Never before has the business environment for manufacturers been more rapidly changing. Over the past couple decades, manufacturing companies have invested billions of dollars to maintain standing in the industry and market share in attempts to combat the effects of Moore’s Law, which states that the speed and capability of computing factors will double every two years, and to stay relevant in constantly shifting times. While technology continues to advance at an exponential rate, creating new developments and efficiencies, for the first time we’re observing physical limitations to the industry, thanks to a global pandemic of uncertain longevity, which has raised the question, “As physical limitations limit a company’s potential production capability, what can manufacturers do to maintain market share and stay competitive?”
Over the past few months, a number of manufacturers with the capital and competency to do so offered their services to aid in the production of personal protection equipment. While this was a temporary throughput solution that provided help during a critical time and yielded a positive public image for these organizations, the efforts wouldn’t be enough to provide the necessary revenue streams for most companies to sustain existence, and many of these manufacturers are once again looking toward the future of their primary production channels.
Manufacturing makes up 11.4% of the total U.S. GDP, yet is considered to only be “medium” in technology change when compared to other industries, per IBISWorld. In other words, one of the leading industries in size is only in the middle of the pack in terms of technological integration. That means there’s plenty of opportunity for growth. Here are three critical steps manufacturing companies can take right now to differentiate themselves from the competition:
While work is still sparse, companies that invest now to increase abilities and efficiencies may not only see immediate success, but post-COVID growth, since many of their competitors may have become lax during these times. How this looks for one company may be different from another, based on factors like risk appetite, availability of assets and available technologies, so there’s no one-size-fits-all solution. Rather, it would be better to acknowledge that there are an abundance of routes and solutions, some of which include using resources already available to the business, reallocating man-hours or doubling down on investment in new technology.
Next, companies should work toward creating new production streams. The COVID era has no end in sight, so creating and implementing strategies that can limit growing pains during this complex time might assist in the sustainability of the organization.
Finally, companies should keep an eye out for the availability of applicable technologies. While sales and business are down, tech companies – like many others – are looking for new ways to combat the cons that come with living in these times. Staying current with industry technology may permit a company to be an early adopter of new systems that could allow for more autonomous and enhanced production, which would ultimately allow it to avoid or better overcome the physical limitations brought about by the current environment.
These steps can provide a solution to one or more of the many current problems you may be facing. By implementing them, you’ll be able to stay productive, profitable and efficient, conquer the physical limitations, and ultimately stay ahead of the curve.
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Material discussed is meant for informational purposes only, and it is not to be construed as investment, tax, or legal advice. Please note that individual situations can vary. Therefore, this information should be relied upon when coordinated with individual professional advice.