Key Trends to Remember for 2023

Rising interest rates, a shortage of skilled labor and unresolved supply chain issues will impact everyone, but none more than the underprepared.

Mfg Data

For industrial manufacturers, 2023 is in danger of being the year of “I told you so.”

The global pandemic caused supply chain disruptions that continue to reverberate today. Governmental subsidies to both businesses and consumers helped protect industry from many of those disruptions, but the subsidies are all but gone now. Rising interest rates and the continuing shortage of skilled labor, combined with unresolved issues in the supply chain will impact everyone, but none more so than the underprepared. Looking ahead, here’s how the best and worst will likely fare through 2023 and beyond.

Smart Factories

The smart factory concept is not new, and many organizations have made some inroads toward achieving higher-frequency and higher-resolution data about their production environments. In most cases, significant opportunity remains untapped. The opportunity for employing smart factories encompasses two domains:

  • Improving the capture of data and the operational context to surface the information needed to inform better decisions.
  • Providing the insights and information to more stakeholders, in a more consumable manner, specifically, active rather than passive presentation of impactful data at, or even before, the time of need.

The connected enterprise brings focus to both the primary information flows of “how is my task progressing?”, and secondary information flows, such as “how does the progress of someone else’s task impact the work I am doing?”

Think about a product engineer receiving workflow-driven notification of a production quality issue that requires the replacement of a component with an alternate part. If that engineer is aware of current stock levels, impending obsolescence can be taken into consideration through the replacement process.

To help manufacturers explore smart factory processes and technologies, in June Deloitte opened The Smart Factory @ Wichita, a new Industry 4.0 immersive experience on the Innovation Campus of Wichita State University. The Smart Factory @ Wichita brings together an ecosystem of forward-thinking solution providers, and allows companies to demo the latest state-of-the-art capabilities.  

Continuing Supply Chain Disruption

The scenario of the broader connected enterprise doubles down when we consider the continuation of supply chain disruption. The need to be flexible, and efficiently manage multiple sources of supply while managing overall profitability means sharing information not just within the organization but upstream, driving increased collaboration with suppliers.

Of course, not all supply chains are equal, so a one-size-fits-all response is unlikely to be optimal, and may not even be achievable. A blended approach to document and transaction-sharing is best — through organization-owned portals, supplier-owned portals, EDI and other direct forms of data interchange. AI/ML can help in not just understanding whether a supplier’s performance is changing, but whether that supplier’s performance is improving or degrading when compared to its peers - a judgement based on the whole supply chain suffering the same challenges.

From there, it’s easier to determine whether a particular supplier needs reinforcement due to its critical nature or, if its long-term value is in question, if a replacement is necessary.

Skills Shortages

Manufacturing skills shortages will continue in 2023. While the global slowdown may reduce some of the tension on the labor markets, having access to the right skills in the right place will be a ongoing challenge. As part of the move towards a smarter factory, understanding the skills of your employees, how they’re deployed, and how the value of your people can be increased with continuous learning will become critically important. By automating and reducing the non-value-add tasks placed upon workers, managers can increase both the workers’ effectiveness and their job satisfaction.

Modular robotics in both the physical world and the data environment (through robotic process automation) are reaching levels of maturity that make them more accessible from the perspectives of both cost and complexity. With the industry continuing to focus on ease of deployment and ongoing use, the International Federation of Robotics reports 15 percent more operational industrial robots in 2021, with an average increase of 14 percent per year over the past five years.

Looking at other drivers in 2023:

  • Pessimistically, we are going to see increasing attempts at cyberattacks, both to gain access to critical data and to enact ransomware. Companies that have invested in security, whether on their own or through third-party services, should carry less risk, but no one should rest on their laurels.
  • Optimistically, we will also see more additive manufacturing in 2023 as speed, quality and scale continue to improve. This will assist in resolving some of the issues from the previous topics. Adoption of 3D printing represents a big change in product design and thinking, which in some cases may add too much uncertainty if other challenges reduce an organization’s appetite for risk.
  • Those organizations that have already taken steps towards composable enterprise applications and a holistic approach to transformation have more means and agility to adapt to the ongoing challenges. Organizations that decide not to or are unable to take those first steps will continue to find themselves patching together reactive solutions to problems

If 2023 is a year of slowdown, instead of battening down the hatches, companies should use the opportunity to take the first step on a transformative journey towards smarter, more connected manufacturing.

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