Coronavirus and the future of manufacturing

The Coronavirus has severely disrupted the global logistics network. In this post we discuss the future of manufacturing and the transition process.
Mar 2, 2020 • 7 minute read
Edward Kost @EdwardKost
Technical Co-pilot
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The future of manufacturing in light of the Coronavirus       

As stock prices fall under the crippling weight of the Coronavirus, businesses are scrambling for more secure manufacturing solutions.

Apple already issued a warning that it would miss its revenue forecast as a result of Coronavirus causing manufacturing delays. The closure of factories in China saw the country's manufacturing fall sharply in February, hitting a record low. So what's the future of manufacturing in light of such a massive disruption to the global supply chain?

Predicting the future of manufacturing

To predict the future of manufacturing we need to first take a look back at the major developments in our manufacturing history to identify any clear patterns of progression.

Progress in manufacturing has been driven by the pursuit for higher efficiency. Worflows that were once processed by hand were replaced by machinery, decreasing material cost, production time and labor costs.

Assembly lines were then introduced which shaved off a considerable amount of processing time between each manufacturing station. Lean manufacturing methodology further cultivated manufacturing methods by drastically reducing waste throughout the entire ecosystem.

All of this has culminated to the present where we find ourselves at the cusp of another major advancement in the evolution of manufacturing. We see two big trends defining this advancement.

Reshoring manufactruing plants 

Offshoring manufacturing operations has long been identified as an inefficient solution. The Coronavirus has served to highlight the fragility of staking so much of the supply chain on a single country.

Moving forward, more businesses are likely to start adopting an onshore manufacturing model to secure their operations against future disturbances. But reshoring is only going to be viable with increased automation.

Increased automation

Automation technology has progressively been replacing human labor in the last few decades, and that trend will definitely continue, because automation makes the supply chain much more efficient.

It's no surprise that the reduction in human labor is proportional to an increase in manufacturing output and at a lower cost. 

manufacturing output vs number of employees
Source: pewresearch.org

manufacturing output
Source: fred.stlouisfed.org

The simultaneous increase in manufacturing output and decline in manufacturing jobs over the long term shows that American manufacturers have become far more productive than they were three decades ago – that is, they can produce more goods, or higher-value goods, with less labor.
- Drew DeSliva from the Pew Research Center 

But the cost effectiveness of increased automation goes beyond just the replacement of hourly salaries and benefits. Thanks to Industrial Internet of Things technology, and the strategic placement of sensors, manufacturers can now predict the likelihood of a particular machinery component failing and take the necessary course of action to prevent it from happening.

If manufacturing machines are now capable of diagnosing themselves, this means we're only a step away from being able to completely automate their service and repair.

So where does that leave us now?

  • More and more manufacturing processes are being outsourced to robotic solutions

  • Higher automation is resulting in higher production output at lower costs

  • Higher dependence on automation solutions is pushing human effort further away from the manufacturing floor, and in some cases replacing them completely

  • Automation is making reshoring more of a cost effective solution, which is likely to be capitalized upon in the wake of the Coronavirus.

Another trend worth noting in the same breath is the growing remote workforce culture that's being rapidly accelerated by the threat of the Coronavirus. This is likely to disrupt all industries in the near future, including manufacturing.

growing gig economy
Source: gomedici.com

The next stage in the evolution of manufacturing will need to capitalize upon this trend as well. If the driving force for change continues to be the pursuit for higher efficiency, the next logical phase of progression is a completely remote manufacturing process. That might sound impossible, but Augmented Reality technology means this shift might be closer than we think.

AR and the future of remote manufacturing 

A completely remote manufacturing solution is one where the manufacturing floor is solely operated by autonomous manufacturing robots and managed by humans remotely.

This solution is well within reach when you consider that the complex nature of manufacturing can be broken down into three simple categories:

1) Material handling 

Transferring items and products between locations. 

2) Processing 

Manufacturing materials and products. Also includes fastening connections, painting parts, application of adhesives etc.

3) Inspection

Quality control, measuring parts to ensure they are within ranges of tolerance, discarding poor quality products, passing high quality products.

Since all of the tasks within each category requires a binary solution process, and there's no need for any creative human input, it's becomes clear that it's only a matter of time before the manufacturing floor is completely automated.

But before we start panicking about a robot uprising, let's make clear that a remote manufacturing solution doesn't completely remove humans from the equation. Humans will still be monitoring the manufacturing process, and strategizing the development and growth of the business. They just don't need to be physically present in the manufacturing facility to do so.

As far out as this sounds, this technology is already in the process of being developed.

Industrial Internet of Things technology is already able to do much more than predictive maintenance and locating displaced tools. Robert Schmid, The IoT chief technologist at Deloitte, says  the technology will soon be used to operate manufacturing robots.

He also suggests that these manufacturing bots could be outfitted with built-in sensors and marketed as both a product and a service. 

The final stage of the supply chain is shipping, and Augmented Reality has already begun paving the way to a fully automated shipping solution.

DHL has rolled out a global AR program that helps operators find order items, scan them and then place them in their correct locations much faster and with fewer errors. This is obviously leading to a future where orders are automatically processed, fulfilled and even shipped.

augmented reality and DHL
Source: dhl.com

Augmented Reality technology is currently being implemented by the US military to help their mechanics operate at higher efficiency. An AR headset assists Marine mechanics by identifying all of the components relevant to the task at hand and providing them with step-by-step instructions on how to service them. 

us marine mechanic and augmented reality
Caption: US Marine mechanic completing vehicle maintenance with the assistance of an AR headset.
Source: technologyreview.com

The superior training capabilities of AR are currently being rolled out across different industries including tech. Industrial tech company Atheer has crafted a solution that provides step-by-step instructions to trainees in an immersive digital environment to help them assimilate into their roles faster than ever before.

While these innovations should encourage us to celebrate the impressive progression of the human race, they should also highlight our shifting priorities in the workplace.

If machinery is now providing us with step-by-step instructions on how we should best complete our jobs, how long before our efforts aren't required at all?

Transitioning into the new age of manufacturing

To effectively transition into the new new era of manufacturing, there are a few boundaries to overcome.

Improve printing solutions

The first step is to improve the economics of printing solutions. Current printing solutions are only economical for low value, high volume products. The cost-per part threshold needs to be shifted to cover a wider variety of stock:

costly 3d printing solutions
Source: 3d.formlabs.com

To become economically viable, printing solutions also need to be capable of switching between different materials. Efforts to combat this problem have already commenced with the invention of Additive Manufacturing Systems.

Once printing solutions become fully capable of switching between different materials, there'll be less of a real estate requirement on the manufacturing floor, which will encourage the establishment of a vertical integration arrangement and further compliment reshoring efforts.

vertical supply chain

Caption: Vertical integration allows companies to house their entire supply chain.
Source: pmmold.com

Embrace Augmented Reality technology 

The Augmented Reality applications listed earlier demonstrate why AR tech is likely to be the binding agent to this remote manufacturing solution.

AR provides users with a higher degree of insight into a remote environment unlike any advanced video camera setup. If manufacturers want to check up on the progress of their remote manufacturing operations, AR tech is the most immersive solution to use. Managers can simply slip on an AR headset, take a virtual stroll around the manufacturing floor, check on the health status of all the equipment and even examine the quality of manufactured products by manipulating a 3D projection of it.

To best transition towards this setup, businesses need to start embracing AR solutions today. Adapting to the shifting tech landscape is much easier if the technology isn't foreign to you.

AR tech is already being used by the manufacturing industry to share conceptual prototype designs with remote stakeholders. Workers on the floor can also now share the operating status of equipment with remote technical experts to improve maintenance procedures.

ar tech in maintenance
Caption: AR tech used in manufacturing machinery service maintenance.
Source: blog.thomasnet.com 

Transition into the remote workforce model 

Businesses that want to future proof their manufacturing operations can't ignore the growing remote workforce trend. The lower overheads of this staffing model, coupled with the almost nullified labor costs of an autonomous manufacturing plant will make future manufacturing businesses exceedingly efficient.

A manufacturing business that has embraced the remote workforce model will have all staff directly linked to the strategic growth and development of the business working either from home or in coworking spaces and fill any remaining talent gaps with a highly skilled freelancer workforce.

remote manufacturing workforce
Caption: Simplified example of a remote manufacturing business model 

AR can facilitate this transition. Highly skilled and experienced manufacturing technicians can be promoted to more strategic positions and remotely train junior floor staff through an Augmented Reality network, thereby reducing the number of valuable assets on the floor.

Junior floor staff could then use AR headgear to train the AI algorithms that will eventually take over their roles.

Final thoughts

Times of crisis have the unique ability of testing the stability of our operational frameworks. The Coronavirus outbreak highlights the fragility of our current outdated manufacturing model and the necessity to progress towards a more secure and cost effective alternative.

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