Like most industries, the manufacturing industry has had its fair share of ups and downs over the last few years thanks to the pandemic, inflation, labor shortages and supply chain challenges. In response, Deloitte’s 2023 Manufacturing Industry Outlook report says manufacturer optimism has dimmed, causing the second-quarter Manufacturing Outlook Index to decline. Even so, the report says the industry “continues to surpass the expectations of previous years” and projects a 2.5% growth in GDP in manufacturing (based on Oxford Economics’ Global Model) for 2023.
With such a mix of high and lows, what can manufacturing professionals expect for the year ahead? Deloitte surveyed 100 US executives and other senior leaders in August 2022 to answer that question and came up with its top five manufacturing trends.
Today, we’ll look at three of these manufacturing trends and explore how Acumatica Cloud ERP and Acumatica’s manufacturing management software can help manufacturers stay on top of—and benefit from—each one.
1. Investing in Advanced Technology
Deloitte’s first manufacturing trend indicates that we’ll continue to see digital investment by manufacturers who seek to make their businesses connected, efficient and profitable in the current and future global economy. And, according to the report, this ongoing investment is a good thing.
“Companies with higher digital maturity have shown greater resilience, as did those that accelerated digitalization during the pandemic.”
– Deloitte’s 2023 Manufacturing Industry Outlook Report
Resiliency during uncertain times is critical for survival, which begs the question, In what technologies are these companies investing? Based on the responses of the surveyed manufacturers, robotics and automation top the list at 62%, followed closely by data analytics at 60%. The next three technologies include the Internet of Things (IoT), additive manufacturing and cloud computing—such as Acumatica’s Cloud ERP.
As sophisticated manufacturing management software, Acumatica helps manufacturers digitally transform with industry-specific features that improve, streamline and automate production cycle planning, performance tracking, financial reporting, order fulfillment, inventory control, data collection, supply chain management, product quality and compliance needs. With Acumatica’s comprehensive ERP software, manufacturers become connected businesses that make rapid, strategic business decisions based on complete and accurate information as they work to address the ongoing economic uncertainties, adjust to market fluctuations and anticipate unexpected events.
Additionally, manufacturers who implement Acumatica manufacturing management software will continue to reap benefits as Acumatica firmly believes digital transformation doesn’t end at go-live. The company provides bi-yearly updates, offering Acumatica customers a constantly improving and future-proof Cloud ERP product that’s ready for anything the market throws at it, including the unending supply chain disruptions.
2. Addressing Unending Supply Chain Disruptions
By now, companies had hoped the supply chain woes of the past three years would be a distant memory, but that hope has yet to be realized. In fact, a recent CNBC survey found that 61% of logistic managers at major companies and trade groups consider the supply chain still in a state of disruption with 30% saying it won’t return to normal until 2024, 29% saying in or after 2025, and 12% saying it will never go back to the way it was prior to the pandemic.
Clearly, the supply chain continues to cause turmoil, and Deloitte’s respondents agree. The report notes: “72% of surveyed executives believe the persistent shortage of critical materials and ongoing supply chain disruptions present the biggest uncertainty for the industry in the coming year.”
In an effort to mitigate supply chain risks, survey respondents are turning to “time-tested approaches,” including relationship management and engaging with suppliers beyond tier 1, building resilience in the supply chain through diversification and boosting local capacity with new production facilities in the US. But Deloitte highlights the fact that many manufacturers are also “turning to digital capabilities that can increase their supply network visibility and improve control and coordination.”
In “Top Strategies and Techniques for Building Supply Chain Resilience,” Debra Mignola, Director of Product Management – Distribution, Acumatica, addresses this topic, writing that manufacturers can utilize manufacturing software, like Acumatica, to:
- Manage inventories/resources, supplier deliveries and production schedules with the software’s planning and forecasting capabilities.
- Adjust to changing circumstances using the information provided by the software and the software’s flexibility.
- Analyze data, assess operational constraints, and determine alternative solutions using the software’s business intelligence tools.
As Mignola notes, “Acumatica is an award-winning Cloud ERP solution that can improve your supply chain resilience.”
3. Making a Commitment to Corporate Responsibility and Sustainability
The last manufacturing trend is the growing commitment of manufacturers to corporate responsibility and sustainability. Though the environmental, social and governance (ESG) movement has been around for years, Deloitte says manufacturers may need to monitor it closely in 2023—especially as global regulators are “moving toward requiring more disclosures for nonfinancial metrics.”
A few of the sustainability measures manufacturers have taken in recent years include voluntarily complying with a “complex network of reporting regulations, ratings, and disclosure frameworks,” managing waste, increasing supplier diversity, elevating smart buildings and electrifying fleets, according to Deloitte. Manufacturers are also embracing diversity, equity and inclusion (DEI) strategies as a way to build stronger communities and to engage the younger workforce.
With Acumatica’s ERP software, manufacturers have the ability successfully enact these measures by:
- Reducing waste through end-to-end inventory control
- Creating lean operations using real-time production data
- Uncovering gaps in production sustainability with automated audits and compliance reporting
- Adhering to compliance and disclosure requirements with automatic prompts
And Acumatica’s manufacturing management software provides manufacturers with the complete visibility needed to see the actions taken across the organization—from the shop floor to the C-suite. Not only will manufacturers have the capacity to ensure they’re meeting their sustainability and corporate responsibility goals, but they’ll also appreciate the fact that Acumatica shares these same goals.
As Todd Wells, Chief Marketing Officer, Acumatica, wrote in an article celebrating Earth Day, “At Acumatica, we’re passionate about protecting the natural environment and making the world a better, more inclusive place for the people with whom we share it. This led us to establish the AcumatiCares program—a broad nerve center through which we will drive and manage our sustainability efforts moving forward.”
Benefitting from Manufacturing Trends with NexTec Group and Acumatica
Like Acumatica, NexTec Group is committed to making a difference, and we do that by helping our customers find and implement the best technology for their diverse needs. Our experts develop close working relationships with our customers, ensuring they make informed decisions and experience valuable results.
For manufacturers, we highly recommend Acumatica’s manufacturing software, which will aid their efforts in following and benefitting from manufacturing trends for years to come. As to this year’s manufacturing trends and the manufacturing industry’s outlook, Deloitte says this:
The acceleration gained in 2022 is expected to continue into 2023, though headwinds of supply challenges, labor shortages, and an uncertain economic environment will persist. Energy price volatility, higher labor costs, and inflation worries could also affect the industry. In addition, the impact of legislation passed in 2022 will likely become more evident in the coming year. Amid these uncertainties, innovations and solutions pioneered in 2022 are expected to gain momentum in 2023, potentially altering tried-and-true business practices in the pursuit of growth and productivity.
Come what may, it’s an exciting time, and we’re eager to work with manufacturers who are ready to invest in advanced technology, take charge of their supply chain needs and commit to robust sustainability practices. To learn more, reach out to us. We’d love to chat.