Summit ’17: Digital, Distributed, Democratized Manufacturing
MForesight examines the long-term future of US industry
On July 25th, MForesight hosted its second National Summit, which focused on the rise of Factories of the Future: Digital, Distributed, Democratized Manufacturing.
The Summit explored how digitization of design and manufacturing, distributed and democratized manufacturing with economies of scope are changing the nature of products and work. Speakers and participants examined how the increasingly widespread availability of tools like computer-aided engineering, new knowledge-sharing platforms, and networked operational technologies are changing how we organize industry. The Summit also investigated and assessed America’s strategies for creating and sustaining manufacturing jobs, preserving the technological edge, and maintaining global manufacturing leadership.
The opportunities are tremendous — but there are serious risks too.
By 2020, some estimates show there will be at least 20 billion online devices in use. Other estimates show as many as 50 billion — or at least five for every person alive at that time. Add to this sheer numerical scale the rising complexity that comes from the emergence of the Internet of Things (connectivity between devices and real-world equipment and operational processes).
As David Vasko, Director of Advanced Technology at Rockwell Automation, argued at the Summit, the potential efficiency gains for manufacturing firms are incredible. Harvard Business Review has reported that manufacturing overhead averages upwards of 35% of production costs, and digitization can cut significantly into these factors.
Finding meaningful patterns in the evermore plentiful data can save money, protect consumer health, improve workplace safety, and create new value.
Still, digitization brings uncertainties: a forthcoming MForesight report previewed at the Summit describes how rising connectivity puts industrial firms in the cross-hairs of hackers. As the Cybersecurity for Manufacturers report will underscore, there are numerous public and private investments and management practices that could ameliorate the risks. But we’re still a long way from realizing those methods.
And there are other layers of complexity. As Christie Wong Barrett, CEO of Mac Arthur Corporation, explained in her speech at the Summit, the implications of new digital technologies like autonomous mobility are difficult to forecast.
Major manufacturing firms, in some cases, have yet to even imagine the components they will need to regularly purchase from suppliers in a decade or less. It’s daunting to envision the future supplier ecosystem in most sectors.
Still, as Wong Barrett argued, it’s possible for firms to prepare by beginning to change mindsets and to think creatively about increasing flexibility in the whole manufacturing ecosystem.
Quoting Wayne Gretsky, Wong Barrett encouraged manufacturers to “skate to where the puck is going to be, not where it’s been.”
As speakers throughout the Summit emphasized, digitization creates flexibility and helps to distribute and democratize the manufacturing economy. This idea is vividly illustrated by Local Motors, a company that’s 3-D “printing” entire cars at micro-factories distributed in cities around the country and world.
Justin Fishkin of Local Motors explained how the emerging production tools and a radical simplification of production processes (their cars contain as few as 15 components, compared to upwards of a thousand for the average auto) make distributed manufacturing possible.
Local production doesn’t just mean more responsiveness to customers — it means keeping jobs and resources in a community rather than shipping them elsewhere. It’s a faster, cheaper, more democratic mode of manufacturing that could only be possible in the current age.
As the diverse speakers at the 2017 MForesight Summit made clear, technology is driving changes in economic logic and even organizational cultures. Data is becoming a key source of competitive advantage. Supply chains are becoming more flexible networks for co-creation. While the promise is great, there are also perils. Industries and governments need to focus more than ever on developing foresight.
On the 2017 Summit Presentations & Handouts webpage, you’ll find the presentations that speakers have shared, as well as handouts that were on the resource table, and results of the interactive activities.