People, Processes to Be at Center of Factory of the Future

May 29, 2013
IDC survey says production capability and flexibility will trump efficiency and capacity.

FRAMINGHAM, Mass. – Research firm IDC Manufacturing Insights announced the results of a recent worldwide survey about "the factory of the future" in a new report, "Business Strategy: The Journey toward the People-Intensive Factory of the Future." The report's key conclusion is that "formidable challenges — from tough economics to rising market complexity — are driving a profound rethinking in the manufacturing industry." More than 43% of survey respondents declared they have a formal process in place to design future production plants.

Key results from this study include:

•    For more than 56% of respondents, the factory of the future will be measured according to its production capability and flexibility, not merely efficiency and production capacity

•    Over the next five years about 10% of Western enterprises will give up to make-to-stock, heading toward make-to-individual

•    In five years, 47% of manufacturers will produce modular platforms centrally while using local small factories, suppliers and distributors to tailor final products for local demand

•    Manufacturers will have to achieve the global plant floor, harmonizing, supervising and coordinating execution activities across the company's and suppliers' network of manufacturing operations

•    Despite growing plant automation, people — and the flexibility and decision-making capabilities they provide — will be at the center of the factory of the future; finding skilled workers will prove to be a key issue in the industry

•    63.6% of respondents expect their production processes to be largely or completely digitized in the next five years; more than 26% of manufacturers will invest over 25% of their total ICT budget for plant-floor IT

A Complex Set of Global Challenges
According to the report, the global manufacturing industry is passing through probably one of the most complex market contexts ever. A sequence of financial crises and the always-threatening instability of global markets have dominated the business landscape in recent years. But these complex challenges have also resulted in a positive turnaround for the manufacturing industry.

For the last 15 years, the manufacturing industry was essentially "neglected" with respect to other industries and was not considered a good industry to invest in for the most advanced economies around the world. However, the situation is rapidly changing. Governments now better understand that an economy purely based on service alone cannot survive in the long run. Manufacturers themselves are going back to basics and putting a renewed premium on production knowledge driven by the need to protect and enhance their technology.

"The manufacturing industry is back onstage in developed countries worldwide. Governments, media, manufacturers themselves, and their people are all changing their mindset with a stronger focus on production," said Pierfrancesco Manenti, head of IDC Manufacturing Insights, EMEA, and Practice Director, Operations Technology Strategies. "We are about to witness a new generation of manufacturing enterprises where operational processes on the plant floor — at the very heart of the enterprise — are considered the centerpiece of this transformation."