How will smart manufacturing change in 2021?

1 Dec 2020

Image: © Andrey Armyagov/

Forrester’s Pascal Matzke looks at the trends expected to come for the manufacturing industry in 2021 following the Covid-19 pandemic.

The coronavirus crisis reminded us all of the often-invisible powers that manufacturers and logistics companies have in keeping things moving.

Remember all the panic buying of toilet paper and pasta and shortages of personal protective equipment at the beginning of the crisis? Well, goods were mostly produced and delivered. The lights stayed on.

But behind the scenes, processes designed over years to drive operational cost control, efficiency and predictability were complemented and sometimes even replaced by those that emphasise flexibility and resilience.

Looking forward into 2021, the current crisis will accelerate the digital transformation efforts already underway in manufacturing. It will drive the shift of the underlying core systems away from linear transactions that are focused on efficiencies and cost to the continuous interaction focused on effectiveness and customer value. So, what are some of the key highlights we can expect for smart manufacturing?

Increased flexibility and resilience

Manufacturing ecosystems will drive flexibility and resilience. For example, in 2021, most large manufacturers will re-evaluate their supply chain systems and processes against the goals of better resilience and flexibility.

They will regularly pool data about supplier and carrier performance and take faster decisions on ecosystem relationships they need to enter or exit. They will shift many of these systems into the cloud to manage operations from anywhere with everybody, and thereby elevate the collaboration of these systems within a broader partnership ecosystem.

The growth of emerging tech

Emerging tech will act as a catalyst for change. The pandemic showed how emerging technologies such as augmented reality and additive manufacturing (3D printing) can help in an emergency, but now manufacturers are working out where they can drive sustainable value and thus change the way their organisations operate.

Engineers guided customers through remote maintenance tasks as travel restrictions limited their ability to help in person. The need for a rapid response to the pandemic removed many obstacles to adoption.

Upskilling will be critical

Elevating human skills will be a key success factor. Despite ongoing automation within manufacturing organisations, shortage of talent has become a major issue, especially in China and India.

Already, the processes of manufacturing advanced AI and automation technologies are extending from repetitive physical tasks into knowledge territory.

In 2021, manufacturing firms will aggressively invest in technologies such as unstructured content analytics, digital worker analytics, knowledge management solutions, industrial knowledge graphs and reinforcement learning.

By Pascal Matzke

Pascal Matzke is a vice-president and research director at Forrester. A version of this article originally appeared on the Forrester blog.