- Around 67% of manufacturing firms surveyed expect that their IT budget will increase up to 10%, whereas 14% of manufacturing firms expect their IT budget to go up by more than 10%.
- Overall, the increment in the IT budget of the industrial manufacturing industry lags the industry average. This can be attributed to the COVID-19, as it has a devastating effect on both the supply /demand side of the manufacturing industry. On the supply side, the production has halted due to several restrictions of the distancing norms, workforce safety measures, etc.
- On the demand side, as the economy took a severe blow, the purchasing power of people reduced, affecting industries like automotive. Travel restrictions also affected the aerospace industry a lot. As a result, manufacturers had to refocus on budget allocation and operational expenditure.
- Manufacturing firms are going through a transformation, but manufacturers still prefer conservative and practical solutions that have clear productivity or cost-reduction benefits.
The Bottom Line: The manufacturing industry has been a laggard in technology modernization as it involved huge cost implications due to large brownfield installation.
With the advent of smart manufacturing, a new business model (As-A-Service model), and customer preference (product personalization), manufacturers are forced to rethink their technology stack. They will continue to invest in the same in the coming years.
