2024 Trends, 2025 Predictions

Ed Ballina
Hello there friends. We’re coming to you today with another podcast episode. Hi, I’m Ed Ballina and my partner.

Alvaro Cuba
How are you guys? Alvaro Cuba here.

Ed Ballina
So here we are back again. Busy, busy time of the year. A lot of fun. Getting ready for the holidays, my amigo. Holidays and we’re expecting maybe eight to 12 inches of snow tonight. Our first snowfall of the year. So a little chilly. But hey, welcome to the Manufacturing Meet Up podcast. You know the drill. This is where Alvaro and I sit back. We talk about our experiences on the shop floor as if we were sitting around a table having a beverage. And we’d love to hear your stories. And we’ve been bringing it to you and that we hope to continue that.

Alvaro Cuba
Yes, guys, sit comfortably, your coffee or your drink, and let’s get this started.

Okay, so here we are. And this time we thought instead of talking about news like we normally do, and Ed and I have been participating in different conferences, pretty busy time in the year. And on my part, I went to the Digital Supply Chain Transformation Assembly in Charlotte in North Carolina. Two days, very intense days, seven delegates from all different industries. Vendors. Very interesting dynamic because it was a mix of success cases, AI implementations, challenges, round tables, workshops. And it was basically about three questions. AI in new technology is here. So how do we get our heads around it and how we get comfortable about it?

Second is we are all implementing something. 77 % of the manufacturers and all of you guys, or 77 % of you are implementing right now a project. So what are the growing pains and how to deal about that?

And the third is how to start getting our heads about the strategy for the long-term so we can get the full potential of the new technology. And this was not only about supply chain. We talked about omnichannel, we talk about digital twins, we talked about the C-suite, iCloud, brick and mortar and digital. So it was very interesting and it was great to exchange experiences across.

I learned a lot and I had a great time, very fun time. How about you, Ed?

Ed Ballina
That sounds impressive as heck. And you even brought back some new terms like industry 5.0 that I got to brush up on because I’m still at 4.0. So I’m a little lagging. We’ll talk a little bit later about the 5.0. Don’t worry. 5.123 release. Yes.

I also had a fun busy time. attended Pack Expo in Chicago. It’s probably my third or fourth time there. It is really an amazing, amazing experience. What I can tell you is you better wear comfortable shoes because you’re going to be walking all day like the equivalent of like 10 club stores worth of floor space with all kinds of shiny equipment for little engineering and manufacturing folks like me. it’s it’s it’s kind of like…

Alvaro Cuba
But these guys are used to they walk the plant up and down every day.

Ed Ballina
So yeah. And you don’t have to wear safety shoes there, which makes a little bit more comfortable. Yes. But a couple of things that kind of struck me one, of course, I already told you my feet hurt. So let’s put that aside. The amount of robotics that I saw. Right. And I mean, this has been grown. Right. Every year you see more. But the number of applications that are using robotics almost you could not walk past a booth that didn’t have some sort of robotics application. So that was really, really interesting.

The other piece is big focus on sustainability. So a lot of equipment manufacturers are offering better solutions from a sustainability standpoint, whether it’s recovery of heat or using recycled plastics. Obviously, sustainability is here to stay. But also, we’ll talk about this later, kind of saw a trend more towards let’s make sure we’re getting the money out of our sustainability spend which is really, really great to see.

Alvaro Cuba
One other thing that we wanted to share with you guys is we were invited to a machine health ceremony to be the hosts. And we had a lot of fun with Ed hosting the ceremony. But more important is we saw some great maintenance and reliability work for many plants and some of the clips that are amazing. So we wanted to share some of those with you because we really think these guys are taking not only machine health, but all the high tech and the new technology to a different level and starting to integrate it into the day to day.

Ed Ballina
And to be honest, that’s where Alvaro and I stole most of our predictions was in watching what these folks did. And we said, yeah, that’s exactly what’s going to happen next year. So we cheat a little bit, but you know, it’s all good. Okay. So let’s see the, let’s see the clips.

Augury Spotlight Award Winner: Fortune Brands
I’m really thankful for Pat Knox. You’ve got this whole thing initiated and encouraged us to be the pilot plant for Fortune Brands. We started out with the 40 and now we’re just pushing through over the next couple of weeks. We’ll have all of Fiberon covered under Augury systems. So thank you very much for the recognition and I look forward to the future.

We have a really good partnership with Augury and I’m really proud of this initiative and we’re cascading not only Fiberon, we’re cascading this across 16 sites right now and Wow. Really embracing it and we’re putting it in place and it’s really effective and really proud of the Fiberon folks. You know, we have a great team there that’s embraced the solution and we’re really driving change. And we’re not only doing it through what we’ve integrated initially, but we’re taking it. We’re going to the next level by doing some digital transformation with ignition. We’re creating dashboards through the API calls and creating creating information to make quicker and insightful decisions. So this is a really critical project for Fortune Brands and really excited about winning this. So really appreciate it guys.

I was gonna say one thing, one challenge for us just was the fact that I think the initial thought was we were just gonna be changing things out all the time and just convincing folks that it wasn’t just about parts changing. It was about utilizing non for the, you know, our reliability guy that reaches out to us, utilizing him for his background and his knowledge to give us advice on what we should try before we change stuff out, you know, and it’s saved us. In some cases it works, in some cases we’ve got to take the next step. But just having people realize it’s not just about parts changing every time there’s an issue, but we do have to trust the system. 

We spend a lot of time, we spend a lot of money with the system. You’ve got to trust the system that it’s going to do. It’s going to tell you the right things and we have to have the right follow up. So that was our challenge initially. And we still struggle with that a little bit now, but it’s getting better.

Ed Ballina
So hey, I hope you enjoyed watching that as much as we did. You cannot mistake the enthusiasm and the light in people’s eyes that you saw in these clips, right?

This is what it looks like when you get a whole facility behind an initiative like Machine Health and they reap tremendous rewards. One consistent theme, and by the way, we hosted 40 winners out of thousands of hundreds of entries and they range across industries from oil to paper to beverage to dog food across the world. I think we have three continents that were represented, if not more. and a really diverse group of people that showed us it transcends industries and countries. But one thing that was in common is how they focus on changing the culture and bringing people with them. And you have heard Alvaro and I just kind of really beat the drum on that because we both have been the recipients of technology, which is exciting and fun. And it’s the new toy. But if you don’t couple that technology with processes and culture and getting people engaged, you’re not going to win.

Alvaro, I know you were just as thrilled as I was by watching this.

Alvaro Cuba
I was. And one of the things that impressed me is, like we all, when we implement some new technology, sometimes it doesn’t go that well, sometimes it’s better. But these guys had the leadership, the energy, they persisted and they made breakthroughs. No, they showed us the culture, the teamwork, but they also showed very impressive results on doing that. there was some time ago a lot of banter about, we don’t know, it’s just fade, it’s going to give us the results or not. We saw the results.

And of course, like always, people make things happen. And the teamwork and the leadership were instrumental in making this to happen. And they are taking their plants to a whole new level.

Ed Ballina
So we just wanted to share that with you guys and hope you enjoy the clips. Absolutely. And we will be inviting some of those teams to appear on our podcast next year. Hopefully they’ll take us up on that because there’s no mistake in the enthusiasm and the pride that these folks show and rightfully so.

Alvaro Cuba
And those are great best practices for everyone.

Ed Ballina
So, excellent. So now we were trying to figure out how do we end this year? know, and we’ve got always lots of topics as you all know. Yes. But we thought we would really go out on the limb. My partner, co-host, Alvaro and I, dusted off our crystal balls. I don’t have one in front of me right now. First, we did our homework about 2024. Yes. So we’re going to talk to you about our highlights of 2024, what we think was really, really cool. And we’re then also going to provide you at much risk to our credibility, our predictions for 2025. Okay.

Stay tuned. We are going to score ourselves and talk about that later. But it’s scary, but we’re going out there. So yes, we do kind of challenges for the year. Right. So what do we think? You know, what do we think are some of the headwinds that we are, you know, encountering as we go into 2025? And I’ll mention a couple of them. You know, cost pressures, right? We saw we’ve seen this shift in the last year where we started seeing a very heavy shift away from output is king by itself to output not at every cost because our costs have gone up, know, the pricing in the marketplace hasn’t held. So people are looking for value. So a lot of cost pressures push for productivity, trying to unwind some of those costs that we all incurred, you know, during COVID. So that’s one’s going to continue.

The labor market is still really tight, folks, especially for skilled trades, right? Try to find, you know, electricians, PLC programmers, mechanics with experience. It’s challenging. So even though it’s gotten better since COVID, we still have a gap that we’re trying to fill. And many facilities are going with less than optimal staffing situations. It’s not that they don’t want to hire. They just can’t find people.

And then, well, many of us think that You know, COVID really threw a wrench in the supply chain, which it most obviously did. Some people think that, we’re back to life as normal. It is not. We’re still seeing supply chain issues. There were a number of companies that went out of business. So the supply and the market in general is a little tighter than it has been before. And we’re still struggling to get certain materials provided to the facility. those are kind of the challenges as I see them. I know, Alvaro, you probably have some perspectives on your own here.

Alvaro Cuba
Well, we…we experienced that, no? So I totally agree with you Ed though that is one of the highlights of 2024. So we had the labor shortage at the beginning of the year, coupled with demand and both were fighting each other. Then we had our fair share of supply chain issues and guys, I don’t need to talk more about that, but every single year we have our fair share.

And we always survive, we always strive, and we always are ready for the next years. But we couldn’t let pass as a highlight in 2024, the cost pressures and the labor shortage as you have absolutely, I’m pretty sure experienced like we have seen.

The second highlight that we saw is a boom in internet and high tech. And I think it starts with a boom in general, not only manufacturing. So think about it. iPhone just launched a new version. AI powered, chat GPT. Most of you I’m sure using chat GPT and Excel just launched a new version  with AI to help you do your things in Excel even faster.

Ed Ballina
How about one for PowerPoint?

Alvaro Cuba
Meta launched the new glasses. So we have seen, and I’m sure you, your family, your communities have seen this explosion of AI in your daily lives. Well, here’s a number for you. The global market of AI It’s said to be right now in $4 billion. It’s predicted that in 2033, it’s going to be 156 billion. So it’s going to be 45 % CAGR year over year, every year. But that is the total market. Now manufacturing, only predictive maintenance, machine health. It’s 18 billion. It’s going to grow $18 billion at 26 % CAGR. So everyone is going after it. Hear this statistics. In 2022, so when we were going out of COVID, 26 % of the manufacturing plants were implementing something in AI or high tech. Two years later, only two years later, we are 86 % of you guys, of every single plant is implementing. And in two years, it’s going to be 93%. That means everyone. So it is really here and it’s adoption, it’s solutions, and it’s value. People are starting to see the value and starting to see the coins coming in. we thought this… has to be one of the highlights of 2024.

Ed Ballina
I couldn’t agree with you more. just, I mean, I can’t imagine a point in time in my career or my adult life where I have seen the kind of growth that you’re just quoting here, right? We’re not just talking about a little evolutionary, you know, no, we’re talking about like straight up, you know, S-curve shift, logarithmic growth, however you want to characterize it. I mean those numbers. Rockets. Now there are very famous, the rockets going to the moon will, this is going to be one of those rockets. But listen, if Elon Musk can figure out how to catch a rocket out of the air and return it to use, come on people, it’s about time we get really with it with our AI. So impressive, So it really is amazing to watch this and to your point, it’s not just manufacturing. It’s happening in our personal lives. So it is truly a revolution.

Another highlight, right? That we call for 2024 is people, right? The whole people aspect. I love, you know, labor in there as well. There’s a couple of competing forces. It’s really interesting to watch. So we’ve talked about the silver tsunami, which I guess I guess I’m part of that too. So yes, a lot of us are leaving the workforce. Many of us, like myself, have decided to come back and get involved because we really enjoy the work. But there’s this new force to contend with, and that’s the new blue collar, “new collar” right? Trades are at an all time high in terms of demand. They get paid very well. And I think I’m starting to see some new entries into the labor force that are going to be the mechanics, the electricians, and the PLC folks of the year. And AI is helping that appeal.

The other piece is this workforce, the newer workforce, not to typify too much, but people are seeking meaning in their jobs. They’re no longer just willing to punch the clock, pay me for eight hours, I’ll do a good job for you, and then, no, they want something more. And AI can really help with that.

Imagine you’re a mechanic that you know, has been working in this plant in breakdown mode. And all of a sudden, we introduced predictive maintenance technology, you can get to equipment and address it before it fails, you start diving deeper into, you know, the vibration analysis and what could cause this, what could cause that. Now, what I mean, what much more meaningful work that is than going in there and cleaning up the mess of bearing shrapnels, grease everywhere, we try to figure out what broke aside from just the bearing.

That brings meaning to people’s lives and today’s workforce is connected. So as we engage with AI and they become more capable of using this high technology, their work becomes more meaningful. We’re not just asking for their brawn, we’re asking for their brains too. So that’s really, really exciting. now I’m gonna hand off this part of this to my partner, Alvaro, who’s gonna share our predictions with you. Okay, so I let him take the bullet first on this one.

Alvaro Cuba
Before going to predictions, just a couple of comments on what Ed was saying. I think a highlight is we are seeing a new landscape. The new generations are thinking about no college and skilled trades. couple of things here. 44 % of the roles have already changed in 2024 because of new technology and AI. And 50 % of the people is thinking in changing roles. And that goes back to what Ed was saying, the purpose, the meaning. And we have a golden opportunity guys here in manufacturing because technology is changing the way people see in manufacturing. It’s not the dirty, repetitive.

Technology is fun, it’s clean, it’s energizing. It’s a lot to with technology. That attracts the new generations. So go for it. But like it was saying, and let’s put ourselves out there with the 2025 predictions.

Ed Ballina
And here’s the drum roll. Okay.

Alvaro Cuba
Thank you, amigo. No more pressure, please. Well, here, the first one, and Ed alluded to that, is industry 5.0. We have started to see this. 4.0 is bringing so much technology and so much things that we can use in the shop floor. But we need to balance that or more than balance, complement that with people and the skills in people. And that’s exactly what is this term about industry 5.0. It’s about people, but it’s more specific, frontline people. workers in manufacturing. And we are talking about skills, empower, agility, resilience. And it was mentioned in this, the new technology is bringing new tools. The main tool is a way to start connected. Imagine if your operator in this part of the line is connected with that operator. And those operators can be connected with a line in other place and connected with what is happening in customer service or with suppliers. So getting the skills of the people, getting them connected and help them in two things. One is resilience to adapt to the change because the technology is bringing a lot of change. So if they can adapt to the change, they are going to jump to it and they are going to be proactive on the change.

And the second is versatility. We said 44 % of the jobs are changing roles and responsibilities. That will continue. And we need our people in the lines and in the plants to be resilient and versatile. we Ed, I hope you are with me, but we are predicting that this 5.0 is starting to become a big trend and we will see much more about that.

Ed Ballina
So I could not agree more. You’ve covered it very well. I have a little studying to do on 5.0. I was up to 4.6, so I’m not quite there yet. But you’re point on connectivity and how this grows, right? So think we started this journey around machine health and predictive machine health, right, which is phenomenal. It draws a lot of benefits. We are expanding into production health, right? So getting the process health coupled with machine health. So it’s growing that way, but it’s also growing from manufacturing. It’s reaching out to supply chain planning to quality control. Right now there are standalone systems in many of these applications that once we join them, the synergy is incredible. And then growing in a different dimension, once you scale that in your own enterprise, you grow that to your suppliers and you grow that to your customers. So now you have demand pulling instead of scheduling based on forecasts. I mean the promise here is complete connectivity and complete transparency and optimization of the supply chain. And I, for one, I’m really thrilled about that because it is about running better, right? And being able to provide that supply chain efficiency end to end. So connectivity, I think is another big call for the year.

Alvaro Cuba
Yeah, I couldn’t agree more. Connectivity, would say, is the second. And in this case, we talk about connectivity for the people in 5.0. Now we are talking about connectivity between the different systems to start bringing the end-to-end supply chain and start reaping the big benefits. And there is where strategy is important. So to start thinking the whole plant versus just only pieces.

The third one is, and we have discussed a lot about this with Ed. We have. It’s about sustainability. And I’m going to steal something that you said, Ed. What is going to happen in 2025, our prediction is sustainability is going to start being less symbolic and more systemic.

I love that phrase and it all goes to lines running better. The sustainability we are used to here is the C-suite sustainability. We have to improve the world. We have to be out there. We have to have these goals and all that. But guys, in reality, the real sustainability is in the lines. If your lines, and you’re the operators or supervisors, if your lines are running better, it means less waste. It means less energy, less reprocess, better quality, less throw aways. So all that is the true sustainability.

And that’s the one that is going to bring the dollars, is going to help the planet, and is the trifecta. Because that, at the same time, is going to help you guys in the line to do a better job, more relaxed job, and enjoy and have time to think, to innovate, and to bring new things to the line.

Ed Ballina
And you’ve probably picked up on a little bit. If you watch our podcast, Alvaro and I have talked about this kind of on the edges, right? But I think the way he said it was perfect, right? I think sustainability, we’re all agree it’s right thing to do, right? We waste too much, we consume too much energy, and there’s technologies that can help us with that, which is terrific. But sustainability is going to move from the C-suite photo op for the annual report.

It truly drives the performance of the enterprise and sheds money like its going out of style. If you’re the mechanic on a line that you’ve been trying to get some capital support for, right? And you’re struggling with this thing every day. And you just hear that your company invested millions of dollars on a pinpoint sustainability solution. You’re sitting back and saying, Hey, if you could just give me a little bit of that, I can make this line run six efficiency points better.

And that’s going to throw so much cash, less product to landfill, that it far outpaces the photo op. But the photo op is important too, right? We want to make sure that we are respectful of the planet and are doing the right thing. But I think the rubber is going to hit the road. Sustainability has got to pay for itself. And I think we’re going to see that coming. So makes economic sense versus a high level idea.

So I’m going to quick, because I think there’s another prediction going out there, and that is we have experienced a pretty hard push on cost reduction and productivity this year. And folks, let’s be honest, we layered on a lot of costs during COVID just to keep the wheels on the wagon and get product to the shelf. And consumers were willing to pay for that at some point in time. They have signaled that the prices are too high. So we’ve had to focus on productivity and cost as well we should.

We need to strip out some of those extra COVID costs that are still marbled in. However, I also think that as we start watching this economy continue to grow into next year, the companies are going to be faced with an interesting dilemma because they’ll continue pushing the productivity and maybe taking capacity out. But at the same time, I think there’s a potential for more production need out there. I think as the economy heats up, we’re going to create more demand, which means we need to be even better at getting product themselves.

Not different than what us manufacturing folks have had to deal with all our lives, which is you got to balance productivity and output and service to customers, quality and everything under the sun. But I think the balance may shift a little bit here. So with that, I think we are getting ready to like hit the gong here on our predictions. And I think you have you have something else to share that you know, not more.

Alvaro Cuba
Just, yeah, but first a quick reminder, our four predictions:

industry 5.0 starting to go up
connectivity and data to end to end
third sustainability meaning running lines better.
And this, which is not different than what we always try to do, productivity and production.
And we have to do both at the same time.

The predictions are out there and we said, we’ll venture to create a scorecard. We’ll create a scorecard so we can check ourselves.

And Ed, I hope you are with me, but next year, by the end of next year, we’ll bring the scorecard and we’ll let you know how well we did and we’ll learn from it.

Ed Ballina
Absolutely. Cause you know, I mean, I think you know us by now. Don’t put it beyond us to manipulate the scorecard to make us look right. Okay. I’m not promising. We may see some tricks there.

Alvaro Cuba
Okay. Amigo, please. Let’s close it.

Ed Ballina
Let’s do it. Another great episode. Thank you. This has been great. I guess this is a wrap up for this episode. We’ve got more stuff coming that we’re not going to completely unveil, but there’s a rumor there’s a bloopers episode coming, which is frightening. I have no idea what we did. But think back to our first podcast. I tell folks, Hey, watch my podcast and start about episode seven? Because I don’t want you to see what this was like episode one and two. Not that we’re great, but So, hey, team. So if you, you know, our typical stuff, if you like this episode, follow, subscribe, give some feedback. We’re on YouTube. We’re in iTunes. We’re in Spotify. We’re almost everywhere. And if you like to keep the conversation going email us at mmu@augury.com or The Endpoint which you know is a free onsite community for manufacturing pros like you and I will also show those links in the show notes for this episode. Alvaro, hey, happy Thanksgiving. We probably won’t connect until sometime after that. Wish you and your family the best.

Alvaro Cuba
Yeah, the same and happy Thanksgiving for all of you guys.

I hope you had a great holidays. more important, please participate with us, tell your friends, enjoy it and join us for the Manufacturing Meet Up podcasts. Thank you very much, guys. Thank you. Bye bye now.