Research Paper on Smart Manufacturing: IT Enabling Fair Competition and Meeting Global Demands

Introduction

In the past few years, industrial organizations and manufacturers have identified the role of IT in smart manufacturing. The need to adopt advanced technology in the manufacturing industry is to enable fair competition among individual companies and to address the pressing global demands and needs for goods. The increase in world population makes the manufacturers face the challenges of adequate and quality supply of goods (Uhlmann, Portela Santos, de Souza Silva & Frazzon, 2018). Such companies engage in the global market amid challenges and risks that require the use of correct strategies in dealing with them. Understanding the logistics for manufacturers in the global markets requires that one understands factors such as global market risks, forces, supply chain, strategies, and development chain as they influence the success of manufacturing.

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Global Market Risks

Manufacturing companies face risks that, not only affect their planning but also their ability to compete favorably in the world market. One of such risks is caused by the tariff wars. This affects companies with heavy reliance on foreign aluminum and steel as raw materials for their products most. Such companies face the uncertainty of an increment in the cost of such materials due to the fluctuating tariffs. The risk is as a result of the fact that different countries set different tariffs to benefit their business with other nations(Soniewicki, 2017). For instance, the retaliatory tariffs, which were announced by Canada, the EU, and Mexico is projected to cause a blow to many manufacturing companies that rely on raw materials from such countries. The shrinking talent pool is another risk facing the manufacturing industry. For instance, significant numbers of parents in the United States of America advice their children to join the manufacturing industry because it pays well. This leads to flooding the industry with employees with no talents in their fields of operation. Another risk is the pace at which change is coming to the manufacturing companies competing at the global arena(Uhlmann, Portela Santos, de Souza Silva & Frazzon, 2018). For instance, the Industrial Internet of Things (IoT) industry 4.0, which refers to the gradual integration of traditional manufacturing into the new technologies in the connected world, faces challenges that can translate into risks. The risk of failure of the technologies adopted in the manufacturing industry is one of the challenges facing the growth of manufacturing industry ion the global market today(Soniewicki, 2017). Another risk is safety; this is caused by the reduced emphasis on the culture of safety due to tight staffing and high employee turnover in the manufacturing companies. Other factors posing risks include robot proliferation, cyber vulnerability, and third-party vendors.

Global Market Forces

Even though the manufacturing industry has grown due to the adoption of technology that enables the companies to make good use of information, some market forces still make their success a challenge. Digital transformation is one of the factors that have brought revolution in the manufacturing industry in terms of the way companies manage information(DeMeo, 2016). It is also important to appreciate the positive market forces that have improved opportunities for manufacturing companies to thrive in the global market. One of the factors that give pressure to manufacturers is the growing mobile and social technologies. Since a growing number of employees and customers are becoming increasingly techno-savvy, the manufacturing companies are also under pressure to supply their technology needs(DeMeo, 2016). Evolving customer expectations is another global market force that faces manufacturing companies. Since customers are connected for 24 hours of the day, they expect quick response form their service and goods supply sources. This intensifies the pressure on the manufacturing companies to adopt new technologies, which may not be cost-effective in some instances. However, it can also be said that the changing customer expectation is a positive market force as it leads to an improved performance by the manufacturing companies.

Strategies

Due to the diversity in the global market, the manufacturing companies have to device various strategies to help them compete favorably. One of such strategies address the specific needs of the customers as one size does not fit everyone, neither does one flavor becomes the favorite of everyone. The manufacturers have realized the need to address the consumer tastes and preferences by adding local tastes to their global products to avoid generalized productions(Vartiak, 2017). Another strategy is understanding and fulfilling the requirements of different cultures. Since it is hard to introduce new cultures to people by marketing products, the manufacturing companies beat this challenge by helping people appreciate and maintain their cultures. Such companies achieve this by venturing into the production of goods that are acceptable to the different cultural backgrounds(Vartiak, 2017). The manufacturing companies compete favorably in the world market by tying up with people at the local level to understand the needs of the local markets; this allows them to expand their markets.

Development and Global Supply Chain Management

The role of manufacturers in developing their companies involves the management of risks, market analysis, and supply chain management. The challenges and characteristics of the integrated market, as well as the rising vertical disintegration and International Corporation, create the notion of companies being linked to supply chain at the global level(Agigi, Niemann & Kotze, 2016). Supply chain management is crucial to achieving quality and quantity in production. In the case of manufacturers, the management of the supply chain involves an array of activities in planning, implementation, and control sourcing. Other activities involved within the supply chain include the delivery from the point of raw material access to the point of consumption (Agigi, Niemann & Kotze, 2016). Manufacturing is part of the larger supply chain that involves value addition. It is key to the supply chain as it plays the role of reducing the bulkiness of the raw, materials into the fine finished goods as well as make the goods more suitable for the customer needs. Since manufacturing constantly remains a developing industry, better ways of technology adoption and understanding of customer need must be developed. Developing the manufacturing industry requires global leadership, science, and innovation(Agigi, Niemann & Kotze, 2016). Leadership is key in providing the right direction in ensuring the industry understands the future needs of the global market.

Conclusion

Manufacturers play an important in the global market as it deals with the challenges and the existing forces to meet the needs using limited resources. Some of the factors bedsides market forces that need to be studied include strategies, supply chain, and the development of the manufacturing industry. The manufacturing industry can be better with global leadership and proper strategies of managing the market forces, risks, and limited resources to achieve the customer needs.

References

Agigi, A., Niemann, W., & Kotze, T. (2016). Supply chain design approaches for supply chain resilience: A qualitative study of South African fast-moving consumer goods grocery manufacturers. Journal of Transport and Supply Chain Management, 10(1). DOI: 10.4102/jtscm.v10i1.253

DeMeo, T. (2016). Five Market Forces that are Driving Manufacturing's Future: Content Management Will Play a Key Role. Retrieved 13 September 2019, from http://www.kmworld.com/Articles/Editorial/ViewPoints/Five-Market-Forces-that-are-Driving-Manufacturings-Future--Content-Management-Will-Play-a-Key-Role-114282.aspx

Soniewicki, M. (2017). Market orientation and competitiveness of Polish manufacturing companies. International Business and Global Economy, 36(1). DOI: 10.4467/23539496ib.17.014.7462

Uhlmann, I., Portela Santos, P., de Souza Silva, C., & Frazzon, E. (2018). Production Rescheduling for Contract Manufacturing Industry based on Delivery Risks. IFAC-Papers Online, 51(11), 1059-1064. DOI: 10.1016/j.ifacol.2018.08.467

Vartiak, L. (2017). Global sustainable and responsible investment activities and strategies of companies. New Trends and Issues Proceedings on Humanities and Social Sciences, 3(4), 77-87. DOI: 10.18844/gjhss.v3i4.1610