The governments of every major economy seem to care a lot more about where and how things get made than they used to. As a result, manufacturers find themselves under growing pressure to make products sustainably, cost-effectively, and increasingly close to home (wherever that is).
From AI and machine learning to physical robots and the industrial metaverse, smart manufacturing technologies play a role in helping the manufacturing sector respond to this unfamiliar scrutiny.
As we look ahead to 2024, we predict that a healthy pragmatism will take hold in the manufacturing sector: The prior bold claims on everything from generative AI and the industrial metaverse to reshoring of manufacturing jobs and autonomous vehicles will be toned down as the painful realities of grappling with issues such as technical debt, legislation, and global supply chains bite. This is definitely to be welcomed, but it’s just unfortunate that it took so long.
For 2024, we predict:
Over 75% of industrial metaverse projects will rebrand to survive the metaverse winter. The metaverse — the 3D experience layer of the internet — was the ChatGPT of late 2021 and most of 2022. It dominated newspaper headlines, and startups with even the most tenuous of connections to it attracted unsustainable valuations.
A year ago, Forrester predicted the “metaverse winter” in 2023, and now we see that same chill spreading to the industrial sector. The industrial metaverse builds on a number of existing — and proven — technologies and is quite different from the consumer or enterprise metaverse, but the name is becoming a liability. In 2024, watch most of these projects quietly drop the metaverse label to ensure that they are able to keep their funding and executive sponsorship.
Among Fortune 500 manufacturers, 30% will dilute plans to bring manufacturing home. COVID-19, post-pandemic supply chain disruptions, container ships stuck in canals, and fractious geopolitics have combined in ways that make governments understandably nervous.
And now they’re rushing to respond by identifying strategic industries (batteries, pharmaceuticals, etc.), offering cash and tax breaks, and generally cajoling manufacturers to “come home” and bring manufacturing jobs back from offshore locations they were sent to decades ago.
Automation plays a big role in making manufacturing cost-effective in an expensive labour market, but just throwing robots at a poorly designed workflow is never going to end well. We’ve been buried under a mass of bullish headlines about new factories and big investments, and we’ve also seen some expensive embarrassment as overconfident early movers failed to get (individually great) machines, software, and people working together quite as well as they expected.
A lot of those plans are now being re-examined with greater care: In 2024, expect some Fortune 500 manufacturers’ boldest promises to be quietly diluted.
First published on Forrester blog.