Industry Outlook
Manufacturing is at a defining moment. The promise of Industry 4.0—moving beyond automation to harness data across connected technologies on the shop floor and throughout the value chain—is finally within reach. Yet realization of that vision has progressed at a relatively slow burn. Many operations still look the same as they did 20 or more years ago. Manufacturing has traditionally taken a more measured approach to digital adoption, largely because operational teams oversee environments where safety, reliability, and uptime are paramount. That necessary caution, combined with the long reinvestment cycles associated with major equipment and the persistent challenge of building trust and collaboration between information technology (IT) and operational technology (OT) teams, has made it difficult to introduce new digital capabilities at scale. This has created a costly competitive gap, causing many companies to fall behind in terms of efficiency, quality, and speed of innovation.
This slower pace of change has made it even more difficult to overcome the challenges of continuous disruption, intensifying global competition, and the growing demand for efficient, localized manufacturing. The industry is facing an explosive demand for AI-ready data, which means companies that have traditionally taken a more conservative approach to transformation are now being forced to accelerate toward digitization. Progress now depends on moving beyond the siloed proof-of-concept (POC) cycles that have delivered limited value to instead focus on disciplined investment.
The calls to action for 2026 are clear: close the foundational gaps that hinder transformation, including those that pose risk to operations and the organization as a whole; prioritize data governance, quality, and accuracy; and refocus on the people who will play a pivotal role in this transformation. By doing so, manufacturers can better innovate, invent new ways of working, and position themselves to pursue value and resilience across the entire organization.
What would it mean to manufacturers if they could increase their efficiency rates by 5%, 10%, or even 20%? That would put enormous value back into the business. The big question is, what investments will get you there? That’s where we can help manufacturers navigate their options and take steps that will lead to better, faster, more informed decisions about the business.
The transition facing manufacturers in 2026 is not merely digital; it is systemic and cultural. The time for the slow burn is over.
Resilience is not just cybersecurity—it spans supply chain, operations, workforce, and technology fundamentals. Leaders must now transform fragmented assets, siloed processes, and specialized knowledge into a seamless, adaptive business ecosystem. This requires making decisive investments now to:
This integrated approach—one that prioritizes business needs, technology fundamentals, process rigor, and human capital—will not only close competitive gaps but also position manufacturers to pursue both value and resilience across the entire organization, turning a two-decade-old ideal into a competitive reality.
Additional Contributors: Bill Graca, Dave Haak, Greg Kaiser, Gautam Narayan, Kaeli Smith
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