The Six Structural Shifts Reshaping Industrials
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April 28, 2026
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The industrials sector has always evolved through disruption. But today’s environment is different in kind — not just degree.
What were once cyclical pressures — labor constraints, capital availability, energy costs and economic and trade policy — have become structural forces. They are reshaping how industrial companies operate, where they invest and how they create value.
At the same time, many organizations are still navigating these shifts within legacy operating models with complex portfolios, constrained supply chains and limited visibility into performance.
FTI Consulting’s 2026 Global CFO Survey results reinforce this tension. Industrials CFOs are signaling urgency around cost, capital and operational performance, while simultaneously leaning into AI, portfolio actions and transformation initiatives to drive value.1 Together, these dynamics point to six structural shifts that will define the next era of industrials performance.
This article sets the foundation for a six-part series, each exploring one of the structural shifts reshaping industrials, and what they mean for value creation in the years ahead.
Portfolio Realignment: Focus Over Complexity
Nearly six in 10 industrials CFOs surveyed are actively reshaping their portfolios; 27% are evaluating acquisitions, 16% are considering divestitures and 20% are pursuing both.2
Recent portfolio simplifications across large corporates, through carve-outs and separations, have demonstrated clear valuation upside, reinforcing the premium placed on strategic clarity. High-profile examples such as DowDuPont, General Electric and Honeywell illustrate how separating distinct business units can unlock shareholder value by improving focus, transparency, and capital allocation.3,4,5
It is therefore not surprising that industrials companies are actively pursuing portfolio reshaping. More notable, however, is the proportion signaling limited near-term M&A activity, suggesting a degree of caution amid geopolitical and policy uncertainty.
The next wave of portfolio action will not be about scale alone; it will be about strategic coherence, capital efficiency and clearly defined sources of value.
Geopolitical Fragmentation: Redefining the Operating Model
Macroeconomic and geopolitical pressures are front of mind, with inflation (47%), capital markets uncertainty (45%) and supply chain disruption (44%) being the leading concerns among CFOs.6
Global networks are not disappearing, but they are being reconfigured rapidly. The connection points between supply chain nodes are being rerouted, as regionalization and localization strategies, already accelerating in the early 2020s, continue to take hold.
Supply chains are becoming more regional, more resilient and more capital intensive as a result. This shift reflects a fundamental trade-off between efficiency and resilience, now central to strategic decision-making.
With rising input costs, constrained and more-costly capital and elevated disruption risk, industrials companies are no longer optimizing global networks. They are actively re-architecting them, making more consequential decisions on where, when and how to invest.
Skilled Labor Scarcity: The Constraint on Growth
Industrials CFOs rank talent pressures lower than other sectors (27% versus 36%), suggesting a different vantage point on workforce challenges.7
In practice, however, skilled labor remains a constraint on growth. Persistent shortages across trades, particularly in high-growth regions and asset-intensive industries, are increasingly impacting the timing and cost of execution, with maintenance and capital projects progressing more slowly and at a higher cost to complete.
This gap reflects a broader disconnect — while AI is augmenting many functions, these roles still require tenured expertise, problem-solving and physical execution. They are not easily automated or replaced.
The skilled labor constraint is real, and companies that can consistently access and deploy skilled labor will simply grow faster than those that cannot.
Embedding AI to Scale
AI is now the top value creation lever for industrials CFOs (51%), followed by operational and cost optimization (45%).8
This aligns directly with the sector’s core requirements: disciplined, focused investments in AI and operational efficiency are emerging as the primary drivers of enterprise value. The shift underway is not about adoption, it is about application. Organizations are prioritizing use cases with immediate financial impact — forecasting accuracy, working capital optimization, service teams and logistics deployment and cost visibility — while more advanced capabilities remain in development.
At the same time, IoT-driven data is expanding operational visibility, enabling more predictive decision-making.
AI and automation have moved past initial adoption. The race is now on for companies to effectively scale and embed these capabilities in their core operating model.
Energy Independence and the Power Super Cycle
Energy has re-emerged as both a cost pressure and a strategic opportunity.
Inflation remains a top concern, with energy and input costs playing a central role. For many industrials companies, energy represents a vital input and a meaningful share of cost of goods sold (“COGS”) — creating an additional headwind in an already cost-constrained environment. Recent geopolitical developments in the Middle East, not reflected in survey data, further amplify this volatility.
For energy consumers, this necessitates productivity offsets through pricing, mix improvement and sustained efficiency gains. At the same time, investment in energy infrastructure, grid modernization and electrification is accelerating, reviving momentum behind the power super cycle and creating growth opportunities for companies that are poised to capitalize on the push for greater non-dependence on fossil fuels.
The result is a dual mandate: manage near-term cost pressure while positioning to capture long-term growth.
Capital Cost Reset: Discipline Becomes the Differentiator
Capital is no longer abundant. Industrials CFOs are feeling the shift; only 14% report debt financing as significantly more available (versus 23% overall), while public equity availability is stronger (35% versus 25%).9
Debt markets remain constrained, particularly for private and PE-backed companies, while fewer CFOs view IPOs as likely, signaling a preference to operate within existing capital structures.
This is driving a renewed focus on capital discipline. As capital becomes more expensive and less accessible, investments must be rigorously justified, returns must be realized and execution must be consistent.
The implication is clear: capital allocation is no longer a supporting function, it is a primary driver of enterprise value, with little margin for underperformance.
Takeaway: The Six Shifts Are Interconnected
Together, the above six shifts define a new operating reality for industrials:
- Portfolio decisions are shaped by capital costs.
- Supply chain redesign impacts working capital and labor needs.
- AI enables productivity gains that offset cost pressures.
- Energy dynamics influence both cost structure and growth strategy.
In the pieces that follow, we will take each shift in turn — exploring what it means and how leaders can translate these forces into sustained value creation.
Footnotes:
1: “2026 Global CFO Survey Report,” FTI Consulting (2026).
2: Ibid.
3: “Some of the biggest splits in corporate America,” Reuters (October 1, 2025).
4: “GE completes three-way split, breaking off from its storied past,” Reuters (April 2, 2024).
5: “Honeywell Announces Intent to Separate Automation and Aerospace, Enabling the Creation of Three Industry-leading Companies,” Honeywell (February 6, 2025).
6: “2026 Global CFO Survey Report,” FTI Consulting (2026).
7: Ibid.
8: Ibid.
9: Ibid.
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Published
April 28, 2026
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