Digital confusion: 50% of manufacturing SMEs lack the knowledge and skills to optimise business operations

Posted on 25 Jan 2022 by The Manufacturer

Manufacturing organisations are falling behind in terms of digital adoption, which could be negatively impacting their bottom line, according to new research by GAIN LINE.

The survey asked 1,000 senior managers/directors and those heading up procurement, HR and ops teams at SMEs in ‘traditional’ industries — rail, life sciences, manufacturing, energy and construction — about the use of and attitudes towards digital services/tools within the business.

It found that 57% of leaders in the manufacturing sector feel they aren’t confident with technology, with more than half lacking the skills needed to move from paper to digital services. 

GAIN LINE helps firms grow by digitally optimising their operations for improved efficiency and has growing concerns that reluctance to go digital within the sector could be negatively impacting organisations. As well as impacting efficiency and profitability, lack of digital adoption is also setting manufacturing firms up for issues in the near future with government initiatives such as Making Tax Digital requiring businesses to file their tax returns online. 

Despite hesitancy, 40% of manufacturing respondents stated that they have started early stages of digital adoption by moving some services from paper to digital, although 61% believed they could never get to a point where business operations (everything from HR to accounting) were merged to one system.

Smart,Industry,Control,Concept.hands,Holding,Tablet,On,Blurred,Automation,Machine. Image courtesy of Shutterstock

When asked what the main barriers to going digital were, manufacturing industry respondents cited: 

  • Lack of confidence with technology (50%)
  • Lack of digital skills within leadership and employees 47%)
  • Resistance from leadership 47%)
  • No time of budget to train staff (27%)
  • Lack of budget (26%)

“Many SME manufacturing businesses see potential benefits of going digital,” says Jonathan Ward from GAIN LINE, “however, lack of digital skills and resistance from leadership can make it difficult to put plans in motion. Going digital can save firms huge figures in both time and money.

Of the SMEs across all five sectors that have gone fully digital, 58% said that doing so saved them money, 56% said it improved morale and 52% said it increased revenue.

Jonathan continued, “There are lots of options for manufacturing businesses to help them go digital including hiring digital apprentices, sending employees on training courses, applying for digital grants and seeking help from a digital transformation specialist such as GAIN LINE.”

*image courtesy of Shutterstock