Category: Industrial & Manufacturing

market expansion strategy

Strategies to Enhance Market Share in Asia for Industrial and Manufacturing Firms: In Conversation with an Infiniti Research Thought Leader

Ajay Biswari, AVP – Custom Research (Market and Competitive Intelligence) at Infiniti Research has over 10 years of experience in delivering solutions for global giants in the industrial and heavy equipment sector. His core expertise includes market entry, market expansion, merger and acquisition identification, and customer needs assessment.

Industrial and manufacturing firms often face dilemma in understanding market dynamics and developing an effective market entry or market expansion strategy. Also, the rising competitive pressure, increasing need for differentiation in the market, and need to comply with the stringent regulatory environment have adversely impacted companies in the industrial and manufacturing industry. Consequently, industrial and manufacturing firms are under the pressure to expand their base of operations to developed markets. This necessitates stakeholders to develop an effective market expansion strategy, understand the competitor landscape, and gain a comprehensive view of the current market scenario.

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Do industrial and manufacturing companies need to expand their business to new markets?

Amal: Absolutely! Today, several market dynamics affect the business operations of companies operating in the industrial and manufacturing industry. The rising market uncertainties such as increasing competitive pressure, uncertain political scenarios, and rising operational costs are some of the major factors impacting the business operations of companies in the industrial and manufacturing sector. Let me explain in detail impacts of these challenges on companies in the manufacturing industry. The growing competitive pressure often leads to price wars between companies and negatively impacts a manufacturing company’s bottom line. Furthermore, increasing political instability in the recent times including events such as BREXIT and NASTA are even making it more difficult for companies in the industrial and manufacturing industry to sustain a leading edge in the market. To remain ahead in the market and expand market share, it is vital for industrial and manufacturing firms to expand their base of operations to new markets.

market dynamics

Can you shed some light on the strategies that must be adopted by manufacturing firms to survive in today’s competitive market scenario?

Amal: Let me list out three major strategies, which according to me help companies stay ahead of the game. Some companies use technologies to overcome challenges. For instance, recently a major tool manufacturing company achieved 24% productivity improvement and 10% workforce efficiency improvement by investing in new technologies such as IoT and AI.

Also, companies are investing in new product innovations. Introduction of new products in the market can help companies to stay competitive. But, I would highly recommend manufacturing companies to employ a market expansion strategy, as this is sure to provide an above-average growth rate and can save millions of dollars in savings.

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But, why do you think entering the Asian market can be an ideal growth strategy for manufacturing firms?

Amal: Well, recent studies show that over forty per cent of global economic activity is now occurring in Asia, and world growth is expected to continue being led by Asia over the next decade. Also, India and China are two of the major economies which are growing at the fastest rate globally and provide vast opportunities for manufacturing companies. And even these countries heavily depend on exports as one of the revenue streams. So, new manufacturing companies can easily set up manufacturing bases relatively with a low cost of labor and raw materials. So, I think choosing the Asian market can be an ideal growth strategy for companies in the manufacturing industry.

Can you provide more insights on why Asia is a promising market for industrial and manufacturing companies?

Amal: Definitely! To start off with, Asia offers an attractive manufacturing environment that is favourable for manufacturing companies. Also, if we look at the share of global manufacturing output, it has almost doubled in the last decade. Moreover, the low operating cost and diverse demography are some of the other attractive factors in the Asian Market.

I would also like to add another significant geographical advantage within the Asian market in terms of access to market. With companies in the Asian manufacturing industry already competing with each other to be on top of the manufacturing pyramid, this market is trying to garner interest among global firms by offering smooth entry into their market. Also, considering the production cost, Asia offers lower operational costs compared to other developed countries.

What are the major market expansion approaches that some of the top manufacturing companies in the world adopt to stay ahead of the game?

In my view, most manufacturing companies look at setting their individual manufacturing bases or enhance their sales through various approaches. For setting their own manufacturing bases, companies generally leverage greenfield and brownfield expansion approaches. Let me explain these approaches in detail. Generally, greenfield expansion approaches involve huge investment in terms of resources, time, and capability. Although this approach provides complete control over the manufacturing and supply chain processes, this involves huge risks and takes a longer period for results to be shown. However, the brownfield expansion approach provides a kick-start immediately. Also, the brownfield expansion approach requires relatively lower capital investment compared to greenfield approach.

In the case of sales expansion strategies, manufacturing companies mostly look at own sales network or channel partners. Own sales network approach is mostly similar to the greenfield approach, which requires huge capital investment. However, channel partner approach helps companies gain in-depth knowledge about the market through channel partners who are already present in the market.

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IR3

Industrial Shift to Automation: A Game Changer in the Industrial Scenario?

In recent years, industrial automation has facilitated the control over various operations of an industry without any significant intervention from humans, using various control devices. Companies use a set of technology in automation strategies to get the desired performance or output. Some of the advanced technologies used in industrial automation involve control strategies such as cascade controls, modern control hardware devices such as PLC’s sensors, other final control devices, standalone computing system, communication system, and human-machine interfacing systems.

advantages of industrial automationIR_Brochure

Types of Industrial Automation 

Based on the flexibility and the level of integration in the manufacturing process, Industrial automation systems can be classified into four basic types:

  1. Fixed Automation

In this type of automation, the sequence of operations to be performed is set by the equipment configuration. It is mostly used in the case of high volume production. Some examples of fixed automation systems are distilled process, assembly lines, machine transfer lines, etc.

  1. Programmable Automation

In programmable automation, the sequence of operation can be changed by changing the program. The sequence of operation varies based on the different product configurations, and new programs can be entered for new products, into the programmable devices. This kind of automation can be found in industrial robots, batch processes, and steel rolling mills

  1. Flexible Automation

This is an extension of programmable automation, but there is a greater flexibility to deal with product design variations. In this case, the sequence of the process should be changed so that the programmer can give commands in the form of codes

  1. Integrated Automation

This type of industrial automation is entirely under the computer’s control. From the designing process to the dispatching, the entire system is entirely automated. Robots handle everything including the equipment in this system.Integrated automation has simplified various industrial processes. The new trends in industrial automation deal with latest communication protocols and control devices, which help control field devices such as control valves and other final control elements. The automated industry also uses some instruments or smart devices that have communication capabilities and also the ability to control processes without interfacing to the other field level control devices.

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Top Six Categories of Heavy Equipment

Heavy equipment vehicles refer to heavy-duty vehicles, which have been specifically designed for assisting in construction work. Although every heavy machinery has their own standard themes, there are certain equipment within it which are specialized for specific jobs. Each type of heavy equipment has its respective place in particular industries, be it construction, moving materials, or farming. The six leading industries and categories of heavy equipment are discussed here.IR_Brochure

Construction Industry

Dump trucks, cranes, and bulldozers are the most prominent type of heavy machinery used in this industry. Dump trucks are used to carry dirt and other forms of sediments to build sites for laying the foundation. Cranes are used for spreading it on ground level for the building; they are also essential in hoisting up and putting in place enormously heavy objects. Bulldozers are another commonly used heavy equipment in numerous construction projects due to their versatility. These conventional types of heavy equipment seen in modernized construction contribute to faster, safer, and cost-effective building plans.

 Farming Industry

Heavy equipment plays a prominent role in this industry. The most commonly used heavy machinery in farming include tractors, off-road vehicles, harvesters, and tillers. A majority of the heavy machinery used in the farming industry is not very applicable to other industries, making them a more specialized category.The tractor remains the most widely used heavy equipment, one of the main reasons for this being its versatility. Other heavy machinery available for farming include planters, farm drills, grain carts, etc. that are strictly dedicated only to growing crops.

 Forestry

Land clearing is a prominent part of forestry and construction alike. However, forestry is more focused on the production of paper goods, plywood, and other tree-based products. Heavy equipment such as wood chippers, skippers, knuckleboom loaders, and feller bunchers are used to harvest wood and create many different things. Mulchers are an excellent option for land clearing.

Material Handling

This industry involves activities related to packing, loading, and shipping in a warehouse setting. The most commonly used heavy machinery in this sector is the forklift. Certain models of forklifts are also designed for wear and tear of a construction site and for moving around a lot of building materials. Though a few newer heavy equipment in this industry has started to pick up, the forklift has dominated this sector for a while and will remain a significant piece of equipment for both construction and shipping.

Transportation Industry

Trucks and trailers are the most commonly used heavy equipment in this industry. The trucks used for delivery are mostly in the form of semi-trucks, whereas dump trucks are widely seen in construction because they are designed to handle rougher terrain on construction sites comparatively.

Grounds Care

Grounds care contains a set of equipment that are specifically designed for a lawn, golf course, or any other grassy property. One of the most commonly used heavy machinery in this industry is the lawn mower, which brings in a vehicular approach to the classic grass cutting. Some of the other widely used equipment include weed whackers, compact tractors, and sweepers.

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How Does the Future Look for the Manufacturing Industry in the US?

Over the past decade, the global manufacturing sector has witnessed numerous challenges, mostly due to the recession that has choked off demand. This recession has resulted in a steep decline in employment rates in advanced economies. However, despite such challenges, the manufacturing sector remains critically important for both the developing and developed nations.IR_Brochure

The American Scenario

Gone are the days when manufacturing companies considered cheap labor as the most critical output. Now, factors such as advanced technology, availability of materials, protection of intellectual property, etc. are the essential ingredients of success for manufacturing companies. The US is known to have the edge over other competing economies on these parameters.

The Opportunities and Challenges

According to recent research, the US is the second-most competitive manufacturing economy after China. It is predicted that by 2020, the manufacturing sector in the US will be the most competent among the world economies.

  • While many of the manufacturing companies think that the US is a great place to do business, their success might not have the same impact, mainly regarding generating a considerable number of well-paying jobs, as they did half a century ago. Opportunities are shrinking for Americans without a college degree. Job opportunities in the manufacturing sector are also declining due to the installation of advanced technologies by manufacturing companies, resulting in a lesser number of people required to do a particular job.
  • The US has a strong base of millennial population. With proper recruitment and training efforts in place, this generation can help build the manufacturing sector. Manufacturing companies can focus on creating a pipeline of talent armed with the right skills and concentrate on the latest technology, which will help them exploit the available opportunities.
  • Many of the manufacturing companies have started employing the Internet of Things (IoT), which has the potential to transform the manufacturing sector. The primary challenge here is not implementing IoT to its full potential, as it won’t be able to harness and analyze useful information and make actionable changes.
  • Robotics and automation could be a game changer in the manufacturing sector. Many prominent manufacturing companies are looking at employing this technology into their However, finding the right area to incorporate robotics and making the decision to invest in this technology, considering the capital investment involved, is the main challenge.

 

Though the US manufacturing sector is facing unprecedented challenges, there is a bright future ahead. Through agility, technology, and ingenuity, the US manufacturers will be able to grab more opportunities and overcome the challenges and usher in a new era of manufacturing.

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Top 4 IoT Trends That Drive Smart Manufacturing

Internet of Things (IoT) is set to transform the way the manufacturing industry operates and functions. Smart manufacturing or advanced manufacturing technology is driving the companies to transform the competitive market landscape. Thus, making it inevitable for the companies to adopt smart manufacturing and seize the benefits it has to offer. Smart manufacturing coupled with IoT enabled devices is an aIR_Brochuremalgamation of information, human interface, and technology that helps evolve and develop every aspect of the business. IoT is an interconnected network of devices driven by connectivity and software that has brought the fourth industrial revolution – Industry 4.0.

Trend 1: Industrial Internet of Things (IIoT)

IIoT is the process of using IoT enabled devices and integrating it within the manufacturing processes on the factory floors leading to an increase in production efficiency, product quality, and speed. Purely built on connectivity, IIoT enables people and facilitates business processes to collect vast amounts of data and leverage advanced analytics to gain insights.

Trend 2: Cloud-Computing Technology

With the help of cloud computing coupled with IIoT, companies can reap the benefit of sharing important and critical information in real-time. The data shared from beacons and sensors help organizations to anticipate needs and predict trends, obtain required inventory details, and minimize turnaround time for machines as well as the suppliers and manufacturers.

Trend 3: Artificial Intelligence

Thanks to big data, vast amounts of information is available to the organizations, which can be leveraged to gain consumer insights, predict trends, and foresee market developments. With the help of machine learning, artificial intelligence helps organizations understand patterns, anticipate information, and track incongruities, which helps them to refine processes, enhance productivity, and adopt smart manufacturing techniques.

Trend 4: Smart Sensors and Beacons

The organizations can benefit with the help of IoT enabled sensors that will help them to record, generate, and understand information right from packaging to the core machine elements. Besides these, the IoT enabled sensors help the manufacturing industry to measure and track everything, right from volume to temperature; thereby, creating seamless information flow to facilitate automation and drive smart manufacturing.

 

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Top Three Challenges in the Industrial and Manufacturing Industry

The manufacturing industry is the backbone of every other industry and is the most submissive and traditional of them all. But with technological innovations and latest developments, the manufacturing sector is witnessing an image transformation as it moves from a more passive approach to a moIR_Brochurere strategic approach to drive revenues and profits. The industrial manufacturing companies are constantly trying to gain a competitive edge in the market by innovating and undertaking research and development activities in full swing. As a result, the manufacturing industry has transformed its processes with a slew of new concepts and techniques such as smart manufacturing, green manufacturing, and additive manufacturing or 3D printing.

Strict Regulatory Compliance Issues in the Manufacturing Industry

Manufacturing companies across the globe are constantly under the scanner with the growing compliance and regulatory measures imposed at every stage. The manufacturing industry is inundated with growing concerns over health, safety, and sustainability factor of the equipment and machinery. The strict regulatory compliance norms have increased the burden on the manufacturing companies with every region or market having their own set of rules. This demands the manufacturing companies to ensure complete supply chain visibility of their processes and tracks their materials right from suppliers to consumers.

Innovation is a Challenge for Manufacturing Companies

For an industry driven by technology, innovation is the key to stay abreast of the competition and gain a foothold in the market. The manufacturing companies must innovate and invest in new product development to remain relevant and enjoy the benefits of a first-mover advantage. However, the product and service innovation shouldn’t be at the cost of quality and the manufacturers must resist cutting corners when it comes to product quality. The companies in the manufacturing industry must ensure procedures that streamline operations and drive manufacturing success.

Bridge the Talent Gap in the Manufacturing Sector

A skilled workforce can drive the manufacturing industry to scale new heights. In the absence of a talented workforce, the manufacturing companies cannot build their infrastructural capabilities to initiate new product development projects. The manufacturing companies must focus and direct their efforts towards skill building and improving workforce policies that motivate employees to increase their work efficiency.

 

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How Does the Future of Manufacturing Industry Look?

A growing economy and a flourishing manufacturing industry are directly linked to each other. The increase in investments in the manufacturing industry has a compounding effect across the global economy. As a result, increase in productivity, employment, and growth opportunities can be witnessed in the manufacturing sector as well as across several industries including oil and gas, telecommunications, IR_Brochureand retail. Technological advancements, innovations, and the increase in competition drives the manufacturing companies to scale new heights. Industry 4.0, the manufacturing industry buzzword, is a process of revolutionizing manufacturing activities by integrating technology such as cloud computing and artificial intelligence; thereby, offering the best of the physical as well as the virtual world. Not only are the developed nations reaping benefits of Industry 4.0 but the developing economies have also recognized the many benefits of sophisticated manufacturing techniques.

Factor Driving Growth in the Manufacturing Industry

For any industry to grow, it requires an educated and skilled workforce. Without one, the manufacturing companies lack the talent as well as the innovative capabilities to develop new processes and products. Any company in the manufacturing industry requires a skilled workforce at every stage, right from engineering to production. The manufacturing companies can opt for a public-private sector partnership that will help them bridge the talent gap through industry-based and on-the-job training. Apart from this, the government and regulatory authorities across the globe are developing policies aimed at building capabilities and improving competitiveness. Policy makers are increasing engagements with the private sector players in the manufacturing sector to drive skill development, innovation, and improve trade policies.

Industrial Sector – Future Possibilities

The manufacturing and industrial sector uplift the standard of living across the world by driving GDP growth and facilitating lower unemployment rates. There are numerous possibilities and growth opportunities that the manufacturing industry can bring to both the developed and developing economies in the world. The policymakers must identify the best practices adopted across the globe and integrate those drivers to transform their manufacturing capabilities and improve the industrial sector.

 

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Technological Advancement: A Boon to Manufacturing Industries

Manufacturing industries play a critical role in shaping a country’s economy and workforce. In developing countries, manufacturing industries provide a pathway from subsistence agriculture and incrIR_Brochureease the income and standard of living. At the same time, in advanced economies, manufacturing industries are a vital source of competitiveness and innovation, with enormous contributions to export, productivity, growth,  research, and development.

How has digitization widened opportunities for manufacturing industries?

Digitization and other technological advancements have brought about a host of opportunities for manufacturing industries, and have added wings to the future of manufacturing.

  1. Improved wireless technology:

A better wireless technology facilitates better mobility across the factory floor. It helps manufacturers quickly act on handheld data and collaborate real-time with remote experts rather than being confined to a control room. In this way, wireless technology makes it easier for manufacturing industries to manage their time and resources

  1. The Industrial Internet of Things(IIoT):

The IIoT influences the future of manufacturing in a big way. IIoT refers to the application of techniques such as machine learning and big data in the industrial settings. IIoT helps connect machines and devices that provide better agility, reduced risks, and increased visibility into operations.

  1. Assist Data-Driven Decision Making:

Connected machinery and devices allow manufacturers to tap into their data and gain complete visibility into the performance and working conditions of their assets and machinery. Subsequently, the results are improved, and there is a visible reduction in downtime and improved inventory turns. It also allows manufacturers to make clear and informed decisions with sufficient data in hand.

  1. Collaboration between IT and OT:

IT and OT in this context refer to information technology and operational technology respectively. Digitization is gradually bridging the gap between information technology and operational technology. This gives room for better partnerships in areas such as cyber security, predictive maintenance, fog computing, etc.; thus, offering new opportunities in manufacturing industries.

Manufacturing industries are stepping into a dynamic new phase. There is a spark in the demand and innovations in this sector, which further brightens their future. As the factories have started to go digital, there is an increasing need for skilled workers, advanced technology, and processes to align the shift to a digital landscape. The future of manufacturing industries mainly lies in efficiently implementing digitization strategies with manufacturing operations. With the increase in scope and implementation of advanced technology in place, manufacturing industries are up-and-coming regarding growth and profits.

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Industry 4.0 – Revolutionizing the Manufacturing Industry

Industry 4.0 may seem too complex and confusing for neophytes and experts alike. Industry 4.0 is the process of transforming the activities in the manufacturing industry with technology and making it dynamic and intelligent, bringing to life the concept of a smart factory. In layman terms, it refers to the amalgamation of top technology innovations such as cloud computing, artificial intelligence, advanced robotics, and InterIR_Brochurenet of things (IoT) that has revolutionized the manufacturing industry. These sophisticated technologies bring together the best of both worlds – the physical and virtual worlds – to the manufacturing industry.

Industry 4.0 in the Manufacturing Industry – How?

Industry 4.0 aims at improving manufacturing and production activities by integrating automation and ensuring process optimization. This application is not limited to the routine physical production activities and trickles down to other functions such as product development, planning, and supply chain logistics among others. Considering the fact that it is still in its nascent stages of development, a question that arises is how is Industry 4.0 revolutionizing the manufacturing sector? Here’s how.

  • With the help of Industry 4.0, manufacturing companies can drive transparency and agility across business operations, which irons out the shortcomings of an average supply chain
  • It allows the manufacturing industry players to create a responsive supply chain, which enables the manufacturers to reach out to the end consumers directly. The technological adoption facilitates the creation of customized solutions and personalized products that address the customer’s needs
  • By replacing superfluous traditional systems with an advanced digitized system that scores high on interoperability, industry 4.0 aims at minimizing costs and maximizing revenue for the industry
  • The introduction of technology and automated processes improves employee morale, increases workforce productivity, reduces training costs, and lowers employee attrition levels in the manufacturing sector

 

Industry 4.0 in the Manufacturing Industry – Roadblocks

Integrating Industry 4.0 with the existing processes requires the manufacturing companies to collaborate with vast amounts of data directly. Not many manufacturing companies hold the potential to adopt a data-driven and technology-based approach as they lack the required infrastructural capabilities. In addition to the technological capabilities, there are several other roadblocks such as a dearth of skilled human resources, an abundance of strict regulatory frameworks, and high investments that hinder the successful adoption of Industry 4.0 among the manufacturing companies. The companies who overcome these challenges will gain the first mover advantage in the manufacturing sector and gain a strong foothold in the market.

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Manufacturing Industry and its Outlook – Vision 2020

The manufacturing industry is still one of the largest contributors to the world economy despite the phenomenal growth of the services sector. Even though the manufacturing industry is nearing its saturation point, the industry hasn’t stopped growing and innovating. Several innovations such as automation, robotics, lean manufacturing, analytics, and outsourcing have been driving the growth of this sector. Furthermore, manufacturing industries are also looking at new avenues, product innovations, and strategic changes to remain competitive.

Developing nations largely depend on the manufacturing industry to boost their GDP. Here are some of the innovations and trends in the manufacturing industry which will define its future:

Manufacturing Industry and its Outlook – Vision 2020

Breakthrough in Material Science

Manufacturers are looking at material sciences to create products that are far superior to the existing ones. Materials such as graphene, carbon fibre, nanofibers, carbon nanotubes, and vantablack have extreme physical properties, which help in the production of futuristic products. Carbon fibres are increasingly used in the aerospace industry because of its exceedingly high strength to weight ratio. The exorbitant cost of such materials has hindered its application for mass production. However, these materials will eventually find its way inside consumer applications with the advent of newer materials and economies of scale in the existing ones.

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Brochure CTAPersonalization and Customization

For long, manufacturers have been emphasizing on reducing the cost using large scale production, resulting in fewer product choices to the customers. But the needs and wants of the customers have been growing to the point that they demand personalization and customization. Digital technologies have made it possible to scale up the level of personalization and customization and keep the costs low. Intelligent use of technologies such as 3D printers has also driven the level of customization along with smart product modifications like IKEA. The line between consumers and creators is blurring due to the advent of DIY platforms, product collaboration programs, crowd funding and ideation platform.

Smart Products

Modern products are increasingly capable of operating tasks and analyzing information with little human inputs. For most, smart products like smartphone, smartwatch, fitness trackers have been an everyday part of life. With the use of multiple sensors, connectivity, and electronics, previously analog tasks and processes could be simplified. Manufacturers have realized the potential of smart products and see it not only as a product but as a platform to create an ecosystem which allows for customization. This platform allows for a lucrative aftermarket which provides additional revenue streams through add-ons.

Big Data Analytics and Automation

Industrial control systems have been generating a vast amount of data for a long time which wasn’t put to best use. With the dramatic increase in computing power, rise of the Internet of Things (IoT), and advancement in machine learning algorithms, manufacturers can now analyze an enormous amount of data to enhance operations, resolve operational issues, improve production efficiency, and reduce wastages. The manufacturing industry is depending on big data analytics to enable automation. In a manufacturing plant, data collected from multiple sensors and control systems can be automatically fed to execute the production process.

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