ecosystems
- Digital Network Connectivity
- Digital Supply Chains
- Engineering and Production Technology
- Enterprise Technology Integration
- Operational Excellence
- Sustainability and the Circular Economy
- Transformational Business Cultures
Additionally, individual leaders are recognized in the Digital Transformation Leadership and Next-Generation Leadership categories.
The last word: “As more manufacturers extend digital’s reach onto the factory floor and throughout their operations, we are witnessing transformative performance improvements that would have been unthinkable just a few short years ago—and that are improving life for employees and customers alike,” said MLC Co-Founder, Vice President and Executive Director David R. Brousell.
What does it take to be a digital transformation champion? Anheuser-Busch InBev can tell you.
The world’s largest brewer won four Manufacturing Leadership Awards in 2022, including the highly coveted Manufacturer of the Year. (The honors are given annually by the Manufacturing Leadership Council, the NAM’s digital transformation arm.) The MLC chatted with AB InBev Global Vice President Marcelo Ribeiro recently to get his insights on the processes, technologies and strategies driving the company’s success.
Business transformation drivers: “We have a dream at ABI, which is ‘to create a future with more cheers,’” said Ribeiro. “[That means] a clear strategy to lead and grow, to digitize and monetize our ecosystem and to optimize our business.” Here are a few ways AB InBev is pursuing that dream:
- Developing and delivering products that give consumers what they want, when they want it
- Making sure the supply chain can adapt quickly to consumer needs
- Increasing capacity without compromising safety, quality or sustainability
Rising to challenges: “The future is becoming less predictable,” Ribeiro said. “We need to prepare for that, so we have to build a more resilient, flexible supply chain.” Additional opportunities include:
- Moving from transactional relationships with vendors and suppliers to partnerships
- Looking beyond operations and across the entire supply chain to meet sustainability goals
- Creating a collaborative manufacturing ecosystem that fosters the sharing of ideas
Meeting the digital future: Ribeiro says that ABI’s digital strategy has three key aspects:
- Making data more accessible and available to frontline workers
- Creating a template for digital technology that can be easily tailored to the unique needs of each business
- Using advanced analytics to contextualize data and discover where it can best be applied to aid decision making
Leaders required: Ribeiro noted that leadership is essential for making this vision a reality.
- “It is critical to empower the front line,” he said. “Leaders should be focused on providing the resources to allow people to do the work and achieve excellence themselves. In the end, people are key for any business transformation.”
Find additional insights into AB InBev’s digital transformation in DIALOGUE: AB InBev’s Award-Winning Dream, or make plans to attend Rethink, where Ribeiro will present a keynote address on “Building Your Enterprise into a Digital Transformation Champion.”
Electronic waste is a big problem.
In 2019, the world generated a record 53.6 million metric tons of discarded electronic and electrical devices, according to a Global E-waste Monitor report. That’s an increase of 21% in just five years. But there’s more: The figure is expected to double by 2050, hitting 120 million tons annually.
The good news is that manufacturers can be an active part of the solution. Though their bread and butter has typically been bringing new products to market, manufacturers are now also developing end-of-life processes for goods to mitigate environmental impact, according to Bright Machines Vice President of Industrial Solutions Adam Montoya, writing in the Manufacturing Leadership Council’s Manufacturing Leadership Journal. (The MLC is the digital transformation division of the NAM).
The challenge: complex components. Disassembling a product is not nearly as straightforward as assembling it, according to Montoya. Take a server, for example. A company might know what’s inside it based on its original configuration, but memory or processor upgrades could have changed over the course of its life.
- When a lot of change has taken place, the dismantling process is unique to each server, making it complex and difficult to automate.
The solution: intelligent disassembly. Improving the end-of-life process for electronics requires intelligent disassembly, a combination of smart technology and a different way of thinking, says Montoya. Here’s how it works:
- Automation technology that uses AI and advanced vision systems interprets the contents of a particular component and compares it against the original blueprint.
- Next, the system assesses the presence and location of components within the unit.
- It then sorts, separates and removes components so they can be reclaimed or recycled.
The bottom line: Manufacturers stand to realize many benefits from intelligent disassembly. Components with sensitive data can have machine-driven proof of destruction. Systems with usable parts can be repurposed rapidly.
- Ultimately, it’s an important way for manufacturers to collectively reduce carbon footprints and electronic waste while delivering business value, says Montoya.
For more on this topic, read Rethinking End-of-Life Technology Value in the Manufacturing Leadership Journal. And to learn more about how manufacturing leaders are undertaking digital transformations, join the MLC at its Rethink conference in Marco Island, Florida, on June 26–28.
The NAM recently released its Top 8 Manufacturing Trends for 2023—a guide to the opportunities ahead and the resources that the NAM can offer. Here is what to look out for this year and beyond.
Advanced and emerging technology: Manufacturers are investing in a multitude of new technologies, including artificial intelligence, virtual reality, machine learning and more. Automation and robotics are enhancing workers’ abilities but will also require many more high-skilled employees. Though the workforce shortage is a challenge, digital technologies will help manufacturers become more resilient, efficient and profitable.
- NAM resources: How do you maximize these opportunities? The NAM has resources for you, including the Manufacturing Leadership Council (the NAM’s digital transformation arm), the Innovation Research Interchange (the NAM’s innovation division) and the MLC’s Manufacturing in 2030 Project.
Supply chain resilience: As manufacturers face long lead times, increased costs and a scarcity of raw materials, they are taking steps to boost supply chain resilience through reshoring, cybersecurity, increased supplier pools and more.
- NAM resources: Manufacturers can benefit from resources like CONNEX Marketplace, which helps connect nearby manufacturers and suppliers; the NAM’s Supply Chain Hub—a continually updated collection of webinars and policy documents focusing on supply chain issues; and useful case studies highlighting best practices.
Talent disruptions and opportunities: Manufacturers are confronting a range of challenges around the workforce, including labor shortages and skills gaps, while also figuring out how to take advantage of previously untapped talent pools.
- NAM resources: If you are searching for ways to enhance your employee benefits, The NAM Manufacturers Retirement 401(k) and Savings Plan offers manufacturing employees secure benefits for the future, while Innovation Management Workshops give manufacturing leaders the skills to build innovative and creative teams. Meanwhile, the Manufacturing Institute—the 501(c)3 nonprofit workforce development and education partner of the NAM—promotes a range of events and initiatives designed to expand and diversify the manufacturing workforce as a whole.
Cybersecurity: The threat from bad actors is real, and strong cybersecurity has become critical to manufacturing operations up and down the supply chain. At the same time, manufacturers will have to be on the lookout for new cybersecurity reporting requirements.
- NAM resources: The NAM can help, with support like the NAM’s complimentary Cyber Risk Assessment. NAM Cyber Cover offers cyber insurance and risk mitigation, and you can check out these videos from manufacturing executives laying out best practices for cybersecurity defenses.
Post-pandemic growth and expansion: Long-term goals shouldn’t be downgraded, despite an uncertain economy. Manufacturers should keep pursuing technological advances, navigate government incentives and stay open to mergers, acquisitions and other investments.
- NAM resources: The NAM Incentives Locator helps manufacturers find funds and tax credits to help their business, while the MLC offers networking opportunities for manufacturing leaders.
Tough economic outlook: There’s no doubt that manufacturers face economic headwinds. That means manufacturers need to look for ways to be nimble and responsive to changing realities and able to work more efficiently than ever.
- NAM resources: Tools like NAM Shipping & Logistics give manufacturers discounts on shipping and freight, while NAM Energy offers conversations with energy advisers who can help adjust energy use strategies. IRI Coffee Houses promote virtual conversations with innovation leaders to discuss new developments and opportunities.
Sustainability: Manufacturers are committed to strengthening operations and maintaining a healthy planet at the same time. More than ever, manufacturing companies are looking for ways to reduce carbon emissions.
- NAM resources: The NAM provides resources that can help manufacturers with innovating for sustainability, as well as rethinking end-of-life technology value. Manufacturers can also learn about how digital solutions drive sustainability in manufacturing.
Looking ahead to 2030: Changes in the manufacturing industry and in the world around us—from population growth to the rise of a new middle class to increased interconnectivity—have manufacturers planning for big changes in the next decade.
- NAM resources: The IRI offers a forum for manufacturers to connect with R&D leaders, while the MLC’s Next Phase of Digital Evolution report shows how manufacturing leaders can plan their long-term futures.
Learn more: Take a look at the full guide for more details and to find out more about the NAM resources that will help manufacturers deal with these key trends.
AI is changing the way manufacturers do business—from the production line to the back office and across the supply chain. At the Manufacturing Leadership Council’s Manufacturing in 2030 Project: Let’s Talk about AI event last month in Nashville, Tennessee, panelists discussed how those sweeping changes would alter, and enhance, the manufacturing workforce.
A collaboration between the MLC (the NAM’s digital transformation arm) and the MI (the NAM’s 501(c)3 workforce development and education partner), the event provided key insights for manufacturers into how technology and workforce trends interact with each other. Here are a few key takeaways.
Net positive: “The history of technology adoption is about improving the job quality of individuals on the shop floor. AI helps them to do the job better, provide them with better tools, gives them greater authority and ultimately increases the value-add of their jobs. All of that is a net positive for those individuals,” said MI Vice President of Workforce Solutions Gardner Carrick.
- By leveraging data and enabling greater efficiency, AI will improve communication, increase collaboration across disciplines and stimulate innovation, according to the panel.
- In addition, “AI can even inform the workforce’s creativity by working with it to design a new product or system,” said Jacey Heuer, lead, data science and advanced analytics, Pella Corporation.
Skills needed: While you might expect that implementing AI requires workers skilled in programming, data science and machine learning, manufacturers will also need to expand their bench of critical thinkers and problem-solvers. The panelists had a few tips to help companies along.
- Invest in upskilling programs to make the AI integration process at your company smoother and develop the talent you already have.
- Update job descriptions to reflect the skill sets the company will need in the next five to seven years.
- Consider recruiting for and teaching adaptive skills—skills that enable individuals to adapt easily to changing demands and environments—which can increase the flexibility of your workforce.
- Build partnerships with local schools, community colleges and technical and vocational schools to develop talent pipelines that will meet your needs.
The human-AI collaboration: While AI will take over monotonous, repetitive tasks, the panelists predicted that the industry will continue to center around human labor.
- “You can teach AI to do X. You can teach AI to do Y. [However,] combining the two may be really difficult for AI, while a human can do it better. You’re going to continue to see humans in roles that center on making decisions and telling stories,” said Asi Klein, managing director, industrial products and organization transformation, Deloitte Consulting.
- Meanwhile, AI adoption will likely lead to an increase in available jobs, as more skilled workers will be needed to guide and inform these new processes.
The last word: “Over the last 12 years, we’ve seen a lot of technology adoption, but we have not seen a lot of job loss. In fact, we’ve seen job gains,” said Carrick. “There is a lot of opportunity to reimagine jobs to add value that AI will help to illuminate.”
It’s time to think way outside the proverbial box, according to the Manufacturing Leadership Council, the NAM’s digital transformation arm. In fact, as we get closer to 2030, manufacturers are creating entirely new boxes—including new digital business models, products and services, revenue streams, ways to serve customers and opportunities to increase competitiveness.
Collaborative innovation: By 2030, metaverse technologies will provide rich virtual environments for the collaborative development of new ideas. These shared virtual spaces will enable contributors from multiple remote locations to collaborate in real time.
- These collaborations may include manufacturers, partners, academic institutions and research institutes.
- New concepts can be tested in a virtual world before moving to physical prototyping or production.
Outcome-based products and services: As digital platforms mature and products become increasingly smart and connected, the decade ahead may see a boom in more outcome-based services. This is where the customer doesn’t buy a physical product, but instead signs up to pay for the guaranteed outcomes that product or system delivers.
- This shift will require manufacturers to establish new infrastructure rich in predictive analytics, remote communications and consumption monitoring.
- It also requires a mindset change for traditional manufacturing, from a focus on units and costs to product lifecycles, performance levels and usage.
Blockchain networks: By 2030, blockchain could be leveraged for most world trade, helping to provide the secure traceability and provenance needed to prevent physical product counterfeiting, grey markets in medicines and even the adulteration of the global food supply chain.
- A blockchain is an electronically distributed ledger accessible to multiple users. Blockchains record, process and verify every transaction, making them safe, trusted, permanent and transparent.
- Blockchain technologies promise to be a viable solution to manufacturers’ need to automate, secure and accelerate the processing of key transactions across industrial ecosystems.
E-manufacturing marketplaces: Digitally empowered production-line adaptability, such as the kind that emerged during the pandemic, will provide a foundation for companies to offer spare production capacity to other companies in different sectors.
- This maximizes the return on a company’s production-line investments and can generate new revenue streams for the future.
- Combined with e-commerce, e-manufacturing will enable designers, engineers and/or smaller companies to more easily connect with a large pool of qualified producers to deliver and scale a final product.
Manufacturing in 2030 Project: New Boxes is just one of the industry trends and themes identified by the Manufacturing in 2030 Project, a future-focused initiative of the MLC. For more details on megatrends, industry trends and key themes for Manufacturing in 2030, download the MLC’s new white paper “The Next Phase of Digital Evolution.”
Now that 2023 is here, we’re looking back on 2022’s top tech trends in manufacturing. The NAM’s digital transformation arm, the Manufacturing Leadership Council, and its innovation management division, the Innovation Research Interchange, gave us an overview.
AI everywhere: From automatically responding to shifts in production demand to anticipating breakdowns in the supply chain, artificial intelligence showed up more than ever before throughout manufacturing operations.
- More than two-thirds of manufacturers are either using AI now or will be doing so within two years, according to MLC research.
- Current use cases include predicting needed maintenance for equipment, forecasting product demand and monitoring performance metrics such as productivity and efficiency. Future use cases could include fully autonomous factories that run continuously with minimal human intervention.
Training on demand: Training for technicians and frontline operators used to mean time in a classroom with a live instructor. In 2022, more manufacturers turned to virtual, on-demand learning tools that allowed workers the freedom to learn at their own pace.
- This ran the gamut from video content libraries to immersive augmented reality/virtual reality experiences that guide and correct trainees.
- In 2023 and beyond, this type of learning experience will be essential to attracting and retaining younger workers who are familiar with digital learning and want the latitude to gain new skills on their own schedules.
Digital twins: Manufacturers used digital twins—virtual models designed to reflect a physical object, system or process accurately—to create design prototypes and test their performance.
- Digital twins will continue to allow for new levels of design optimization, improved product development and performance and significant waste reduction for manufacturers.
Robotic collaboration: Once confined to steel cages and bolted to floors, industrial robots took center stage in 2022.
- No longer limited to repetitive tasks and kept far from human workers, new-generation robots are safe enough to work alongside employees, can be moved quickly around shop floors and are programmed easily to do multiple tasks.
- Since they’ve also become more affordable, they’re an economically feasible investment for companies of all sizes.
Cybersecurity as safety: A rise in connected factories also meant a rise in cyberattacks on manufacturers. In an industrial setting, a cyberattack can be very dangerous, as it can cause equipment to malfunction.
- Last year, more companies began addressing the threat with cyber drills, tabletop exercises for simulated attacks and other training exercises designed to keep businesses—and workers—safe and secure.
Low-code/no-code development platforms: In 2022, more manufacturers embraced the use of mobile and web apps to build applications quickly. Using these platforms, enterprise and citizen developers can drag and drop application components and connect them to create apps—without line-by-line code writing.
- Business teams with no software development experience built and tested applications without any knowledge of programming languages, machine code or the development work behind a platform’s configurable components. We can expect to see more of it this year.
Smart glasses move beyond the pandemic: Many manufacturers kept up their pandemic-era use of smart glasses, which they had used to troubleshoot issues on the ground when travel was restricted and engineers and technicians couldn’t reach sites.
- They also expanded smart glasses’ use to include scanning sensor data so users can see visual data “mapped” onto equipment to better identify issues and fixes.
Manufacturers are pursuing sustainability like never before.
That’s according to recent polling conducted by the Manufacturing Leadership Council, the NAM’s digital transformation division. The annual Sustainability and the Circular Economy research survey seeks to determine the progress made in sustainable manufacturing.
Competitiveness: There has been a surge in the number of manufacturing executives who view sustainability as critical to the future of their businesses.
- 58% of respondents in 2022 believe sustainability is essential to future competitiveness compared to 38% in 2021.
- 68% of executives say they are implementing extensive, corporate-wide sustainability strategies. That’s up from just 39% in 2019.
What’s driving change: The motivations go beyond regulatory compliance and cost savings.
- 78% say sustainability is about better alignment with corporate values.
- 68% believe in creating a cleaner, healthier environment.
- 66% seek to improve company reputation with customers and investors.
Top corporate goals: More than half of survey respondents reported having specific sustainability goals and metrics across almost all key functions in the company.
- Goals were most apparent in manufacturing and production (79%), supply chain (69%) and product design and development (67%).
- Additional goals were cited in transportation and logistics (56%) and partner compliance (51%).
Energy efficiency is No. 1: The primary sustainability focus of manufacturers, according to survey results, is energy efficiency and reduction, combined with the transition to renewable energy sources. These efforts are linked intrinsically to meeting net-zero emissions goals.
- 45% of respondents report having announced formal net-zero goals.
- 30% aim to hit net zero by 2030.
Digital tech, employee training play a role: Also on the rise is the number of companies that recognize the importance of digital solutions in their sustainability efforts.
- These tools are being used to manage and monitor materials and energy consumption, optimize operations to improve efficiency and report sustainability progress.
- Respondents also say meeting sustainability targets must include engaging employees through education and training, as well as greening their supply chain.
The last word: An overwhelming 90% of all respondents agree that manufacturing has a special responsibility to society to become more sustainable and accelerate the transition to a future circular industrial economy.
Interested in putting some renewable energy solutions into action, including solar power, battery storage and LED lighting? Programs from utility companies and other entities enable efficiency upgrades with little or no upfront capital. Connect with NAM Energy to explore your options!
Digital manufacturing is built on just five “cornerstones”—and the work done in those areas in the next decade and beyond will largely determine the success or failure of key aspects of manufacturing’s technological future, according to the Manufacturing Leadership Council, the NAM’s digital transformation arm.
The MLC says that developments in electronics, computer systems, communications technologies, software and cyber infrastructure will have a direct impact on advancements made in human-machine interaction, automation and robotics, and autonomous operation. We break these down below:
Electronics: Intel predicts that by 2030 it will be able to incorporate 1 trillion transistors on a single semiconductor chip.
- Manufacturers will need that kind of power to enable computer systems and software to process much larger data volumes as they connect more plant equipment and people within their business ecosystems.
Computer systems: Manufacturers should expect a changing computer landscape as biological, physical and digital systems converge to offer more options.
- Quantum computing and nanocomputing offer potentially greater computational ability, which will allow manufacturers to process more data faster.
- Meanwhile, traditional computers will become lighter, thinner and more flexible. Different user interfaces, such as voice recognition, will progress.
Communications technologies: The years ahead will see manufacturers adopt 5G-based networks, which offer higher bandwidth and lower latency than prior technology.
- Communications technology suppliers are already working on 6G networks, expected to become commercially available in 2030.
Software: Next-generation software applications, in addition to web and mobile capabilities, will support voice, wearables, touch and AR/VR to a greater extent than ever before.
- These applications will be driven increasingly by artificial intelligence.
Cyber infrastructure: The cyber infrastructure that has been in development for the past two decades has allowed for separation between data and physical computing sources (i.e., cloud computing.)
- Looking ahead, an infrastructure that brings together data from all sources with business and technology tools will facilitate innovation, R&D, operating models and business growth.
Manufacturing in 2030 Project: Ride the Power Curve is just one of the megatrends identified by the Manufacturing in 2030 Project, a future-focused initiative of the MLC. For details on more megatrends, industry trends and key themes for Manufacturing in 2030, download the MLC’s new white paper “The Next Phase of Digital Evolution.”