Joanne Moretti, SVP and CMO, Jabil
The term “business as usual” is obsolete. In today’s digital economy, there is nothing usual about business. Change is happening at an unprecedented rate and on multiple levels. Our customers, large and small, new and old, tell us that in the face of such change, they need to innovate at lightning speed. They no longer fear failure; today, they will fear irrelevance. In a 2016 PwC global survey of more than 1,000 CEOs from all sectors, 61% said that they were concerned about the speed of technological change in their industry. In a similar study in 2015, 45% of tech company CEOs said that their company had entered a new industry within the last three years, and an additional 23% said they had considered doing so.
The digital age comes with a perfect storm of disruption that has several megatrends behind it. Accelerating technological change often disrupts established industries and creates entirely new business models, and there is no end in sight. According to a survey by McKinsey & Company, 60% of companies believe that by 2020 half of their income will come from technology-enabled innovation. Now, every company in every sector needs to think like a technology company.Consumer expectations are sky high, and the barriers for new entrants into markets have never been lower, creating disruption as well as opportunities for startups and competitors at every turn. Geo-political shifts such as Brexit, tax reform, treaties, trade imbalances, currency fluctuations, debt rates, resource scarcities, climate change and other political and policy swings are causing uncertainty for brands around the globe. Analysts, supply chain managers and economists are busy around the clock calculating “what-if” scenarios and preparing for change.
And to make matters even more interesting, huge demographic shifts are occurring where a growing and aging population, coupled with rapid urbanization, puts enormous pressure on infrastructure, talent pools, and healthcare and energy resources. What’s more, the skills gap is widening in the science, technology, engineering and mathematical fields (STEM) just when more engineers, scientists and data analysts are needed to help transform our industry.
We believe this seismic shift in consumer expectations, coupled with the opportunities created by technologies such as AI (Artificial Intelligence), AR and VR (Augmented and Virtual Reality), AM (Additive Manufacturing) and the Smart Factory require a new kind of manufacturing partner with an agile, fast and economic skill set, as well as global scale and outlook.
Accelerated innovation is one of the key starting points in this new world, where fast is the new slow, and slow is simply too late. Compressing the process from innovation to market is essential to ensure the benefits of being first to market combined with bringing the best product. The use of VR and AI in design, as well as rapid prototyping using 3D printing, will shorten the time and cost of taking an idea to prototype radically. Combine that with parallel manufacturing and supply chain development, and it’s easy to see how quickly ideas can reach the consumer.
Those consumers are, of course, all around the world and demand fluctuation is common, so manufacturing agility becomes the second part of the puzzle. This flexibility in manufacturing geography can also serve to protect against some of those geopolitical shifts as well as potential supply chain disruption. Real manufacturing agility requires an operational excellence at the highest level, using all that is available from new technology, from smart factory, Internet of Things (IoT) and Industry 4.0 ideals. New technologies such as AM, AI and VR are finding their way into manufacturing, and the companies that can take them and apply the engineering rigor to establish them at volume will be able to offer their customers the greatest agility and speed, producing the world class, life-changing products we expect.
So many moving parts, right? Absolutely! That’s why great supply chain orchestration is essential to help manage and mitigate risk from your supply chain, uncover opportunities and ultimately deliver superior financial performance and customer experience. The world is changing and changing fast; those that wish to serve the brands that empower the world need to be ahead of the game and ready for anything. In short, they need to adapt fast and adapt first.