COVID-19 has seen permanent and significant changes, either positive or negative, in every industry. Manufacturing in China closed due to COVID-19, causing disruptions across global supply chains. Procedures and processes needed to include COVID-19 workplace health & safety, with social distancing and increased hygiene efforts.
What changes do we expect to see in 2021? Here are five ways manufacturers can overcome COVID-19 and its negative impact on the industry.
The Rebuild of Supply Chains
COVID-19 in 2020 has shown manufacturers that they need to be flexible and digitally enabled to cope with global crisis and pandemics. Placing strain on singular, larger suppliers now require contingency plans in case these impacts occur yet again. Manufacturers and supply chains are either planning on moving onshore (or near-shore) or look to stockpile inventory to replace low volume manufacturing.
Digitization will continue to be a staple in manufacturing development to build smarter supply chains. Digitization assists with disaster recovery and pre-empting supply chain demand.
Return Your Manufacturing to Shore
Australia is unable to manufacture everything it wants, however, we’re capable of meeting the demands of manufacturing what we need. Prior to COVID-19, Australia focused on imports to drive supply, which created risks if the major supply chains were under demand. If this was established on-shore, the Australian government could invest in manufacturing, driving employment, business income, and overall economic recovery.
With the Australian GDP generally low due to the Australian dollar, locally manufactured goods would become more competitive in the international market. This coupled with the reduced supply from China would provide an opportunity to fill certain gaps in manufacturing.
Keep Up With Digitization
Although we have touched on digitization in our previous discussion, what does this mean for manufacturers? Digital transformation strategies to adopt new technologies is a priority for almost every industry in the new year.
What is Smart Factory and Industry 4.0?
The Smart Factory (or Industry 4.0) represents traditional automation in a fully connected and flexible system. It can be defined as a full-integrated and collaborative manufacturing experience that responds in real-time to meet the ever-changing demands in factory and supply networks. It is the collaboration of linking physical and virtual components of the production system, to eventually create a Cyber-Physical system of process.
These systems consist of smart machinery, storage systems, and production facilities that are capable of exchanging information, initiating or responding to actions, and controlling one another independently.
Industry 4.0 is made up of 9 pillars, including:
- Additive Manufacture
- Advanced Simulation
- Autonomous Systems
- Augmented Reality
- Big Data
- Cloud Computing
- Cyber Security
- Internet of Things (IoT)
- Universal Integration
Feel free to contact us to learn more about Industry 4.0.
Increase Your Reliance of Automation
Automation is a key component to your digital transformation strategies. Automation reduces the need for human interaction, decreasing human error while maintaining social distancing and preventing further COVID-19 outbreaks and cases.
By implementing automation in manufacturing, human capital can then be re-distributed elsewhere, further supporting arms of the business that require additional support during pandemics.
While it may not be possible for manufacturers to make new investments if they’re experiencing financial distress, in the long run manufacturers that prioritise automation will be able to lower costs, improve efficiencies, and reduce health risks in their workplace.
Accelerate Your E-Commerce
In particular industries, online shopping has seen substantial growth during COVID-19. Consumers have shifted almost entirely to online shopping, which raises the question; will consumers return to brick-and-mortar stores after the pandemic?
Brick-and-mortar was already struggling prior to COVID-19 and the question still stands as to how this will affect e-commerce in the years to come. Those who have invested in their e-commerce capabilities will be able to capitalise on the accelerated growth towards online shopping, however, those who have yet to refine their technology, may be left with reduced market share.
In terms of manufacturers, this rapid industry change presents both as a threat and as an opportunity. Manufacturers with a polished customer base (and customer loyalty) may see an easy transition from instore to online purchasing. However, some may completely lose a customer base altogether if their customer experience relies solely on an in store experience.
We have already seen well established business names in apparel, fast food, and health & wellness close their doors due to COVID-19, but how many others will be affected after the pandemic?
We hope you found this blog useful! Subscribe to our email newsletter to receive content updates as we post them. Crystal Delta is a global software engineering practice specialising in Manufacturing, Banking & Finance, and Education. Contact us today.