All signs indicate that the digitalization of the world will further accelerate this year. For now, we're not out of the pandemic yet. And when we do come out of lockdown, we'll probably not return to the situation as it was before. For the manufacturing industry, this introduces challenges as well as opportunities.

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Six manufacturing industry challenges and opportunities in 2021

All signs indicate that digitalization of the manufacturing industry will further accelerate this year. We’re not out of the pandemic yet. And when we do come out of lockdown, we may not return to our previous habits. In the manufacturing industry, this introduces challenges and opportunities.

1. Online collaboration

Practical reasons drive part of the transition to online that is taking place now. The current situation makes certain aspects of collaboration challenging. For example, innovation processes and creativity, which are traditionally dependent on the interaction between people. Being able to perceive each other well is essential in that interaction. It’s possible to meet regularly, but without seeing each other physically – and all the non-verbal communication that goes with it – meetings run the risk of being less focused and productive. Scrum also suffers because many elements of this agile development methodology are based on physical togetherness.

Of course, options for collaborating online are becoming more and more widespread. Take the Breakout Rooms feature in Microsoft Teams, which allows for sub-meeting rooms that temporarily split up a large meeting into smaller meetings. This feature helps facilitate brainstorming sessions during a specific type of meeting. Additionally, tooling for webinars, virtual whiteboards, and mind-mapping is continuously improving. Tools like this help structure dialogue and work out possible solutions as a team.

None of these are perfect alternatives to meeting each other in person, but technology never offers a complete solution. Online collaboration creates its own issues and challenges. However, experience shows that you can go a long way with the right tools and the willingness to experiment and learn.

2. To cloud or not to cloud?

The Covid-19 pandemic has had significant worldwide social and economic consequences. Many companies had to close their doors, threatening continuity and revenues in many different industries. If the situation is not under control, the world economy will continue to be unpredictable. Among the industries that were not severely negatively affected, cloud developments will accelerate. The more recent technological advancements are used to support activities that wouldn’t otherwise have been possible, such as providing remote technical support using augmented reality.

Sustainability objectives are also influencing the increase in adoption of place and time-independent work. CO2 emissions need to be reduced, which means we need to limit business travel as much as we can. One could even argue whether it is still necessary to send technical staff around the world. The past months have shown that it’s perfectly possible to provide field service remotely. With the right tools, preparation, and training, it offers the same experience whilst being more efficient.

Companies that are not entirely cash-poor will be able to free up resources and thoroughly evaluate processes and see what can be improved using (cloud) technology. Companies that are in survival mode might not have room to innovate. Even if they realize that they can work more efficiently and cost-effectively by digitalizing, they may hold off on moving to the cloud.

3. Closing the gap between business and IT

2021 will be the year in which low-code becomes more mainstream. The ability to develop software applications without the need to know a programming language is now a reality that we live in. More and more companies are using low-code to adapt their ERP and/or CRM systems to changing circumstances and optimally use staff in their positions. It helps to close the gap between business and IT and removes the demand for proprietary software. Taking these steps improves the management of business software and makes further development easier.

4. Supply chain optimization

The Covid-19 pandemic has also led to the realization that ‘just-in-time’ delivery across your entire supply chain could cause issues. Companies will need to keep more substantial ready-made stocks, both on the purchasing and sales side. There will be a stronger focus on the supply chain’s regional or local organization to ensure that deliveries are fast and reliable. Outsourcing production to Asia is no longer an option, even if it offers savings.

5. Digital selling and marketing

For the time being, we will be collaborating digitally. This fact poses problems for sales and marketing departments, which cannot organize physical meetings and events to generate leads. It’s no wonder that developing or professionalizing digital sales and marketing opportunities is high on the agenda. Companies are realizing the benefits of better coordination between sales and marketing. It sets up the company better at an international scale and enables smaller companies to offer their products or services worldwide.

6. War for talent

The current crisis also poses challenges in the field of HR. The way companies attract new talent and keep existing employees has fundamentally changed. Current application procedures, feedback, and assessment processes are conducted almost entirely online. On the other hand, most employees no longer see remote working as a ‘nice-to-have,’ but rather as a prerequisite for employment.

In the war for talent, recruiters turn to smaller online communities on social media, such as LinkedIn Groups. They need to make their search for talent more specific. After all, posting vacancies only on busy job platforms will lead to a flood of applications that might not meet the requirements.

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Gijs Ettes
Marketing Manager

gijs.ettes@pulse.nl