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“Industry 4.0” is a term now in common use generally to describe the “fourth industrial revolution”, a term that it is used interchangeably with. But what does it mean, on a high level and specifically for what impact it might have on your business?

To get us all on the same page, let’s first go back to “Industry 1.0” and be clear about the other distinct eras of industrial revolution:

Warehouse design and management are an art form and  science unto their own. 3PLs and large retailers, in particular, have taken what was once a slow-moving, unseen part of a cost-center in the business and turned it into a highly efficient, increasingly automated, carefully measured and service-focused asset. Manufacturers, on the other hand, while being at the leading edge of automation, measurement and efficiency on the production floor, may not always apply the same level of industrial design planning and management as they would normally demand.

As it turns out, warehouse operations for a manufacturing facility have a lot of similarities as other types of businesses, but do have some requirements that are unique to their needs.

Product Development is a challenge for any business, but especially for small manufacturers. While there are reams of data and statistics out there showing you how many products fail every year, and how daunting the percentages are (and to be honest, there is a lot of disagreement on these numbers), there is relatively little mention of the challenges of coming up with your new product in the first place.

There are a lot of innovations in manufacturing getting press in recent years, but most of them relate to the improvement of productivity through process improvement – continuous improvement, supply chain management, culture and developing talent. But there is one radically innovative technology that is flying under the radar but is already poised to bring the sci-fi future into today’s factories.

Many small manufacturers get their start innovating around a single hit product but building on early success is often the hardest thing for a business to do. As Robert Glazer explains, “When you bet your company's future on just one product's explosive success, that doesn't automatically translate to long-term growth.”

The most successful manufacturers understand that resting on success can kill even the most popular businesses. A commitment to ongoing product development is the best way to ensure future relevancy. Developing additional products that align with a current area of expertise is crucial to building the brand and driving growth.

Manufacturing is a broad term that is thrown around loosely in the news and in the public domain. 

We've heard for decades about the "decline of manufacturing", but depending on how you measure it, it's not always clear there has been a decline. Frequently a decline of jobs in manufacturing is reported as implying a decline in production, but it is often a result of higher productivity that comes from more automation, improved supply chain logistics and systems. This itself can lead to a decline in employment. 

Reverse logistics is already a fast-growing element of manufacturing and distribution, but lacks the wider understanding it deserves. As a result, many businesses that are unwittingly executing on reverse logistics are missing an opportunity to make it a smooth, efficient and potentially profitable part of their business as they would expect from other process areas.

Last month, we published Part I of this article, where we talked about making that transition from “freewheeling inventor” to “process-driven listener”. Basically, it is about being more systematic in how you collect the data and insights that lead to more relevance in your new products. This is hardest for the business which was started from a single brilliant idea that succeeded, because it is not uncommon for the small manufacturer to not really understand WHY their initial product succeeded. Play-Doh, the ubiquitous colorful molding clay of everyone’s youth, was originally created in the 1930’s as a wallpaper cleaner. Success is great, but if you started out intending to be an innovator in the cleaning products business but all of your customers are under five years old, where do you go next?

Over the years you’ve seen a lot of material coming from us about using “Lean” Manufacturing and using Lean techniques in other areas like distribution and logistics. As a manufacturer ourselves, we have always strived to take our own advice, but like many of you, we also learned in the process that while the reward is great, the work to get there can be HARD.

With heightened competition from the global economy, a dwindling workforce as a result of the labor shortage and increasing demands from customers—it’s never been more important for manufacturing facilities to focus on efficiency. Of course, many operations managers turn to lean techniques in an effort to streamline and increase production, but how can facilities take things a step further?