By Mike Edgett, U.S. Product Marketing Director, Medium Segment, Sage
Without question, this year, manufacturers have experienced disruption. To show how quickly things have evolved, in a manufacturer survey released in March conducted by the National Association of Manufacturers, 53.1% of manufacturers anticipated a change in operations due to COVID-19, with 35.5% saying that they are facing supply chain disruption. It would be safe to assume that today those numbers would be even higher.
Now more than ever, companies are prioritizing digitalization and implementing new technologies and testing additional techniques to prepare for whatever the near future may bring. With digital transformation at the top of everyone’s agenda, there are a few areas food and beverage manufacturers must prioritize to keep ahead of change.
AI + robotics take center stage
A divide has been forming in manufacturing in the area of digital transformation. According to a recent IDC report, digital investments for F&B manufacturers are top of mind. They have substantial net-positive effects on RPI (Revenue Performance Index) and PPI (Profit Performance Index). Since the beginning of the pandemic, the need to keep the business running remotely or with a limited workforce, while also having the right data to predict disruption, is at the forefront. With large amounts of the workforce being forced home and regulations put in place to stop the spread, the value of AI and robotics has become more apparent than before for facilities as they offer a more controlled means to uphold quality control and operational efficiency. Such technology can not only monitor equipment and manufacturing parameters, but also provide the foundation for improved predictive maintenance. AI goes beyond just the four walls of the plant. It can manage the larger data sets that can assist in forecasting inventory needs and refining business processes to be as efficient as possible.
In addition, COVID-19 has tested many company’s ability to quickly change production and inventory plans. There will certainly need to be a push for predictive analytics and AI in manufacturing moving forward so as to respond to “unpredictable” anomalies like COVID-19 in as educated a way as possible. Predictive analytics can help reduce risk and provide food and beverage managers the insight needed to keep them agile. With the type of insights that AI can bring in, there can be a strong emphasis on accurate inventory controls, and effective handling of cash flow, which, during a crisis, is ever important. This same AI will be able to reduce unplanned downtime, capital expenditure, and asset maintenance costs, as well as improve safety and workforce effectiveness.
Sanitation methods increase tenfold
Food manufacturing plants in the United States have always been under rigorous guidelines for cleanliness and are consistently inspected to ensure they meet proper standards. This is to guarantee not only consumer safety, but worker safety as well. However, as has been reported in national news, the COVID-19 pandemic has brought a new level of worker safety to the forefront. Companies have had to determine how to maintain efficiency in the plant while also respecting social distancing guidelines.
While in most industries working from home has rarely been seen as feasible or encouraged in the past, many companies have been forced to become more flexible and agile during this time. It’s likely that remote working will become more commonplace in the future, and that plant floors will become less crowded, which will undoubtedly be aided by greater adoption of automation and AI. In addition, many plants have tasked an entirely separate third-party workforce to clean five days (or more) a week. While clean downs have always been an integral part of manufacturing plant protocol, it has expanded to all work areas, not just those that are in contact with the food or beverage being manufactured.
Imports and exports – A change in taste
Consumers today want to know more about the food they eat, how it was processed, where it came from and how it was grown. Now, coupled with the complications brought on by COVID-19, there is predicted to be an even stronger preference towards homegrown foods, with an avoidance of foods from overseas. There is a strong value placed by the consumer on organic foods, made in their own country, and F&B manufacturers are working to pivot to fill this need.
Further, being that a lot of imports are higher-end goods – for instance, certain meats, breads and cheeses – it’s possible that many specialty products will take a hit in sales, and companies that are rooted in those goods may shut down or need to pivot their product offering. As restaurants open, they may also struggle to receive those unique products, furthering the potential demise of related brands.
While nearly every industry in the United States (and across the world) has suffered in some way, shape, or form during this global pandemic, manufacturers are working to stay agile and efficient by quickly adopting digital transformation across their organizations to stay ahead of the competition. As a staple sector that helps the global economy run efficiently, with new technological advancements, safety implementations, and the incorporation of predictive analytics, more intuitive ERP usage, and AI and robotics, it’s sure to come out stronger and more resilient post-pandemic.
Mike Edgett is an enterprise technology & process manufacturing expert with 20+ years leading business strategy for brands such as Infor, Quaker Oats, and Bunge Foods. At Sage, Mike leads the US Product Marketing team focused on the medium segment. This group drives the go-to-market strategy for Sage’s solutions designed to meet the business needs and challenges across the manufacturing, distribution and service industries.
