As vaccines begin to roll out, offering the hope of reining in the spread and severity of COVID-19, the manufacturing sector is undergoing a rapid transformation that will last long beyond the pandemic.
Re thinking supply chains
According to CEOs surveyed by KPMG, the greatest threat to growth over the next three years for many manufacturers’ apart from the economic consequences of the pandemic, will be risk to the supply chain. “The current environment has introduced significant uncertainty and less predictable demand levels and timing, placing even more importance on an agile supply chain that can flex to varying demand levels with quality and reliable on time delivery,” says Brian Heckler, KPMG’s National Sector Leader for Industrial Manufacturing. “Manufacturers are revisiting source of supply in terms of location and vendors, sales and operations planning and supply chain visibility and reliability to manage in today’s world. Digitalization, enhanced analytics, and connectivity can enable better orchestration, real-time visibility, and better demand/supply management.”
In response to changing risks, 66 percent of CEOs say they have had to rethink their approach to supply chains.
Executives say that the pandemic is proving to be a shot in the arm for the digital transformation of their companies. Manufacturers are going beyond the deployment of digital technologies to help make their supply chains more flexible. They are also investing in a range of technologies that are part of what has come to be called the fourth industrial revolution. “The impacts from the pandemic shined a bright light on the trajectory of digital transformation across the enterprise and the globe,” says Donna Meshaka, KPMG’s Industrial Manufacturing Advisory Leader. “Manufacturers are now accelerating their need to modernize their operating models and enable them with more agile platforms and technologies such as the cloud, low code, blockchain and 5G.”
Reimagined workforce models
Manufacturing companies are considering how to transform their workforce models, as remote working has widened their potential talent pool with the right combination of physical spaces, technology and a flexible workforce. Almost three quarters (72 percent) of manufacturing CEOs are prioritizing investment in new technology, approximately three times the number (28 percent) who are prioritizing investment in workforce skills.
To learn more about these manufacturing sector trends read KPMG’s manufacturing industry CEO outlook report.
Follow Brian Heckler on Twitter @Hecklerb and Donna Mesheka @dmeshaka