Pandemic Was a Catalyst for Manufacturers, But Obstacles Remain
More than a year since the pandemic struck, manufacturers are “rapidly accelerating past recovery and towards a digital future,” observes a new report based on a survey of manufacturing executives. Most notably, the pandemic’s disruption gave them the opportunity to raise their comfort levels with concepts such as on-demand manufacturing.
However — and you knew there was a “however” coming — manufacturers reported that continuing supply chain concerns and workforce challenges were stifling innovation. Eighty-one percent reported that quality issues in their supply chains had resulted in cost overruns in the past year. Plus, 55% said that their existing supply chains presented IT security risks and 42% reported concerns around IP protection risks.
In addition, even as these manufacturers embrace a “digital future,” 44% reported difficulties in hiring manufacturing talent with the necessary digital expertise, and 45% said limited budgets were a major barrier to hiring new innovation talent.
“The overriding takeaway from this year’s report is that the pandemic served as a catalyst to turn emerging digital ideas into strategies that are now irrevocably changing supply chains,” said Dave Evans, CEO of Fictiv, which conducted the survey with Dimensional Research. “Companies moved quickly and decisively to solve short-term problems but recognized that the limitations of their current supply chains required long-term investment and innovation. Looking ahead, industry leaders are nearly unanimous in their expectations that those digital investments will help them build faster, greener and more-resilient supply chains.”
Manufacturers tended to like the idea of bringing some manufacturing back to the United States; however, 55% reported that workforce training was the No. 1 barrier to increasing their U.S.-based manufacturing footprint, followed by cost (43%).
In spite of challenges, “The show must go on — there’s no time for inertia or indecision,” the report quoted Jan Burian, senior director and head of IDC Manufacturing Insights EMEA, as observing. “Industrial organizations will continue to push forward, relying on operations managers to navigate an environment increasingly complicated by limited supplies, disrupted workforce availability, regulation and fluctuating demand.”