2026 Industrial Mid-Year Leadership Review: A Supply-Demand Challenge

Operations and Capacity

Power Equipment

The demand from data centers, grid and defense converged on the same power equipment, and there was not enough of it. Gas turbines, transformers and switchgear were in short supply, and lead times ran from roughly a year for switchgear to more than three for large transformers.² GE Vernova sold years of turbine production in advance, Siemens Energy reported the largest order book in its history and some hyperscalers, including Meta, began building their own power on site rather than wait for a grid connection. Wood Mackenzie projected the US market for this equipment to grow from approximately $20 billion in 2026 to $65 billion by 2030.³ A reduced 15% tariff rate on imported grid equipment, in place through 2027, eased costs while domestic supply stayed short. The advantage went to manufacturers whose operations executives could lock in scarce capacity and hold output on schedule.

Capital Deployment

Strong demand forced leaders to question how aggressively to invest behind that growth. Manufacturers serving data centers, power and defense weighted new plants, capacity additions, automation and acquisitions against forecasts that ran years out. The premium went to the President and General Manager who could tell durable demand from a cycle, sequence the spending and scale without running ahead of the market. That remit spanned manufacturing, pricing, capital allocation and talent at once, a breadth once distributed across several functional leaders.

Labor and Automation

The labor shortage went deeper than the executive suite. Maintenance technicians, controls engineers and automation specialists grew scarce and many manufacturers automated the work they could not staff. At a growing number of plants, AI moved from pilot projects into daily operations, applied to predictive maintenance, quality inspection and scheduling.

Running an instrumented plant meant integrating operational technology with enterprise software and carrying a workforce through the change, and many manufacturers found the executive fluent in both production and digital systems one of the hardest hires to complete. They also added robotics and connected equipment on the floor, and running that hardware called for a different leader, an operations executive who could deploy capital-intensive automation and prove its return. The two profiles rarely sat in one person.

Supply Chain

The trouble getting parts pushed many manufacturers to rethink purchasing. Dual sourcing became common practice, nearshoring gained ground and inventory strategy shifted from lean toward resilience. Some companies went further and moved production back onshore, a growing trend that raised demand for site leaders and plant managers who could stand up new domestic capacity.

Tariffs reinforced the shift, as steel and aluminum and copper held at 50% and raised the cost of imported metal across the supply base. Manufacturers put a premium on supply chain leaders who could rebuild a network while it ran, work that reached senior leadership rather than the plant floor.

Commercial Leadership

Companies also changed their ask of commercial leaders. With product scarce and tariffs raising costs, the job moved from chasing volume to protecting margin, deciding which customers got limited supply, holding key accounts and passing cost increases through without losing them. They looked for chief commercial officers who could run pricing as a discipline, a different profile from the volume-focused sales leader.

Ownership and Consolidation

Ownership changes drove a second stream of leadership demand. Strategic acquirers took 86% of industrial deal value over the trailing year, the highest share on record, as buyers went after capability they could not build in-house fast enough, the controls, software and automation.⁴

Private equity carried greater weight in hiring. Sponsors stayed disciplined on price and concentrated on the middle market, buying small companies in fragmented segments tied to the buildout: test and measurement, flow control, filtration, thermal management and industrial services. Under the buy-and-build model, these leaders were expected to grow a platform through a sequence of add-on acquisitions, often to several times its starting size, so the capacity to scale with it weighted in the hire. That work required a leader who had already turned a spun-off business into a standalone company on a tight deadline, and those operators were harder to find than the number of jobs that needed them.

Generational handoffs at many family-held manufacturers moved long-held businesses toward professional management, opening searches for leaders who could keep the operating knowledge while changing how the business ran.

Leadership and Supply

The executives who fit this profile were, in most cases, already running businesses, well compensated and selective about the next move, while relocation stayed difficult and expectations around pay and flexibility kept climbing. That made vacancies costly. In a market where demand could move ahead of capacity, a president, operations, supply chain or commercial role left open for six or nine months became a constraint on growth.

The Road Ahead

Demand is unlikely to ease in the second half, and that is the opportunity. Capturing it will take leadership that most companies cannot build overnight, and the depth to run at this pace takes years to develop. The companies that treat that depth as something to build ahead of demand will be best positioned when it counts.

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SOURCES

¹ Institute for Supply Management, Manufacturing PMI Report, July 2026.  |  ² Wood Mackenzie, US data center electrical equipment lead-time survey, 2026.  |  ³ Wood Mackenzie, US data center electrical equipment demand outlook, 2026.  |  ⁴ PwC, US Deals 2026 Midyear Outlook: Industrial Manufacturing.