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Writer's picturePaul Tero

Global Megatrends and Industry Division C

Updated: Sep 1, 2022



While manufacturing has always been with us, it has changed over time. The industrial revolution of the 1700s mechanised processes that were once manual, and in the late 1900s technology enabled the automation of production. What more could change over the coming years? This article contemplates just that – what could happen in the manufacturing industry over the next 10 or more years? What could happen to career or business prospects? What follows are some insights from a futurist on the manufacturing industry – a perspective on what could be.


Now, although there are several long-term megatrends shaping the world as we know it, in this article I just want to focus on two – computerisation and climate change. Societal and demographic global megatrends, while important (eg. the size of the global middle class is expected to grow from 1.8 billion to 4.9 billion in the 20 years to 2030), may not be as significant.


About the global megatrend of climate change


We are witnessing shifts in weather patterns, increases in ocean temperatures, and rising rates of abnormally high seasonal temperatures. Shifts that impact harvest yields and interrupt the annual rhythms of fauna and flora (eg. long term prospects for 19% of the currently 38,000 threatened species are in danger due to climate change).

Unless there is a globally significant and sustained effort at combating climate change, we will witness a continuing increase in land and ocean temperatures over the coming years. Likewise with the frequency and duration of land and marine heatwaves. And not forgetting the increasing intensity and frequency of heavy precipitation (eg. about 40 years ago, the average was 14 days a year where the temperature was above 50°C somewhere on earth – that average is now 26 days a year).


About the global megatrend of computerisation


Ever since the computer chip was released, the power to process data has only increased. That first microprocessor (CPU) released in 1971, an Intel 4004, could perform 63,000 instructions on 4 bits of data every second. Compare that with what we can do today. One of Intel’s latest CPU chips, the “Core i9-10900K” can perform almost 90,000,000,000 instructions on 64 bits of data every second. In other words, what the latest CPU can do in 1 second, that CPU from 1971 would take at least 264 days.


And this relentless improvement in processing power is not likely to stop anytime soon.


The impact of these two influences


So, what will these two global megatrends do to the manufacturing industries?

What is manufacturing – it is the physical or chemical transformation of materials, substances or components into something new. Think plastics, cars, food processing, and measuring equipment. But also think about physically large products like structural metal components and individually microscopic products like medicines.


First to climate change. The impact is on three areas: inputs, process, market demand. Depending upon the type of raw materials required by the manufacturer, interruptions to the smooth supply of inputs may not be experienced. However, depending upon market demand, the cost of those inputs may vary.


The price of Lithium, for example, has risen in recent years. An upswing driven by the increased demand for renewable energy storage – a direct result of the market responding to the threats posed by climate change. A similar story can be found in the price of copper, one of the key components of solar cells, it’s price has been rising as well in recent years.

Self-evidently, the demand for different manufactured products will be influenced by climate change. In 2016, for example, there was about 80GW of new solar cell generation capacity added across the globe. This year its expected to be more than double than that of 2016. Passenger vehicles are another example – 16 nations, including Germany, Norway, Thailand and the UK, have all implemented strategies to phase out and eliminate combustion engine vehicles over the next 10 years or so.


The third area that climate change is having an impact upon manufacturing is in the process of transformation. Efforts include reducing the energy being used in the manufacturing process and moving to a re-use component of the circular economy model. The three Scope boundaries as outlined in the GHG Corporate Protocol Standard is also affecting the production processes and the supply chains of manufacturers.


Secondly, computerisation.


Computers are obviously having an impact upon manufacturing operations. From process control, to scheduling, inventory management, product design and marketing. Compared with years past manufacturing has become more automated, more efficient, and in some respects more responsive to market conditions.


The “Industry 4.0” label is a catch-all for this trend of digitisation. Where components of Industry 4.0 include IoT devices (sensors and actuators), robotics, data analytics, and wireless communication. Where phrases such as smart factory, big data and cyber-physical systems are used.


While the reasons for robots vary among the different manufacturing segments (eg. the electronics division use them for improved quality, automotive for safety and product flexibility), there are about 2.7 million industrial robots in use globally. And another important component of Industry 4.0, IoT is also set for continued growth. IoT sensors and actuators facilitate both the collection of real-time data and the control of processes. The market for IoT, depending how it is defined, is expected to grow over the next few years from anywhere between 7% and 20% CAGR.


The implication of the increasingly pervasive nature of computerisation is found in the use of data. The more data that is made available, analysed and used to create various forms of value to the manufacturer, the more productive they will be. That is, improvements in automation, in maintenance regimes, in energy efficiency, and so on.


Thus, both climate change and computerisation will continue to shape the manufacturing industry.


What are your prospects


From the preceding, and from a career perspective, there are several observations that can be made:

  • If you are more the “get it done” type: you’ll be using increasingly complex machines and software to get your work done. Maintenance tasks may be more suitable for you

  • If you are more the “thinking” type: there’ll be more data and a greater need to analyse data from a systems perspective in order to manage operations, customers and regulations

  • If you are more the “creative” type: there’ll be opportunities in virtual technology and 3D printing. New types of raw materials might be discovered through Quantum computing

  • If you are more the “helper” type: you’ll be needed to maintain the skills of those within the industry and develop pathways for those entering it

  • If you are more the “leader” type: you’ll be needing to improve your skills of persuasion and collaboration with other industry stakeholders. You’ll also need to be very comfortable with leading in a highly digitised industry

  • If you are more the “structure” type: you’ll be faced with using RegTech to help you navigate your GHG and you place in complex value chains

Overall, in the years ahead you’ll need to comfortable with both using more computing and not doing or producing some of the things that previous generations did.


Like with other industry sectors - from a business perspective, when it comes to responding to climate change its all about mitigation (ie. shifting focus to reduce risk) and resilience (ie. fortification to handle risk). And, when it comes to computerisation its all about automation and using data. So, whether you’re a manufacturer or one who provides goods and services to this industry, likely impacts are:

  • Mitigation: changes in raw materials and/or changes in goods produced

  • Resilience: improving operational efficiency and shifting to renewable energy sources

  • Automation: increasing digital integration of all aspects of manufacturing operations

  • Data analysis: improving the digital skills of the workforce and enhancing data security

Overall, and quite obviously, for businesses there are both risks to be aware of and opportunities to exploit in the change that is happening.


The global megatrends of climate change and computerisation are impacting life and economies in profound ways, including the manufacturing industry. Just like the extractive industries, it seems that these two megatrends are symbiotic in their effects. That is, the path to climate-aware operations is being built with pervasive computerisation.


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