Is your value chain ready for the challenges of 2040?

The rise in the frequency and intensity of global disruptions is sparking uncertainty, and triggering profound transformations across value chains – as highlighted in the recent report Beyond Cost: Country Readiness for the Future of Manufacturing and Supply Chains. As global value chains start to rewire, the Global Future Council on Advanced Manufacturing and Value Chains has set out to create potential scenarios to guide manufacturers’ decision-making processes as they rethink their operations to account for critical driving forces including climate disruption, consumer expectations and behaviour, global relations and trade, technology evolution, cybersecurity, regulatory complexity, workforce and skills, and social equity.

The Council’s 2023/2024 mandate aimed to map various scenarios for value chain configurations across the time horizons of 2030, 2040, and 2050. These dates were chosen because:

To address challenges and uncertainties related to the driving forces that the manufacturing ecosystem will continue to navigate through 2050, the Council designed a strategic framework outlining three key dimensions considered essential for shaping future value chain configurations: integrated sustainability, end-to-end collaboration, and technology adoption.

Each of these dimensions includes a number of components, with certain indicators serving as their real-world measures:

To meet the needs of the manufacturing sector in navigating the shifts impacting global value chains triggered by the eight driving forces, and the reality of looking at a time horizon 15-plus years away, the Council set out to create its own scenario-planning workshop exercise to map possible configurations of value chains in 2040.

Potential value chain configurations that are best equipped to meet the new requirements and opportunities brought by each driving force are intended to provide leaders in manufacturing, academia, government, and civil society with a deeper understanding of future needs – and their implications for strategic decision-making. They serve as strategic tools, guiding stakeholders in adapting to emerging global dynamics, and ensuring resilience in the face of uncertainty.

To set the stage, workshop participants break into groups representing each driving force. Each group is equipped with researched key data points and uncertainties related to their respective driving force, identified by the Global Future Council on Advanced Manufacturing and Value Chains – to aid participants in beginning to envision the year 2040.

These data points and uncertainties provide an initial space for discussion, allowing participants to express the unique patterns and dynamics that continue to evolve and influence their operations – ultimately customizing the experience to help in producing relevant value chain configurations best suited for each driving force. As this portion allows participants to supplement additional uncertainties to the provided one-pagers, it ensures the exercise remains topically relevant.

Based on the discussion, the group identifies the three uncertainties that would have critical impact on future value chain configurations. As previously mentioned in this article, the workshop breaks down the complexity of value chains into three key dimensions: integrated sustainability, end-to-end collaboration, and technology adoption, with relevant indicators. In the workshop, each indicator is displayed on a card and presented to the participants, resulting in 32 cards laid out on each of the groups’ tables. Correlating to the cards, a board template was created for each of the three dimensions the cards represent. The participants discuss the 32 indicators pertaining to each dimension in detail, and select those needed for a value chains configuration best equipped to address the group’s driving force – and associated key uncertainties.

This allows for the selection of strategically important indicators for each dimension, which are then pinned to the board in the appropriate dimension’s field. In the final step, the group explores how the selected cards are interconnected – both within and across dimensions. Relationships between indicators are visualized on the board through arrows, circles and lines. In this way, each working group develops a mapping of the key indicators and linkages and correlations deemed critical for addressing the unique uncertainties of their driving force in a 2040 value chain scenario.

The Council’s methodology, centred on envisioning value chain configurations for 2040, inspires participants to step out of their comfort zone, beyond the two- to five-year planning horizon. By mapping potential future scenarios, the exercise can inform decision-making on possible actions to tackle challenges and capitalize on opportunities arising from emerging trends and uncertainties set to continue impacting the sector in the years to come. This approach is designed to ensure flexibility, by addressing their implications on manufacturing and supply chains across various industries.

For more information or questions about the Global Future Council on Advanced Manufacturing and Value Chains, this scenario development method, and how it could be applied to your organization, please feel free to contact Kyle Winters (kyle.winters@weforum.org) and Jasmina Holst (jasmina.holst.ext@weforum.org).