5 Tips for Strategic Modernization of the US Industrial Sector
Over the past several decades, gross sales and GDP of US manufacturing has fallen precipitously (as a share of global manufacturing). As a result, some have been led to believe that US manufacturers simply can’t compete with the lower costs of manufacturing abroad. However, it’s important to remember that US-located manufacturing has many competitive advantages when it comes to more sophisticated manufacturing processes.
These competitive advantages all involve harnessing the power of modernized tools and processes—something data shows to be lagging significantly in the industrial sector. As experts in industrial modernization, Merkur excels at supporting partners as they refine their processes and technologies. Here are our top 5 key tips.
The Importance of Keeping Pace with Modernization
Since 1997, the number of US-based manufacturers is down roughly 25 percent, but they still account for 60 percent of US exports, 35 percent of US productivity growth, and 70 percent of US R&D spending. In short, the US industrial sector packs a punch when it comes to supporting the US economy.
While globalization has pushed a significant amount of manufacturing abroad, it’s clear that the manufacturing which has stayed on US soil is most competitive when it harnesses modern technologies and keeps pace with innovations.
Here are a few key improvements in manufacturing over the last several years that manufacturers should be thinking about:
– Digital supply chain solutions to improve efficiency and resilience
– Lean manufacturing to reduce waste and improve productivity
– Predictive maintenance to minimize downtime and sustain equipment
– Updated health and safety measures to protect workers and reduce costs
– Custom tooling design to boost productivity, protect equipment and more
In order to enjoy these benefits, manufacturers must first decide that it is time to modernize their processes. Unfortunately, it’s not always an easy decision.
5 Tips for Strategic Modernization of Your Manufacturing Facilities
While manufacturers may recognize that need for changes are imminent, they may still feel reluctant about the investment cost. This is not unusual and demonstrates well-warranted caution.
Some perceptions and preconceived ideas about updating manufacturing processes can be a hindrance in doing what’s best for your facility. The key is to think about modernization in a strategic manner. Here are 5 tips to help you with strategic modernization:
Challenge Your Assumptions About “Modern”
Areas of industrial modernization include digital transformation, automation, sustainable manufacturing, worker reskilling, energy efficiency, supply chain management, predictive maintenance, lean manufacturing, custom tooling design and workplace safety.
If you’re not in the information technology space, trying to understand these new and upcoming technologies can quickly become overwhelming. However, these terms can be de-mystified.
Words like “digitization”, “artificial intelligence”, and “automation” can immediately make you think of science-fiction films, but in practice, these technologies are far more straightforward than you might think. Automation, for example, is just a fancy word for using computer software to handle repetitive tasks like paperwork or packaging—activities so routine, straightforward, and ubiquitous that human intervention might do more harm than good (think human error when inputting numbers into a data sheet).
In short, modernization is an umbrella term that includes many different new technologies & processes, many of which can be broken down into simple and clear business value.
Modernization Isn’t All-Or-Nothing
Modernization is a blanket term for so many technologies, including the “Internet of Things” (IoT), AI and digitized workflows. Although conversations about improved efficiency, productivity, quality, etc. commonly couch the discussion as modernized vs. status quo, the reality is that modernization is a process. You don’t need to adopt every innovation available at once; in fact, it’s often much better to transition methodically and gradually.
This is for several reasons:
- Employees need time to adjust
- Steady changes help minimize or eliminate downtime
- Oversights are not unusual when integrating new technologies
- Innovation can happen at the facility level and may require buffer time
Keep Your Employees in the Loop When Considering Automation
When considering modernization, communication is key. Keep all stakeholders in the loop and, if there’s resistance, work to get all stakeholders onboard. Reassure everyone that their jobs are secure (if that’s true). Let them know they are not expected to adjust to these changes overnight.
It’s also important to communicate the long-term benefits to workers alongside the short-term discomfort of learning new skills. For example, automation can significantly reduce time pressures or safety risks to machine operators.
There should also be ongoing conversations throughout your organization with time set aside to refine your ideas and approach to communicating these changes. Making sure that communication flows both ways also allows your employees to feel like important contributors to the final decision.
Always Consider Sustainability in Modernization
These days, “sustainability” is a major buzzword, and that isn’t likely to change anytime soon. The number of US government regulations, digital security and environmental protection protocols will continue to increase.
By keeping pace with them and planning for the future, you can make energy-efficient and strategic decisions to reduce costs and environmental impact both immediately and long-term.
Remember that Worker Skills are a Critical Component of Industrial Modernization
A recent Deloitte study concluded that the existing skills gap in US manufacturing is likely to widen in the coming years, possibly resulting in over two million vacant manufacturing jobs by 2030. Without skilled workers, the US cannot have a strong manufacturing sector, period. Strategic modernization requires attention to workers and laborers.
As mentioned above, possibly the greatest competitive advantage onshore US manufacturing has over outsourcing is the improved access to a high level of institutional knowledge and skilled tradesmanship. Failing to integrate advanced training and continuing education to workers results in missing out on a core component of modernization.
Merkur as Your Partner in Modernized Manufacturing
At Merkur, we’re seasoned experts not only in engineering custom manufacturing solutions and tackling the most challenging aspects of your manufacturing processes, but we’re also partners in all areas of modernized manufacturing services.
We’re ready to work shoulder-to-shoulder with you as you take an important step towards the future of your business. Learn more by visiting our website or giving us a call today at 877-571-0222.
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