Canadian Manufacturing

The top technology trends for the manufacturing industry in 2020

A checklist of technology trends that will influence manufacturing in the next few years

December 12, 2019  by Kevin Dherman, Chief Innovation Officer at SYSPRO Corporate

PHOTO: Machine learning/Mike Mackenzie via www.vpnsrus.com

—Sponsored content provided by SYSPRO Canada

It is no secret that the manufacturing industry is critically important for both developed and emerging economies. From producing necessities like food for a nation to creating much-needed jobs, the sector is a source of innovation, productivity and global trade. Manufacturing represents more than 10% of Canada’s total GDP. What is more, manufacturers export more than $354 billion each year, representing 68% of all of Canada’s merchandise exports.

Innovations in technology have transformed the manufacturing sector manifold over the past decade. Combined with globalization and ever-evolving consumer demands, the pace of change on manufacturing business models and processes will continue to increase, creating rich new market opportunities. Here are the technology trends that I predict will metamorphose manufacturing in the next few years.

  1. The augmentation of human ability

Artificial Intelligence (AI) is no longer just an industry catch phrase. According to Accenture, despite skepticism of AI as just another technology buzzword, its momentum is very real. 84% of C-suite executives believe they must leverage artificial intelligence (AI) to achieve their growth objectives. With AI in place, interactions with customers will move from straightforward transactional models to multidimensional conversations spanning a variety of complementary channels. Within the manufacturing sector, this could take the form of an AI chatbot.

Advertisment

This takes me to my first trend – the rise of the augmentation of human ability. Chatbots or ‘digital citizens’ have enabled or augmented human ability by allowing manufacturing businesses to make decisions much faster. What is important is the fact that the chatbot is not replacing the human element in customer service, but rather adding value by offering customers a 24/7 touch point. Technology is simply enhancing human abilities in order to place the customer at the centre of a business.

  1. 5IR and the “digital opportunity”

By 2023, IDC predicts that the global economy will finally reach “digital supremacy” with more than half of all GDP worldwide driven by products and services from digitally transformed enterprises. The truth is that the digital revolution is inevitable, and it is vital to embrace the digital opportunity or face the risk of redundancy in a highly competitive world.

For the manufacturing sector, the fifth industrial revolution (5IR) will require manufacturers to incorporate a level of artificial intelligence, managed infrastructure, advanced analytics and even robotics to remain relevant. Deloitte calls this Digital “muscle building”, where technology will allow manufacturers to connect and monitor every facet of their business. This is all while their ability to flex production, delivery, and customer support continues to be important.

  1. The circular economy and the evolution of sustainability

According to Nielsen’s recent global sustainability report, 81% of respondents feel strongly that companies should help improve the environment by implementing programs to this effect. There is also an appeal for the manufacturing sector to contribute to the global sustainability zeitgeist by opting into the ‘circular economy’. In order to address the growing consumer and societal pressure to reduce waste to address resource scarcity and climate risk, the circular economy will continue to gain ground.

The circular economy is a simple concept. It essentially refers to the reuse of resources and decrease of waste. Each product at end-of-life becomes a new resource rather than merely being discarded. It recognizes the value of waste items, repurposing them as alternative resources that can be used again and again in a circular goods cycle.

For example, a plastics manufacturer could incorporate more recycled content in each packaging unit that they sell. Energy reduction is another bi-product of the circular economy. By reducing energy usage, the environmental benefits of less air pollution are close to follow. Technology can make this process a lot easier. Increased intelligence can help managers and directors make decisions on a range of topics, from planning the factory floor in a more efficient manner and buying more energy efficient machines to looking at implementing a full green initiative.

  1. Advanced food tracking and packaging

600 million people suffer food poisoning every year, according to the World Health Organization, and 420,000 die as a result. When an outbreak occurs, investigators can spend days or weeks tracking its source. A good example is the recent recall of lettuce within the US where reports stated that at least 65 people in 19 states had reportedly gotten sick due to a strain of E. coli traced back to the lettuce, most of them hospitalized.

Increasingly, technology is playing a more pivotal role in risk detection as opposed to disaster recovery. This is known as traceability, where technologies and software such as ERP allow manufacturers to meet the consumer demands for food transparency while enhancing the ability to identify, respond to and even prevent food safety issues.

  1. The wise pivot

With the competitive landscape changing, businesses have had to investigate the option of shifting away from traditional business models. The shift is called a wise pivot, and it is sometimes a necessary move for companies to remain relevant in a highly competitive landscape. It also talks to the generation of new revenue streams, only made possible by the introduction of the digital opportunity. Some famous examples include Netflix, which started out as a DVD rental service or Starbucks that started off selling espresso makers and coffee beans.

The introduction of new technologies has also opened the door for more opportunities within the manufacturing sector. Product-focused manufacturers are now feeling the need to take another look at their current business models so that they can respond to market trends. Manufacturing leaders are also investing in new connected services offerings, which will facilitate an integration both within and beyond their enterprise. For example, instead of excess inventory (such as chairs) being obsolete and in stock for months, a manufacturer can now place those items on a third-party platform such as Amazon.

  1. Every enterprise is a platform

According to the 2020 IDC FutureScape Report, by 2023, 60% of the G2000 will have a digital developer ecosystem with thousands of developers; half of those enterprises will drive 20%+ of digital revenue through their digital ecosystem/platform. In a nutshell, this refers to how manufacturers could transition into more of a platform enterprise, where they make money from services delivered via apps and APIs on a scalable technical foundation.

  1. Greater customer engagement

Despite continuous technological shifts, one element remains the same: your customer experience journey needs to remain phenomenal. According to ChannelFutures.com, your customers’ perception of your brand—and, ultimately, their buying behavior—is directly tied to their end-to-end experience with your company’s products and services, employees, website, apps, marketing and promotional materials, and more. The article goes on to say that an important part of delivering a good customer experience is the reliance on interconnectivity and integrated workflows. This has been made possible with technologies and software such as SYSPRO Enterprise Resource Planning.

Ultimately, the manufacturing sector has seen constant growth and change with the introduction of new technologies ranging from AI to IoT. Customers are also calling for greater sustainability efforts, quicker response times and improved service levels. As long as every business decision is made with the customer in mind, technology can offer a digital opportunity for manufacturers to flourish in 2020 and beyond.