Nine out of 10 senior manufacturing industry executives expect the “competitive importance and pace of innovation” to increase as companies adopt new technologies, according to a new survey by Frost & Sullivan’s Manufacturing Leadership Council.
The technologies in question are the digital tools and strategies commonly referred to as Industry 4.0.
The survey found that manufacturers plan to focus their innovation in three key areas:
- Supply chain (49%)
- Business model (52%)
- Service (57%)
And they believe three main technologies will help them “improve their innovation performance”:
- Internet of Things technologies and pervasive sensor networks (64%)
- Advanced data analytics (56%)
- 3D printing systems that allow the rapid prototyping of new product ideas (42%)
How can food manufacturers leverage these technologies to innovate and remain competitive?
Supply chain transparency
Of the focus areas, supply chain innovation is where food manufacturers have made the biggest moves.
In particular, the digital ledger blockchain is garnering a lot of attention as a way for companies to gain full insight into their entire supply chain. Just last month, IBM announced a partnership with 10 major food companies (including Nestle, Unilever, and Tyson) on a blockchain initiative.
Blockchain will allow companies to see much farther than the “one-up, one-back” that FSMA requires. In addition to providing better traceability for food safety purposes, it also helps processors achieve the full transparency that today’s consumers demand.
Meal kits — A new business model
As far as business model innovation, meal kits have moved over the past year from fringe to mainstream as companies like Campbell and Nestle look for new ways to connect with their target audience.
The meal kit model still faces challenges — just look at the Blue Apron IPO — but with consumers looking for healthy, convenient foods that they can make quickly at home, this market is expected to grow significantly over the next few years.
E-commerce is coming
Finally, while food manufacturers aren’t traditionally considered service companies, that’s changing thanks to e-commerce.
While grocery may be the final frontier for online shopping, it’s definitely coming. Three in 10 Millennials currently purchase groceries online. E-commerce doesn’t represent the majority of their grocery spend, but they do shop online more than older generations. And the next generation is likely to take online shopping to a whole new level.
These are just three examples of how food manufacturers are innovating to stay competitive. What other examples have you seen? Is your company doing something new and interesting? Let us know in the comments or email us at email@example.com.