Q&A: How analytics, AI, digital twins help manufacturers build resilient supply chains

Editor's note: Anupam Bhatnagar, head of Americas manufacturing and consumer industries at Hitachi Digital Services, joined Smart Industry for a short back-and-forth about building in resilience in modern manufacturing for companies that, in this climate, are constantly being tested:

Rather than optimizing purely for cost, they’re designing networks that can sense, pivot, and respond in real time. Advanced analytics, AI-based planning, and digital twin technologies are enabling this shift—giving companies end-to-end visibility and the ability to model scenarios before disruptions occur.

We’ve seen it in action. Schneider Electric, for example, uses a digital “control tower” platform to detect and mitigate disruptions, reducing lead-time volatility by more than 30%. This shift marks a fundamental redefinition of resilience: it’s no longer about building stronger walls, but about creating smarter, more adaptive ecosystems where technology amplifies human decision-making.

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SI: As automation and digitalization accelerate, how are manufacturers reimagining their workforce strategies? What trends are you seeing in how industry is addressing the skills gap and preparing its workforce for a more technology-driven future?

AB: Step into Hitachi Rail’s Lighthouse Factory in Hagerstown, Maryland, and it’s immediately clear how far manufacturing has evolved. Robots, sensors, and AI-driven systems hum seamlessly in the background—but the real story is how people and machines now collaborate, each amplifying the other’s capabilities. Not just technology but the manufacturing workforce is undergoing its most significant transformation in decades.

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This is Industry 5.0 in motion—technology as a collaborator, not a competitor. Leading manufacturers are rethinking their talent strategies to empower their people through digital tools.

Bosch, for example, has launched a global digital academy that teaches AI and robotics skills to tens of thousands of employees, creating operators who think more like data scientists than machine tenders. Other companies have piloted immersive AR training programs that are helping engineers troubleshoot complex systems remotely, cutting downtime while boosting engagement.

The data supports this evolution. The World Economic Forum estimates that nearly half of manufacturing workers will need reskilling by 2030. But those that invest early are seeing the payoff: productivity gains of 15% to 20%, stronger safety records, and higher retention rates.

The next generation of factories will not be defined by automation alone—but by the creativity and capability of the people who command it.

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SI: Technologies like AI, industrial IoT, and digital twins are redefining operational excellence. Which innovations do you see having the most transformative impact on manufacturing productivity and competitiveness in the near term?

AB: Every industrial revolution has been defined by a breakthrough—steam, electricity, computing.  Today, it’s not one technology, but the convergence of many—AI, digital twins, advanced robotics, and IoT that’s rewriting the rules of competitiveness.

Leaders are no longer asking whether to digitize, but how to orchestrate AI, robotics, and digital twins into an integrated operating model. At Hitachi Rail’s Hagerstown plant, AI-driven visual inspection systems work in tandem with human specialists to detect microscopic flaws in paintwork. The result? Significant reduction in defects and a measurable boost in equipment effectiveness.

Across the sector, digital leaders are reporting 20% higher asset uptime and 30% faster product cycles—but the real transformation runs deeper. Industry 5.0 reframes technology not as a set of discrete tools but as an intelligent ecosystem that learns, adapts, and collaborates with human ingenuity.

In that sense, the factory of the future looks less like a machine—and more like an organism, continuously sensing, optimizing, and evolving.

Emerging technologies are no longer on the periphery—they’re becoming the backbone of competitive differentiation. are driving a step-change in performance by unlocking predictive, autonomous, and data-rich operations.

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SI: With growing pressure from regulators, investors, and consumers, how are manufacturers integrating sustainability and circular economy principles into their operations? What examples stand out to you as best practices for balancing environmental responsibility with business performance?

AB: In boardrooms across the world, one theme now dominates the manufacturing agenda: how to grow responsibly. Sustainability has moved from the periphery to the core of industrial strategy, and Industry 5.0 is providing the framework to make it real.

The ambition is clear—a regenerative manufacturing model where digital intelligence minimizes waste and maximizes value. Using digital twins and advanced traceability systems, manufacturers can now simulate carbon footprints, optimize resource flows, and design products for reuse from the outset.

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Estimates suggest that circular manufacturing could unlock $1 trillion in annual material savings by 2030—and early adopters are already seeing tangible gains.

At Hitachi Rail, for example, digital twins are being used to model maintenance cycles, reducing material waste by 25% and cutting emissions by double digits. This isn’t just good ethics—it’s good economics. The new competitive frontier will belong to those who view sustainability not as a constraint, but as an engine of innovation and growth.

Circularity is emerging as the next frontier—designing for reuse, remanufacturing, and materials recovery at scale. The challenge isn’t ideological; it’s operational. Success requires data transparency across partners, clear incentives, and alignment between sustainability and P&L outcomes. Sustainability is no longer a compliance exercise—it’s a strategic imperative shaping investment, innovation, and brand equity.

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SI: Looking ahead, what defining characteristics or strategic capabilities will separate the leaders from the laggards in manufacturing over the next five years, given the pace of technological disruption and global uncertainty?

AB: The manufacturing leaders of tomorrow will look very different from those of the past.  They’ll be technologists and humanists in equal measure—comfortable leading in ambiguity, fluent in data, and deeply attuned to purpose.

We’re already seeing this new leadership model emerge.  Companies like Toyota are blending digital agility with inclusive leadership cultures. By empowering teams to experiment with AI and automation, they’ve accelerated innovation cycles by up to 40% and improved employee engagement by 30%. These leaders see technology not as a control mechanism, but as a way to amplify human potential and organizational adaptability.

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Three imperatives will define their success: empowering people through intelligent technology, building adaptive ecosystems that can flex with global volatility, and embedding sustainability into the heart of strategy.  In essence, the future belongs to those who can marry precision with purpose—transforming manufacturing into a force not just for efficiency, but for progress.

Manufacturing is entering a new era defined by intelligence, interconnectivity, and impact. Those who lead with vision—and back it with digital and operational excellence—will set the pace for the industry’s next chapter.