New opportunities for the industries to utilize new technologies and tools to reduce the dependence on human power and ensure employee safety.

 

Emerging Industry Trends 2021

Manufacturing Domain:

‘Industry 4.0’ has revolutionized the manufacturing industry by increasing the implementation of technologies in ground level manufacturing activities. From robotics to big data collection, manufacturing industry has undergone various developments resulting in high productivity gains, better quality management, and developing global reach. However, the COVID-19 pandemic brought a significant halt in all value chains, which has changed the course of growth of the manufacturing industry. This has also opened new opportunities for the industries to utilize new technologies and tools to reduce the dependence on human power and ensure employee safety.

1.     Shift toward localized manufacturing:

Even before the COVID-19 pandemic, the U.S.-China trade war, heightened tariffs, and unstable social conditions threatened the global supply chains. Hence, the manufacturers are expected to focus on localized production, which can reduce time and costs incurred on logistics. Since the Industrial Revolution, manufacturers have been searching for methods to increase production at lower costs, however, previously this was achieved by cutting on labor related expenses. This created a nurturing environment for the manufacturing industry in highly populated countries such as China and India, making China the largest manufacturing hub globally. Considering the current situations in China, major manufacturing companies are reshoring their production units either in their own country or toward Vietnam, India, Indonesia, and others. Companies from the U.S. and other countries have already invested significant amounts of money on developing supply chains to outsource manufacturing from China. Further, factors such as high labor costs, unavailability of infrastructure, strict environmental policies in developed nations, and high material costs are still a major concern within the companies. However, long-term commitment of investments toward local production through the government bodies can aid reshoring significantly. The U.S. has already focused on strengthening the ‘Made in USA’ tag whereas, the Brexit of the UK has also created nurturing business environments for these countries.

2.     Transition from B2B to B2C and DTC business models:

The terms ‘direct-to-customers’ (DTC) and ‘business-to-consumers’ (B2C) are not new. However, the rising dependence on e-commerce has opened new horizons for companies to switch toward these business models. The B2C and DTC models offer various advantages including obtaining control over the brand that eliminates the risk of misrepresentation and dilution by third parties, surged profits with the use of manufacturer’s suggest retail price (MSRP), price control over the product, and better productdevelopment considering direct demands from the customer by recognizing consumer demand and ultimately developing better R&D capabilities to produce products as per consumer requirements. Moreover, with the high penetration of internet in the life of people, manufacturers and especially startups are gaining traction in the global market. These companies have various advantages such as direct distribution, web-only retail, specified brand identity, borrowed supply chains, and social media marketing. This not only requires less investments but also assists in gaining direct profits from consumers all over the world.

3.     Use of edge computing:

Adoption of newer technologies in manufacturing processes has become much easier with the use of Internet of Things (IoT). Though IoT based products have been around for nearly a decade, it remains as the top trend each year, owing to the constant innovations and developments in the arena. In manufacturing, IoT has developed new ways for real-time data collection and processing, to enhance manufacturing activities. This includes the use of edge computing, which is likely to overcome the shortcomings of cloud-based information collection models. Edgecomputing mainly includes data capturing, storing, analyzing, and processing, near the client or on the edge. This technology was developed to address the exponential growth of IoT based devices and the real-time data collected through them. The tremendous amount of data generated by IoT devices not only incurs high costs in bandwidth, but also affects the quality of the data produced. As more manufacturers are using IoT based devices by using 5G connectivity and edge computing, data processing and analyzing can become much easier and reduce latency.

1.     The rise of Industry 5.0:

The COVID-19 pandemic has paved the way for the Industry 5.0 even though fourth industrial revolution has not ended yet. The Industry 4.0 mainly focused on using technology to optimize and enhance production; however, the Industry 5.0 is all about collaboration between humans and machines. The term ‘cobots’ or collaborative robots has been around for a while, and its use is expected to be enhanced in 2021 owing to the supply chains disruptions caused by the COVID-19 pandemic during 2020. The main goal is to create a balance between human involvement and process automation to optimize the manufacturing process. The Industry 5.0 also focuses on new corporate technologies and industrial transformations considering sustainable policies where management of resources, minimal waste generation, and complying with environmental policies can also assist in cost optimization.

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