contract manufacturing Archives - Business Intelligence

Tag: contract manufacturing

A CIO’s Guide to Industry 4.0 – The Future of Manufacturing

Industry 4.0 is the next phase of digitalization in the manufacturing sector that is driven by factors including the proliferation of data volumes, growth of connectivity and computational power, and key advancements in manufacturing innovations. Although they are still in the early stages of development, smart factory and industry 4.0 have already begun transforming manufacturing. By embracing industry 4.0, manufacturers can gain much more than just extending their digital reach and or selling new varieties of products and services. Industrial automation can increase productivity and performance and also bring down the overall production costs. Another major benefit of industry 4.0 is that it will greatly promote globalization through worldwide supply chains and sensor networks. Developing the right digital capabilities for becoming a manufacturing 4.0 organization requires a strategic step-by-step approach. This article outlines the key steps critical to success.

According to Infiniti’s industry experts, ‘Digitization is important, but most companies are not prepared enough.’ Want to strategize for successful digital transformation in your business? Request a free proposal to know how our solutions can help.

Industry 4.0Evaluate existing capabilities with expectations

CIO’s must begin by evaluating their existing technological capabilities and compare them with the digital maturity that they expect to achieve. Prioritize measures that directly align with the organization’s overall strategy and will most likely create better business value. It is also vital to communicate and get commitment for the measures that are chosen for not just the top leadership but also ensure that it is evident to people across the organization who are integral to the execution.

Begin with pilot projects

Pilot projects can be used to demonstrate proof of concept and demonstrate the business gains that can be derived from the industry 4.0 strategy. Early success in the pilot projects can also help gain buy-in from the organization and secure adequate funds for the final roll-out. Collaborate with digital leaders outside the company to create pragmatic designs for the industry 4.0 concept, this is can significantly accelerate digital innovation.

Think you are losing out market share to players who have already embraced technological innovations in manufacturing? Get in touch with an industry expert from Infiniti Research to know how our solutions can help you reassert your position in the market.

Map capabilities required to achieve desired goals

The flaws in the pilots for industry 4.0 transformation will help CIOs identify the capabilities that the organization lacks in achieving the desired results. Create a blueprint highlighting the technology enablers that will help propel the business processes forward. The success of an industry 4.0 transformation will largely depend on the company’s ability to deploy appropriate skills and knowledge.

Embrace digital capabilities

A company can encounter several roadblocks in their journey to embrace digital transformation. Data is critical to make the right business decisions and adopt feasible strategies. Combine data from different verticals of business including logistics, QC, and engineering functions and use this to analyze new methods to attract customers. Advanced technologies such as real-time analytics can be used to attract customers and fully capture the potential of industry 4.0.  Actively understanding customer behavior and orchestrating a distinct role for your organization within complex ecosystems will be the greatest breakthrough to successfully adopting industry 4.0 capabilities.

Learn more about Infiniti’s portfolio of solutions

shipbuilding company

Competitive benchmarking for a U.S. Shipbuilding Company Helps Improve Productivity By 31%

The U.S. shipbuilding industry is known to be one of the finest producers of both military and commercial fleet. However, the rising costs continue to erode the budgets and overall profitability of shipbuilding companies in the US. According to experts at Infiniti Research, some of the key causes of the rising costs include material and schedule delays, starting production with immature designs, inexperienced labor force, and reduced productivity due to the introduction of a new series of a given combatant. Other roadblocks to growth faced by players in the U.S. shipbuilding industry involve factors such as unstable and declining build rate, lack of appropriate competitive benchmarking, and suboptimal acquisition strategies. While companies are taking measures to address these U.S. shipbuilding industry challenges, the inefficiencies in tackling costs continue to plague the industry’s overall growth.

Top markets (by global market share): South Korea, China, and Japan

RFP for more insights on top segments, market opportunities, and growth strategies in the U.S. shipbuilding industry.

Business challenge

A U.S. shipbuilding company, engaged in building and repairing vessels of assorted sizes and utility, approached experts at Infiniti Research to undertake a competitive benchmarking study in an effort to understand how key players in the shipbuilding industry performed and tackled business challenges. Apart from this they also sought strategies to address other business challenges including:

  • The shipbuilding company noted a decline in productivity when compared to other international shipyards, with outputs tailing by at least 40% in comparison
  • Tackling cost growth by identifying the key cost drivers and taking corrective measures
  • Assess the U.S. private shipyards using a standardized benchmarking system
  • Improving operating margins which was found to be much higher compared to international commercial shipyard companies
  • Enhancing obsolete designs that do not adhere to the quality standards
  • Identifying DoD, Navy, and industry actions, policies, and contract incentives that can be implemented

Facing similar challenges in your business? Get into dialogue with an expert from Infiniti Research to learn how we can help your business with tailor-made solutions.

Our Approach

Experts at Infiniti Research undertook a comprehensive competitive benchmarking study with exhaustive secondary research from proprietary and open source information sources to develop insights and hypotheses specific to the U.S. shipbuilding industry. Rigorous desk research through 750+ sources was executed to understand the U.S. shipbuilding market landscape, competitor strategies, and market trends.

 As a part of the engagement, in-depth market research was undertaken where our experts assessed ten leading international shipyards and the seven major U.S. shipyards to understand their key product lines and compare the shipbuilding practices in the international markets with that of the client. The market data collected was also validated with market experts and independent consultants in the shipbuilding sector. An Industry best practice assessment also identified key strategies and best practices followed by international shipbuilding companies to reduce costs and enhance productivity. This enabled us to help the shipbuilding company benchmark their exiting processes with that of key players in the market and identify the critical gaps. With Infiniti’s market opportunity analysis, the U.S. shipbuilding company was able to analyze various growth opportunities.

Results Achieved

shipbuilding industryInfiniti’s engagement helped the shipbuilding company implement strategies to enhance their overall productivity. Within a span of 7 months, the client recorded a 31% increase in their productivity. The benchmarking analysis also helped the client understand how they compared to top performing shipbuilding companies and replicated their cost-cutting strategies into the business. The shipbuilding company also identified the right suppliers to procure good quality materials at reasonable prices, bringing down the overall cost of production. Additionally, the shipbuilding company was also able to:

  • Improve their operating margins by 10% in each quarter
  • Revamp design implementation strategies by understanding the changing market requirements and discarding the obsolete segments
  • Identify unmet market needs and key growth segments before their competitors, giving them a first-mover advantage in the market

Shipbuilding industry

For more insights on our solutions portfolio

additive manufacturing

Additive Manufacturing Challenges in the Aviation Industry

In recent years, additive manufacturing (AM) has created a buzz in industries across the world, promising a flexible and cost-effective alternative to traditional manufacturing. One such sector that AM has brought about key transformations is the aviation industry. Additive manufacturing techniques play a pivotal role in aviation companies to reduce costs, increase efficiency, shorten time-to-market, and allow greater design flexibility. It acts as a vital technique to create complex designs and produce lightweight, yet strong structures. That being said, at present, there are several additive manufacturing challenges that need to be addressed by aviation companies before they go into its widespread adoption in the sector.

Driving change in an organization isn’t easy. A deep understanding of how your organization should adapt to the changing market innovations is key to foster organizational change. Request a free proposal on how our market intelligence can help your business with the right strategies to adapt.

Additive manufacturingAdditive manufacturing challenges in the aviation industry

Inconsistency in quality

Additive manufacturing currently faces several challenges in maintaining quality consistency. This is especially true in the case of the production of fully dense metal parts. Several aviation experts have also been raising concerns over the repeatability of the existing additive manufacturing systems. Also, the current AM systems are believed to offer accuracy of only approximately 30-40 microns. This is one of the critical challenges of additive manufacturing in the aviation industry as this does not align with the quality tolerance standards of aerospace companies. Consequently, some additive manufacturing parts require additional work after they are printed. This hurts the efficiency and purpose of AM.

Large and odd-sized parts

Another key challenge of additive manufacturing in the aviation industry is the inability to manufacture large and odd parts, making the production of certain large aircraft components difficult. This is one of the key areas where additive manufacturing underperforms when compared to traditional manufacturing.

Gain industry insights and solutions to your key business challenges from Infiniti’s industry experts.

High material costs

AM technology uses only a small quantity of polymers and metal powder for the production of aircraft parts. However, these come at a much higher price when compared to the materials that are generally used in traditional manufacturing. This, in turn, lowers the incentive to use additive manufacturing in the aviation industry. This challenge must be addressed by AM providers by identifying alternative materials that can bring down the production costs.

Scalability limitations

Traditional manufacturing and sourcing techniques often help companies to stock large quantities of inventory for unforeseen contingencies. But in the case of AM, it may not be possible to scale up production in case there is a sudden surge in demand. As this scenario is highly likely in the aviation sector, scalability becomes one of the biggest challenges of additive manufacturing in the sector. Several additive manufacturing providers are already working on this challenge by enhancing the production speed of AM systems.

Want more insights on our market intelligence solutions?

shipbuilding company

Exploring Critical Challenges Facing the Swiss Manufacturing Industry

Manufacturing industry

As the center of gravity of manufacturing has gradually migrated to Asia over the past decade, it has become acceptable in more developed nations to assume that manufacturing industry can no longer play a substantial role in the expansion and continued sustainability of their economies. Switzerland is known for setting itself apart internationally by being a highly competitive and attractive market to do business. The Swiss manufacturing industry has come under increased pressure over the past couple of years. The global financial crisis and the subsequent strength of the Swiss franc posed several manufacturing industries challenges. In the view of these manufacturing industry challenges, the questions to find answers to here is how long Swiss manufacturing companies can remain competitive and how they are going to do so.

It is important for companies in the manufacturing industry to build on existing strengths in order to flourish and stay competitive in the long run. Request a free proposal to find out how our solutions can help companies in the manufacturing industry achieve this.

Manufacturing industry challenges in Switzerland

Economic volatility

The Swiss economy is characterized by rising volatility and increased uncertainty since the global financial crisis almost a decade ago. Subsequently, there was an increased pressure on margins of companies in the manufacturing industry due to the strengthening of the Swiss franc. This situation was stabilized to a considerable degree when the swiss national bank implemented the EUR/CHR exchange rate floor. However, the increasing pressure has resulted in several companies in the Swiss manufacturing sector to make additional operational adjustments. Manufacturing companies exporting primarily to Europe are most likely to shift their focus outside traditional markets to growth regions.

New growth markets

During recent years, strong economic growth has occurred in emerging markets rather than developed markets. In this scenario, the key challenges for Swiss manufacturing industry companies will be to expand their operation further into new growth markets and at the same time compete effectively with existing players in these markets.

Get in touch with our experts to gain insights on how we can help manufacturing industry players to increase efficiency and productivity.

Rising global competition

Amidst rising global competition, innovation, the need to introduce new and innovative products are becoming paramount for companies in the manufacturing industry. While targeting new growth markets, manufacturers must ensure that their products are tailored to suit local needs. Product innovations are essential in developed markets to survive despite the rising competitive pressure. The challenge here for companies in the Swiss manufacturing industry will be to reinvent themselves amid these tensions, especially because new products from emerging markets are increasingly being imported to developed countries and has become a source of competition for manufacturers in domestic markets.

Shortage of resources

Another critical challenge for Swiss manufacturing companies involves issues such as shortage of resources, which is prominent in case of talent and energy. Firstly, the Swiss manufacturing industry has long experienced shortage of labor and this needs to be addressed immediately in order to remain globally competitive. Secondly, Switzerland’s energy policy provides for phase-out of nuclear power and promotes renewable energy sources. This entails both risks and opportunities for the Swiss manufacturing industry. The challenges here would be to restructure the energy industry as an opportunity while staying prepared for contingencies such as electricity prices or uncertainties in terms of supply securities.

Learn more about Infiniti’s solutions for the manufacturing industry

manufacturing sector

How the US Manufacturing sector Compares to Other Nations

After several years of falling output and diminishing labor force, the industrial manufacturing sector in the United States has been enjoying resurgence over the past couple of years. According to manufacturing industry experts at Infiniti Research, factors including the strengthening economy, better workforce quality, favorable tax policies and regulatory environment, and reduced transportation and energy costs are catalysts for this revival. In order to move forward, it is essential to understand how the manufacturing industries across the world are performing in comparison to that of the U.S. manufacturing industry. In this blog, experts at Infiniti Research provide insights on the manufacturing trends and some of the manufacturing challenges faced by different nations. They also highlight how the US manufacturing sector compares to these nations.

China has one of the strongest manufacturing industries in the world in terms of manufacturing output and the percentage of its national output that is generated. Meanwhile, Poland has the highest percentage of its workforce employed in manufacturing.

United Kingdom

The drop in the value of the British pound against the U.S. dollar and the euro has strengthened the U.K.’s manufacturing sector, thereby facilitating an increased demand overseas for goods from the country. Furthermore, the manufacturing sector holds a strong presence in the country due to its significant role in the export economy. In fact, the manufacturing sector contributes to a good majority of the U.K.’s overall exports. One of the key manufacturing trends in the U.K. is the rising efforts made to capture a significant share of the overseas market. However, the weak pound can impose manufacturing challenges as it may increase the import cost of certain supplies. Furthermore, as Brexit negotiations unfold, the future of manufacturing in the U.K. will experience significant turbulence.

Most companies in the manufacturing industry often cite congestion, logistical issues, or connectivity problems as major barriers to overcome. Are you facing similar issues in your business operations? RFP to learn how our solutions can help you overcome to these predicaments.

Switzerland

The effective governance policy in Switzerland has played a favorable role in shaping its strong manufacturing g sector. As a result of their long-held international neutrality, the country has transparent and fair processes, strong judicial effectiveness, and good economic and political stability. Moreover, Switzerland prioritizes being a strong trading country. The country has also got a top-notch manufacturing talent pool with a large number of highly-skilled workers. The key manufacturing challenges faced by companies in Switzerland include the cost of production and the strong franc value that could hamper exports.

Brazil

The rising corruption in Brazil is one of the primary factors that has plagued the country, resulting in a flailing manufacturing sector. Corruption makes investors reluctant to pour money into business operations due to chances of long-term uncertainty. Consequently, this dampens the chances of long-term investment and business growth. This can have adverse effects on the country’s manufacturing sector. A healthy manufacturing sector is contingent upon transparency in financial transactions, relative certainty in a country’s political environment, and individuals being held accountable for illegal action.

Indonesia

Although a decade ago Indonesia’s manufacturing sector contributed a significant amount of their GDP, Over the years the industry’s contribution has considerably dipped. Indonesia is largely hampered by anemic labor productivity. The sizeable proportion of small and unproductive firms in Indonesia are dragging down the entire sector. To improve their global competitiveness, Indonesia needs to develop its workforce and advance its manufacturing sector. They must focus on incentivizing manufacturing companies with low productivity to either exit the industry or improve their productivity through technology and skilled labor.

Request a free brochure to gain insights into how our solutions are tailor-made to solve different business challenges.

Manufacturing sector in the US

Skilled workforce, advanced technology, and pro-business policies have propelled the growth of the manufacturing sector in the U.S. Manufacturing contributes to over $2 trillion to the United States economy. The labor costs in the United States are significantly higher than in other countries. However, the levels of productivity found in the United States make up for this difference, making the country an attractive location for manufacturing investment. Furthermore, disruptive technologies including additive manufacturing, 3D-printing, robotics, and the utilization of the IoT and Big Data are revolutionizing the U.S. manufacturing sector. This has not only increased levels of productivity but has also made the United States one of the most attractive locations for high-technology manufacturing firms. The United States has, benefited from open trade policies, and in order to attain continued manufacturing growth, the country should avoid tariff wars or overly restricted trade policies.

The gap in labor costs in the United States in comparison to other countries has started to drop and is expected to continue as the cost of industrial robots falls.

Learn more about how manufacturing sector challenges vary from region to region and how our market intelligence solutions can help overcome them.

workforce management

Drilling Down the Workforce Management Challenges of the Manufacturing Sector

The manufacturing industry in the U.S. has made impressive strides in the past couple of years. The country has witnessed a rise in public awareness about the modern manufacturing industry, increase in jobs returning to the country, and also the advent of new technologies that are driving the industry forward. However, the ongoing struggle to find skilled labor due to the rapid retirement of baby boomers from the sector is proving to be a major workforce management challenge for companies in the manufacturing sector. Apart from this, there are several other challenges that manufacturing companies must tackle in order to sustain the future scalability of the sector.

Stay updated on our latest market intelligence solutions for the manufacturing industry. Request a free brochure to learn more.

Top workforce management challenges

 Hiring the right workforce

Manufacturing operations today are largely different from what it was a decade ago. The advent of digital technologies including robotics and advanced enterprise software are paving way for a new manufacturing environment. The modern workforce must have the skills and expertise to handle the digital systems which have become a part and parcel of the manufacturing sector.  Fewer schools offer shop classes and more students shy away from manufacturing, posing as a workforce management challenge for manufacturers to find the right talent.

Are you a manufacturer facing similar challenges? Request a free proposal to know how we can help you overcome them.

Consistent training and education

With rapid changes taking place in the manufacturing industry, even well-trained employees may face difficulties in keeping pace with these disruptions. Another key workforce management challenges for companies in the manufacturing sector is to ensure consistent training and education that would ensure that employees are up-to-date with the new tech trends and other market changes.

Overcoming stigmas related to manufacturing jobs

Throughout the United States, manufacturing has fallen out of style. High Schools, teachers and parents alike are steering children away from a career in the industry. This sector is currently bogged down by outdated stigmas such as being a dark, dangerous, and an ominous industry creating serious workforce management challenges for this sector. 

Cybersecurity threats

Technology continues to change how manufacturers develop products and interact with customers. As a result, information technology security risks have increased. Despite this, several manufacturers fail to take the necessary steps to protect their data. The number of connected products in manufacturing operations is on the rise, consequently, external and internal vulnerabilities are also increasing in the industry.

How can Industry 4.0 help manufacturers overcome workforce management challenges? Download this free resource to find out:

workforce management

 

Get in touch to learn more about our solutions for better workforce management:

contract manufacturing

Why are Top manufacturers moving to Contract Manufacturing?

What is contract manufacturing?

Contract manufacturing is often used interchangeably with the term ‘outsourcing.’ outsourcing is the technique of transferring portions of work to outside sources and suppliers, instead of undertaking the entire work within the company, resulting in lower costs and expenses. Contract manufacturing is a form of outsourcing where a manufacturer enters into a formal agreement with another manufacturer (contract manufacturing organization) to produce parts, products, or components, which the former will then use in its own manufacturing process, to complete its own product. They then undertake their own marketing, sales and distribution, and customer service to bring the final product to the end-users or consumers. In some cases, contract manufacturers may also be specialized organizations that provide contract manufacturing services to more than one business. 

Learn how top manufacturers around the globe are enhancing their operations. Request a free brochure to know how our solutions can help your business get there.

Different types of contract manufacturing

The different forms of contract manufacturing vary based on nature and operations involved in a business. Some of the most common forms of contract manufacturing agreement includes:

Production of the entire product

As the name clearly suggests, this involves contract manufacturing organizations building the entire product for a company under the brand name or label of the latter. This type of contract manufacturing is also called as ‘private label manufacturing’.

Production of parts or components

In this type of contract manufacturing, companies depend on a contract manufacturing organization to produce parts or components that will be incorporated into the final product of the company. For instance, a computer hardware manufacturer can use contract manufacturing for producing smaller computer parts and components, which is then assembled into their final product.

Hiring service or labor force

This involves subcontract for labor. If a business does not possess enough manpower in their company to carry out production processes smoothly and quickly, then they can outsource labor. Take the example of big multinational companies in the US who set up their manufacturing unit in Asian countries and subcontract their labor forces to Asian human resource companies. The key reasons why companies adopt this form of manufacturing is the specialized skills that these labor forces have and the comparatively cheaper cost of labor when compared to their home countries.

Using manufacturing equipment or facility

Companies that do not have the facility or the equipment to manufacture can transact with a contract manufacturer for the use of their facility. This saves the company capital investment needed to set up a manufacturing unit.

Confused about what strategies will help you increase your profit margins? Leave it to the experts! Request a free proposal to know how we can help you formulate the best go-to-market strategy and increase your share of wallet.

Why do top manufacturers favor contract manufacturing?

The decision to make or buy a product/ parts of a product can often prove to be a tough decision for companies. They often undertake feasibility studies for the management to gain a better understanding of what would be more beneficial for them. One of the key benefits that companies can derive from contract manufacturing is the reduction in cost and expenditure. But this is not the only reason companies opt to get into agreements with contract manufacturing organizations. Some of the other reasons include:

  • Improved allocation of resources
  • Greater focus on core business functions
  • Increased innovation and enhanced product quality
  • Reduction in manufacturing time
  • Streamlined business relationships

 

GET MORE INFO on Infiniti’s solutions for business:

Close
Infiti Logo

Hello there!

Contact us to know more about our cost-effective custom market research offerings to support efficient market penetration, new product launch, and devise strategies to monitor and outperform your competitors.

Cookie Policy

The Site uses cookies to record users' preferences in relation to the functionality of accessibility. Please refer to the help guide of your browser for further information on cookies, including how to disable them. Review our Privacy & Cookie Notice