The past half-decade has seen significant progress regarding the digitalisation of manufacturing, but there is still a way to go before the use of technologies, and the benefits they deliver, becomes the norm rather than the exception.
Since 2015, the UK has borne witness to a number of political and industrial endeavours all geared towards strengthening the country’s industrial competitive edge on the world stage.
We not only have a government department with ‘Industrial Strategy’ in its title, we also have a modern Industrial Strategy to go with it, one which prioritises productivity, technology, skills and sustainability and is starting to deliver on its promise.
The industry-led Made Smarter Review has been ratified, a Made Smarter Commission has been established and a 24-month North West Pilot (designed to boost the output and growth of small and medium-sized manufacturers through the adoption of digital technology) has been launched.
The UK’s network of Catapult centres has gone from strength to strength – particularly the High Value Manufacturing Catapult cluster, which now encompasses seven main facilities and a further nine outreach centres.
There has also been a widespread recognition that the digitalisation of manufacturing is not an end goal or an overnight transformation, but a journey – one that the majority of businesses have only just started on or, more worryingly, are unaware of the pressing need to embark on.
Despite isolated pockets of excellence and individual success, the UK as a whole continues to experience stagnating productivity; attracting, recruiting and retaining talent remains a challenge; and global competition is increasing on all fronts, from established players to disruptive new entrants.
These issues are by no means unique to the UK, almost every industrial nation faces them. Similarly, the technologies proven to help alleviate each of these challenges have been largely de-risked and are readily available to those wishing to embrace them.
“If you really want to do something, you’ll find a way. If you don’t, you’ll find an excuse”
Jim Rohn, American entrepreneur, author and motivational speaker
Time, therefore, is of the essence. The next 12 months (and beyond) can’t be just about maintaining current our level of adoption, we must find ways to accelerate it.
How the UK collectively achieves that lay at the heart of the fifth annual Digitalising Manufacturing Conference, held at the Manufacturing Technology Centre (MTC), one of the High Value Manufacturing Catapults.
Image courtesy of MTC.
“The Fourth Industrial Revolution represents a huge, multi-faceted opportunity for value and wealth creation, one that applies to every business, regardless of size or sector,” noted CEO of Make UK, Stephen Phipson.
However, it’s not solely about technology, he continued. “Equally important are strong leadership and management, a conducive trading environment, consistency of message [i.e. agency coordination], and, most important of all, skills.
“Without the right talent, the promise of the Fourth Industrial Revolution won’t be delivered,” Phipson warned.
“We used to have three people in our accounts department. Thanks to software automation, one is training to be a HR professional and the other two are training on [Robotic Process Automation] and leading a business-wide transformation”
Will Bridgman, chairman, Warren Services
Just prior to the financial crash, UK productivity was close to equalling that of its long-term manufacturing rival, Germany.
Ten years on and UK productivity is 3% lower than any G7 nation and business investment overall is generally weak, noted Chris White, director for the Institute for Industrial Strategy at King’s College London.
Increased productivity comes via research, innovation, skills and training, White continued; something the government aims to stimulate by increasing total R&D spend from 1.7% of GDP in 2016 to 2.4% by 2027.
Such a lofty ambition will be only achieved by a concerted effort from both government and business, particularly regarding how we adopt new advanced technologies such as artificial intelligence, automation and big data.
However, given the UK’s lack of modern infrastructure, digital skills, regulatory framework for a digital economy and strategy around jobs of the future, one might question whether the government is actually prepared for what tomorrow holds.
Though for the past three and a half years, one thing has been dominating Westminster’s attention.
“Brexit means we need an industrial strategy more than ever, we have to provide reassurance at a societal, organisational and individual level, and confidence about what our future looks like,” White said.
“Elections are always fought over who can spend the most on public services. They always ignore those who create the wealth, the high-value jobs, the exports, the economic growth, i.e. manufacturers”
Juergen Maier, chair of Made Smarter and (up to Jan 2020) chief exec of Siemens UK
Talk of Brexit aptly segued into a panel discussion which offered an international comparison on digitalising manufacturing.
The four international panellists all referenced how their countries were already embracing and exploiting the opportunities provided through digital technologies, with strong government and industry backing to ramp up efforts in the immediate future.
‘Industry 4.0’ was described as “a wake-up call that offered Germany a focal point for its many agencies and stakeholders to rally around”, by Kai Peters, of Germany’s VDMA (Mechanical Engineering Industry Association) – the largest trade body in Europe.
Sweden’s ‘Smart Industry’ strategy has seen politicians striving to engage with SMEs and gain their interest in change programmes for the first time in 25 years, according to Björn Langbeck, of the Swedish Agency for Economic and Regional Growth.
The challenge, according to Langbeck, is that many SMEs are making a reasonable profit and therefore don’t want or see the need to change.
His point was picked up by Andrzej Soldaty, who noted that the owners of many Polish businesses believe their domestic market to be large enough for them, so aren’t aware of or don’t feel threatened by globalisation – an assumption that Poland’s ‘Future Industry Platform’ strategy is aiming to change.
How to better engage with and incentivise SMEs
MAKE IT TANGIBLE, DEMONSTRATE VALUE AND SPEAK THEIR LANGUAGE
- Listen to their challenges –
- Offer the right support – not just financial, but training, government advice, workshops, demonstrations, networking opportunities
- Tap into and coordinate efforts with those who already have trusted relationships with SMEs
- Make the message easier to hear and understand – avoid using tech jargon and buzzwords
- Family businesses trust family businesses – they don’t necessarily want to listen to slick marketing professionals, sales people or large corporates
- Provide short, sharp programmes or projects that deliver a quantifiable ROI and help ‘turn on the light for digitalisation’
- Don’t ask too much too soon
Alongside a lack of awareness or impetus for change, the panellists all agreed that a lack of standardisation and interoperability were major barriers to increased global adoption.
“To genuinely scale technology, standards are a must,” said Doug Woods, president of the US-based Association for Manufacturing Technology (AMT).
Over the past decade, Woods has led the AMT’s effort in developing ‘MTConnect’, a free and open to download, industry-wide interoperability standard that offers a vocabulary for manufacturing equipment to provide structured, contextualised data with no propriety format.
“Businesses often have knowledge of a technology in isolation, unaware of the greater gains available by combining them together”
Mark McNally, ISCF Director, Manufacturing Made Smarter
North West Pilot: Progress to date
In the 12 months and change since the Made Smarter North West Pilot was launched (at The Manufacturer’s Manufacturing Leaders’ Summit 2018), the programme has already seen “job creation and positive changes”, according to Claire Porter, Head of Manufacturing at BEIS.
Almost two-dozen companies based in the region have so far signed up to benefit from the initiative, which expects to help them improve productivity and revenues, increase export sales, reduce their environmental impact and achieve greater supply chain integration.
To date, around 300 small and medium-sized manufacturers based in the region have secured support, including specialised advice and £1.6m of funding (for 62 of them); a total of 800 businesses have already approached the pilot for support.
The 12 manufacturing business leaders who embarked on an eight-month Made Smarter Leadership Programme, run in collaboration with Lancaster University Management School – image courtesy of Made Smarter.
It’s hoped that the pilot will ultimately engage with more than 3,000 manufacturing SMEs, with up to 600 qualifying for more in-depth support and match-funded grants towards the cost of new software or hardware.
However, the reality is that a full assessment won’t be made for another 18 months, Porter noted – potentially tempering hopes for the accelerator programme being rolled out to other regions in the near future.
Addressing concerns that Made Smarter may go the same way as the now defunct Manufacturing Advisory Service (MAS), Porter said that the government is “fully behind the programme” and a number of other nations have enquired about how they can establish similar initiatives themselves.
Made Smarter is relevant for any North West SMEs employing less than 250 staff who make, create, manufacture or engineer.
Want to know how Made Smarter could help you with a technology investment plan and 50% match funding for investment?
*Unless attributed, all images courtesy of Depositphotos