The second post in a series based on the National Center for the Middle Market’s new research report, Middle Market Manufacturing: How to Thrive in a Transforming Environment, this post looks at seven key insights related to how technologies are reshaping the industry.
Automation, robotics, and the implementation of advanced manufacturing techniques have dramatically altered the factory floor and the manufacturing processes that take place there. While the vast majority of manufacturers say the impact has been positive, the new technologies come with their fair share of challenges. Indeed, according to our latest research, implementing advanced manufacturing techniques is seen as manufacturers’ greatest area of opportunity. Yet nearly half (47%) of manufacturers also cite it as a formidable task.
As manufacturers continue to explore ways to take advantage of the advances available, here are several insights to keep in mind:
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Fast-growing manufacturers are much more technologically-oriented.
Compared to their peers, middle market manufacturers that are growing by 10% or more annually assign more importance to every technology advance about which we asked. Most notably, they show greater interest in new materials and composites, advanced process controls, and embedded sensor technology.
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Robotics isn't the only area receiving attention.
Robotics captures a lot of media attention. However, over the past year, middle market manufacturers’ technology investments have been equally divided among robotics and advanced automation, new materials and composites, advanced process controls, and cybersecurity.
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Priorities will shift forward.
Over the next five years, components parts manufacturers will continue to pay a great deal of attention to robotics and advanced automation. However, original equipment manufacturers say that new materials and composites and advanced process controls will be even more important issues.
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Cybersecurity will become a top concern.
As factories and products get “smarter,” supply chains become more integrated, and older machines that were not built for security are being connected, the need for new approaches to cybersecurity will escalate.
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Manufacturers will require more capital.
As companies continue to invest in technology, retool factories, and upgrade cybersecurity, they will require additional capital. However, those investments should pay off. More than three-quarters (76%) of manufacturers expect to realized productivity gains over the next five years as a result of new technologies.
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Technology won't necessarily replace employees.
It could even require a larger workforce, especially among fast-growing businesses. Overall, just 27% of middle market manufactures believe their workforce will decrease as a result of technological advancements while 45% say employment will stay the same and 28% say it will grow, which could be a challenge considering that many manufactures struggle to find skilled employees.
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Large, fast-growing manufacturers are embracing IoT wearables.
These devices are used primarily to measure environmental conditions and vehicle driving speeds and distances. To a lesser extent, companies are using them to monitor employee location and movement.
See what else is changing in the manufacturing environment.
Technology is one of many factors causing manufacturers to rethink the way they operate. To learn more about technological advancements and other trends at work in the industry, download our full research report, Middle Market Manufacturing: How to Thrive in a Transforming Environment.
Next in this series
Post 3: Manufacturing Is a Riskier Business: How to Mitigate New Risks and Embrace More Opportunities
Post 4: Spinning Challenges into Gold: What the Fastest-Growing Manufacturers Do Differently to Succeed in an Evolving Industry