Francisco Betti joined the World Economic Forum in May 2015. He is an international development professional and is currently leading the platform for Shaping the Future of Advanced Manufacturing and Production, which was launched by the Forum at its Annual Meeting 2017, upon request of world-leading governments and companies. The platform is helping global leaders anticipate how advanced manufacturing technologies are transforming factories, business models and partnerships, and to understand the implications for the economy, society, and environment in order to shape a more inclusive future.
The World Economic Forum is an independent international organization committed to improving the state of the world by engaging business, political, academic, and other leaders of society to shape global, regional, and industry agendas. Incorporated as a not-for-profit foundation in 1971, and headquartered in Geneva, Switzerland, the Forum is tied to no political, partisan, or national interests.
Prior to joining the World Economic Forum, Francisco worked for PricewaterhouseCoopers SA in Geneva, Switzerland, primarily running management consulting projects for international organizations.
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Francisco Betti: LinkedIn
Some of the highlights from the podcast:
- Changes the pandemic has created across supply chains and manufacturing across the world.
- Geopolitical dimension of the global economy and innovation’s massive acceleration.
- Next levels of transformation across different companies to fill in the gap that emerged on the supply side.
- Transformation of operations and business models
- Future of manufacturing and operations in terms of artificial intelligence, robotics, analytics
- Resilience as a major competitive advantage
- Automation and augmentation as a major investment to adapt to the new normal
- Readiness for adapting to change
- things that companies can practically do to constantly upgrade
- Future of manufacturing and production in terms of different talents from across multiple industries
- [00:59] So first I’d like to begin by talking about COVID-19 and the changes that the pandemic has created, across supply chains and in manufacturing in general, across the world. And then I wanted to get to your 30,000 feet view in terms of, what are some of the main trends that you have seen by talking to senior executives within manufacturing before?
- [01:20] Absolutely. Right. And maybe start by saying that we did run a consultation as we were mid waiting there, the first wave of COVID-19. So that was about May 20, 20 we’d over 400 executives. So chief operating chief supply chain office, I think that over 80% of them acknowledging that their supplier networks were disrupted for the very first time, both on the demand and satellite side.
- [03:01] So I wanted to pass it to you and maybe expand on some examples and what you have seen at the forum in terms of companies that have shifted or adapted their models to best feed the current reality,
- [03:42]We saw a massive acceleration of innovation, not just from the operational side of things, too, of course, response to the pandemic and keep facilities up and running, but also massive innovation in the wind, which in which companies are delivering value to their customers, companies were able to rapidly pivot and get started into e-commerce.
- [04:53] Companies realize that, that it was possible to transform not just operate in, but also business model scale. And then we saw that happening when it comes to product design and development when it comes to the ways in which companies interact with their customers.
- [05:51] I think that you hear that regularly from the activity if you work with, but not almost every company is looking at how to diversify its own satellite system as one of the main pillars and foundations for reducing disruptions across operations, but also to enable them the transformation of growth, their value chains, they’re all looking at the future, let’s say of work and the future of remote control of operations.
- [06:54] We have seen consumption patterns change radically over the past six months, and that will continue. There are new generations that were not new generations, but then what entire generations, which would, for example, not used to commerce
- [08:21] I wanted to ask you, Francisco, from your perspective, what are some of the new trends that you’ve observed in this? Ultimately, these are the jewels of manufacturing, right? That the combination of artificial intelligence, robotics, analytics, these are the best manufacturing facilities in the world. What are some of the new findings that emerged this year when you put together the report compared to the previous?
- [09:06] What we did is that we’re not, we started out what we search in collaboration with McKinsey that was back in 2017. And we realized that most companies were stuck in what we describe as aspire to look purgatory, what is [inaudible], it’s the challenge they are facing, which means that they are over-invested in lots, but they are seen limited success when it comes to developing new applications and especially deploy them at scale and close there, of their manufacturing and satellite systems.
- [10:21] As I mentioned before, they have all demonstrated significant operational and financial impacts when it comes to the adoption of very specific use cases. So here we are not talking about technology in general, but we are talking about the practical application of technologies in combination to address very specific operational and business challenges.
- [11:17] So dabbling the impact, especially in the productivity case. I think it’s revealing to see how, you know, new use cases driven by advanced manufacturing industry 4.0 intelligent manufacturing technologies are helping increased factory output productivity or year, of course, product cost reduction. An
- [12:17] The first one is that they are all-embracing agility and customer-centricity as they transform. And they walk backward on the operations, which allows them again, agility, flexibility. Customer-centricity allows them to respond faster to new customer preferences and changing demand and adust the production flows accordingly.
- [13:26] And then you’ll realize that resilience is and will be a major competitive advantage going forward. And, that requires rethinking the supply yes ecosystem, and again, to mitigate risk and allow flexibility at the supply chain level. Now that’s the third thread on unforgivable shift, which is there related to the fact that speed and productivity.
- [14:31] Of course, in the current context with the additional challenge, which is, you know, leveraging our automation worker supplementation, to ensure a safer environment and prevent future disruptions as that, that may come from new outbreaks.
- [15:29] So I think that what is interesting to observe is that again, the sustainability conversation, it’s more than more a topic that is driven within companies by chief operating and satellite officers. So the ones who are at the forefront of the transformation of manufacturing, supply systems, out of the ones who are embracing and leading the, let’s say the sustainability revolution manufacturer. And I believe that that’s, that’s a major change compared to two and a year ago.
- [16:10]Now, I guess my question to your point of companies being stuck, trial and error, and you know, different testing and, you know, pilot purgatory, as you called it very vividly, what would be your advice to the thousands upon thousands of other factories, right? And other manufacturing plants across the world? How could they, because you know, we’re not going to have 2000, 3000, you know, lighthouses, but what would be the low hanging fruit that may be even smaller or medium size companies and their factories could look at too, you know, move the needle to the next steps in terms of their industry 4.0,
- [17:06] That’s a big question. I think that probably one of the reasons why many are still starting pilots to forget a risk course, there is a sort of an obsession for them by technology, right? We tend to focus a lot on technology, but we forget that too successful in drive the digital transformation of manufacturing. There are a series of enablers that are essential and that companies need, to work on.
- [18:10] It has to do as well with the need to, as I mentioned before, to think about, long-term not just about short-term cost reduction, which would have been always the challenging operations, but you not be able to embrace a new, they mentioned such as sustainability as we were discussing before.
- [19:02] We have a great example of a company using commercial smartwatches that they have received to monitor for the, for the bright toes and the shop for engineers to monitor operations in real-time and get, you know, alerts and, and sign certain signals.
- [20:27] So I’d like to double click a little bit and focus on that and zero in and ask you from what you have observed, and maybe from the companies that might move a little bit slower. What are some of the main shifts in the mindset of theirs, whether they’re at the CEO level, those your chief supply chain officer level, the two things still need to be made in order for this change to be accelerated?
- [20:56] Absolutely. And, and what we can observe is that those companies were really ahead of the curve and ahead of the game, work on that mindset change and three levels, you know, CEOs and CFOs and CTOs were convinced, but they weren’t convinced because they run the right analysis and they saw the potential return on investment.
- [21:53] Most of these lighthouse companies did at the top level. And if there is not aggregated that if there is not a convention, that this is something we should be investing in from the top plants will not, would not fly.
- [22:52] You know, they brought them in for a pilot, and was impossible instead of taking them away because workers saw how better and how easier their tasks were made and facilitated with those devices. So I think that’d be an important piece to drive and have this mindset change and also those three levels.
- [23:59] I don’t know anybody on the planet if anybody has the answer to this, but how do you see also the challenges that will occur from technology developing so fast? And at the same time, we as humans might have a leg, right? In terms of adapting, learning, reskilling, upskilling, you know, how do you see this moving in the future? And what are some of the things that companies can practically do to constantly upgrade, I guess, this stuff?
- [24:48] So if you look at the evolution of technology as a curve and the number of investments that were made on upskilling and reskilling across industry sector, and even at the company level, you know, there’s clearly a gap.
- [25:35] The advanced manufacturing industry 4.2 intelligent factual contexts. My belief is that companies are more and more moving into frameworks of continuous on-the-job training, which means that probably as shop floor operators, you know, we will see programs that will run throughout the year and forever through which we’ll be looking at new technologies.
- [26:43] I think what is important in this workforce transformation story is to say that 70%. And we have observed that through some process, 70% of staff risk in manufacturing remain human-driven on manual. So manufacturing is still primarily a human-driven activity.
- [28:00]Those focus on areas in which technology will help increase the number of workers that are needed. Think about the research and development side of CS design, post-manufacturing services. We are likely going to see major job increases in those say, I think that finally, the question is not, how do we manage that transition in a fair and just way, especially for those segments of the workforce who are probably most exposed
- [28:37] Final question. And I, wouldn’t be curious to get your perspective on this because our day job being executive search and headhunting, and we are sometimes tasked by companies through their supply chain to bring talent that comes perhaps from a lateral field or left field. What do you see as most needed for the manufacturing is for the supply chains of the world in terms of bringing the people from perhaps left field or a different industry best be creative and come up with new solutions.
- [29:27] Good question. My sense is that if I look at it again, in order, we are in daily contact with many executives who comes from different backgrounds and often not just engineering, but I think that you know, there’s always be a degree of technical knowledge that will be required for people to justify operations
- [30:20] And we are doing at the forum and through the framework of our platform on the future of manufacturing and production is bringing executive from across multiple industry sectors together to engage in these type of conversations that help them broader view and vision
- [31:03]Thank you very much. Uh, Francisco, this has been very insightful and practical much appreciate all the sharing and all the case studies and continue to inspire us with the work of the forum, and continue to put out great reports that I can not stress enough.
Quote from the Episode:
About the Host:
The host, Radu Palamariu is the co-author of “From Source to Sold – Stories of Leadership in Supply Chain”. He has been named one of the top 3 Global Supply Chain Influencers on LinkedIn and was featured in Forbes, Bloomberg, WEF, Bangkok Post, and MIT Supply Chain Talent magazine. Radu invites executives to share stories and perspectives around technology, logistics, e-commerce, supply chain, and manufacturing, and their views on how the future will look.
Alcott Global connects and upgrades the supply chain ecosystem by finding the right talent through executive search, developing talent through learning solutions, and meeting supply chain technology needs through a comprehensive crunch base marketplace.
The supply chain executive search has been our focus since the very beginning, offering recruitment services for top-tier supply chain roles at every level of the end-to-end supply chain: plan, source / procure, make, and deliver. Our consultants have years of experience in placing top talent, in North America, LATAM, Europe, the Middle East & Africa, and APAC, and besides speed, one of our biggest strengths is our network within the supply chain industry, and we capitalize on it to find the best solutions.
Through the years, we have grown as an organization and our offerings with it. One of our initiatives, the learning solutions- training and supply chain academy, is focused on transforming leadership- self-leadership, executive presence, influence capital, and business acumen. Through Supplify, we aim to match corporations with the top technology companies to solve their supply chain and logistics challenges with a focus on innovation and digital transformation.
We are in constant touch with the leaders in supply chain, inviting them to inspire the supply chain professionals in thought-provoking podcast episodes and events, and showcasing what is possible at the yearly Leaders in Supply Chain Awards.