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Business Operations

“What’s Ahead for 2022?” Predicts Growth, Continued Challenges

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Remote work, digital twins, an increased focus on sustainability and continued talent shortages: these are just some of the trends affecting manufacturers that we’re likely to see in 2022 and beyond, according to a group of expert panelists on the recent Manufacturing Leadership Council’s “What’s Ahead in 2022?” Critical Issues Panel. The NAM’s MLC is a global business leadership network dedicated helping to senior executives leverage digital transformation in the manufacturing industry.

We rounded up some of the top predictions as they pertain to manufacturers.

Economy

  • Manufacturing production will continue to be strong, said panelist and NAM Chief Economist Chad Moutray. Toward the end of 2021, it was 2% above February 2020, “a sign that we’re continuing to move in the right direction despite … continuing supply chain challenges.”
  • S. labor-force participation is not likely to return “where it was pre-pandemic,” Moutray said. “A fair share of that is coming from retirement … [and] some people who are continuing to worry about child care and schooling.”
  • The economy will grow about 4% in 2022, Moutray predicted.

Policy

  • Washington will make moves to ease supply chain problems. “Congress knows they must do something to unleash the bottlenecks,” said panelist and NAM Senior Vice President of Policy and Government Relations Aric Newhouse. Legislation could involve workforce-participation incentivization in the form of training programs, as well as giving additional resources to ports.
  • The vaccination and testing Emergency Temporary Standard will be “an area for continued movement” in 2022, Newhouse said.

Technology

  • Technology will find ways to cope with what are likely to be ongoing workforce shortages, IDC Energy and Manufacturing Insights Group Vice President Kevin Prouty said. These will include automation and technologies to enable virtual and remote work.
  • More manufacturers will begin using vision analytics, Prouty said, owing to the increased affordability of cameras and the ease with which footage can be analyzed, shared and moved in the cloud.
  • Use of artificial intelligence will start to become the norm among manufacturers rather than the exception, panelist and MLC Content Director Penelope Brown said. “We’re seeing manufacturers move away from that research phase and much more toward a roadmap” for how they’re going to use AI in their plants.

Environment

  • There will be greater, more widespread movement toward sustainability. In a recent MLC survey of manufacturers, 87% said they believed manufacturing had a responsibility to society to be more sustainable, Brown said.

Dive in deeper with the MLC’s recently redesigned website, and ensure your team has access to the MLC’s full network and suite of intel, events and other resources.

Business Operations

When and How Will Manufacturing Achieve Net-Zero Emissions?

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When it comes to sustainability, the question is no longer whether manufacturing needs to work to create a greener industrial future—it’s when.

To help manufacturers advance their sustainability efforts and achieve net-zero emissions by 2050, the NAM’s Manufacturing Leadership Council has dedicated the December/January issue of the Manufacturing Leadership Journal to Manufacturing 4.0 sustainability.

Key Highlights from the Latest ML Journal

  • Sustainability survey: Review the results of the MLC’s latest M4.0 sustainability survey to understand manufacturing-leader sentiment about climate change. Learn how the pandemic is changing the way leaders prioritize sustainability and net-zero strategies. Plus, find out how sustainability can affect future growth and competitiveness.
  • Practical examples: See what forward-thinking companies such as Procter & Gamble are doing to slash emissions and fight climate change. Also, discover M4.0 strategies and technologies to help you develop your own net-zero action plan.
  • Current conversation: Understand the successes, opportunities and challenges in the race to achieve net zero by 2050. Hear from thought leaders such as MLC Co-Founder David Brousell and Lisle Corporation President Mary Lisle Landhuis.
  • Potential obstacles: Learn the roadblocks to developing a sustainability program and how to overcome them. Know the challenges of adopting a circular-economy mindset and why it’s well worth having.

Why the ML Journal matters: Sustainability is just one of the exciting topics discussed in the ML Journal. Throughout the year, you’ll find case studies, interviews, technology showcases and deep insights on M4.0 from manufacturers working on the front lines. The Journal is a quick, easy way to stay current on the digital revolution—and sharpen your company’s competitive edge.

Click here to receive trial access to the entire December/January issue on M4.0 sustainability or to browse articles on a range of topics from past issues.

Business Operations

The “Megatrends” Are Coming: Global Predictions Manufacturers Should Know

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Several “megatrends” affecting manufacturers and the world at large will begin unfolding in coming years. University of Cambridge Judge Business School Dean Dr. Mauro F. Guillen made this prediction during a presentation at the recent Manufacturing Leadership Council’s “Manufacturing in 2030: The Shape of Things to Come” event.

Three trends: “Three kinds of trends … are coming together to produce a very different situation by the year 2030,” said Guillen, the author of “2030: How Today’s Biggest Trends Will Collide and Reshape the Future of Everything.” He categorized them as “population trends, trends about emerging markets and technological trends.”

Here, we break down some of the highlights from these three umbrella trends.

Durable-goods demands will start earlier—and extend later: Owing largely to immigration patterns, large durable-goods purchases will, on average, start to come earlier in life, Guillen said.

  • Thus, in coming years, durable-goods manufacturers can probably expect their customer demographic to broaden to include younger people.
  • At the same time, Guillen said, given that people are living longer and better, consumers will wield purchasing power for longer than they did in decades past. “There is a massive concentration of wealth in the upper age groups,” Guillen said. This will mean greater demand for certain goods, such as robotics capable of caretaking, later into people’s lives.

Purchasing-power centers will shift: Currently, the U.S. and Europe are the world’s largest consumer economies, but by 2030, those distinctions will belong to China and India, Guillen said. And by 2040, India will have eclipsed China in this regard, due to population growth.

  • While older people will hold onto their purchasing power, younger consumers will hold sway for larger buys as they spend their money on homes, cars and other major purchases.
  • Meanwhile, wealth accumulation will continue to grow everywhere in the world, he said, fueling the appetite for manufacturers’ goods.

Emerging markets will overtake developed ones: Manufacturers can soon expect to see emerging markets become larger than developed ones, Guillen said.

  • That trend will mean a shift in manufacturer focus away from the U.S. and Europe and toward Africa and India. Said Guillen, “Sooner or later consumer markets will gravitate toward where the population is.”

The last word: Guillen’s main point of advice for manufacturers? To “identify the wave that you want to surf and take that opportunity, go with that wave. It’s so much better than going against the prevailing winds. You’ll be aligning yourself with the global economy.”

Business Operations

AI Roadmap: How Manufacturers Can Amplify Intelligence with Artificial Intelligence

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Artificial intelligence offers manufacturers a host of benefits. These include better visibility into supply chains, insights from predictive analytics and the ability to respond to unexpected changes in demand more efficiently and quickly. Here’s a six-step roadmap for manufacturers looking to integrate AI into their business.

Six-Step AI Roadmap for Manufacturers

  1. Acknowledge AI’s potential
    Engage the C-suite in dialogue about how best to use AI. Allocate resources for specific AI projects and set priorities across the business. Pick company AI “agents” who can create business cases, develop metrics and put AI solutions into action.
  2. Transform and plan
    Create an AI plan that includes key performance indicators in line with your business strategy. Establish a special data unit to address needs AI could help support, such as data collection and cleansing.
  3. Build your data foundation and structure
    Convert any remaining nondigital data, “clean up” other data sources so they don’t contain errors or duplicates and add structure to boost your data quality and effectiveness.
  4. Create an external “partnership ecosystem”
    If your business doesn’t have in-house AI expertise, engage outside experts such as start-ups, academic specialists and consultancies.
  5. Leverage in-house AI expertise
    Employ outside AI experts to teach other staff members about data science. Your existing workforce will need this information to learn new skills and fulfill new responsibilities.
  6. Create architecture and infrastructure
    Consider using standardized infrastructure service offerings that can slot easily into your existing business setup. This will make integration much smoother.

Why does AI matter? Manufacturers that create AI-friendly cultures today are positioning themselves to boost customer and employee satisfaction tomorrow—and they’re gaining a competitive edge to boot.

Business Operations

How BASF Uses Enhanced Reality to Help Workers Learn

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The human side of digital transformation was on full display at a recent virtual plant tour of BASF Chemical Intermediates Geismar, Louisiana, facility. Hosted by the NAM’s Manufacturing Leadership Council, the tour gave participants an inside look at how the company is using Voovio’s enhanced-reality technology to transform employee training.

Who they are: BASF Chemical Intermediates, a division of German multinational chemical manufacturer BASF, makes approximately 600 distinct products sold worldwide to the chemical, plastics, agricultural and consumer goods industries, among others.

What is Voovio? The company has partnered with simulation-software maker Voovio to design a customized training solution for its employees: a virtually accessible digital replica of the BASF plant.

  • Using a computer or other digital device, employees can select plant components such as valves, pumps and control panels to get a detailed view of each. These components respond and perform virtually the same way they would in real life.
  • Using the software, trainees can click on any piece of equipment in any workflow to see how it fits into each process.

Why use it? BASF wanted to make worker training faster, more interactive and more self-directed so employees could learn new skills and review existing ones more quickly and easily.

Scalable training model: The tailorable Voovio software offers different training-module levels based on each worker’s experience level and skills.

  • Training modules include an equipment replica, tasks to be performed and an action checklist for completing a series of tasks.
  • Employees get feedback from the software as they perform each virtual procedure, letting them know whether they’ve performed a task correctly.

Real-world application: Voovio also lets companies take the training into the production facility. Using an approved digital device, employees can perform test runs at any time to ensure they’re prepared to complete a job on the ground.

The verdict: BASF has already begun to reap the benefits of the software. Since implementing Voovio, it has seen a marked increase in both worker competency and productivity.

Sign up for a virtual plant tour: Don’t miss the MLC’s upcoming tour of Johnson & Johnson’s facilities on Wednesday, Dec. 1, from 11:00 a.m. to 1:00 p.m. EST. You will see how Johnson & Johnson uses mobility tools, advanced robotics and material handling, as well as adaptive process controls to drive improvements. After the tour, stay for the panel discussion on how to scale advanced manufacturing technologies to ensure a sustainable, reliable and adaptable product supply chain. Sign up today!

Business Operations

How Cloud Computing Could Help Chip Manufacturers

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One small component is creating big delays in global supply chains: the ubiquitous semiconductor or chip. These components are not only essential to our phones, laptops and other electronics, but to the production process in just about every sector of the manufacturing industry. So, what would help us produce more of these desperately needed parts? According to Birlasoft Vice President and Global Business Head of Communications, Media & Technology Nitesh Mirchandani, the answer is cloud computing.

Why the shortage? As COVID-19 unfolded, millions of consumers purchased new laptops, smartphones, game consoles and other devices as they spent more time at home. This shortfall was compounded by the existing high demand for chips brought on by the growth in smart products—everything from thermostats and appliances to robot vacuum cleaners and GPS-enabled dog tags. COVID-19 also caused a wave of semiconductor factory closures that also exacerbated the problem. The result? A shortage that industry experts say could last through 2022.

Why the cloud? Cloud computing is the on-demand delivery of resources like data storage, software, networking and other services via the internet. Users either purchase a set subscription or pay by their level of usage—both cheaper and more flexible options than maintaining an on-site IT team for all needs. Cloud computing has several advantages for semiconductor manufacturers, according to Mirchandani:

  • It speeds up time to market through swifter design and development. Because they can be accessed anywhere, cloud services enable teams to connect and collaborate more easily. Development cycles become quicker as teams connect better internally and with other parts of the business, including partners and suppliers.
  • It enables data-driven business decisions. Thanks to the faster processing and analysis of cloud computing, manufacturers can get instant information on things like factory performance, supply disruptions or customer demand. Likewise, workers can be alerted to a machine that needs maintenance or to potential defects in materials or products.
  • It provides service continuity. Internal IT teams often have limited resources. Cloud infrastructure is managed by specialists who can ensure uninterrupted service, so in-house IT teams don’t need to continuously maintain software through updates and patches.

Why it matters: Semiconductor shortages threaten to drag down the economy just as recovery is getting underway. Businesses rely on chip-enabled technologies for creating products, managing operations and maintaining the flow of goods and services. Consumers rely on them for smarter, safer homes and connections to work or school. Unless chip manufacturers can shore up production to meet demand, the ripple effect will create added distress for many sectors of the economy.

Business Operations

A Manufacturer Goes Lean and Wins Big

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Consumer goods manufacturer Church & Dwight found that it needed to boost performance to meet customer demand. To meet this goal, it embarked on an ambitious Lean initiative at all of its 13 production facilities.

“We look at all challenges through the lens of Lean manufacturing—it’s the only way that we can operate,” said Bruno Silva, vice president of manufacturing operations.

What’s Lean? Researchers James Womack and Daniel Jones first defined the concept of Lean manufacturing as “a way to do more with less … while coming closer to providing customers exactly what they want.” Many manufacturers see mastering Lean as an essential springboard to operational initiatives like digital manufacturing and other advanced production practices.

Setting the stage: In developing its Lean program, Church & Dwight first held a weeklong leadership summit to decide on standards and expectations. The company’s leaders came up with a Lean assessment system with 16 standards and a definition for achievement at the gold, silver and bronze levels. But the essential part was ensuring frontline employees were driving improvement from the bottom up—not the other way around.

  • “This is not corporate pushing it down,” said Felipe Vilhena, director of Lean manufacturing – global operations. “We help workers overcome challenges and give them the right tools to do that. We created a mindset and expectation that improvements are part of the work.”

Putting it into practice: Initially, each worker was asked to list five potential improvements at his or her site, and then go out and make them. The company provided training and support to help with these fixes, while managers kept employees fully informed of their progress according to key indicators.

  • Workers formed self-directed teams and continued to seek out improvements, which they began making more and more frequently. Thanks to the trust and autonomy that employees were given, engagement and retention measurably increased at the same time.

Receiving recognition: The company’s achievements have received recognition from its peers in the industry. One of its top-performing facilities in Green River, Wyoming, earned the company a 2021 Manufacturing Leadership Award in the Operational Excellence category from the NAM’s Manufacturing Leadership Council.

The last word: “It was important to create the right expectation and mindset,” Vilhena said. “From big to small improvements, we are seeing them happen every day.”

Business Operations

Nexteer Displays Advanced Manufacturing in Action

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Would you like to see the latest advanced technologies exhibited and explained for your benefit, all without leaving your office? The NAM’s Manufacturing Leadership Council’s virtual plant tours provide just such an opportunity, taking you inside cutting-edge processes and complex systems at manufacturing facilities across the country. Most recently, the MLC dropped in on Nexteer Automotive, where tour participants got to see its innovative Digital Trace Manufacturing™ (DTM) System in action.

Who they are: Nexteer specializes in electric and hydraulic power steering systems, steering columns and driveline systems, as well as advanced driver assistance systems and automated driving-enabling technologies. The company serves more than 60 customers around the world, including BMW, Ford, GM, Toyota and Volkswagen.

What is DTM? Nexteer’s DTM System connects and standardizes the company’s entire operations—including thousands of data-production components in 27 manufacturing plants around the world. To showcase the system’s capabilities, Nexteer took tour participants inside its Saginaw, Michigan, site, which includes six manufacturing plants comprising 3.1 million square feet of manufacturing floor space.

Tour highlights: Participants learned about the complexities of running a large-scale automotive component manufacturing plant, as well as how Nexteer uses the DTM System to maximize efficiency.

  • Nexteer team members explained how they design and program machines for data processing, showing how they determine where data will be sent and how they use barcode scanners and other methods to track components’ serial numbers.
  • Participants also got a virtual walk-through of Nexteer’s tracking system, which follows material from receiving and shipping through the production line with single-box precision. They also learned how Nexteer uses its Center of Analysis to correct any issues that arise.

Why it matters: It’s one thing to have a large system collecting data, and it’s another to be able to use that data effectively. The Nexteer virtual plant tour provided participants with practical takeaways, which will help them adopt similar innovations at their own facilities—for the benefit of employees, customers and shareholders alike.

Coming soon: Don’t miss the MLC’s upcoming tour of Johnson & Johnson’s facility on Wednesday, Dec. 1, from 11:00 a.m. to 1:00 p.m. EST. You will see how Johnson & Johnson uses mobility tools, advanced robotics and material handling and adaptive process controls to improve its operations. After the tour, stay for the panel discussion on how to scale advanced manufacturing technologies to create a sustainable, reliable and adaptable product supply. Sign up here.

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Hologic Supports Women’s Health via Innovation

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Nilo Caravaca, Hologic’s vice president of operations for Costa Rica and Latin America, says the company has an “important purpose”: to improve and save women’s lives around the world. At the Costa Rica facility that he manages, the company manufactures diagnostic and imaging equipment that protects women’s health, such as mammography systems and bone density scanners.

In pursuit of their goal, Caravaca and his team have embraced innovative technologies as well as best practices in talent management. For their achievements in attracting, upskilling and retaining a world-class workforce, the NAM’s Manufacturing Leadership Council awarded Hologic the 2021 Manufacturer of the Year award in the small and medium enterprise category. But the company is not stopping there. Caravaca anticipates further innovations, as Hologic keeps prioritizing efficiency, safety and growth.

Here is a snapshot of Hologic’s two award-winning projects and a look at things to come.

Supply chain innovation: Almost every product made by Hologic’s Costa Rica facility serves a patient with an urgent medical issue. That means its supply chain must be incredibly resilient and reliable.

  • To meet these critical needs, Hologic launched a project called “Impacting Lives Every Day,” which employed robots for moving materials and bots for automating processes, while improving operations using real-time data and analytics.
  • The project has resulted in a more reliable supply chain that gets products to patients faster while improving quality and safety.

Talent management: Caravaca believes companies need to focus on people in addition to technology to make the transition to Manufacturing 4.0, the next wave of technological progress.

  • To that end, his team developed a new set of talent management processes that helps attract and recruit the best employees on the market, as well as ensure they have the opportunity to perform at their highest level.

The last word: An engineer by trade, Caravaca has a simple “formula for the future” of manufacturing: “Find the right talent, fit that talent in the right position, engage it and add tenure over time.” That will allow people to grow into their roles and perform at their peaks—the best result for both the company and the employees themselves.

To learn more about the innovative technologies and processes at Hologic’s Costa Rica facility, read “Hologic’s Winning Formula” in the August 2021 issue of the Manufacturing Leadership Journal.

Business Operations

How Manufacturers Are Mastering Data

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When it comes to data management, most manufacturers are basically teenagers. They’ve gotten past the early stages but have yet to reach full maturity and mastery in their approach. In fact, it is often unclear what the data strategy is, who is responsible for it or even what the data is worth in the first place.

A new survey from the NAM’s Manufacturing Leadership Council shows us how manufacturers are progressing in their quest to harness the power of data—a capability that could have transformative power for many manufacturers throughout their operations. Below are some highlights.

Data collection: Most manufacturers rate their organizational data skills as just average, saying they struggle to collect the right data and interpret it.

  • Fifty-eight percent of respondents said their company had just a moderate ability to collect data that is meaningful for their business needs.

Data analysis: If gathering data is a challenge, gaining insights from that data is an even bigger one.

  • Seventy-five percent of respondents ranked their organization as only somewhat capable in their ability to analyze their manufacturing operations data.
  • Even more worrisome, 11% of respondents said their organization was not at all capable of this type of analysis.

Applying insights: The practical application of data to create value is also a challenge for many manufacturers.

  • Almost one-third said they expend greater than 80% of their efforts on gathering and organizing data—as opposed to analyzing and applying insights from it.

Other stumbling blocks: The survey revealed additional impediments to using data:

  • The lack of systems available to capture the data (46%)
  • Data inaccessibility (43%)
  • The lack of skills to analyze data effectively (39%)

Opportunities: The good news is that even with these imperfect efforts, organizations are largely leveraging the data they do have to make informed decisions.

  • Forty-eight percent said their organization makes data-driven decisions frequently, while 18% said they make data-driven decisions constantly.

The bottom line: Seventy-five percent of respondents said data mastery will be essential for future competitiveness. Indeed, data mastery is crucial to the industry’s transition into Manufacturing 4.0—the next big wave of industrial innovation—and the MLC will be tracking the industry’s progress closely.

To see more insights from the latest MLC M4.0 Data Mastery Survey, read “Growing Pains” in the August 2021 issue of the Manufacturing Leadership Journal.

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