The Manufacturing Transformation Outlook 2024
The new year is an opportunity to reflect on the remarkable transformations that have swept through the manufacturing and automotive industries over the past 12 months. The landscape of manufacturing continued to evolve at pace in 2023, with the adoption of technological solutions reshaping the industry.
Cloud computing, edge computing, and artificial intelligence (AI) have emerged as driving forces. Last month, I sat down sat down with IBM’s Andreas Kuehmichel – Global CTO Industrial Sector IBM– to reflect on progress and discuss what we might expect to see in 2024.
1. The Cloud Revolution
In 2023, automakers continued to migrate operations to cloud platforms, allowing for enhanced collaboration, data storage, and real-time analytics. Why? Hybrid cloud solutions have enabled seamless communication between different departments, transforming fragmented workflows, automating work and accelerating business growth.
I reflected on the scale of the industry’s adoption of cloud solutions in the context of complementary technologies:
“The numbers are significant. Forrester are talking about $1 trillion being invested in cloud alone by 2026. Now Gen AI has arrived, businesses have to accelerate their multi-cloud and edge strategies like never before. Businesses are seeking to get a return on intelligence, not necessarily a return on investment anymore.”
2. Artificial Intelligence: The Driving Force
Perhaps the most transformative technology in the automotive and manufacturing industries, AI has been a driving force behind the industry’s evolution. In 2023, AI applications have become integral to various aspects of the manufacturing process, from design and production to customer service.
Automakers have not only employed the technology to optimize production lines on the factory floor, but they have also integrated intelligent features in vehicles themselves to enhance the end user’s experience.
“Anybody in a production line is starting to put AI in to trace and optimise inventory, to better optimise materials and supply chains that they’ve got, to make things more safe, to set production irregularities,” I explained.
I went on to illustrate the scale of financial rewards on offer to automakers who adopt AI solutions:
“The beautiful thing about generative AI is the amount of places you can see it. In maintenance, if you can get just 10% improvement in uptime, it translates straight through to your bottom line. At the top end, if you can start putting these technologies into sales and marketing processes to drive better prices, better targeting, better yields, even a 5% improvement means a lot of money.”
3. Looking Ahead to 2024
The automotive and manufacturing industries will continue their technological transformations this year, propelled primarily by cloud, edge, and AI. Companies who adopt these solutions will be rewarded with a clear competitive advantage. But integration must be underpinned by a comprehensive business strategy.
2024 is going to be a massive year for Gen AI, AI in general, cloud and edge. The more companies that succeed will create a flywheel effect: there will be more stories coming out about the winners, and therefore more people will want to invest and get involved.
“Now’s the time to do that. Why wait until 2025?”
You can watch the full discussion – here – https://youtu.be/yKIsJvPt8Hc.
Read my previous blog Digital Transformation – Taking Stock of The Intelligent Automation Market – Kieran Gilmurray