CloudNC featured in What's the Scoop? A post-pandemic innovation boom

December 18, 2020
CloudNC featured in What's the Scoop? A post-pandemic innovation boom

Published 18 Dec 2020: EMS NOW

By Philip Stoten, with contributions from fifteen technology CEOs, Carl Hung of Season Group, Anna-Katrina Shedletsky of Instrumental, Theo Saville of CloudNC, Amar Hanspal of Bright Machine, John Mitchell of IPC, Chintan Sutaria of CalcuQuote, Yoav Zingher of Launchpad, Dave Evans of Fictiv, Juan Arango of Koh Young, Bruno Racault of ALL Circuits, Marco Annunziata of Annunziata + Desai Advisors, Brad Heath of Virtex, Ross Berntson of Indium, François Monette of Cogiscan, and Mark Wood of Microart.

The 2020s have not started as anyone would have wished. The COVID-19 pandemic has exposed weaknesses in supply chains and in global manufacturing, yet still I believe that this will be the most innovative decade in human history.

Has COVID-19 exposed the need for innovation and even a revolution in manufacturing and supply chain? Do you expect a period of rapid innovation and digital transformation? I asked the “What’s the SCOOP 50 (#WTS50)”, a group of interesting and influential founders and c-suite executives in the manufacturing world. Here’s the first dozen or so responses!!

Carl Hung, CEO of The Season Group and SG Wireless: “Just as 2020 didn’t start as anyone would have wished, it is ending in a way that no one can possibly expect. With Joe Biden now the President-Elect of the USA, we can expect faor more uncertainty to arise before any calm is to come. In the face of uncertainty, it becomes even more vital for us to be able to get accurate information in front of us as soon as possible. Gone are the times where we may have a few days of buffer to decide on a plan of action and react. Things have been shut down, left right and centre, without much forewarning. Without the data, we would not be able to make the most precise decisions.

I see a continuing adaption of more Industry 4.0 technologies such as IoT first for data collection and analysis, and then subsequently 5G deployments for no-latency control of manufacturing equipment. Season Group’s subsidiary, SG Wireless, is designing products for customers to collect data and remotely manage their business. I also see more reliance on data in the cloud as opposed to locally hosted servers, but that will entail more investments in the security side first and foremost.

Previously many organizations may not have seen the need for these types of deployment as they could not see a quick enough return on investment or any ROI at all, but this pandemic has proven to them, and to their customers, the need to be able to operate remotely at all times.”

Anna-Katrina Shedletsky, Founder and CEO of Instrumental: “Absolutely! When COVID-19 hit, the #1 concern on the list for most manufacturers was how to continue to ship in this environment. In trying to solve this problem, leaders took a hard look at the inefficiencies in their existing processes: spending millions on international travel to put engineers directly on the line, relying on dozens of experiments during development to suss out root causes, and pushing new programs over the line with a combination of luck and heroism.

For many engineering teams, the pandemic has clarified exactly what is most urgent about “digital transformation”: having siloed product and process data, or no data, or data that’s only accessible from the factory floor, is a huge problem. Trying to engineer remotely through cell phone photos or Facetime and Zoom is untenably slow. There’s a clear data availability and access problem that digitization can solve, and solving it actually unlocks further innovation.

We’ve seen our customers, U.S. and European electronics brands who work with manufacturing partners in greater Asia, who started 2020 ahead of the field on remote data access double and triple down on additional investment in the first half of the year. Across the board, they delivered on-time, high quality product launches this fall. Their competitors are one cycle behind. One supply chain leader at a Fortune 100 company who is still evaluating their digitization path forward shared with me, “We already know that we cannot go back to how we did things before Covid.”

Theo Saville, Founder and CEO of CloudNC: “COVID has been an extraordinary accelerant for pre-existing trends. The death of the high street, the uptake of cycling, the move to flexible remote working, the rise of retail investment. We’ve seen ten years of progress jammed into ten months.

However manufacturing has not been a big beneficiary, quite the contrary, the sector has taken a hammering. Supply chains have been torn apart, and the global vacuum of demand continues to push poorer performing manufacturers out of business. Conversely, the strongest and most innovative companies are surviving and even thriving, and coming out on the other side leaner, meaner, and with a reduced field of competition.

Customer demand and investor capital are becoming more concentrated towards vertically integrated industry winners and disruptive innovators, who are invariably those at the head of the I4.0 charge. It is this drive to tech which is unlocking a magical benefit that has previously been so challenging to achieve in the high-mix side of manufacturing – scalability. It’s pretty hard to grow your factory past a few dozen employees when it runs off paper or excel, or past hundreds if running off the current generation of ERP systems, which are scarcely fit for purpose. Operational complexity grows exponentially as people and machines are added, causing diseconomies of scale. It’s crazy to see that a five-man band can compete effectively with a GKN-size entity in CNC machining.

In the years post-vaccine, I predict that accelerated vertical integration, rapid tech adoption and consolidation will drive expansion of average revenues and margins in manufacturing’s higher mix industries.”

Amar Hanspal, CEO and Co-Founder of Bright Machines: “Covid-19 has shone a light on the importance and value of digitizing and automating factory operations. Manufacturers are seeing real value in taking a software-first approach to automation, improving the capacity, capability and quality of their operations. And as this past year has demonstrated, it has also given them an opportunity to provide safe working conditions, build supply chain resiliency and reshore operations.

More broadly speaking, I am most excited about the potential of this digital transformation to speed up innovation by enabling localized production and removing barriers to entry to get great products made. I believe the days of leaning on globalization – finding cheap pools of labor – has run its course. After all, consumer demand for unique, higher quality products only continues to rise, while low-cost labor pools are dwindling around the globe.

Software-defined manufacturing democratizes product innovation so that anyone – regardless of location or available resources – can turn a great idea into a product, on-demand.”

John Mitchell, President and CEO of IPC: “Traditionally, the drivers of innovation are varied and vast. From the constant pressures to improve productivity, lower cost, and improve quality to obsolescence rendering leaps of insight and invention, innovation has been a part of the electronics manufacturing DNA since the beginning. In the 1990’s we saw product and production drivers; in the 2010s, supply chain flexibility and sustainability were some of the watchwords of the Industry 4.0 “revolution.” Enter 2020 and COVID-19.

This year, COVID-19 exposed many supply chain weaknesses, illustrating just how far some companies were from being able to understand their product development ecosystem – especially remotely. The coronavirus acted as a catalyst for much of the electronics industry to accelerate their adoption of several of the transformations that were ‘nice to haves’ or good to talk about in the 2010’s. Now that a company’s production was depending upon them – those Industry 4.0 platitudes needed to perform!

In addition to maximizing a factory’s Industry 4.0 capabilities, the resilience of the supply chain came under deeper scrutiny. Instead of a global ‘supply chain,’ companies are now having to understand and develop their regional ‘supply network’ or ‘supply cloud’. Single source lowest cost supply options have been replaced with three-tier minimum suites of suppliers that offer local, regional, and global options at varying production quantities and price points.

Finally, nearly everyone in the electronics ecosystem is beginning to appreciate the tremendous skills gap that must be addressed for the digital transformation to become complete and be sustained.The world is now much more comfortable and savvy with online communication and education. These should be leveraged to continually advance the capabilities of those of us in the industry building electronics better.

Yoav Zingher, Founder and CEO of “I don’t think supply chains have ever got quite this much attention! This year everyone found out what manufacturing insiders already know – our ability to flexibly make things, innovate, and adapt has been severely reduced in a competitive drive to lower prices.

In a static world, lower prices are the easiest way to compete. But in a world of rapid change, either because of negative shocks such as a pandemic, or positive shocks such as technology innovation, the best way to compete is to be one step ahead of everyone else, by being flexible and adaptive. I think that 2020 has demonstrated this in a big way, and those companies and countries that can build on this lesson will be at the forefront of innovation.

Dave Evans, Founder and CEO of Fictiv: “2020 really has been an exceptional year. We’ve seen serious disruption to the manufacturing sector as well as creativity and camaraderie as the industry came together to solve immediate healthcare problems, like PPE, test equipment and, of course medical equipment like ventilators. But while it showed the manufacturing industries impressive will, creativity and capability, it also exposed weaknesses in the way goods are made and the way supply chains are managed, underlining the need to transform from the old ways of doing business to something more agile and resilient.

I fully expect 2021 to be a year where digital transformation really takes hold. We now know that transformation is not just a “nice to have”, but essential for factories, companies and manufacturing ecosystems. It is likely in the future that a digitally enabled manufacturing ecosystem will be table stakes for brands wishing to purchase parts or products.

For this reason, and because the transformation was already necessary and underway, I believe that 2021, like the remainder of the 2020’s will be a boom time for innovation, for creativity and for the digital transformation of everything. At Fictiv, we have seen our digitally enabled system hold up throughout the crisis and how it was agile enough to shift and adapt as disruption challenges it. The pandemic isn’t the reason for innovation or transformation, it’s the fabric of everyday life in the technology world, but it certainly served to test the industry and I believe it will act as an accelerant!”

Juan Arango, Managing Director of Koh Young America: “It has certainly been a tough year for the manufacturing industry, but I’ve been impressed by the ingenuity and resilience of everyone involved. Our customers, many manufacturing essential products, have been able to provide continuity for their customers, and I think we have been able to do the same for them. We’ve used every digital tool at our disposal to make sure we could continue to provide remote support for the products in the field, and we’ve even been able to support many new equipment installations.

In the Americas, the manufacturing industry has done an amazing job filling the gaps when overseas supply chains have been challenged or disrupted and this bodes exceptionally well for the future as we move into more uncertain times. There has been a lot of talk about bringing more manufacturing and manufacturing jobs back from Asia and the US has shown that they have the creativity, capabilities and capacity. The US has always been the epicenter of innovation, so why shouldn’t it be the epicenter of innovative smart manufacturing.

I expect 2021 to pick up where we left off as the industry continues to innovate on the factory floor and in its business processes. This digital transformation and shift to greater automation can serve to make the US even more competitive in the future. I see a bright future of innovative people developing innovative products, supported by an equally innovative digitally enabled local manufacturing industry.

Bruno Racault, CEO of All Circuits: “2020 was a really tough year in France, and indeed throughout Europe. Leaving aside the ongoing human tragedy, we had to be innovative and creative to continue our work as we managed supply disruptions, working conditions and, of course, a roller coaster of demand. The year has ended well for ALL Circuits with three major new contracts being awarded that will allow us to continue to grow and transform our factories.

Many of the dynamics of 2020 have led brands to think long and hard about where they make their products and we’re happy that France, and indeed Europe, will likely end up winning more business as a result. I believe this trend combined with a focus on digital transformation, Industry 4.0 and automation, will lead to a renaissance of European manufacturing, particularly in France and Germany, two countries committed to becoming the smartest manufacturing region in the world.

And our customers are innovating too. Many in the automotive sector, where we are very active, are working hard to create new mobility solutions related to autonomous and electric vehicles. France has been the second largest innovation nation, after the US, at CES’s Eureka Park and we’re happy to be supporting those innovative startups and hel[ping them bring their products to market worldwide.”

Marco Annuziata: “The COVID-19 pandemic has been a rough reality check for our entire economic system. In some areas, new technologies have helped us react fast: manufacturing platforms have mitigated the disruption of global supply chains; and 3D printing has allowed us to switch production lines and ramp up PPE production. But it wasn’t enough to prevent economies across the world from plunging into a deep contraction.

Companies, and policymakers, now know we need to be better prepared for “black swan” disruptive shocks; and to cope with the ongoing, lower-frequency disruption that will continue to come from protectionist pressure and trade tensions. Manufacturing companies need greater agility, to respond faster to sudden changes in demand and supply chain shocks. And they need to better leverage the power of their human capital: we’ve heard for years that the robots were taking all the jobs, but when people could not go to work for fear of contagion, production came to a halt.

I think this will now trigger a major acceleration in innovation, guided by a greater awareness of where innovation can bring your company the greatest value. Software systems that can help reconfigure in real time operations and supply chain management; labor-augmenting technologies that give manufacturing workers better information and real-time training; manufacturing platforms that enhance resilience and flexibility at the ecosystem level. The pandemic has exposed the weaknesses of our manufacturing sectors; the recession will leave companies and governments weakened and more indebted – the imperative to accelerate innovation will be inescapable.”

Brad Heath, Founder and CEO of Virtex: “There is a definite need to develop innovation around how we think about supply chains.  There is so much concentration around Asia that domestic manufacturers are putting their businesses at significant supply chain risk due to dependence on Asia.  We have to develop novel ways to identify, qualify and support domestic sources for commodities we currently source in Asia for the majority of our purchases.   We need to develop innovative tools to fill gaps in supply chain in a proactive way.

As small to mid size manufacturers, we also need to develop advanced software tools for quantifying and avoiding supply chain risk from force majeure type events.  This can include weather, pandemics, civil unrest or any other unpredictable factors which are currently not part of our current toolset.  This can be done through AI, machine learning or other tools that are not typically part of the SMB toolkit.

We also need to deal with innovation around how we deal with workforce shortages.  The ability to train, qualify and interact with a remote workforce that is currently dealt with in a hands on manner.  We have learned and leaned on many communication tools during the pandemic.  We need to take this to the next level around training, skill assessment and qualification.”

Ross Berntson, President and COO of Indium Corporation: “Indium Corporation has keenly felt the challenges of COVID-19 in the toll on our people and our customers. However, through the stress, we have created systems and products that are capitalizing on the information and communication revolutions accelerated by the pandemic.

As a material supplier and innovator, we are deep in the supply chain, meaning we are subject to some of the biggest bullwhip effects. In other words, demand fluctuates greatly. We are relying on communication systems and data analytics that link us to end user demand while also increasing the flexibility and velocity of our production processes to be able to surge when demand spikes.

Our materials, likewise, are being designed for rapid scaleup and faster processing so our customers are able to respond to end-market demands. These materials include products like Durafuse™ LT which eliminates the need for underfill processes and InFORMS® preforms which eliminate stitching process steps. Both products speed our customer assembly processes while reducing costs and increasing reliability.

These types of innovation in materials, data analytics, communications, and processes are essential to a healthy pandemic response. Our human resources are also evolving to focus much more on talent development and cross training to create flexibility when large groups of associates might be restricted from their production roles. Our software, hardware, and personnel are all more robust, more antifragile, than ever and getting stronger!  Perhaps we have the pandemic to thank for this?

Francois Monette, Founder and CBDO of Cogiscan: “Even before the pandemic started Cogiscan had defined a long-term strategic business plan that was directly related to digital transformation. It is now clearly understood that the pandemic had profound impacts in all aspects of our lives, and that many of these changes are here to stay. At Cogiscan, over the course of a few months we went from a company who always had employees traveling the world to sell, install and support our technology to one that performs the same functions almost 100% remotely.

Similarly, most of our customers already had some form of digital transformation effort underway but these long-term plans moved to a much higher priority. The majority of CEOs have identified digital transformation as a top priority for the coming year and they have assigned more budget and resources to develop and implement their roadmap.

Companies such as Cogiscan that provide smart factory technology will face a great challenge and opportunity to scale up their operations to keep up with the market demand.”

Mark Wood, CEO of Microart Services: “I am going to go with yes and yes, to an extent. First of all, COVID also exposed the adaptability, resilience and sheer desire to get things done in the manufacturing industry. I could not be more proud of how our team stepped up and did what had to be done to get essential products out and to provide continuity to our customers. It also exposed some issues with those over extended supply chains with too great a dependence on Asia and in particular China. We’ve seen many customers and prospects respond to this, exploring the possibility and value of sourcing closer to home, and closer to their customer. I think we’ll see more.

Regarding digital transformation, our journey started long ago and continues at a pace. COVID has shown the value of real-time data, particularly for parts availability, so while we continue to digitally transform the factory floor it is essential to do the same with business processes, like procurement and inventory management.

The twenties has been an innovation boom from the start and I expect more. We love the creativity of our customers and appreciate the chance to help them turn their light bulb moments into reliable products that consumers can use. Let’s face it, we’ve all had to be extra creative this year, it’s in our DNA, so let’s leverage that creativity for good and get some great life improving technology out there.”

Chintan Sutaria, Founder and CEO of Calcuquote: “Only a decade ago, no one was seriously talking about API connectivity, machine learning or process automation within the supply chain. But, the leaders in the industry started turning those buzzwords into project initiatives over the past several years. Today, being familiar with the terms is the mark of a supply chain leader. This progress started before COVID-19, so it isn’t necessarily because of the pandemic that this innovation began happening. However, one thing that the pandemic did is bring this need for innovation beyond the early adopters and into the mainstream because people were forced to replace physical processes with digital ones.

Everything from how relationships are maintained to how sales are conducted has changed. Relationships changed because you couldn’t meet face-to-face once a week over lunch to discuss vendor/customer collaboration. So instead, people started to develop systems to allow that relationship to stay active. You couldn’t sell things as easily by just emails and phone calls, so you had to shift to ecommerce platforms that were embedded within your business systems.

The nature of innovation in human history is to continue to accelerate exponentially. We’ll continue to see that in the years to come. While we’re still making our way through this pandemic, it is easy to attribute the cause for this innovation to COVID-19, but the reality is that it was happening long before and will continue to happen long after.”

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