We are on the cusp of a technological revolution that could boost productivity and increase global growth. But it could also replace jobs and deepen inequality. While the challenges facing businesses in 2024 are largely the same as before, there are differences - albeit subtle ones - from year to year:
Supply chain
The COVID-19 pandemic and the Russia-Ukraine war clearly show that it is impossible to predict when and where another supply chain disruption will occur. The fact is, however, that we must be prepared for the next disruption.
Costs
Things are becoming more expensive at all levels of the supply chain. Producers are faced with higher labor and material costs. On the consumer side, everything is getting more expensive, which simultaneously reduces consumers' willingness and ability to bear additional cost increases. The result is that companies are unable to raise prices to offset the increased costs. Therefore, they must try to increase efficiency in order to control costs and maintain their profit margins.
Sustainability
Several incentives and forces are pushing the industry towards a more sustainable future. The pressure on companies to take action on climate change and improve the overall sustainability of operations will continue to increase.
Pace of innovation
There is a long trend towards accelerating innovation cycles in many industries. This will continue as companies are faced with faster development cycles and a constant drive to innovate in order to stay ahead of the competition.
Labor force
As the wave of retirements continues, there is an acute need for engineers in the fields of systems, electrics and electronics. The next generation of engineers and technicians are coming into the industry with a lot of talent and passion. But not fast enough to bolster teams that need resources. As a result, industries of all kinds are facing shortages in key positions. From engineering to manufacturing and beyond, organizations must find new methods to replace departing talent and experience with a mix of new talent and new technology.
How can companies prepare for the challenges of the future?
It is crucial to look beyond the immediate fluctuations of industrial demands and adopt a strategy to become more resilient, flexible and adaptable for the future. The best way to achieve this is through digital transformation.
AI is here, whether we like it or not.
McKinsey* believes AI is a productivity booster and will change the way we work and live. The question is whether we see artificial intelligence as threatening competition or helpful support. We have to adapt to changes in order to survive in the global competition. It is important to recognize and minimize the risks, but also to see the resulting opportunities as chances. With demographic developments in mind and the growing shortage of skilled workers, AI can help. Artificial intelligence will not make us humans superfluous, but it will change existing professions: Well-trained specialists are and will remain indispensable, but with the help of AI they can form an advanced team and pave the way to a successful future.
Use the potential - with our know-how.
Our expert support helps you to integrate AI into your work processes in a meaningful and future-proof way. Together, we will find solutions that suit your company.
Sources
Dale Tutt, 2024.02.09, How digitalization will help overcome industrial pressures, Siemens Digital Industries Software Blogs, How digitalization will help overcome industrial pressures - Thought Leadership (siemens.com)
Kristalina Georgieva, 2024.01.14, AI Will Transform the Global Economy. Let’s Make Sure It Benefits Humanity, IMF Blog, AI Will Transform the Global Economy. Let’s Make Sure It Benefits Humanity. (imf.org)
Thomas Saueressig, 2024.01.15, KI – Handeln statt Hadern, SAP Corporate Blog, AI - Acting instead of quibbling | SAP News Center
*McKinsey & Company, 2023.06.13, Study: Generative AI can become a productivity booster, News,Study: Generative AI can become a productivity booster | McKinsey & Company