Digital disruption doesn’t faze UK manufacturers

Posted on 5 Apr 2017 by Jonny Williamson

The UK manufacturing sector is confident it can thrive in a digital world, albeit with dramatic change and innovation, according to new research by Fujitsu.

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More than four in five (82%) manufacturers are excited by the business opportunity digital disruption presents.

With the majority of manufacturers expecting digital to fundamentally change the sector within five years, more than four in five (82%) are excited by the business opportunity digital disruption presents.

Almost all (90%) of  the manufacturing professionals surveyed by Fujitsu reported the sector has already been impacted by digital disruption, and 95% expect it to be further impacted in the future.

Looking at their own organisation, 95% admitted theirs needed to evolve in order to thrive and 90% believe the industry will fundamentally change by 2021.

When asked to consider the main effects of digital disruption, there was a strong consensus that it increases competition and enables new entrants in the sector (50%). Manufacturers also highlighted that it creates a faster pace of change (48%) and fosters more innovation (38%) and market growth (38%).

Graeme Wright, CTO for Manufacturing, Utilities, and Services, UK & Ireland at Fujitsu explained: “For manufacturers, digital disruption is as much about the transformation of business processes as it is business models and revenue streams.

Servitization, according to Wright, not only provides manufacturers with the opportunity to increase revenue, it also ensures the complete service a customer requires – such as maintenance, spares, expertise – is delivered at once.

Driving digital disruption

According to  Fujitsu’s Fit For Digital study, almost half of those surveyed (47%) stated that it is their CIO who is internally driving the response to the challenge of digital disruption. This is seemingly at odds with respondents in retail, financial services and public sector, which all believe the charge is being led by their CEO or combined leadership team.

Wright added: “It is somewhat disappointing that only CIOs have digitalisation on their agenda, whereas the responsibility in other industries lies with the CEO or the board collectively. However, this may be down to the nature of the business.

“While industries such as financial services have always dealt with information and data, manufacturing deals with physical things and assets, so have a different set of challenges to tackle. The next stage for manufacturers will be finding the right partner which has the ability to help them fulfil their transformation vision.”

In order to thrive, the sector believes in the power of collaboration and co-creation; almost half (48%) said they would feel more confident in their organisations’ ability to embrace digitisation if they had the right technology partners to shape their approach. Additionally, more than two thirds (67%) felt the need to collaborate with technology experts would be vital for future success.