Welcome to the Fourth Industrial Revolution. This era takes us far beyond the steam and water that kicked off industry in the 1800s and builds upon the electronics and computers that seemed so high-tech in the go-go 1980s. We’re in the early stages of a Digital Revolution poised to shake up supply chains with dramatic transformations fed by factors including robotics, artificial intelligence, biotechnology and nanotechnology.
How will this affect your business? Here are four industry trends to keep an eye on:
Also known as 3D printing, this technology has been promised for years and is finally coming into its own. The global market for three-dimensional printing will grow from nearly $3.7 billion in 2016 to more than $10.4 billion by 2021, with a compound annual growth rate (CAGR) of 23.2% for the period, BCC Research estimated.
This technology will take production closer to end users and massive quantities of any product won’t need to be made or stored, meaning less need for huge trucks and sprawling warehouses. Supply chains will have to be quicker, more nimble and more targeted.
Remember all the rage over factories moving overseas? Well, some are coming back. Companies are being enticed by the stateside skilled workforce, easier monitoring of the supply chain and increased local control to drive quality and innovation. UPS research shows that investment in automation and other advanced manufacturing is an opportunity to further drive efficiency and U.S. competitiveness: Nearly three-quarters of businesses believe advanced manufacturing technologies will improve the economies of localized production.
To be sure, reshoring isn’t as easy as simply moving jobs back. Companies must examine every aspect of production, logistics and distribution to make this work properly.
Smart companies – particularly those who are in distribution – are working to stay one step ahead of e-commerce, where shoppers can buy direct from the manufacturer and bypass the wholesaler. As we’ve previously discussed, the once sleepy industrial sector is undergoing a shake-up as technology makes B2B commerce far easier and more transparent than ever before. Mergers and aqcuisitions (M&A) continue dominating the headlines as the sector’s players gobble each other up, form strategic alliances or cash out ahead of the looming sweeping changes.
As we’ve written, the modern era is leading to smart operations, a reversal from the Lean and Six Sigma wave that left supply chains too brittle. Machines can increasingly self-monitor performance to predict failure and autonomously trigger maintenance processes. Machines can also react to unexpected changes in production, preventing over- and under-production. The days of shutting down expensive production over a surprise broken part could soon be over, as could human error leading to assembly-line goofs.
Much coverage is being given to how robots are threatening jobs. Things are changing, but the vision of a robot nation is far too simplistic. You can either be scared or be excited that Industry 4.0 is creating exciting changes in everything from how and where things are created to how they’re distributed.