Richard Hill, Head of Manufacturing & Automotive at NatWest, takes a closer look the bank’s Future Fit report and what it means for manufacturers and businesses across the supply chain.
Medium-sized enterprise (ME) manufacturers can be seen as the ‘engine room’ of the UK’s manufacturing sector.
But this incredibly important and influential group can sometimes be overlooked and left to navigate the intricacies of the manufacturing world alone.
That’s why we embarked on an extensive research project; Future Fit: The Road Ahead for Manufacturing, focused on businesses with turnover from £5m-50m.
After nearly 300 interviews with ME manufacturers and extensive quantitative analysis, the report finds that the manufacturing sector is built on solid foundations of high-quality processes, cross-disciplinary collaboration and long-term instincts.
But there are a number of challenges to be faced, including a clear disconnect between the future demands of global manufacturing, and manufacturers’ strategic plans to meet and prepare for these shifts.
Among the companies surveyed, 91% agree it will be crucial to accelerate their capabilities over the next five to ten years to stay competitive. Despite this, 14% still have no plan in place to do so.
Unsurprisingly, embracing new technology was seen as vital for the future of the sector. But while more than two thirds of the MEs surveyed believe that technologists will be the most in-demand skill set by 2050, there was little energy for exploring how to meet these needs.
The report also found that while successful high-growth businesses tend to work in ecosystems of mutually reinforcing activities and skills, many UK MEs operate within fragmented supply chains.
To download a free copy of the Future Fit report, click here.
This could leave businesses isolated and vulnerable to economic shocks and unforeseen technological changes.
The serious impact of this lack of connectedness is plain to see: 40% of those surveyed feel that poor visibility of customers’ plans is a major internal challenge.
Manufacturers seem to understand that their customer needs and those of the industry are changing.
We know we have some great manufacturing businesses in this country, but they need more proactive help in order to enhance competitiveness – particularly from a global perspective.
Only by working with our customers to transform our business will we be able to support them in taking advantage of this new age of manufacturing.