World Economic Forum Report: Which Country is Best Prepared for the Future of Manufacturing?

Guest post by Has Patel, Founder & President, Infologic, Inc. and AMP SoCal Pillar Committee Member



The World Economic Forum (WEF) recently released a document, titled: Readiness for the Future of Production Report 2018.  The introductory overview provides the following context:

As the Fourth Industrial Revolution gathers momentum, decision-makers from the public and private sectors are confronted with a new set of uncertainties regarding the future of production. Rapidly emerging technologies—such as the Internet of Things, artificial intelligence, wearables, robotics and additive manufacturing—are spurring the development of new production techniques, business models, and value chains that will fundamentally transform global production.” The introduction goes on to state, “The report seeks to build awareness on the factors and conditions required to transform production systems and help countries assess readiness for the future.”

The report presents the results of the first edition of the Readiness for the Future of Production Assessment, which measures how well positioned countries are to shape and benefit from the changing nature of manufacturing through the adoption of emerging technologies.

Overview and Methodology

The Assessment is made up of two groups of indices – (a) Structure of Production which represents the current state of manufacturing capabilities, and (b) Drivers of Production which represents the future state of manufacturing, and measures the position of a country to capitalize on the emerging technologies to transform their manufacturing base. As shown in the following figure, these two groups of indices incorporate a number of drivers which were scored for 100 countries.


What has passed is past….. the future belongs to the U.S.A.

During the last two decades, the US manufacturing sector faced many competitive challenges which resulted in the loss of manufacturing capabilities and employment to foreign countries. Such observation is also supported in this report in which the United State’s current manufacturing rank, which is represented by the “Structure of Production,” is below a number of advanced manufacturing countries, including Japan and Germany.

However, the US ranked at the top in the “Drivers of Production,” which represents future readiness of countries in the manufacturing sector. In this regard, the report states, “The United States’ manufacturing sector is the 2nd-largest in the world,” which comes as no surprise. It goes on to reinforce this stance and the potential growth for the US by stating:

Over the last two decades, however, the competitiveness of locally manufactured products and the attractiveness of the United States as a manufacturing location have been strongly challenged. The country is well positioned for the future, holding the top score on the weighted Drivers of Production component and scoring in the Top 5 across all drivers except Sustainable Resources and Institutional Framework. The United States is globally renowned for its ability to innovate and is currently at the forefront of major developments surrounding the emerging technologies of the Fourth Industrial Revolution. Furthermore, its ability to develop, attract and retain advanced human capital capabilities is supported by strong higher education institutions. Notably, the United States is making efforts to reinvigorate its manufacturing sector.”

The US manufacturing sector is a very important part of the economy and represents approximately sixty percent of exports and seventy percent of R&D investments. As the country is now well positioned to lead the Fourth Industrial Revolution, all major manufacturing stakeholders from government, industry and academia should develop passions and plans to ensure that the country will lead this revolution. The Apple Corporation’s recent announcement of a $5 Billion Advanced Manufacturing investment fund is exemplary. Such leadership will allow the United States to earn long-term competitive advantages well into the coming decades.

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