Manufacturers active in M&A, says Microsoft

Posted on 8 Apr 2009 by The Manufacturer

Research commissioned by Microsoft Dynamics has found that 20% of all UK manufacturing companies have undergone a sale, merger or acquisition in the last 12 months and a further 15% expect to undergo a sale, merger or acquisition over the coming year.

The research, which surveyed 500 UK company directors and managers in February 2009, was commissioned as a snapshot of how change is affecting all of the UK’s industry sectors. Of the UK’s key industries, the research found that the manufacturing sector is witnessing a significant level of mergers and acquisitions (M&A), among other areas of change.

Embracing change
Even with the financial crisis having a firm hold on manufacturing, almost 6 in 10 manufacturing companies surveyed (59%) answered that they are experiencing more change now that this time a year ago — more than any other sector surveyed. This is led by product and services development (57%), with change to technology infrastructure (51%) and to business systems and processes (47%) following closely behind. The research also found that for 70% of manufacturing companies, the majority of changes will involve amendments to existing technology infrastructure. With manufacturing having the highest scores for new products and for new purchasing restrictions, there is evidence that companies are taking a rounded view of the need for change.

“The negative news and statistics around the UK manufacturing sector are seemingly endless,” says Gary Turner from Microsoft. “But our research shows that the sector is far from static. Looking at the type of change the companies we surveyed have experienced, it’s clear that smart manufacturers have been addressing both their cost base and seeking new opportunities for sales. This shows both an appreciation of the need to be disciplined about costs and a willingness to adapt when there is a clear need for planning systems. One thing is clear; it’s better, and cheaper, to upgrade your financials and forecasting software to become more efficient and anticipatory than try to revolutionise the business with an overbearing enterprise solution.”

The survey also shows that the UK’s small and medium-sized manufacturers are being proactively managed:
• Pioneers, who enable change from inside the business, dominate manufacturing; 43% of managers — more than any other sector — fall into this category
• As a result, 85% of manufacturing companies — more than any other sector — claim to promote operational change within their organisations
• 19% of manufacturing companies consider that changes within their business at an operational level are often costly and fail to meet expectations.

To obtain a full copy of the research results, email [email protected]
A whitepaper based on the research, independent commentary and customer case studies is available for download at