Artificial intelligence and iot technologies will play a leading role in turning the promises of discrete manufacturers into reality.
As we head into the New Year, we expect this shift to manifest itself in five ways.
1. Sustainability and profitability go hand in hand
For too long, sustainability has been viewed as a cost center rather than a value center. Organizations that prioritize sustainability have outpaced those that don't.
While implementing sustainability practices does incur upfront costs, the long-term benefits often outweigh these initial investments. Sustainability can improve efficiency, save costs, promote innovation, reduce risk and enhance competitiveness, making it an integral part of a manufacturer's overall strategy, rather than just a cost center. In fact, as McKinsey notes, "Companies that reduce costs and emissions at the same time can gain market share and fund further decarbonization efforts through the additional revenue they generate."
In 2024, we expect this idea to take root and manufacturers will take advantage of the fact that sustainability and profitability can go hand in hand. Thanks to the acceleration of digital transformation over the past three years, discrete manufacturers are now at a stage of digital maturity where they can leverage a variety of tools to align their financial goals with product decarbonization.
One such example is generative design, which utilizes generative artificial intelligence to create an optimal design based on a set of requirements and constraints. The user defines the design problem, and then the engine determines a series of optimal solutions, often with many solutions that humans cannot determine. It can do in hours or days what designers would take weeks or months to do, opening the door to previously unfeasible designs.
2. Sustainability is a core element of product design
The choice of material and component suppliers is often the two biggest contributors to carbon footprints, and for energy-intensive products such as cars, customer use can have an even bigger impact. Most importantly, the decisions that cause Scope 3 emissions offer the greatest opportunity to substantially reduce emissions. In 2024, we can expect to see manufacturers start incorporating sustainability criteria into their design decisions.
Typical design criteria include cost, performance, risk, time to market, durability, reliability, manufacturability, etc. The decarbonization trajectory of suppliers is particularly important, as we expect a scenario where suppliers with more aggressive plans will be selected, while cleaning suppliers who are not as fast to decarbonize will be weeded out.
Select the right manufacturing process, make lightweight designs, and run 3D simulations to validate and iterate on digital designs, thereby reducing physical prototyping. By using these tools to optimize design and manufacturing processes early and often, manufacturers can both accelerate innovation and reduce costs.
3. The Internet of Things is a must for reducing factory emissions
Many manufacturers are still hesitant to adopt iot due to perceived challenges such as implementation costs, workload, and disruption.
In 2024, manufacturers will be pushed to modernize their factories. Iot will shift from a competitive advantage for early adopters to a must-have for any manufacturer who needs to reduce energy use and carbon emissions. By using iot sensors to directly monitor emissions during production, manufacturers can accurately measure their carbon footprint and comply with relevant regulations. They can also identify energy-intensive operations and implement optimization strategies to reduce overall energy use by monitoring energy consumption in real time. Cimc, a leading logistics and energy equipment supplier, has adopted this strategy, using iot energy management software to reduce energy consumption by 13%.
In addition to this, iot supports bottleneck analysis, which automatically identifies the top limiting factors hindering OEE on the factory site, enabling manufacturers to identify opportunities to improve efficiency and reduce waste. Doing this analysis early in the production cycle can further reduce errors and defects, preventing waste and rework.
4. Invest in circular and modular design
Circularity is a fundamental aspect of sustainability that emphasizes minimizing waste, improving resource efficiency, and creating a closed-loop system in which materials are reused, refurbished, remanufactured, and recycled. In 2024, we expect manufacturers to increasingly focus on circularity, with modular design becoming one of the most influential long-term strategies for decarbonizing products.
Modular design is about creating products with interchangeable components that can be easily disassembled, reused, repaired, upgraded, or recycled. Modularity improves the service life and circularity of products, as parts can be reused and remanufactured rather than sent to landfills. Modularity can also improve the efficiency of factory tools and reduce the cost of product changes required by the market. Technology will play a crucial role in enabling modular design, as digital tools are needed to control the downstream complexity that modularity brings.
5. Critical point of product service system
As with iot, many manufacturers are hesitant about the risk and investment required. While this is a transformational change, moving to a more customer - and service-focused PSS model has many advantages, including recurring revenue streams and enhanced customer relationships. They need to find ways to reduce the use of materials, increase the reusability and recyclability of products, and improve waste management.
Product service systems incentivize manufacturers to make products more modular and repairable, extend product life through service, and prioritize refurbishment, remanufacturing, and responsible end-of-life management.
China is a manufacturing country, but also a manufacturing power. One of the most important points is the understanding of Chinese enterprises for sustainable development strategy. China's industrial enterprises attach more importance to sustainable development strategies than many similar enterprises in the world. Therefore, in 2024, Chinese enterprises will set off a new revolution in how to use digital technologies to transform sustainable development strategies into concrete strategies and methods that can be implemented. This will bring Chinese industrial enterprises a truly viable and competitive future.
In 2024, government regulations, technological advances and consumer pressure will come together in due course. Will this be the year those empty promises turn into action? We will wait and see, but judging from the current situation of discrete manufacturing, the prospects for sustainable development are bright.
