7 Manufacturing Industry Trends to Watch for in 2024

The manufacturing news in 2023 was full of issues such as supply chain disruption, inflation, transportation challenges, and worker shortages. Going into this year, you as a manufacturing company must know about emerging industrial developments to avoid issues that plagued the industry last year.

With an experience of over 19 years in the global manufacturing industry, we at STAEDEAN have seen many trends come and go. However, one thing we can tell you for sure is, having the right technology in place can bring you closer to gaining a competitive edge and adapting to the changing industry dynamics. To help manufacturing businesses gain this edge, we offer industry-specific software solutions embedded in Microsoft Dynamics 365.

This article will share the top trends we think will dominate the manufacturing industry in 2024 so you are up to date with the latest advancements to remain agile in a rapidly evolving landscape.

What are some technological trends the manufacturing industry can expect in 2024?

1. Cloud adoption

ABI Research states that investment in cloud-based manufacturing execution software will reach US$5.4 billion by 2031 as manufacturers embrace new and innovative productivity-enhancing solutions. 2024 will mark the beginning of the full adoption of analytics by discrete manufacturers, and they will focus on improving production performance, customer experience, and product traceability offered by cloud technology.

Additionally, around 62% of companies globally plan to increase their investment in cloud computing over the next five years, according to Euromonitor. The best way to get started with cloud adoption is to have the right strategy, planning, and management structure for your cloud deployment.

2. Analytics and big data

Big Data is bigger than ever, with the ability of manufacturing companies to collect data from an ever-growing number of sources. This data, combined with powerful analytics capabilities, allows manufacturers to slice and dice data in ways that provide them with a comprehensive understanding of their business.

Leveraging advanced analytics to access critical insights is increasing for manufacturing companies to engage in more data-driven decisions around sourcing, production, fulfillment, cost reduction, etc. In fact, by 2026, the manufacturing analytics market is projected to be worth $28.4 billion, more than 3.3 times its current value.

3. Industrial IoT, artificial intelligence, and machine learning

Industrial IoT (IIoT) is the extension of IoT to industrial applications and one of the leading manufacturing trends for 2024. With IIoT, manufacturers can interconnect unique devices within an existing internet infrastructure to make strategic decisions using real-time data and achieve various goals. A market report by Grand View Research stated that the global IIoT market size is expected to expand at a CAGR of 23.1% from 2022 to 2030.

In the automotive, heavy machinery, electronics, and metals industries, AI-based decision-making and machine learning are heavily used for quality inspection, supply chain management, production line checks, and inventory management. If not adopted quickly, IIoT and AI can become two trends that will leave you behind your competition.

4. Product as a Service

Digitalization has dramatically changed how consumers interact with manufacturers. Today, customers expect engagement and access to their brands. Rather than make a one-time purchase, they expect increased personalization, which opens the door to the opportunity of Product-as-a-Service. Also known as Asset-as-a-Service, servitization, or switching from CAPEX to OPEX.

With Product-as-a-Service (PaaS), manufacturers can deliver products and rental support services as part of long- or short-term subscription contracts. They can offer products or equipment to customers for a fixed period on rent or lease and gain periodic payment for the equipment used. This allows you to introduce new revenue streams into your business and grow with a closer customer relationship.

5. Smart factories and manufacturing

Smart factories are part of the broader "Industry 4.0" movement, transforming operations and shop floors in production environments across the globe. They use a combination of high-end technology such as cloud connectivity, edge computing, 5G, AI, and IIoT.

As it drives future competitiveness, manufacturers will likely continue progressing toward smart factory transformations. For instance, a Capgemini study stated that smart factories could create an estimated $160 billion in value in 2023 in the automotive industry.

Additionally, according to the 2023 Deloitte manufacturing outlook survey, more than 60% of executives are partnering with specialized technology companies to further their smart manufacturing initiatives in the coming years. This means that the time to adopt 'smart factories' for you is now.

6. Digital twin technology

The growth of IIoT, AI, and ML has paved the path for another essential trend of the smart factory evolution: digital twins. A digital twin is a virtual replica of any real-world piece, physical product, equipment or asset, or supply chain. You can use this replica as testing grounds for monitoring, simulating, and optimizing production, quality, and operational performance.

Using a virtual representation of an object helps the manufacturing industry to improve decision-making through data-driven simulations. Manufacturers can use these simulations to observe how equipment performs under different conditions without touching the asset. For example, Rolls-Royce collects critical data from its over 13,000 engines using IoT and telemetry to build digital twins on the Microsoft Azure platform.

7. Sustainability and circular economy

Many manufacturing companies are looking at ways toward carbon neutrality and meeting wider net-zero targets. While manufacturers have traditionally followed a linear “take-make-waste” model, the increase in being environment-friendly has led manufacturers to turn to a more sustainable, circular economy.

The circular economy uses AI, ML, and digitalization technologies to automate processes and increase efficiency. Plan to include the “7Rs”: rethink, redesign, repurpose, repair, remanufacture, recycle, and recover in each manufacturing stage to reduce waste and carbon footprint. This also lays the foundation of the ‘Product-as-a-Service’ trend we discussed earlier.

Do you have an effective manufacturing readiness strategy for 2024?

With new technological advancements added to the roster every year, today’s manufacturing solutions are rapidly progressing.

Here are some steps you can take to increase your digital maturity and agility:

1. Conduct a comprehensive assessment of your business’s current status quo
2. Identify the gaps between the scenarios of ‘where you have to be’ and ‘where you currently are’
3. Embrace digital transformation to automate end-to-end processes in your business using a cloud-based ERP
4. Ensure your data is clean and sorted using a sophisticated master data management solution
5. Connect your ecosystems, such as PLM and ERP, with a strong integration solution
6. Embed analytics into your business to make data-driven decisions
7. Manage all your manufacturing projects efficiently using an advanced project management solution
8. Introduce new business models into your strategy, like Equipment-as-a-Service, for exponential growth by leveraging a solution that supports both manufacturing and rental components of your business

How can we help you become technologically agile as a manufacturing company?

If you’re looking for a way to implement the latest manufacturing industry trends or want to begin your digital transformation journey, we can help you. As a Microsoft ISV with nearly two decades of experience in the Microsoft Dynamics ERP space, we have in-depth industry knowledge and domain expertise.

We offer many solutions on Dynamics 365 and can support you depending on your business requirements. To discuss how you can speed up your journey toward digital transformation in the manufacturing industry, feel free to book a demo with our experts.