Productivity gains are paramount in a slow-growth environment and that could be a boon for industrial manufacturers. They must adapt to changing demands and serve their customers by designing tools that improve the efficiency and performance of factories and other capital projects. Whether enhancing their or their customers’ plants, industrial manufacturers have an opportunity to profit from innovation strategies that build upon advanced manufacturing concepts and the potential of the industrial internet. Industrial manufacturers should be consider their investments more carefully and focus on developing technology platforms as well as new operating models that enable connected products and services to integrate their customers’ operations.
Below mentioned are five industrial manufacturing trends of 2017.
- Leverage data and analytics in a new business model
- Innovate pricing
- Develop strategic partnerships carefully
- Decide what intellectual property to share and what to develop
- Create strategies for talent development and retention
Industrial manufacturers hustle a variety of services enabled by connectivity and data by upgrading their technical capabilities. These new services include condition-based maintenance, which involves ongoing real-time monitoring of equipment to determine its maintenance needs, collaboration with customers on a day-to-day basis to customize asset optimization, and predictive performance management for large and small projects and equipment. This approach helps to enhance customer retention and lead to deeper and more lucrative commercial engagements.
The traditional pricing model for the service contract must be changed from pay-for-product to pay-for-performance. Industrial manufacturers should establish fee structures tied to outcomes. If equipment downtime is reduced or if an upgrade improves productivity, the industrial manufacturer will be paid more.
Industrial manufacturers must become more active players in the technology ecosystem, seeking expertise outside the industry in order to develop equipment connectivity, data analysis, and software that are beyond their current abilities. Leaders have to balance the practice of close collaboration with strategic partners against the need to stay flexible in contracting and partner selection, all while maintaining their hold on their markets. It is possible that a partnership will fall apart because two collaborating companies suddenly realize that their customer base, once distinct, has morphed and they have become direct competitors, vying for the same customers with the same product.
It is difficult for industrial manufacturers to manage digitization and big data analytics because their internal IT systems are so awkward. Also, it is hard for IT to respond quickly or adequately to business and market demands and to facilitate digital solutions that are suddenly in favor in the executive suite. Industrial manufacturers must begin the process of overhauling their IT systems, creating a completely new architecture that can serve as the backbone for internal and external technology initiatives.
When trying to attract and retain talent, industrial manufacturers often find themselves at a disadvantage. They must purposefully map out an exciting technology strategy with specific benchmarks and achievements anticipated for the next 18 to 36 months — and then communicate this clearly to job candidates. Even companies that have not yet felt the shortage of technology-savvy staffers need to take steps to prepare for it as the number of job openings in this field will continue to outpace the number of available hires for the foreseeable future.
The industrial manufacturing trends are not necessarily something that has been discussed in mainstream media. But, that does not mean they lack importance. In many ways, these trends will define how manufacturers respond to changing attitudes throughout 2017 and the next four years. Eventually, manufacturing is evolving in the wake of a new presidency to meet the demand of modernity.