Confusion over Industry 4.0 shackling UK industry

Posted on 16 Jun 2016 by Jonny Williamson

Only 8% of UK manufacturers have a significant understanding of Industry 4.0 processes, despite 59% recognising that it will have a big impact on the sector, according to a new report published today by accountancy and business advisory firm, BDO LLP, in association with the Institution of Mechanical Engineers (IMechE).

As the increasing use of automation; data exchange; technology, and wider supply chain communications provides both huge opportunities and threats to UK manufacturing, there remains a ‘gaping hole’ in the education and understanding of Industry 4.0.

Industry 4.0 Stock
Industry 4.0 offers increased productivity; better data analysis; increased competitiveness, and lower manufacturing costs.

According to the BDO/IMechE report, increased productivity; better data analysis; increased competitiveness, and lower manufacturing costs are the top ways in which Industry 4.0 will affect UK manufacturing.

However, a third of manufacturers are at risk of falling behind global competition having not invested in Industry 4.0-related technology or processes in the past two years. Worryingly, a quarter say they have no plans to invest in this area over the next two years, and 44% of those not investing said this was due to a lack of understanding.

Of those that are increasing investment levels, 16% of companies expected to spend more than £500,000 before 2018, while 7% plan to invest over £5m.

Production would be a key area when investing in automation systems and Industry 4.0 related technology according to 64% of those surveyed, with 45% and 25% respectively saying R&D and logistics were key areas of focus. Only 5% said poor investment levels were due to the lack of external finance or grants.

TM Smart Factory Expo

The Manufacturer Smart Factory Expo is the UK’s only dedicated exhibition in response to Industry 4.0

Showcasing the best solution providers and technology offerings, this unique event is for manufacturing business leaders keen to adopt the relevant tools and knowledge to drive business growth.

  •  Learn about how Industry 4.0 can improve your business
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  •  Hear how other manufacturers are dealing with the fourth industrial revolution
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From a security perspective, 73% of those surveyed said Industry 4.0 will increase the risk of cyber security breaches in their business, and 48% of these felt they had an adequate IT infrastructure which could prevent breaches.

Head of Manufacturing at BDO LLP, Tom Lawton commented: “It is surprising to see such low awareness of Industry 4.0 among UK manufacturers, and clearly more needs to be done to educate, support and assist the sector as we make strides into what is likely to become the fourth industrial revolution.

“UK manufacturers need to push ahead or they will be left behind, especially when it is evident other countries are already moving ahead of the game with education and investment programmes being much more clearly supported by government than in the UK.

“The lack of a clear strategy on what could be the most important development in manufacturing for some years is of huge concern. We would like to see the Government doing more to match manufacturers’ long-term outlook by developing a 15-20 year industrial policy that avoids the disruptions of the political cycle.”

Head of Manufacturing at the Institution of Mechanical Engineers, Philippa Oldham added: “The survey findings show that much more is needed to be done to help our manufacturers understand how technologies such as automation can add value to their businesses.

“By embracing this new revolution our factories will become much more intelligent, be able to detect and even predict faults in our production lines before they happen. This will not only lead to increases in efficiency and productivity but also drive out waste improving our global competitiveness.

“It is now time for Government to set-out a clear long-term strategy which empowers UK companies to invest in these technologies and UK manufacturing’s long-term future.”

Don’t forget to register for our Industry 4.0 webinar taking place on July 7 at 10am. Register now.