1、9TH ANNUAL STATE OF SMART MANUFACTURING REPORT:1State of Smart Manufacturing Report:CPG Edition9T H A N N U A L How the Consumer Packaged Goods(CPG)industry is harnessing emergent technology to reduce risk,improve forward planning and maximize workforce potential 9TH ANNUAL STATE OF SMART MANUFACTUR

2、ING REPORT:2:THE CURRENT STATE OF SMART MANUFACTURING:OBSTACLES AND OUTLOOK FOR CPGInflation and the energy crisis are the top external barriers to growth for Consumer Packaged Goods(CPG)firms,followed by workforce issues.The impact of inflation worries a higher proportion of respondents from CPG fi

3、rms than from the cross-section of organizations surveyed for our full report.However,while supply chain disruption was second on the list of external obstacles for CPG last year,it has now dropped to fifth place replaced by energy costs at number two.Internally,workforce concerns take three of the

4、top five spots attracting,onboarding and retaining skilled employees is hampering growth.Last years top three internal obstacles for this sector related to quality,technology,and data;demonstrating how the people challenge has rocketed up the agenda this year.41%26%Biggest external obstacleBiggest i

5、nternal obstacleInflation and economic growthWorker retention/knowledge retentionEXTERNAL OBSTACLESINTERNAL OBSTACLES12345Q.What do you see as the biggest external obstacle(s)to your organizations growth for calendar year 2024?Select all that apply.Q.What do you see as the biggest external obstacle(

6、s)to your organizations growth for calendar year 2023?Select top 5.Impact of COVID-19 pandemicInflationShortage of skilled workersSupply chain disruptionRaw material/microchip shortage/prices20232024Inflation and economic growthCybersecurity risksWorkforceEnergy crisis/rising energy costsSupply chai

7、n disruptionShortage of skilled workersInflationImpact of COVID-19 pandemicSupply chain disruptionRaw material/microchip shortage/pricesN/AWorker retention/knowledge retentionBalancing quality and profitable growthOnboarding new employeesDeploying and integrating new technologyAttracting employees w

8、ith desired skill setsCapturing,understanding,interpreting,and using data to improve the business20232024Base:1567Base:1353Q.What do you see as the biggest internal obstacle(s)to your organizations growth for calendar year 2024?Select all that apply.Q.What do you see as the biggest internal obstacle

9、(s)to your organizations growth for calendar year 2023?Select top 5.Base:1567Base:13539TH ANNUAL STATE OF SMART MANUFACTURING REPORT:3:THE CURRENT STATE OF SMART MANUFACTURING:This report is based on the responses of 158 managers and executives from Consumer Packaged Goods manufacturers in 17 countr

10、ies.Its part of the 9th annual edition of the State of Smart Manufacturing report,which surveyed 1,567 manufacturing leaders across multiple industries.ABOUT THE RESEARCHTECHNOLOGY INVESTMENTS RISE FOR CPG MANUFACTURERSCPGs investment in technology has risen by more than a quarter year-on-year.Howev

11、er,the percentage of operating budget CPG invests in technology is slightly lower than average,when compared to our cross-sector survey.CPG manufacturers are seeing the best return on investment from production monitoring systems in contrast to our cross-section of industry respondents who dont incl

12、ude this technology in their top 5.In line with other industries,spend on generative AI and cloud solutions are generating strong returns for the CPG sector.Spending in this area increased 26%year-over-year:from 21%to 27%of operating budget.20232024AVG.30%27%21%TECHNOLOGY INVESTMENTQ.Which of the te

13、chnologies that your company has invested in had the biggest ROI over the last 12 months?Select top 3.Generative AI or causal AIProduction monitoringCloud/SaaSDigital thread5GSupply chain planningEnergy managementQuantum computingQuality management system(QMS)Human machine interfaceEnterprise resour

14、ce planning20%18%18%18%18%17%16%16%16%15%15%Base:1562BIGGEST ROI9TH ANNUAL STATE OF SMART MANUFACTURING REPORT:4:THE CURRENT STATE OF SMART MANUFACTURING:Respondents believe that those at the forefront of this industry are using data to fuel AI and production scheduling.Leaders are also perceived to

15、 be using the data they collect to improve processes and quality.In contrast,respondents say the top way their organizations use data is for sales analysis.When it comes to their own data,CPG respondents believe their organizations use well under half of what they collect effectively.BETTER DATA MAN

16、AGEMENT NEEDED TO FUEL INNOVATION AND IMPROVE PLANNING 40%of data is being Only used effectivelyQ.How do you perceive leaders in your industry are using the data collected from their currently employed technologies,processes,connected devices,etc.?Select all that apply.32%Sales analytics33%36%Artifi

17、cial intelligence/applied AI/generative AI/machine learning33%Improve/monitor product qualityProcess optimizationBase:156734%Production planning/schedulingHOW LEADERS USE DATA9TH ANNUAL STATE OF SMART MANUFACTURING REPORT:5Q.Which of the following best describes your organizations current efforts ar

18、ound ESG (Environmental,Social,and Governance/Sustainability)?Select one.*Only showing respondents from these industriesBase:91790%Energy transition/renewable energy89%Auto&tire,auto tier,suppliers,EV,and battery88%Hi-tech electronics/semi-conductor84%CPG84%ChemicalAT LEAST SOME FORM OF ESG POLICY(%

19、)The thing that matters most to CPG firms ESG programs is product quality;this is considered more important than the top-ranked answer energy management given by our cross-sector respondents.Diversity,equity and inclusion rank higher for CPG manufacturers than in our aggregated industry results,wher

20、e it doesnt make the top 5.WHAT MATTERS MOST FOR 2024Commitment to“eco-friendly”processes throughout the product lifecycleProduct quality/safetyHealth and safetyEnergy management RecyclingDiversity,equity,and inclusionReducing manufacturing waste34%32%30%28%35%37%37%Q.What matters most to your organ

21、izations sustainability/ESG policy?Select all that apply.Base:1567:THE CURRENT STATE OF SMART MANUFACTURING:ROOM FOR IMPROVEMENT IN THE FIELD OF ESGCPG lags behind the energy,automotive,and technology sectors when it comes to implementing environmental,social and governance(ESG)policies.9TH ANNUAL S

22、TATE OF SMART MANUFACTURING REPORT:6:THE CURRENT STATE OF SMART MANUFACTURING:CPG FIRMS ADOPT SMART MANUFACTURING TECH TO CUT COSTS86%of CPG manufacturers are using or evaluating smart manufacturing technology and most believe it will help them to reduce costs.This is in contrast to our overall surv

23、ey,where quality improvement topped the table of expected outcomes.However,cost is also seen as the main barrier to adoption of smart manufacturing in the CPG sector,followed by workforce-related issues;namely a lack of necessary skills to implement and use the technology.Q.What positive business ou

24、tcomes are you looking to achieve from your smart manufacturing technology?Select all that apply.Reduce cost41%Improve quality37%Growing into new markets/new products/International expansion36%Digitize our environment/operations35%Drive overall equipment effectiveness(OEE)34%Base:1567SMART MANUFACTU

25、RING IS DRIVING BUSINESS OUTCOMES AROUND THE WORLD86%of CPG manufacturers are using or evaluating smart manufacturing technology9TH ANNUAL STATE OF SMART MANUFACTURING REPORT:7Manufacturers are upgrading their networking infrastructure and investing in more industrial computers and connected hardwar

26、e devices to capitalize on advancements in connectivity.Q.Which of the following smart manufacturing hardware/smart devices has your company adopted or has plans to adopt?Q.Which of the following smart manufacturing software solutions has your company adopted or has plans to adopt?FACTORY FLOOR PROC

27、ESSES SEE MOST SMART MANUFACTURING ADOPTIONIndustrial computers80%Supply chain planning(SCP)75%Connected devices79%Quality management system(QMS)75%Sensors and instruments72%Energy management74%Human machine interface(HMI)68%Enterprise resource planning(ERP)72%Networking hardware84%Production monito

28、ring78%HARDWARESOFTWAREBase:1567Base:1567:THE CURRENT STATE OF SMART MANUFACTURING:PERCENT OF SMART MANUFACTURING ADOPTIONIn terms of software adoption,respondents favor modular,scalable smart manufacturing solutions for tasks such as production monitoring and quality management that can be deployed

29、 quickly at a lower cost than more highly complex,rigid legacy systems.9TH ANNUAL STATE OF SMART MANUFACTURING REPORT:8BUILDING A WORKFORCE WITH A BALANCE OF SKILLS:THE CURRENT STATE OF SMART MANUFACTURING:Q.Over the next 12 months,how important are the following knowledge and/or skills as your orga

30、nization recruits its next generation of employees?CPG employers are looking for a combination of technology knowledge and softer skills to build a strong workforce over the next twelve months.The importance of employees finding purpose in their roles is felt more strongly here than in our cross-sec

31、tor responses,where it ranked sixth.Manufacturers recognize that supporting their workforce through an era of seismic change will be crucial for success;respondents say training for new processes,and change management,will be the biggest workforce-related obstacles over the next 12 months.Knowledge

32、of smart technology84%80%79%78%77%Communication/teamworkFeeling purpose/value in their roleFlexibility/adaptabilityCybersecurity practices and standardsBase:1567rated training employees on updated processes as theSKILLS EMPLOYERS ARE SEEKINGWORKFORCE-RELATED OBSTACLESEmployee retentionRising cost of

33、 labor/skilled staffTraining current employees on updated processesChange managementEmployee engagementKnowledge retention27%28%27%34%31%30%More than 1/3top obstacle when it comes to the workforce.9TH ANNUAL STATE OF SMART MANUFACTURING REPORT:9AI AND BLOCKCHAIN TOP PLANNED TECH INVESTMENTS:THE CURR

34、ENT STATE OF SMART MANUFACTURING:The top technology investment for CPG in the coming year will be generative or causal AI the same finding as in our main report.However,where other industries are yet to see the potential in blockchain,its the second most popular planned investment for CPG,pointing t

35、o the benefits it can bring in tracking and verifying consumer goods.46%Generative AI or causal AICobots(Collaborative robots)39%Generative design39%39%DronesVoice recognition/natural language processing technology(NLP)38%RPA37%Zero trust architecture37%RFID/GeoTagging37%Digital thread37%Industrial

36、metaverse40%Blockchain43%Q.Which of the following technologies has your company invested in?Respondents selected:Plan to invest in the next 12 months from four options.Base:1567TOP 10 INVESTMENT AREAS OVER THE NEXT 12 MONTHS9TH ANNUAL STATE OF SMART MANUFACTURING REPORT:10:THE CURRENT STATE OF SMART

37、 MANUFACTURING:THE FUTURE OF SMART MANUFACTURING:LOOKING TO THE FUTUREThe concerns around change management which surfaced elsewhere in this report reappear when we asked CPG manufacturers about future leadership obstacles.Effectively managing people and resources and resistance to change are the to

38、p barriers in this area.The importance of being able to lead an organization through change is seen as more critical for CPG than in the full cross-sector report,where it sits outside the top 5.Going forward,CPG manufacturers are targeting strategies that will help them retain,upskill and engage the

39、 workforce in order to thrive and grow.Technologies that complement and augment the value brought by people such as smart manufacturing technology and automation are where they see positive business outcomes being created.Despite the ongoing planning and workforce challenges,theres reason to be posi

40、tive for those leaders who focus on the benefits to be had by technology when its thoughtfully applied by an engaged and inspired workforce.Q.How do you plan to drive positive business outcomes over the next five years?Select all that apply.44%Increased automation41%Adopting smart manufacturing tech

41、nology38%Better use of real-time data to make decisions37%Increased use of artificial intelligence/machine learning35%Increased training and employee programsHOW CPG MANUFACTURERS ARE PLANNING TO DRIVE FUTURE SUCCESSTOP 5 LEADERSHIP OBSTACLESResistance to changeEffectively managing people and resour

42、cesLeading or guiding meaningful/enduring changeWorker retentionUnderstanding how to manage the next generation workersThis data represents the top 5 leadership obstacles that will be faced in the next 12 months for CPG.26%25%27%29%29%Base:15679TH ANNUAL STATE OF SMART MANUFACTURING REPORT:11expandi

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