Two disruptive changes affecting manufacturers are speed in the supply chain and personalization of products, according to SAP's Hans Thalbauer, senior vice president, IoT & Digital Supply Chain. Mastering them both will be critical to business success, but organizations can't go it alone.

The rise of demand-driven supply networks is forcing organizations to think differently about their processes - using all kinds of data from across an expanding network - in order to more quickly meet increasingly specific customer demands. Thalbauer predicts that the personalization of products will force organizations to contend with three major trends in manufacturing:

• Moving from outsourcing to distributed manufacturing
• Shifting from mass production to mass customization
• Building a network

1. Distributed Manufacturing

3D printing, or additive manufacturing (AM), is a good way to achieve distributed manufacturing for industries - as well as Hollywood and university theatre - because it can quickly produce architecturally complex items of varying scale, all with dramatically reduced risk of injury.

“Different from traditional manufacturing methods like CNC machining, which removes material from a solid block using rotating tools or cutters, 3D printing is a rapid production method with minimal waste material,” The Engineer stated. “Its design flexibility means users can manufacture bespoke objects for a low cost.”

2. Mass Customization

The next trend is mass customization (a.k.a. mass configuration), which offers the flexibility and personalization of custom goods and services - at high-volume/mass-produced prices. Look for intelligent manufacturing cells - as opposed to assembly lines - in consumer industries and pretty much everywhere else, according to SAP's Thalbauer.

“Manufacturing is dramatically changing into a very, very flexible environment,” Thalbauer said. “We need to have an automation like never before in order to be fast - and also to be flexible in delivering the demands from the customers.”

On-demand retailers can produce custom-made shoes within days an internet order - at a comparable price to their off-the-shelf competitors. And subscription box companies tailor each of their crates to individual consumers. But mass customization could soon move beyond what even customers think they want.

3. Building a Network

“We need to intelligently connect the things with the people and the processes,” SAP's Thalbauer said. “From the equipment manufacturer to the logistics service providers, all of these partners need to be connected in one network ... in order to really achieve a much more efficient supply chain.”

A single network can increase efficiency and lower costs, as with the recent calls by Australia's container transport for an integrated supply chain network that better links sea, rail and other methods for moving goods. And Alibaba just established a network of small- and medium-sized U.S. suppliers; this gives the Chinese e-commerce company reliable partners, while suppliers gain access to more customers