Technology
Are UK Manufacturing Companies Fit to Meet Tomorrow’s Business Challenges?
UK manufacturers have good intentions to innovate and become future-ready, but they need to follow up with some action.
Most businesses focus on the day-to-day issues. Manufacturers wake up ready to tackle their to-do list and respond to immediate needs. It’s normal… As people, we attend to the tasks that are directly in front of us.
But continuing to prioritise other areas above innovation unfortunately puts your business at risk of being unprepared for impending disruptions.
According to research by NatWest, 80% of manufacturers believe innovation is critical to getting their business future-ready, but only 15% include innovation R&D at the top of their agenda.
Why is there such a disconnect between knowing innovation is central to business strategy and not prioritising it?
54% of manufacturers interviewed listed lack of innovation as a significant internal challenge obstructing their business from achieving success.
NatWest
NatWest’s research, based on interviews with 110 UK manufacturers, focuses on three objectives to identifying excellence in manufacturing:
- A leadership mindset toward becoming future-ready
- The level of collaboration with the supply chain
- Investments in innovation throughout manufacturing
The Future-Ready Leadership Mindset
Manufacturing leaders know that implementing innovative digital strategies will cause a significant uptick in the metrics that matter: improved productivity, profitability, and competitiveness. However, although manufacturing leaders overwhelmingly cited getting their business future-ready as important, they struggle to balance day-to-day demands with planning and executing forward-thinking strategies.
Making the shift to prioritise modernising business operations is critical, because the more digitalised a business is, the more resilient—and future-ready—it is when facing disruption.
21% of companies surveyed indicate their business is not resilient, with another 21% saying they are uncertain if their business ecosystem is resilient.
NatWest
Manufacturing leaders must act to prevent a return to outdated working practices and instead seize the opportunity to improve agility and resiliency for future success in an environment where business-stifling disruptions can occur at any moment.
Tighter Collaboration with the Supply Chain
Collaboration with the supply chain now becomes essential to manufacturers’ business models, given the increased visibility into the supply chain through the internet and software, such as ERP systems. Therefore, it’s a priority to integrate a connected factory with the connected supply chain.
As an effect of this collaboration, tech-savvy manufacturers are able to implement a more predictive demand–driven model, better evaluate total cost sourcing, predict customer demand, and enhance supply chain financing.
What this means for the industry is that the competition will only increase on a global scale, and consolidation will occur as the industry shifts to fewer, but larger, competitors in the UK.
Investment Opportunities
Given that innovation and R&D were ranked as top investment priorities, yet controlling costs was listed as the top barrier, manufacturers may be looking toward process innovation as a way of driving down costs.
80% of manufacturers surveyed say that innovation is crucial for medium-sized businesses to accelerate their capabilities in the next 5 years to stay competitive.
NatWest
Digitisation offers many opportunities. Among the leading characteristics chosen by NatWest survey respondents were greater efficiency and productivity, the freeing up of resources, and an improved way to manage and store data.
Although it’s quite easy—and normal—to put off high-level tasks in favour of what’s right in front of you today, the risk involved in maintaining the status quo is detrimental to your business, as more and more competitors opt for technology, collaboration, and investments to become resilient, agile, and future-ready.
Can you afford not to innovate and digitise your internal processes?
Content Curated Just for Manufacturers
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