Like many other sectors, the U.S. manufacturing industry has been heavily impacted by the current health crisis. The global nature of the pandemic has led to bottlenecks in supply chains, turnover and orders.
To learn more about the current situation, relayr, a global industrial internet of things (IIoT) company, worked with the research firm, forsa, to survey more than 200 leaders in the U.S. and Germany manufacturing industries. Topics ranged from how the crisis affects their operations and how they’re dealing with challenges presented by the pandemic to their assessment of future economic development.
The study describes the attitudes toward current developments in the industry and any short and long-term impact that COVID-19 will have an operations. Most respondents say COVID-19 has affected existing customer groups and regions, and they’re looking for ways to adapt. Almost all respondents say technological advantages such as industrial IoT (IIoT), big data, and artificial intelligence support their coping with uncertainty.
According to current estimates, the crisis will lead to economic setbacks across the board. Declining exports and difficulty in planning are leading to uncertainty in the manufacturing industry. Other findings from U.S. manufacturers include that U.S. companies have been hit hard by the crisis with 67% of respondents in the U.S. saying that the crisis has had a somewhat negative or very negative impact on their businesses. Their biggest challenges are a decline in new orders (58%), their employees' concerns about a possible COVID-19 infection (56%), and a decrease in sales (54%). However, only 11% of U.S. companies are seriously concerned about remaining in business.
The survey found that investment behavior has been curtailed. alf of the U.S. companies surveyed expect their investment behaviors to be lower than 2019, while 14% are unsure. In contrast, just more than a third (36%) plan to make investments at the same level or higher than last year.
"Increased flexibility" was at the top of the list for U.S. manufacturers (59%) for measure that were being undertaken to meet the challenges of the crisis. Other top measures include improving customer service and relying on technical innovations to counteract the effects of the crisis.
The survey found that equipment-as-a-service business models are becoming increasingly popular with 16% of US companies planning to transform at the moment. A majority of those surveyed recognize that new business models, such as pay-per-use models ("equipment-as-a-service"), represent an advantage for both the supply and demand sides in the current crisis. In the U.S., 34% said pay-per-use models represent a big or a very big advantage, while 29% consider it a slight advantage. Almost half of the companies surveyed also stated that they use a pay-per-use model themselves (18%), offer it (15%), or do both (9%).
The respondents are adopting various technologies to gain a competitive advantage. In the U.S., 38% of businesses are implementing predictive analytics, followed by big data (33%) and IIoT (32%). More German companies (47%) use IIoT and AI to gain a competitive advantage, while US manufacturers have higher usage rates of predictive analytics. Among the companies that use one or more of the listed technologies, 99% of the US respondents believe technology will help their companies in the crisis.
