Core Viewpoint - The manufacturing industry in China is undergoing a significant transformation driven by artificial intelligence and digitalization, moving towards a "smart manufacturing era" to address challenges such as overcapacity and intensified price competition [2][3]. Group 1: Industry Transformation - The manufacturing sector is facing deep challenges characterized by "involution" competition, necessitating a shift towards technology-driven and ecologically coordinated solutions [1]. - By the end of 2024, over 10,000 smart factories are expected to be established, covering more than 80% of major manufacturing categories in China [2]. - China is projected to have the highest number of lighthouse factories globally by 2024, as reported by the World Economic Forum and McKinsey [2]. Group 2: Changes in Manufacturing Practices - The industry is experiencing nine major changes, requiring companies to embrace transformation in both operational and support systems to achieve high-quality growth [3]. - The shift from reverse engineering to forward R&D emphasizes understanding customer needs and defining products independently, enhancing sustainable innovation capabilities [4]. - The transition from static to dynamic planning in production allows for real-time adjustments to meet highly customized customer demands, improving planning efficiency by 50% and reducing lead times by 30% in some cases [5]. Group 3: Collaborative and Flexible Production - The move from large-scale production to flexible production enables companies to adapt to varying demands and optimize resources across the supply chain [7]. - Procurement is evolving from transactional to networked collaboration, enhancing efficiency across all supply chain stages [7]. - Companies are increasingly pursuing globalization, establishing overseas production lines and supply chains to navigate new challenges associated with global operations [7]. Group 4: Financial and Organizational Changes - The role of finance is shifting from traditional accounting to becoming a business partner, providing detailed operational insights to various business units [8]. - Organizational structures are transitioning from hierarchical models to entrepreneurial partner models, fostering collaboration and innovation [8]. - The integration of AI in management processes is transforming manufacturing capabilities, enabling a unified approach to operations and financial management [8]. Group 5: Technological Integration and Future Outlook - The implementation of cloud-based solutions is facilitating rapid R&D iterations and dynamic supply chain collaboration, enhancing overall operational efficiency [9]. - The ongoing digital transformation in manufacturing is not merely a replacement of traditional methods but represents a new paradigm in production possibilities [9].