What Is The Future of Manufacturing?

Traditionally, manufacturing has been viewed as the process that transitions raw materials into physical products. Seems simple enough. But as we take a deeper transition into higher consumer consumption, the future of manufacturing is up for much speculation.

The Internet of Things (IoT) and software are shaping the future of manufacturing as a whole. Engineers are constantly looking for new ways to improve productivity in the supply chain and production process, and software for manufacturing is helping pave the way.

Industry leaders refer to today’s manufacturing advancements as the Fourth Industrial Revolution. Markus Löffler, Senior Partner at McKinsey, referred to this Revolution as “a new wave of technological changes that will decentralize production control and trigger a paradigm shift in manufacturing.” As new technologies emerge, and an increasing amount of startups are gaining attention for their ground-breaking ideas, businesspeople have high hopes for what that future of manufacturing will bring.

What Is The Future of Manufacturing? 1


More factories are pivoting from offshore production in what’s called reshoring – taking your offshore jobs and bringing them back home. Reshoring is becoming more popular due to the rising cost of offshore labor, coupled with major hidden costs. As a result, reshoring has the potential to be a major talking point in Industry 4.0.

Additionally, many corporations have found that separating research and development from the manufacturing plant also stifles innovation. The trends are hard to ignore: according to a data report, from 2000 – 2007, the United States lost roughly 200,000 manufacturing jobs. However, in 2014 and 2015, reshoring balanced offshoring and about 265,000 manufacturing jobs have returned to the country.

Software & Cloud Computing

Already, cloud computing has a huge impact on manufacturing. This includes the many options available in the Enterprise Resource Planning (ERP) software arena, which aims to help organizations better manage back-office functions, services, and resources. Without the development and advancement of these ERP platforms, manufacturers would struggle to stay afloat and keep up with business demands.

According to Cindy Jutras, CEO of MintJuras, SaaS-based applications currently comprise 22% of all manufacturing and distribution software installed. This is a clear indicator of how these ERP/cloud computing software solutions affect day-to-day operations. ERP solutions have the ability to capture and apply company-wide knowledge and intelligence, among a range of other tasks that keep the most important manufacturing processes automated and trackable.

Future of Manufacturing

The physical production aspect of manufacturing plays a bigger role than before; production is now a part of a much larger set of services and activities. The car designer and manufacturer Rolls-Royce, for example, receives roughly half of their revenue from manufacturing services, including the leasing of their jet engines. Similarly, the company ARM processes most of the chips used in smartphones and tablets without requiring the use of a factory; instead, they license designs to other firms that make them. In the future, more businesses will turn to new ways of adding services and licensing to create products faster and make money quicker.

Cyber Physical Systems

Industry analysts predict that in the future, production technology would be interlinked with everything else, with logistics at the forefront. More products will come equipped with sensors that self-sense damage and corporations will turn to services to broaden their horizons and increase profit. Sensors, IT systems, workpieces, and machinery will be connected in what’s referred to as cyber physical systems. Using standard Internet-based protocols, these connected technological webs will be able to interact with one another to adapt to changes, analyze data, configure themselves, and predict failures. A BCG Perspectives report found that this interconnectivity of technology would help make production systems up to 30% faster and 25% more efficient.

Manufacturers will need to work with a wider net of suppliers, on a much more global scale. With the aid of IoT and supplemental software, manufacturing will be much more interconnected from factory to factory, eliminating the limits that individual factories face. Predictions expect new algorithms to link millions of technologies and keep the entire system synchronized and running stable.


Remanufacturing will become more common. Remanufacturing products saves energy and money, but over the past few years, studies have shown remanufacturing can be more problematic than helpful. Moving forward, manufacturers will work harder to make the remanufacturing process more efficient and effective. This will cut cost for manufacturers and get products on shelves quicker.

Anne Lawson is a British writer who keeps her eye on business and trending issues that affect us all. She loves to delve into the real story and give us interesting tidbits we might otherwise miss.