How can manufacturers overcome the UK’s productivity gap?

Manufacturers are on the cusp of a technological revolution, the fruits of which could help address the long-standing productivity gap between the UK and comparable economies.

UK manufacturers have shown a willingness to invest in transformative new technologies that will help them reap the rewards promised by Industry 4.0 - productivity
UK manufacturers have shown a willingness to invest in transformative new technologies that will help them reap the rewards promised by Industry 4.0.

New research from Oracle |NetSuite and The ManufacturerConnected and Intelligent: The Route to Smarter Manufacturing for SMEs – points to a sense of optimism among UK manufacturers, and a willingness to invest in transformative new technologies that will help them reap the rewards promised by Industry 4.0.

The Manufacturer spoke with Oracle | NetSuite’s manufacturing lead, Gavin Davidson, about the potential barriers to growth for UK manufacturers and how these can be overcome.

What are the key barriers UK manufacturers must overcome to pave the way for growth in 2018?

Gavin Davidson: The skills shortage remains a standout issue. Our research found that nearly two-thirds of UK manufacturers see the lack of engineers and technicians at all levels as their biggest concern.

The manufacturing industry is in a near-constant state of flux, especially as automation technologies take on more repetitive manual tasks; but companies still need talent.

Automation won’t replace workers. Instead, we’ll see new roles created as manufacturers look to get the most out of their investment and implement new business models with this technology at their heart.

The benefits of automation are well-documented, but real productivity gains will only come from having the right people to manage its use.

What priorities will manufacturers focus on in 2018 to achieve growth?

Gavin Davidson, product marketing director - Manufacturing, Oracle | NetSuite.
Gavin Davidson, product marketing director – Manufacturing, Oracle | NetSuite.

Unsurprisingly, two-thirds of UK manufacturers see product innovation as the most pressing matter in the year ahead. However, we’re also seeing a shift towards greater service innovation.

Customers increasingly expect companies to deliver value through a combination of products and services, which is why new business models such as Equipment-as-a-Service are becoming more prominent.

Businesses operating in aircraft maintenance and office equipment rental already offer their products based on pay-per-use fees, but with the advent of sensor technology, manufacturers can now monitor the performance of their products throughout their entire lifecycle, in real time.

This allows them to take a much more proactive approach to repairs and maintenance. Sensors embedded in individual components, for example, can alert manufacturers when a part needs replacing, providing a proactive sale opportunity.

What advice would you give to UK manufacturers preparing to implement Industry 4.0 technologies?

Most UK manufacturers have adopted some form technology that would fall under the Industry 4.0 heading, with 78% already using sensors, machines and servers in their operations.

These companies collect a range of valuable data from these technologies, but what separates the leaders of Industry 4.0 is how they manage and analyse this data, and how they choose to act on the insights it holds.

That’s why a successful Industry 4.0 technology is as much about cultural change as the technology itself, if not more so. To get the most from their investment, manufacturers need to establish policies and processes that empower employees to get the most from the data they capture.

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Upcoming The Manufacturer Connect – Wednesday 28 February, 2018 | Glasgow