6 Major Benefits of Collaborative Manufacturing

Innovative modern and digital technologies have altered the state of manufacturing, not just in the way things are done but also how the entire market is structured.

With 3D printing and automation, for example, it’s now possible for a small-time organization to keep pace with a much larger operation. Understandably, it’s made the entire industry much more competitive and volatile in the sense that anything can change at any time.

Furthermore, consumer demands have changed considerably and people now want higher-quality goods at a much faster rate. Thanks to on-demand style systems that have appeared elsewhere, they also want a higher degree of personalization for their products, which is difficult to quantify in a traditional mass-production-focused setup. In a recent consumer electronics survey, 62% of respondents said they're willing to pay more to customize their devices and goods.

Collectively, it has contributed to a rise in collaborative manufacturing models. More partnerships are happening that allow companies to remain at the top of their industry, but also to provide better service to their customers.

In Sweden, for instance, IT supplier Fujitsu struck a partnership with Volvo to strengthen both companies. Closer to home, Ford shared many of its best practices with strategic suppliers to improve environmental sustainability.

Collaborative efforts can launch for a variety of reasons, but the underlying goal is always to improve operations and success for those taking part. The real focus, of course, is the benefits offered by partnerships and close dealings between organizations.

6 Benefits of Collaborative Manufacturing

Why would companies be open to collaborating with others, especially competing organizations? What is there to gain from it?

1. Wider Geographic Support

For most organizations, supply chains are global in scope. Even within a single company or brand, there are offices located all over the world. It’s not always beneficial to have so many disparate offices spread out, and costs can be extensive.

Open collaboration with another organization can help — particularly with one that has a foothold in the market where a company would like to do business. Often, the partner has more resources, is attuned to the local time, and already has a rapport with local consumers.

2. Time to Market and Delivery Increase

Provided an efficient system can be established, it’s always good to have more hands on deck. It improves the time to market by decreasing how much effort goes into the production of goods. Also, having an international partner can reduce or eliminate shipping requirements.

3. It Unlocks New Opportunities

For manufacturers, the cost of exploring new markets and producing new products is relatively high. The risk of doing so can be even higher, especially when there are considerable costs involved.

A partnership or collaborative manufacturing operation eliminates the hurdles and reduces the risk. Partners can handle the bulk of local work as a subsidiary.

4. Greater Resource Availability

Opening up collaboration with another organization can also afford access to new resources, opportunities and technologies that the parent company does not have. Say one brand is on the bleeding edge of advanced robotics trends, then another company striking up a partnership will gain access to said technologies.

While this is how most partnerships work, there is a possibility that one brand will not share its systems and methods — especially when they involve trade secrets — in which case this benefit doesn’t apply.

5. Higher Quality Goods and Services

Through some partnerships, organizations can vastly improve their products and services by taking inspiration from their partners. As is the case with Ford’s best practice sharing, all of its suppliers helped contribute to higher sustainability for the entire chain.

In other words, teamwork makes the dream work.

6. Shared Reputation Improvements

Naturally, as one company sees an increase in positive reputation and success, the same is shared for its partners. To add to that, when establishing a partner to cover local brand development for a region, the parent brand will often see a strengthening in reputation and support. More importantly, improvements come from markets that would have been otherwise inaccessible.

The flip side to that is a negative connotation can reflect poorly on all involved parties, as well.

A New Player Enters the Field: Cobots or Collaborative Robots

Another element of collaborative manufacturing is the close workings of humans and robots, or what's known as cobots. A wide variety of organizations use advanced robots to complement human tasks.

Amazon is a prime example. Its robot army in warehouse environments makes the task of picking, shipping and organizing goods much more efficient. Even Walmart joined the movement, with plans to introduce a fleet of robot janitors in many of its stores.

Global annual revenues of the collaborative robot sector are expected to reach $7.6 billion by 2027, making it the fastest-growing segment of industrial robotics.

Collaborative robots will creep into many manufacturing processes soon, deeming the movement worthy to mention.

The Future of Manufacturing

Collaborative manufacturing is undoubtedly on the rise, alongside digital enhancements thanks to Industry 4.0. The many benefits such a partnership can offer are growing more and more necessary to succeed in today’s market. The rise of data-driven technologies and processes also helps to encourage further collaboration as it’s easier than ever to share insights with other brands and partners. Ultimately, it means that the future of manufacturing will be directly tied to collaborative efforts.