Winning the Race for Survival: How New Manufacturing Technologies are Driving Business-Model Innovation

An employee works on a production line manufacturing protective suits at a medical supply factory in Xinzhou district of Wuhan, the epicentre of the novel coronavirus outbreak, in Hubei province, China February 12, 2020. Picture take February 12, 2020. China Daily via REUTERS
Image : REUTERS

Call for action

A call for action: Towards a new normal for advanced manufacturing, services and supply chains

Successful firms are shaping the future of manufacturing operations. During the COVID-19 crisis, they have managed to repurpose manufacturing capacity while leveraging advanced manufacturing technologies to develop new capabilities.

Early investments made in the digitalization of supply chains are now paying off. Remote assets management in highly automated industries and online monitoring and team-working approaches have provided robust alternatives to both operating and delivery models in this period of social distancing and restricted travel.

Digital platform-based solutions have also demonstrated higher degrees of flexibility and new forms of inter-organizational collaboration, including public-private partnerships, that have led to “grand challenge” projects such as the development and production of vaccines and critical healthcare equipment at speed.

Workers are seen on a production line manufacturing masks at a factory in Shanghai, China January 31, 2020. Picture taken January 31, 2020. REUTERS/Aly Song - RC22GG96C2AY
Image : REUTERS/Aly Song

As companies emerge from the pandemic disruption, they will have some choices to make. Should they quickly return to “business as usual” or rather examine what worked (and what didn’t) during this period of “mass experimentation and innovation at scale”? The future may belong to those who are able to manage uncertainty and innovate rapidly.

Manufacturing can no longer be simply regarded as a cost-centre to be optimized but rather a primary source of innovation and resilience enabled by advanced manufacturing technologies. Firms which invested in these technologies before others appear to have been able to adapt far more quickly during the crisis than those that did not. Resilience to external shocks is now a source of competitive advantage and will play a bigger role as companies transition towards the new normal.

Future capital may be scarce as firms emerge from these challenging times. Local “just-in-case” asset reshoring actions will not be easily justified without the promise of better products, faster times to market and more efficient and flexible operations to meet fast changes in demand.

Future decisions, from reshoring to multi-sourcing, must be driven by both operating and business model innovation, with investments in advanced manufacturing technologies as a key enabler.

Collaboration across the global manufacturing community is needed more than ever to:

  • Shed light on the role of advanced manufacturing technologies in shaping the future of operating and business models
  • Define what operating and business model innovations that emerged during the crisis may become new practices as companies transition towards a new normal
  • Incubate new public-private partnerships to inform the next generation of industrial policies and strategies and build resilience
  • Leverage innovation to accelerate the recovery and drive economic growth, while protecting all stakeholders, including workers, environment and society

The organizations engaged in the World Economic Forum’s Platform for Shaping the Future of Advanced Manufacturing and Production will continue working together to advance the above priorities and support the inclusive transformation of businesses across industries and geographies.