O ne of the findings in the Manufacturing Leadership Council’s new survey on next generation leadership in the Manufacturing 4.0 era that jumped out at me was that an astonishing 80% of survey respondents feel that their companies’ future success is vulnerable due to a lack of preparedness to embrace the new digital model of doing business.
Manufacturing executives who participated in the survey have good reason to be concerned. Over time, the fortunes of industries change as new technologies come on the scene. In the 19th century, the fortunes of candle makers, for example, declined as electric light bulbs gained in popularity.
But the ability of industries and companies to adapt to the new also plays a critical role in their fortunes. If leadership doesn’t see the proverbial change train coming down the track and fails to adapt, the company may end up an also-ran or even a footnote in the history books. Remember Blockbuster?
To bring into sharper relief just how fast things can change, take a look at the top 10 companies in the Fortune 500 list in 2000 compared with 2017. In the first year of the new century, General Motors was the number one company on the list, followed by Walmart, Exxon-Mobil, and Ford. By 2017, GM had dropped to eighth on the list and Ford had slid into tenth place. General Electric, IBM, and Boeing, which all made the list in 2000, disappeared entirely by 2017.
While it is true that during those years other, non-manufacturing industries such as healthcare, services, and electronics rose to prominence, I think it is also true that today we are not just witnessing a change in how the stars of various industries are aligning in the firmament.
To borrow a phrase from the historian Doris Kearns Goodwin, these are no ordinary times for the manufacturing industry. The requirements of the digital era call for fundamental changes in how leaders lead, in organizational design, and in technology adoption, a combination that can be daunting for any company.
The only way to ease concerns of vulnerability is to move ahead with M4.0 aggressively and with purpose. No company’s fate is guaranteed, to be sure, but future success is more likely when bold action is taken. M