A new report from The Manufacturer and Oracle NetSuite has been launched at Smart Factory Expo in Liverpool.
Connected and intelligent – the route to smarter manufacturing for SMEs examines the attitudes of more than 80 UK manufacturing SMEs through in-depth questions about their approach to hardware and software requirements, and what strategies are being deployed to remain competitive in this fast-changing world.
The report comes at a time when UK productivity is becoming an urgent, national economic issue, given that it now takes UK workers five days to produce what their German and US counterparts can create in four days or less.
Sector strengths and weaknesses are discussed, and – fortunately – the weaknesses highlighted are not insurmountable.
The report explains how manufacturing SMEs can use software to overcome these challenges, learn to work smarter and help close the productivity gap with competitors.
Optimism, but room for improvement
The report reveals a welcome optimism for growth and positive attitudes to breaking into new markets – both in terms of product innovation and new geographies.
On the other hand, there is cause for concern. Management decisions around organisational change, investment in hardware, software and the collection of data are much less of a priority compared to growth.
Furthermore, difficulty in accessing finance is a long-standing issue, and skills shortages and attracting the right employees remains a major worry for many SME manufacturers.
Manufacturing SMEs’ communication and collaboration with their customers and suppliers highlights one area where there is clear room for improvement – far too many (90%) still communicate with their customers through basic email, phone and fax.
The report looks at how SMEs can migrate from these ‘non-intelligent’ formats to using portals or collaborative tools, thereby making the most of smart, data-driven communication systems that combine the key business pillars of CRM, e-commerce and financial reporting.
Sector slowness to embrace Industry 4.0 techniques also reveals why productivity growth remains stubbornly weak. The reason is clear – lack of expertise and poor data collection, management and analysis skills.
The report explains that the secret for smaller companies is not necessarily investing in additional sensors and machinery, but taking stock of what they have and starting to look at the areas that are most important. Businesses need to determine what might make the most difference, analyse it and then work out how to drive process improvement.
Bringing it all together with ERP systems
Crucially, the report identifies a route for overcoming the problems SME manufacturers face when preparing their business for Industry 4.0 – a well-designed ERP package. Unfortunately, many manufacturing SMEs express dissatisfaction with their current ERP system, resulting in underuse of exactly the kind of modules that need to be utilised if they are to embrace Industry 4.0.
To help businesses find the right ERP system, the report concludes with a checklist for SME manufacturers to run through with ERP vendors, ranging from questions about the cloud and Internet of Things capability to ease of use, training opportunities and case studies.
For many SMEs, the leap to Industry 4.0 appears daunting and complicated, but with the right systems in place, especially a user-friendly ERP system designed for a connected business world, the move to a modern, productivity-enhancing environment can’t happen too soon.-
Want to read more?
Click here to download the Oracle NetSuite report, Connected and intelligent – the route to smarter manufacturing for SMEs.