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Source: Manufacturing Digital

25 March 2013

With the results from its latest survey collated and analysed, we catch up with John Hammann, Industry Principal for Manufacturing at SAP, to discuss the state of industry today and where it may be heading in the future.

MD: Could you provide a brief overview of the survey itself?

JH: The survey explores the appetite and capabilities within UK manufacturers for growth. The survey was conducted by Loudhouse during January and February 2013, with 200 senior business decision-makers from across a range of company sizes and sub-sectors interviewed, including high tech aerospace, industrial machinery, automotive, fabricated metal products, building materials, oil & gas, forest products/furniture/textiles, mining and primary metals.

After speaking with such a large cross-section of manufacturers, what do you sense are the growing challenges affecting the sector currently?

From our findings it would appear there are a variety of issues being faced, many of which look to be impeding the sectors growth. Overwhelmingly, the continued economic downturn is the biggest challenge, with over half of respondents indicating as such; then fluctuation in demand, skills shortages and increased domestic/foreign competition.

Conversely, if we look at the key opportunities helping to drive growth, expanding into new markets came out on top, closely followed by increasing efficiency through new technologies and processes, creating new products for either domestic or overseas markets and becoming a particular product or process specialist.

The findings of the report were divided into four key areas; innovation, finance, technology and management. Could you provide a little more detail?

If you look at innovation, the results were driven around being able to customise products to make them more local to specific markets, to be able to collaborate and work more closely with supply partners and to better harness technology to empower innovation.

Finance was predominantly geared around being able to plan better and for a longer-term; quite a number of respondents indicated that they didn’t plan more than a year ahead. Management was closely tied to the difficulties of trying to balance innovation with risk, and not just financial risk. 

Manufacturers are very good users and adopters of technology, not just from an IT perspective, but consider the amount of technology we see in the products we use every day. Most manufacturers have technology systems they use daily to manage their processes already, a technological landscape been up over the years to support the business.

The new technologies coming in now are allowing managers and decision makers to support their business better, without necessitating having to change everything they already have in place.

The findings also had a specific focus towards plugging the skills gap, isn’t that so?

That’s right; the inconvenient truth for many is that, if left unchecked, the skills shortage could have long-lasting consequences on a business’ ability to grow. Talent is not only about recruiting and attracting new people, but retaining and retraining existing workforces.

Almost 80 percent of respondents see apprenticeships as a valuable solution to help fill the skills gap in manufacturing. However, with all apprenticeship initiatives, the need to fund and organise successful programmes involves careful planning and organisation.

I also think that manufacturers need to be more proactive in recruiting the people they want to work for them and trying to change people’s perception of industry being dirty, unclean and not a viable career path. If you look at the type of products being manufactured now and how they are assembled, what needs to be communicated is that it’s a lot cleaner than people assume; especially for high value, high tech products, which I think the UK will manufacture a lot more of.

Why is that?

I think the UK has got an excellent pedigree in respect to the complexity and skills needed. If you look at the core industries that are around R&D, aerospace and defence, the UK is a world-leader. The country has some of the best universities in the world and is home to some of the best companies; ARM, Bowes & Wilkins, Dyson, Rolls-Royce, British Aerospace, the list goes on. 

What do you see as the next big trend to affect manufacturing?

Without a doubt, when it comes to technologies like cloud and mobility, we have noticed a pick-up in interest. Even compared to just last year, we have seen a number of customers who’ve started to use our offerings such as Business ByDesign and Business One as they expand into new markets.

I think the continued drive towards collaboration will only increase, as will the idea of products and services becoming closer together. The amount of technology embedded into products will continue to rise, in conjunction with consumers becoming more demanding and it will be really interesting to see where that takes us in terms of electronic networks and the internet of things.

As the survey concludes, the UK manufacturing remains world-class and with an open mind to innovation, poised to emerge from the economic storm stronger than ever.

You can download the SAP Manufacturing Success Survey here

Read the original article on Manufacturing Digital.

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