Get ready for future-ready manufacturing  

John Kelleher Profile picture for user jkelleher March 24, 2021
Manufacturers who are future-ready will have a competitive lead over their more laggardly rivals, says Salesforce's John Kelleher.

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The persistent nature of COVID-19’s disruption on the manufacturing industry highlights a need to rethink business operations to be more adaptable to market dynamics, but also presents an opportunity.

Modern-day demand planning needs more sensitivity to the context of what customers are going through, encouraging sales and operations planning processes to evolve in response. This explains why more and more business leaders are investing in digitization.

In addition to digital transformation, the highest priorities for C-Suite executives over the next 24 months include increasing process efficiencies, demand planning, and new service offerings. This is according to Salesforce’s Trends in Manufacturing Report, a survey built around the responses of 750 manufacturing leaders globally.

The report finds that business agility is a key differentiator between those manufacturers who are future-ready and those who are not. This means digitizing sales and operations, establishing strong channel partner relationships and adopting a “service as a revenue center” mindset are all vital action points. 

Here are four key takeaways from the report.

(1) Customer-facing roles have changed forever

While supplier and production capacities bore the brunt of the pandemic’s initial impact, the most long-lasting changes are expected to be seen in customer-facing roles. In addition to altered capacities, the need for improved marketing and customer communications has changed significantly over the past twelve months. To improve customer and channel transparency, as well as forecast precision, we’re witnessing the retiring of manual approaches, like predicting the future or collaborating on spreadsheets. Around eight in 10 manufacturers consider moving planning to the cloud to be an important piece of the puzzle.

(2) The cloud is a key ally

Cloud technologies also come into play in terms of future preparedness. Future-ready manufacturers are 2.2 times more likely to have moved their sales and operations systems to the cloud and 2.5 times more likely to have fully-migrated specific business critical systems, like financial planning or demand planning systems. The ability to respond quickly to new product applications, optimization of overall inventory and reduced time-to-revenue from launch date are just some of the benefits. 

(3) Insights will drive successful partnerships

Ease of doing business is an important indicator of partner success. A key part of this is channel partnerships and collaboration. Over eight in 10 manufacturers find that inaccessible data, legacy tools, and cloistered teams impede their forecasting process. This is why future-ready respondents have doubled down on digitizing their sales and operations to collaborate effectively with channel partners, building stronger relationships around data transparency, co-selling, and co-marketing. Moving forward, successful channel partnerships will also include sharing insights securely across ecosystems from manufacturers to dealers to end customers.

(4) For resilience, consider aftermarket services

The sales process doesn’t end at product purchase, of course. Aftermarket services, such as spare parts, diagnostics, and support, are growing in importance in terms of the value proposition, particularly for future-ready manufacturers. This group is also more bullish on bundling product, support, software and other services in a single revenue model – a.k.a. servitization. Overall, 86% of future-ready manufacturers currently provide servitization options, indicating a 'service-as-a-revenue-center' mentality. Such new business models, coupled with progress made in migrating service systems to the cloud, have positioned future-ready manufacturers ahead of their peers.

Salesforce Trends in Manufacturing report

As manufacturers prepare for a post-pandemic world, agility will be fundamental to how they do business. Increasingly, deployment of automation will replace manual forecasting and digitization of sales and operations will be a key determinant for future-readiness. 

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