An intriguing article recently caught my attention on Manufacturing Trends. Written by a chap named Martin Boggess, it’s titled ‘10 Trends That Will Dominate Manufacturing in 2019’ and, if you have the time, it is well worth a read. Drawing from that article, I’m going to comment on those trends which are most likely to have an impact on your business.
First, an overall summary: there’s something big happening in manufacturing right now. It’s called ‘Industry 4.0’, or the ‘fourth industrial revolution’, and it is providing the opportunity to utilize advanced manufacturing capabilities and information technology (IT) throughout the product lifecycle. In other words, right now software and other clever technology can maximize your operation with improved operational visibility, substantial new efficiencies and cost savings, faster production times and the ability to provide excellent customer support.
The trick, of course, is which technology will work best for you. And that brings me to the trends I believe are most relevant for the fenestration industry.
Let’s take a closer look.
1. There’s some seemingly Star Trek stuff (but it isn’t, really), like 3D Printing Accelerating Prototyping.
My colleague Stewart McMillan recently discussed 3D printing in detail and it is obvious how some of the higher-end devices can help you get your job done better. Especially when it comes to prototyping, producing ‘one-off’ designs or, indeed, producing spares for those designs on demand instead of holding, you guessed it, expensive inventory. With 3D printing you can design new products faster, cheaper, react to market demand and be ahead of the curve. And 3D printing costs are coming down.
2. Another trend which is worth noting for some, but not all of my customers, is The Move from ‘B2B to B2C’ models.
Old business models are just that, OLD. Today, some B2B companies are moving to a direct B2C model because you can sell at market price rather than wholesale prices. And, you’ll be able to adjust to consumer demand faster and be closer to your customers, especially if you’re collecting and using meaningful data for accurate forecasting and moving from reactive to proactive. If you’re not doing it, be certain that someone else is.
But be aware that along with higher profit margins, you are now also dealing with new issues and opportunities. If entertaining this model, sales staff focused on customer satisfaction and continued presence on social media are a necessity.
3. Now for some really good news. Tax cuts are improving the cost base for local manufacturing, leading to Continued Reshoring With More ‘Made in the USA’.
We’ve got a resurgent economy and combined with new software and new robotic equipment, made in the USA is ‘doable’ again. And while most of our windows and doors are made on US soil anyway, it’s worth noting that finding and retaining good staff will become more difficult. However, as always, if you pay and train people properly and provide a career path they will stay. If not, you’re just another manufacturer looking for help. Great people make great products which sell more. Provide your people with the best tools to get the job done, including software systems and automated machinery. It’ll be worth it in the short term and most certainly also the long.
4. ERP Systems Are Streamlining Processes.
When your manufacturing is integrated with your suppliers and your third-party logistics provider, you can order just the right amount and know exactly when the materials will arrive. There’s no longer any need for inventory (well, OK, you might need a little, but certainly, far less). This is what the economist Thomas Sowell means by ‘inventory is a substitute for knowledge’. With ‘Just in Time’ manufacturing, your overheads go down. You can price more sharply.
And when you’ve got a modern Enterprise Resource Planning solution, something we’re increasingly seeing in customer sites, it further advances the efficiency we’ve discussed for the supply chain. It brings greater visibility to your operations. And again, by integrating with suppliers and partners, it becomes possible to see across the broader value chain.
With the emergence of affordable ‘Software as a Service’ models from many vendors, including Microsoft, we’re seeing ‘homegrown’ systems and accounting packages giving way to more capable, more ‘company-wide’ solutions. Why? Because the advantages make it worth it.
5. Now’s the time to Leverage Your Supply Chain for Competitive Advantage.
Producing great windows and doors is a complex affair, so you need good systems to do it well. Those systems start with handling your manufacturing. Now, I would say that, because there are very good reasons for it which go to the heart of how to use your supply chain for competitive advantage.
Well-known economist Thomas Sowell notes, in his book Basic Economics, that inventory is a substitute for knowledge.
Inventory is good stuff, because it’s the raw material which keeps you manufacturing (on the one hand) and it’s the finished product which keeps your customers happy (on the other).
But, too much of it, and you’ve got a problem. It’s expensive. It can deteriorate or ‘shrink’. It has to be stored somewhere.
When you know precisely how much you need for any job, your inventory requirement diminishes and along with it the working capital required to maintain inventory. A system which provides a precise bill of materials, down to optimized cutting lists, is just the ticket.
6. Other developments worth keeping on the radar
Did I mention some trends which receive plenty of hot air but don’t really float? These are the peripherals which it doesn’t hurt to know about but aren’t likely to ‘hit’ window and door makers just yet. Like the Internet of Things into which manufacturers are apparently investing a lot. Of course, we’ve been tagging stuff with barcodes and RFID since forever. While the idea of communication with just about everything is perhaps appealing, it’s not a pressing trend for you right now. That may change… but we’ll see.
And then there’s virtual reality and so-called augmented reality, where computer overlays are applied to the real world. Sure, this will have some applications, but it’s likely to be niche and it’s not likely to affect window and door manufacturing any time soon. Let’s just remember 3D movies and TV as an example of how not every promising technology leads to mass adoption; we first saw 3D movies back in the 1950s. The brief resurgence in the 2010s has all but disappeared again.
In closing, note that small and mid-sized companies are using lean principles more than ever to stay competitive and differentiate themselves. They’re doing this by using software in all areas of their business. The technology is there, don’t be afraid to use it, leverage it and enjoy the benefits its intended for. Get your jobs done faster, better and more accurately. And there are a lot of solutions to choose from which will help you do just that.
Interested in learning more?
Feel free to contact me at [email protected]