Benoit Wambergue, VP of cloud products strategy from manufacturing technology specialist Forterro, explains how supply chain disruption has changed the government’s forecasts, and how businesses can adapt to a rapidly shifting market.
2013 saw the UK government predict what the future of manufacturing would look like in 2050. Ten years on, it’s a great opportunity to review the report to assess how the predictions have fared, and what the sector can learn from a look at the bigger picture.
The Government Office for Science report, Future of Manufacturing: A new era of opportunity and challenge for the UK, investigated how the UK manufacturing industry was “set to enter a dynamic new phase, driven by technology, new ways of doing business, global competition and potentially volatility around the price of resources.”
However, not all disruption can be predicted, as we have seen from the likes of Brexit, COVID-19 and resultant economic uncertainty. As any business in the manufacturing sector knows, constantly re-evaluating your business performance in the wake of unprecedented disruption has become a constant feature of recent years. It is to the industry’s credit that new plans have been put into place quickly, but building further resilience is essential in case of further disruption.
There’s no doubt that there is a fine line between balancing increased resilience and a resultant impact on your bottom line, and this is particularly challenging for smaller or mid-market manufacturers. However the continued rise of automation, AI and the importance of cloud-based systems means that those businesses that don’t keep pace with change could see a growing hap appear between then and their competitors.
Across Forterro, we see how digitally advanced and forward-thinking companies can build more resilient business operations. Recent events have underlined the importance of using ERP systems in a way that offers visibility of all operations, including supply and demand, so that when this disruption appears, you have the processes and agility to adapt to new challenges.
The last decade
Whilst the global pandemic was unexpected, it’s little surprise that the report did predict significant disruption would affect the manufacturing industry before 2050.
Due to ever advancing software and data, the prediction was that manufacturers would become faster, more responsive and closer to customers via their services. It suggested that product personalisation would be easier and the speed of delivery to the customer would be quicker thanks to new robotics and data automation.
However, regardless of the increased use of automated processes businesses still rely on highly skilled workers. With an ageing population all industries will have to accommodate a changing workforce, but as technology develops, how businesses deploy their skilled workers will become even more important.
Businesses will have to find the perfect balance of offering training and development to make manufacturing jobs attractive to an older generation whilst also onboarding younger and more digitally advanced employees.
The report also suggests that the next couple of decades will see a more sustainable manufacturing industry; green technologies will be used to reduce resources used in production. With such a significant focus on Net Zero strategies, from the macro level of the government’s industrial policy, down to the more granular level of individual businesses’ day to day operations, sustainable manufacturing processes are likely to rise above an ESG concern or ‘tick-box’ exercise to become a de facto ‘licence to operate’.
One final prediction that has been drastically affected by recent global events is the exposure to new market opportunities UK manufacturers will be seeing. In 2013, the report outlined the UK’s relatively low level of import and export activity compared to key competitors, but in the wake of Brexit and the pandemic, manufacturers have had to focus on new or rebuilt supply chains before even considering potential future growth.
Looking ahead
Although no crystal ball could have predicted the market shocks all sectors have seen over recent years, many of the findings and predictions from the 2050 report are still highly relevant today, although there is no doubt that business priorities have changed.
Climate change has become an even more pressing global concern, finding skilled workers following the pandemic is proving difficult, and Brexit has resulted in a generational shift in the UK’s trading relationship with its closest market.
It’s clear that, as we take this opportunity to look ahead to 2050, that the sector will see significant changes and challenges over coming decades.
Increasing digitisation
An effective manufacturing-centric ERP solution, for example, will have a robust level of functionality out of the box and will allow businesses to manage their supply chain much more easily and effectively. Businesses need the visibility to reduce risk with more accurate forecasts and coordinate materials planning (MRP), production and assembly to minimise lead times and maintain the highest quality standards.
The UK’s manufacturing sector comprises a diverse range of small businesses, which all have their own company – and industry – specific challenges to contend with. The use of ERP systems may not alleviate every single issue businesses face, but it will solve some of them and free teams up to focus on higher-value activities.
The manufacturers that thrive between now and 2050 will be those that can harness and maximise data in their digital transformation process. Whether it’s utilising data from your ERP system to increase visibility across the business, streamlining productivity or moving all systems to a cloud-based process, the effective use of resources will be critical for all businesses, whatever challenges appear.
For more information, visit www.forterro.com.
