My first two columns in 2018 focused on the 10 key emerging technologies being used to disrupt every industry and the five elements of the Internet of Things (IoT) every manufacturer needs to leverage to maximize production and minimize costs.
Now I want to share with you why paying close attention to the shifts in technology and tapping into IoT is so important.
Because we are so interconnected from consumer through the entire supply chain – coupled with social media – consumer buying habits change in an instant … both up and down. This instantaneous shift by consumers can rock your production overtime if you aren’t agile and able to make shifts.
What looks like a steady flow of production now could begin to decline or increase within months given how fast consumers change what and how they purchase. If you want to understand how fast it now takes to reach a broad base of mass consumers, take a look at how quickly it took the following to reach 50 million people:
• Telephone – 75 years
• Radio – 38 years
• TV – 18 years
• Internet – 4 years
• Facebook – 3.5 years
• Angry Birds game – 35 days
Did you get that? It only took 35 days for the video game Angry Birds to connect with 50 million users!
It is crucial for your heat-treat company or division to have the ability to ramp up or dial down production, maintenance and operations in a more predictive fashion with the pace of consumer buying habits in today’s manufacturing economy. Doing so will minimize your costs, equipment requirements and labor demands.
A simple example is the new wave of “mattress in a box” products being sold online. Who would have thought consumers would spend $700-$1,300 on a mattress they never touched? Well, they are today with roughly 10% of the market in five short years. If you are a heat-treating operation on the wrong side of the change in mattress demand, your business will begin to quickly erode.
There are a couple of major consumer buying habits that will cause significant shifts in manufacturing in the next decade. All are picking up steam, and you need to look into their impact on your product mix.
This is business models like Airbnb, Uber and Turo (formerly RelayRides), where people pay to share someone else’s lodging, transportation or automobile. The danger in a sharing economy is once two people begin to share one product, a new one is not produced. For example, if two people share houses for vacations, no hotel is needed. If two people share cars, a new car isn’t needed. Today’s generation is becoming more accepting of a sharing economy. How will it impact what you manufacturer or heat treat?
Swap commerce is similar to the share economy except we are renting someone else’s stuff. We are actually swapping two products we both own and both need. There are a number of trading websites online. The danger in swap commerce is that when two people swap or trade two products they each need, NOTHING new is made. Do you heat treat or manufacture products that could be impacted by swap commerce?
Don’t get me wrong. Every shift in the economy creates new opportunity at the same pace as taking away opportunity. My point is that you, as a heat-treating company, need to do your homework to make sure you are processing products that are growing in capacity and demand, not declining. A great resource can be found at www.TrendHunter.com. They constantly track consumer buying habits in most major industries.
Don’t be left behind. Get informed and get in front of the wave of change coming in the 2020s. IH