{"id":7216,"date":"2018-11-27T09:19:38","date_gmt":"2018-11-27T17:19:38","guid":{"rendered":"https:\/\/blog-prod.qad.com\/blog\/?p=7216"},"modified":"2025-02-27T15:41:21","modified_gmt":"2025-02-27T23:41:21","slug":"rapid-response-change-imperative-manufacturers","status":"publish","type":"post","link":"https:\/\/www.qad.com\/blog\/2018\/11\/rapid-response-change-imperative-manufacturers","title":{"rendered":"Rapid Response to Change is Imperative for Manufacturers"},"content":{"rendered":"<p>[vc_row][vc_column][vc_single_image image=&#8221;7217&#8243; img_size=&#8221;full&#8221;][vc_column_text]<span style=\"font-weight: 400;\">It was Heraclitus, a Greek philosopher, who said, &#8220;Change is the only constant in life,&#8221; highlighting the strong need to always expect and plan for change throughout our lives. This is certainly true for the manufacturing industry as cultural and technological changes increasingly place unexpected demands on businesses. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">While <\/span><a href=\"https:\/\/www.qad.com\/blog\/2017\/01\/constant-manufacturing-change\/\"><span style=\"font-weight: 400;\">change<\/span><\/a><span style=\"font-weight: 400;\"> in and of itself is nothing new, the accelerating pace of change creates risks and opportunities in the markets manufacturers serve and the way in which they manufacture. The changes include, but are not limited to, geopolitical instability, changing business models, cybersecurity concerns, digitally connected products and increasing customer demands. Choosing to ignore these changes does not prevent them from affecting your organization but does require a more rapid and dynamic response to stay ahead of the competition. <a href=\"https:\/\/www.qad.com\/blog\/2020\/07\/business-adaptability-a-core-survival-strategy\">Business adaptability<\/a> and responsiveness are now competitive advantages as manufacturers strive to stay at the forefront of business changes and demands.<br \/>\n<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The following trends serve as examples of the changes impacting manufacturers today and the markets they serve: <\/span><\/p>\n<h2>XaaS via Connected Products<\/h2>\n<p><span style=\"font-weight: 400;\">The term Anything as a Service (XaaS) \u2013 the essence of cloud computing \u2013 is becoming the new business model. This can be thought of in the context of jobs to be completed with the assistance of connected products. General Electric pioneered XaaS by rethinking their jet engine manufacturing business and offering to sell thrust hours versus selling just the physical engines. To do this effectively, data access and intelligence is needed to optimize the outcome. The <\/span><a href=\"https:\/\/www.qad.com\/blog\/2017\/03\/iot-manufacturers\/\"><span style=\"font-weight: 400;\">Internet of Things (IoT)<\/span><\/a><span style=\"font-weight: 400;\">, connected products and advanced analytics enabled by <\/span><a href=\"https:\/\/www.qad.com\/blog\/2017\/10\/temperature-rising-machine-learning\/\"><span style=\"font-weight: 400;\">machine learning<\/span><\/a><span style=\"font-weight: 400;\"> make this possible across a growing number of use cases. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">XaaS is rapidly expanding to products much less expensive than multi-million dollar jet engines. For example, fast food restaurants don&#8217;t necessarily want to buy fryers. They do, however, need to reliably deliver fried food. The expectation is that the kitchen equipment manufacturer will monitor and service the fryer via connected products to eliminate downtime. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">These expectations shift the internal focus of the manufacturer. Products are being re-engineered to be IoT-ready and support remote monitoring. Information systems capable of serialized track-and-trace and lifetime unit history must be created. Service-based intelligence rather than traditional mechanical features becomes the imperative for winning the next fryer or aircraft engine order. <\/span><\/p>\n<h2>Rising Transportation Costs and Changing Retail Landscape Require Supply Chain Adaptability<\/h2>\n<p><span style=\"font-weight: 400;\">Rising and fluctuating transportation costs consistently impact manufacturers. To protect margins, manufacturers need to ensure they have the right inventory, in the right place, at the right time, to minimize costly movements. This increases global sourcing costs and creates new opportunities to push final assembly closer to the customer. Regional contract manufacturers are becoming a critical part of the greater manufacturing strategy. Transportation costs also create incentives for 3D printing\/additive manufacturing as printing products on-site can help to avoid shipping costs.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Changes in retail can impact who manufacturers sell to and introduce new market opportunities. 44 percent of online sales last year went through Amazon. 50 percent of product purchase searches start on Amazon. <\/span><span style=\"font-weight: 400;\">Online purchases of food are increasing at 20 percent annually<\/span><span style=\"font-weight: 400;\">. How should manufacturers respond to these changes?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Are your products significantly differentiated or delivered at a low enough cost to compete against products in the local store and all products available globally? How quickly can your supply chain respond to new market opportunities and adapt to new business requirements? Can your manufacturing operations and delivery supply chain match the &#8220;two-day&#8221; delivery mindset of the online shopper? As a manufacturer, how do you prepare for similar disruptions or respond to an unexpected competitor entering your market as Amazon recently did with the introduction of <\/span><a href=\"https:\/\/www.cnn.com\/2018\/10\/08\/business\/amazon-private-label-brands\/index.html\"><span style=\"font-weight: 400;\">privately branded dog food<\/span><\/a><span style=\"font-weight: 400;\">?<\/span><\/p>\n<h2>Avoiding the Dinosaur Trap \u2013 Will Your Products Become Extinct?<\/h2>\n<p><span style=\"font-weight: 400;\">Digital cameras devastated the film market. Smartphones have greatly reduced the market for analog and digital cameras. Other trends have the potential to overturn entire manufacturing sectors. <\/span><a href=\"https:\/\/en.wikipedia.org\/wiki\/CRISPR\"><span style=\"font-weight: 400;\">CRISPR<\/span><\/a><span style=\"font-weight: 400;\"> technology is a genome editing tool that is faster, cheaper and more accurate than previous DNA editing techniques. For life sciences manufacturers, it has the potential to upend the business model of treating chronic illnesses by providing a cure. In another example, autonomous vehicles are causing suppliers to reconsider how they design interior seating where it is less about driving comfort and more about the riding experience. Will there even be a demand for steering wheels or rear view mirrors for these vehicles? Many manufacturers will have to transition to evolved products and business models or risk disappearing forever.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">So, how well does your organization respond and adapt to changing business, technology and customer demands? Do your enterprise solutions effectively support a rapid response to change? Are you considering new and advanced technologies like <\/span><a href=\"https:\/\/www.qad.com\/blog\/2017\/03\/iot-manufacturers\/\"><span style=\"font-weight: 400;\">IoT<\/span><\/a><span style=\"font-weight: 400;\">, <\/span><a href=\"https:\/\/www.qad.com\/blog\/2017\/10\/temperature-rising-machine-learning\/\"><span style=\"font-weight: 400;\">machine learning<\/span><\/a><span style=\"font-weight: 400;\">, <\/span><a href=\"https:\/\/www.qad.com\/blog\/2018\/01\/blockchain\/\"><span style=\"font-weight: 400;\">blockchain<\/span><\/a><span style=\"font-weight: 400;\">, <\/span><a href=\"https:\/\/www.qad.com\/blog\/2018\/03\/data-warehouses-big-data-evolving-data-lakes\/\"><span style=\"font-weight: 400;\">data lakes<\/span><\/a><span style=\"font-weight: 400;\"> or other initiatives to dynamically address changing business demands? Find out how <\/span><a href=\"https:\/\/go.qad.com\/NA-US-FY19-NUR-CiaB-FlexibleERP_04-CustomerVideoAmtico.html?utm_source=marketo&amp;utm_medium=email&amp;utm_campaign=na-us-flex-erp&amp;utm_content=em-video1\"><span style=\"font-weight: 400;\">Amtico International<\/span><\/a> <span style=\"font-weight: 400;\">relies on their ERP to stay ahead of change.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Now is the time to thoroughly evaluate your organization&#8217;s ability to adapt to business changes for improving production efficiency, exceeding customer expectations and becoming an<\/span><a href=\"https:\/\/www.qad.com\/effective-enterprise\"> <span style=\"font-weight: 400;\">Effective Enterprise<\/span><\/a><span style=\"font-weight: 400;\">.<\/span>[\/vc_column_text][\/vc_column][\/vc_row][vc_row][vc_column][\/vc_column][\/vc_row]<\/p>\n","protected":false},"excerpt":{"rendered":"<p>[vc_row][vc_column][vc_single_image image=&#8221;7217&#8243; img_size=&#8221;full&#8221;][vc_column_text]It was Heraclitus, a Greek philosopher, who said, &#8220;Change is the only constant in life,&#8221; highlighting the strong need to always expect and plan for change throughout our lives. This is certainly true for the manufacturing industry as cultural and technological changes increasingly place unexpected demands on businesses. While change in and of [&hellip;]<\/p>\n","protected":false},"author":53,"featured_media":7217,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[182,199],"tags":[381,606,286,94,380,26,154,591,105],"class_list":["post-7216","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-featured","category-manufacturing-trends","tag-advanced-technology","tag-connected-products","tag-industry-4-0","tag-iot","tag-machine-learning","tag-manufacturing-erp","tag-manufacturing-erp-software","tag-rapid-response-erp","tag-smart-manufacturing"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.7 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Rapid Response to Change is Imperative for Manufacturers | QAD Blog<\/title>\n<meta name=\"description\" content=\"While change in and of itself is nothing new, the accelerating pace of change creates risks 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