After years of supply chain disruptions, economic uncertainty, and heightened geopolitical tensions, manufacturers now face a technology revolution from AI agents and other innovations, and are under pressure to evolve. In response, an overwhelming 85% of the more than 800 manufacturing industry decision makers Salesforce surveyed for its latest Trends in Manufacturing report said they must modernize their day-to-day operations to stay competitive.
To get there, 97% of manufacturers are pursuing strategic changes, including to their service and aftermarket operations, and 26% characterize them as complete overhauls. These efforts include using new technologies like artificial intelligence (AI) and connected assets — which includes machinery, industrial equipment, vehicles, and appliances that are equipped with sensors, software, and connectivity capabilities – to improve and expand service and aftermarket offerings, open new revenue streams, stand apart from competitors, and increase customer loyalty.
Why it matters: Manufacturers face pressure from multiple angles. Fifty-nine percent still experience aftereffects of pandemic-era supply chain disruptions. Meanwhile, workforce challenges — which respondents rank as their top obstacle for growth — are increasing as retirement surges and a new generation is slow to emerge. Additionally, while disruptive technologies like smart manufacturing and AI bring opportunity for scale and efficiency, they also raise unique challenges.
Data infrastructure and visibility are critical in the age of connected assets
High-quality, integrated data is important for any company seeking to improve operations, but it’s critical in the manufacturing industry, where partnerships underpin business models and connected assets open doors to new revenue streams, faster time-to-market, and personalized and proactive customer service.
Yet many teams struggle to bring valuable data insights to frontline employees, with 78% of respondents reporting they spend substantial time searching for information across systems. For example, just 42% of employees at manufacturers leveraging connected asset data have a fully accessible and integrated view of it, and just 43% say the same for telemetry data. This challenge is slated to grow, with a separate study forecasting a 22% increase in manufacturing data volume between 2023 and 2024 alone.
Manufacturers enter the AI era
Trusted data is key in manufacturing as four out of five respondents are at least experimenting with artificial intelligence, and more than one in three (36%) describe it as already fully implemented in operations.
Among the sales, service, marketing, and operations respondents to the survey, generative use cases like content creation are far more common than predictive use cases (74% versus 47%), despite generative AI being relatively new. Time will tell how the industry implements the newest iteration of AI, agents.
Manufacturers invest in supply chains, on-shoring, and nearshoring.
After the industry’s tumultuous start of the decade defined by mismatched supply and demand, skyrocketing costs, and unsatisfied customers, 83% of respondents say their company has pursued supply chain modernization. Yet roughly half or fewer of these initiatives are viewed as having been “very effective” across a variety of metrics like efficiency, cost reduction, and resiliency from future risks.
In the U.S., manufacturers anticipate a continuation of recent on- and nearshoring initiatives, with 61% expecting more of their products to be manufactured domestically over the next year, and 44% saying the same for materials sourcing.
Sales and marketing investments are a top priority. A solid majority of manufacturers are investing in service and aftermarket operations that expand revenue streams and fulfill customer expectations for comprehensive solutions such as repair and maintenance services. Yet sales and marketing initiatives are viewed far and away as the top investment priority, with just two out of five respondents surpassing goals like average order value and sales cycle length. While increasing pressure on margins and profitability is the top driver of these initiatives, respondents were also likely to cite the need for greater agility to quickly adapt to market forces.
The Salesforce perspective: “In the face of macroeconomic challenges like heightening global tensions, supply chain instability, economic uncertainty, and an aging workforce, the manufacturing industry has to become more agile, connected, and intelligent. To get there, manufacturers must be able to leverage all of their data to power new tools and AI capabilities, including autonomous agents through solutions like Agentforce, that can help them drive operational efficiency and open new service and aftermarket revenue streams.” — Achyut Jajoo, SVP & GM of Manufacturing & Automotive
To get there, manufacturers must be able to leverage all of their data to power new tools and AI capabilities, including autonomous agents through solutions like Agentforce, that can help them drive operational efficiency and open new service and aftermarket revenue streams.
Achyut Jajoo, SVP & GM of Manufacturing & Automotive
More information:
- Read the full Trends in Manufacturing report
- Learn about Salesforce’s new Connected Assets suite of capabilities
- Learn more about Salesforce Manufacturing Cloud
Research methodology: Data are from a double-anonymous survey conducted from May 30 through June 24, 2024. The survey generated 830 responses from sales, service, marketing strategy, and operations decision makers in the manufacturing industry in Brazil, Canada, France, Germany, Japan, Mexico, the Nordics, South Korea, the United Kingdom, and the United States. Additional demographic information can be found in the Trends in Manufacturing report.
