How Technology Can Help Manufacturers Maintain Economic Resiliency During a Recession

Today, unpredictability seems to be the only constant in the modern business world. And it’s not a secret — manufacturers are concerned with the threat of a recession in 2023.

With economic uncertainty, inflation, employment shortages, an increasing volatile cybersecurity landscape and supply chain issues, business leaders in the manufacturing industry need to be prepared and look beyond 2023 when they build out their technology strategy.

As a manufacturing business that increasingly relies on technology, there are many business considerations you need to think about for the next year. Especially in a time of uncertainty, you need to constantly evaluate the best use of your technology and whether your processes are the most efficient, effective and secure.

Consideration 1 – Investing in digital transformation for long-term success

A recent study by Deloitte showed that companies with higher digital maturity have shown greater resilience, as did those that accelerated digitalization during the pandemic. By turning their technologies into capital investments in the time before a recession, those organizations who invested more saw much higher revenue growth in the recovery period.

There are several ways this can be achieved but a few good starting points are to implement technology-based solutions that improve products, services or processes, or purchasing or leasing technology-based assets that can be used over a long period of time.

Consideration 2 - Scalability and HR staffing problems can be solved by outsourcing critical functions

Workforce shortages ranked as the manufacturing industry’s top concern in recent data released by the National Association of Manufacturers.

Finding experienced, qualified talent is becoming more and more of a challenge. The average age of today’s Quality Assurance manager is higher than ever, and it has become difficult to find qualified people who want to work in this industry. How do you maintain scalability when you’re struggling to maintain employees?

Consider outsourcing some critical functions, like IT.  Outsourcing IT can help manufacturers reduce costs as you won’t have to invest in expensive technology and resources to manage your IT systems in-house. Instead, you can pay a third-party provider for access to the expert staff and services you need on an as-needed basis. This can help manufacturers save money during a recession when budgets are tight. Additionally, outsourced functions, like IT, can help manufacturers scale resources up or down as needed, which can be particularly valuable during a recession when demand for products may fluctuate. This can help avoid over- or under-investing in IT resources.

Consideration 3 – Reducing & mitigating risks with proactive security

Cybersecurity is an essential aspect of maintaining economic resiliency for manufacturers during a recession. This is because a cybersecurity incident can have severe consequences for a manufacturing business. A single cybersecurity incident can result in significant financial losses (the average amount of damage is $2.8 million), legal action and permanent reputational damage for a manufacturer. During a downturn, cyber attackers are most active, as companies tend to have less resources to invest in cybersecurity, and hackers can take advantage.

The main cybersecurity concern for manufacturing businesses is protecting industrial control systems (ICS) and operational technology (OT) networks from cyber attacks, as these systems are responsible for controlling and monitoring critical infrastructure and production processes. These systems are vulnerable to attacks that can disrupt or damage production, leading to costly downtime and potential safety hazards. Additionally, manufacturing businesses may also be at risk of intellectual property theft, data breaches and ransomware attacks.

So how do you start? Discuss your security strategy with your IT team and leadership. Your team should, at a minimum, be regularly patching and updating software and systems, backing up critical data regularly and implementing strong authentication and access controls. More advanced strategies include conducting regular penetration testing and vulnerability assessments, establishing incident response plans and working with third-party security experts to assess risks.

Factoring in these three considerations to your 2023 technology strategy will allow manufacturers to position themselves for long-term success and resilience, even in the face of economic uncertainty.  

About the Author

Scott Freitag Scott Freitag is a Virtual CIO with Convergence Networks, and specializes in working with clients in the manufacturing industry to ensure their IT strategic and support needs are met and improve their cybersecurity posture. He can be reached at

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