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  • Lawrence Matusek

8 Manufacturing Industry Predictions for 2022

Written By Lawrence Matusek & Tom McKee

With every year comes new challenges and new opportunities. That certainly has been the case during the last two years with a global pandemic, unprecedented supply chain issues, a shifting demographic in the workforce, labor shortages, and more. Industry leaders were disrupted on unprecedented levels. Not only did this environment expose the weaknesses of past methods, but it also shined a light on opportunities to find new ways of conducting business. Companies who began their modernization efforts ahead of the pandemic were much better positioned than those who did not. Today, manufacturers are joining the modernization wave at a high rate, with 85% of companies accelerating their digital transformation programs within the last year, according to the McKinsey Global Institute.

There are some exciting new opportunities are on the horizon in 2022. Let’s jump into our manufacturing industry predictions for the coming year.

#1 There Will Only Be Intelligent Enterprises in The Not-So-Distant Future

As we begin 2022, there is a collective recognition that disruption is the only reliable constant of the future. From climate change and geopolitical instability to new business models and new applications of technology, leaders can no longer trust seasonality or other historic predictive measures. Therefore, the companies that will survive and thrive are the ones who maximize their investments in cloud, mobility, analytics, and artificial intelligence, enabling them to leverage their data and evolve into Intelligent Enterprises. By using their data to provide actionable insights that empower their teams to make proactive, real-time decisions, these companies will enhance their ability to overcome challenges and realize business outcomes. A clear message foretelling the future for those companies struggling to make the shift to an Intelligent Enterprise can be found in the Rick Warren quote: “Irrelevance occurs when the speed of change outside an organization is greater than the speed of change inside an organization.”

#2 Shared Data Model

As companies mature their Intelligent Enterprise using internal data to provide actionable insights, the next logical step will be to expand these capabilities by incorporating external data. According to Forrester Research, more than 70% of global data and analytics decision-makers will be expanding their use of external data. Additionally, as traditional security restrictions and data privacy barriers are resolved, companies will realize the potential capabilities and opportunities unlocked by external data collaboration. Ultimately, this data collaboration will occur in non-competitive environments where companies are complementary to one another, as well as environments where competitors can leverage the shared data to resolve common industry issues, address health related crises, or detect potential cyber or criminal activities.

#3 Industry Clouds Will Become the Norm

More companies are embracing the cloud and reaping the business benefits enabled by cloud technologies. The next evolution will see the emergence of industry clouds that enable companies to quickly respond to changes and disruptions, leverage the latest innovations, and offload system maintenance, all while accessing standard business processes to run their operations. Effort and resources can shift away from supporting commodity industry processes and redirected toward areas that truly differentiate companies from competitors.

#4 Securing Talent for the New Workplace

As manufacturers embrace more automation, employees must be upskilled to work within these tech-heavy environments. Most manufacturers believe that talent pools are critical to their competitiveness, and many are getting ahead of the need for a highly trained workplace by forming relationships with technical education institutions to develop their employees of the future. That training is becoming increasingly important, as 2.6 million Baby Boomers are set to retire from the industry. Those years of knowledge and expertise won’t be there for the long term.

#5 Some Industry Leaders Will Get Disrupted Faster Than They Ever Imagined

This has already begun, and more success stories will start appearing in 2022. Ironically, many leaders are victims of their past success, and they do not realize how the game has fundamentally changed. The latest solutions now offer far more than in the past, and phased implementations can start delivering value after a few months. No longer do you have to wait months to see what a solution might look like. Sample user experiences can be demonstrated in the first weeks of a project. The barriers of time and cost will drop faster than ever.

#6 On-The-Spot Quoting Will Become Commonplace

For manufacturers of complex equipment and systems, quote lead time often takes days or weeks due to the effort and coordination required to compile a complete and accurate quotation. With the right CPQ solution, this lead time will be reduced to hours or even minutes. And quoting will not be limited to salespeople only. Imagine how impactful it is for an end customer when a service technician can identify an issue or opportunity, quote it on the spot, email a proposal that can be reviewed and DocuSigned – all during the same visit!

#7 Solution & Subscription Quoting Will Generate More Revenue & Customer Value

In today’s world, most manufacturers offer far more than just products and services. This can include accessories, spare parts, software, monitoring, training, disposal, extended warranties, service contracts, leasing, and financing to name a few. More and more manufacturers will start quickly generating one-stop, turnkey quotes for entire solutions rather than just pieces and parts that end customers must learn or know how to assemble and run themselves. Quote 2.0 and S/4HANA with BRIM now provide robust handling for solution quoting with recurring billing for related subscriptions or contracts.

#8 SAP CPQ to SAP ERP Integration Will Become Even More Comprehensive

Early adopters are finding that as good as the native integration is, it does not provide everything that many manufacturers need. Typical enhancements include support for plants and plant determination, sales area and status, units of measure, material variants and variant matching, and product costing, to name a few. Custom solutions will be implemented until the product roadmap can catch up.

We recently held a virtual event series on these topics -- You can stream the series on demand here.

About the Authors

Lawrence Matusek | Managing Partner & CTO

Lawrence has over 30 years of progressive manufacturing industry and SAP technology experience and is among the top enterprise architects for SAP configuration and related solution enablement. Leading eLogic’s SAP and CPQ Practices, he has been at the forefront of many of the industry’s most advanced solutions for engineered and configured-to-order products.

Tom McKee | Industry Principal

Tom McKee brings decades of experience as an influential, collaborative, and innovative C-Suite Leader in Manufacturing to drive business transformation. He leads the development and execution of key consulting services and products for modernization and digital transformation for eLogic’s manufacturing customers.

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