Top 3 Predictions For The Manufacturing Industry In 2023
The last few years have been volatile for manufacturing. Staying on top of manufacturing trends for 2023 will help businesses stay ready for whatever comes next.
It’s an understatement to say our world has faced (and continues to face) significant challenges recently, and I’ve been thinking a lot about those challenges and what they may mean for the future of the manufacturing industry. Here are my three key predictions about supply chain disruptions, outsourced manufacturing, and digital manufacturing in 2023.
Agile Supply Chains FTW
First of all, supply chain disruptions aren’t going anywhere. Every supply chain manager should know by now that the pandemic was not an isolated incident. The US-China trade war and large-scale natural disasters – including severe flooding, typhoons, hurricanes and droughts – preceded the COVID crisis. And, as I write this, we’re facing a nationwide railroad strike in the US. We don’t know what disruptions to expect in 2023, but we do know that something (or things) will happen to throw a wrench in the supply chain.
That’s why the keys to successful supply chains moving forward are agility with strategic, proactive contingency planning, and supplier diversification.
Companies well prepared for the inevitable supply chain disruptions will undoubtedly fare better than their competitors dealing with the problem reactively and after experiencing a lot of damage. While strategic proactive contingency planning and diversification may take some time to develop now, it will be time well spent on reducing likely delays, declining profits and potential loss of key customer relationships.
Outsourcing On the Rise
Secondly, more companies will turn to outsourced manufacturing. To reduce operating costs and increase focus on core competencies, we’ll see an increase in outsourced manufacturing in 2023. Peloton led this trend in 2022 by outsourcing all of its manufacturing, and while not every company will go to that extreme, I expect many more companies to outsource some production in the coming year.
Increased reliance on outsourced manufacturing is an ongoing trend supported by data from the 2022 State of Manufacturing Report, which shows 48% of companies reported an increase in outsourced manufacturing this year. Additionally, nearly three-quarters of survey respondents view outsourcing positively while specifying that quality, efficiency, speed, and pricing were the primary benefits.
Doing your due diligence up front to find the right outsourced manufacturing partner or partners is critical to effectively navigating supply chain disruptions. Best practice is to ask potential partners about their strategies for future supply chain disruptions, and dig into the details – the ones you want to work with will have concrete, articulable plans in place.
And keep in mind that manufacturing networks have geographic diversification and resilience built in to ensure that supply chain disruptions aren’t so disruptive.
The Future of Manufacturing is Digital
My third prediction is that 2023 will be a digital manufacturing tipping point. The pandemic was a serious wake-up call to manufacturing companies that adopting digital manufacturing tools was no longer optional. Now, headed into a likely recession, it’s mission-critical. Companies are searching for ways to increase efficiency and productivity, and technology can provide what they’re looking for.
Strategic implementation of technologies supporting digital manufacturing continue to evolve, and implementing them will be a differentiating factor for companies in 2023. A digital manufacturing partner can help your company leverage the power of digital tools, streamline workflows, and make your team faster and more productive.
Don’t Just Get Ready, Stay Ready
Does your company have an effective manufacturing readiness strategy for 2023? This year my motto is: Don’t just get ready, stay ready. If you haven’t started planning for next year, now’s the time – then you’ll be ready to tackle 12 months of come-what-may.
This article was written by Dave Evans from Forbes and was legally licensed through the Industry Dive Content Marketplace. Please direct all licensing questions to legal@industrydive.com.
