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Why now is the time for UK manufacturers to invest in digitalisation

by coneill@eef.org.uk 18. December 2017 11:01

By Ian Isaac, Managing Director, Lombard


In talking to manufacturers about digitalisation, we at Lombard tend to hear two reasons why some businesses are holding off investing in new technology.

1.       Cost – isn’t this emerging technology too expensive? Is it too difficult to get funding for new technology?

2.       Future concerns – with all this political uncertainty, shouldn’t we wait to make any upgrades?

However, conversely many customers tell us that, for these very same factors, now is the time to invest in digitalisation, and they are turning to us to assist with their growth plans. 


Funding

As with any new technology, when robotics and other ‘Fourth Industrial Revolution’ technology was launched, it was expensive. However, over time these bespoke systems only available to large companies, have moved to off-the-shelf options. In fact, as EEF’s Business Growth Consultant Martin Strutt pointed out in a recent podcast, “There has really never been a better time to invest in 4IR technologies as the cost has never been lower.”

This technology is now accessible to many companies and, as our customers have found when we work with them on costing models, the payback can be surprisingly quick.

Although traditional funding models often don’t look favourably on emerging technologies, Lombard’s Technology team have developed a finance scheme designed specifically for this type of technology. It covers a broad range of technology assets and enables businesses to cover that initial outlay through cashflow over an extended period.

As one example, Bowers & Wilkins, creators and manufacturers of world famous speaker systems, wanted to increase automation in their production processes, so they initially approached us for asset finance to enable them to acquire two FANUC painting and sanding robots, along with other plant and machinery. The company built an automated production line that will produce far more output per month as well as improve the consistency of that output. Now, we are currently exploring how our Software Licensing Solution could help them unlock investment in their proprietary software.

Companies that are interested in seeing what is possible should consider some ‘industrial tourism’ where they visit other companies that have already started their digitalisation journey. Another option is to visit EEF’s Technology Hub near Birmingham, which has the latest technology on site.


Brexit

The EEF/BDO Manufacturing Outlook 2017 for Q4 found that manufacturers are ending the year with a bang on the back of continued improvement in global demand and increased export performance. The, uncertainty about the exact political situation in the coming years is not stopping companies from moving forward.

No matter the outcome from Brexit, UK makers will still be competing against companies from around the world. The goal will always be how to ensure Britain is considered the number one place for value-added, quality manufacturing. If UK companies wait too long to access the productivity boost available through automation and artificial intelligence, the cost of playing catch-up will be too high.

In working with manufacturers on investing in new technology, we’ve found that no one is precluded from being part of the Fourth Industrial Revolution. The important thing is to be brave, have confidence in the quality of the products you make, and explore how technology investment can improve your business and secure your future.


Lombard is the headline sponsor of the National Manufacturing Conference on 20 February 2018, which brings together 800+ manufacturing leaders from across the UK. In addition to high profile speakers, including Leader of the Opposition Jeremy Corbyn, the conference features four workshop panels of peers and experts on the themes of cyber-security, trade, employment post-Brexit and energy savings. Register for tickets (with an early bird discount) here.


What top OEMs are looking for in their supply chain

by coneill@eef.org.uk 13. December 2017 16:58

By Rosa Wilkinson, Director of Communications, HVM Catapult

HVM Catapult is a sponsor of the EEF National Manufacturing Conference in London on 20 February 2018. As a supporter of UK manufacturing and innovation, HVM Catapult provided some insights into some of the themes of the conference, which include the Fourth Industrial Revolution, innovation, supply chains, and productivity. 


Debate around the Fourth Industrial Revolution in UK manufacturing is no longer around when it will happen, but around which companies will spot the opportunities created and those which will choose to ignore them. My message to manufacturers is don’t get left behind. Against the backdrop of Brexit uncertainty, our economic outlook is changing. Companies that embrace the potential of 4th industrial revolution technologies, will position themselves better to succeed in a future, potentially very different landscape. Businesses that want to maintain their competitiveness to secure their place in the supply chains of major OEMs need to act now to develop, test and implement the technologies that will improve their long-term productivity, access to data and connectivity.


Already some of the UK’s larger manufacturers are telling us that they see too few companies in their supply chain taking advantage of the technologies available (and expected) today. They want their suppliers of goods and services to be sharing real-time digital information that is a replica of their products and operations - the so-called digital twin. They want to see the power of data used to alert staff when a machine needs maintenance or cut down the administrative time and expense needed to maintain stock levels. They want their supply chain to take advantage of the latest sensor technologies and metrology to improve accuracy and cut down waste. They want the firms that feed them to make full use of the tools which will increase supply chain certainty, drive up efficiency, keep costs competitive and put the OEM ahead of rival businesses in challenging global markets. 


Should we spurn the opportunities created by 4th industrial revolution technologies, we can look forward to dwindling order books, shrinking incomes, falling manufacturing employment and the loss of the UK’s reputation as the best place to invest in Europe. Major companies will move facilities to be close to the suppliers that provide the best service and goods, and today that means the best integrated processes and technology. It doesn’t have to be like that. The UK’s manufacturers are extraordinarily resilient and have a readiness to take on fresh challenges. If they adapt they will win through, beat off the competition and grow. Our future will be bright. 


It doesn’t have to be a painful transition. At the High Value Manufacturing Catapult, we help companies of all sizes think through how they can exploit the new technologies, maintain and improve on existing supply chain contracts and expand their markets. We know translating new technologies into the workplace can be scary – and costly. By providing access to the specialist equipment and expertise needed to investigate new technologies and processes we help strip away the risk of innovation, deferring investment decisions until a firm’s leadership can see that ideas can be scaled up to deliver on a commercial scale. We help manufacturers feel that they’re not alone in their quest for growth. We ease their transition to a new world. 


The value of events like the EEF National Manufacturing Conference is that by coming together, manufacturing leaders can better define the challenges they face and the help they need to tackle them. Britain has never been afraid of change but by sharing insight and experience we are better able to master it. The High Value Manufacturing Catapult is here to help and make sure the UK remains the best place in the world for innovative makers.


To find out more about how HVM Catapult can help companies innovate for productivity and growth, stop by their stand at the EEF National Manufacturing Conference on 20 February 2018. Register your place at the conference and read more about the programme (including speakers such as Jeremy Corbyn, Lush Cosmetics, and Toyota UK) here.


5 reasons why your brand will pack a punch this February!

by coneill@eef.org.uk 13. December 2017 10:44

Get your New Year marketing and sales generation off to a strong start by exhibiting at the EEF National Manufacturing Conference & Exhibition. It is the top event for senior manufacturing decisionmakers each year. 

Here’s why you need to be there as an exhibitor:


1. Get your brand in front of an unprecedented number of key decision-makers.
We’re talking CEOs, MD, FDs, and operations directors – a whopping 800 senior-level delegates with direct access to the purse strings. And not a gatekeeper in sight.


2. An effortless windfall of lucrative, highly targeted business leads.

Generate direct sales, lay foundations for ongoing partnerships and boost brand awareness for your business.


3. Align your brand with EEF, a trusted and renowned organisation.

EEF has been supporting the industry since 1896. It’s the go-to place for advice, resources and is the representative voice of British manufacturing.


4. Unparalleled exposure for your business.

Your business won’t just grab attention at the exhibition. It’ll also be featured across our range of media channels, from EEF’s Insights magazine through to the website, social media and a dedicated conference app.


5. Learn while you earn.

Your exhibitor’s pass grants access to the entire conference and its jam-packed programme of workshops, networking and peer-to-peer learning opportunities.


This is a great value opportunity for businesses that serve UK manufacturers. Don’t miss out on one of the exhibitor spaces – and there’s only a small number available. Get in touch with the conference team for more details.


Addressing the skilled worker shortage through modern technology

by coneill@eef.org.uk 12. December 2017 12:19

By Infor

The shortage of skilled workers has become a major obstacle for manufacturers, one that is interfering with potential growth and generating considerable frustration. While there are no simple answers to this problem, modern technology does offer some tools to help cope with the day-to-day challenges as well as some strategies which will help long-term resolution of the underlying problems.

Discuss these strategies in more detail with experts and peers at the EEF National Manufacturing Conference on 20 February 2018 – an event Infor is sponsoring. 


How did we get here?

Addressing the worker shortage starts with understanding the driving forces. Today’s current severe shortage of skilled workers did not happen overnight, generated by one trigger incident. Multiple factors converged at once to escalate and intensify the issues, also making them difficult to counteract. Now, the self-perpetuating skills gap crises could possibly derail industry recovery—or at least severely dampen optimism when it’s needed most. The critical question remains: How can manufacturers step up and seize unfolding opportunities when the existing workforce is stretched past capacity and open positions are going unfilled because of lack of qualified applicants? 


Let’s look at the top influencers first:

-The aging population. Workers that made the post war industrial era thrive are now reaching retirement age. And we haven’t hit the peak yet. A McKinsey reports says that by 2030, there will be at least 300 million more people aged 65 years and older than there were in 2014. An aging population means fewer workers available for employment.

-Manufacturing has lost its luster. Today’s millennial generation tends to think manufacturing plants are dark, dirty, scary places to work with little future. Waves of plant closings and lay-offs during the global recession generated skepticism among potential workers. Even as the global economy improves, lack of stability is still a concern, keeping some job candidates from considering careers in manufacturing.

-Fear of automation. The hype around automation, robotics, machine learning, and artificial intelligence is a doubled-edged sword. On one side, these technologies portray manufacturing as exciting and innovative. But, on the flip side, automation seems to put the workforce at risk. What jobs are safe from becoming automated? 

-Not enough STEM graduates. Education experienced a shift in focus away from Science, Technology, Engineering, and Math (STEM) courses and toward liberal arts programs. This 20-year pendulum swing generated fewer design engineering graduates. At the same time, the phenomenal growth in computer science and technology fields put graduates in those fields in high demand. There just are not enough to go around.

-The lost art of vocational schools, apprenticeships, and on-the-job training. These programs, once a critical part of sustaining the workforce, have faded away, replaced by the perception that a three-year degree from a traditional university is the only route to a rewarding career. 


What can manufacturers do?

Of the five factors mentioned here, some, such as the aging population, are simply beyond the control of individual manufacturers. Changing perceptions and educating the public are major endeavors that will take collective efforts of many groups, from unions to trade associations. Manufacturers can support and contribute to these efforts, though, helping to portray the industry in its best possible light. 

Some of the influencing factors can be tackled by manufacturers. Reviving apprenticeships is one example. Manufacturers can enact programs to up-skill existing workers, cross-training, and mentor recent graduates.

Put technology to use. Technology offers manufacturers two main ways to counteract the shortage of skills workers. First, technology can help stretch current resources further, making the current workforce as productive and efficient as possible. Secondly, technology can help manufacturers recruit and retain the best of the job candidates, including millennials. Let’s look closer at the role technology can play on overcoming the worker shortage.

Streamline processes. Eliminating extra steps, ending redundancy, and preventing delays and gaps in communication will go a long way in making your lean organization ultra-efficient. Modern ERP solutions push relevant contextual data to users, speeding decision-making. Users no longer have to hunt for forms or rely on memorizing best practices and procedures. Workflows and escalation procedures can be built into the system so much of the process control, compliance, quality control, and tracking or monitoring for details can happen automatically.

Optimize tools. Technology has brought many new tools to manufacturing, drastically changing the amount of time and effort involved in completing some tasks. Examples of dramatic time savers:

-Configure-Price-Quote tools for speeding quotes and design of highly configured products
-Product Life Cycle Management for speeding product launches
-Warehouse Management Solutions for improving efficiency in managing inventory
-Mobility Solutions so that your workforce can access data 24/7, from virtually anywhere
-Enterprise Asset Management Solutions for managing preventive maintenance of plant assets

Support and train existing employees. Manufacturers can also use technology to train, cross-train, and support the existing force so that employees can build on existing skills, become certified in new areas, and play more than one role, when needed. Look for modern ERP solutions with knowledge banks, learning modules, and ways to store/access support aids like videos and help files.

Work the way we live. Workers today expect to find the same technology in their workplace as they use in their everyday lives. They expect the software they use to be as intuitive as their phone, and as insightful as the ecommerce sites they visit. Outdated ERP solutions with cumbersome user interfaces will frustrate employees.


Concluding thoughts

While the shortage of skilled workers will not be resolved quickly, manufacturers can take steps to alleviate the critical symptoms. It starts with showing employees and job candidates there is an interest in providing them with tools for learning and expanding their skills, especially in digital technologies. While manufacturers may ask workers to wear more than one hat at times or fill in to cover vacancies, there are also tools to help every employee be as efficient as possible. Giving employees these time-saving tools will prevent burn-out. And, providing workers with software with a consumer-like interface will also help create a positive work environment, empowering workers, encouraging them to be highly engaged.  

Register for the EEF National Manufacturing Conference, sponsored by Infor, to secure your spot at your choice of four peer learning workshops on themes of cybersecurity, securing your post-Brexit workforce, smart energy and trade.

 


Three examples of manufacturers who saved energy to boost competitiveness

by Administrator 27. November 2017 12:14

             

 

The EEF National Manufacturing Conference 2018 features four workshops featuring experts and manufacturing peers discussing cybersecurity, trade, Brexit workforce and energy. One of the panellists for The Smart Energy Revolution workshop is Hiten Sonpal, a Business Green Award winner and Head of Specialist Sectors at Lombard, the conference’s headline sponsor. In this blog, Hiten shares three examples of manufacturers he has worked with to reduce their energy use and carbon footprint as part of a strategy to increase productivity and competitiveness.

While manufacturers have long had their eye on process improvements to increase productivity, many are missing out on a significant way to decrease costs. It’s all about energy and sustainability.

For the past seven years, the Lombard team has worked with manufacturers to identify and implement proven ways to reduce the energy use of their sites and even generate additional income from generating more power than they use.

Here are three examples of how manufacturers can think differently about energy improvements with short ROIs that can make a company more competitive and future fit:

1.    Energy audit + new equipment

A few years ago, I met a manufacturer who was proud of his manufacturing facility and the fact that many of his machines were two decades old, but still seemed to be chugging along fine. However, a digitised energy audit looked at every plug load in the building and determined that the old machines were using double the energy compared with newer models.

He realised that by replacing the machines, the energy savings would pay for 50% of the finance payments for the new machines in the first year. Just as you’ll realise savings in your petrol costs when you trade in a 20 year old car for a newer version with a better miles per gallon design, strategically upgrading machines for more efficient models is a win.

The manufacturer not only replaced the inefficient machines, but he used the opportunity to find new options that could do several new processes that he previously outsourced (at a cost to his profit margin). Now he offers those services as turnkey solutions to his customers, leading to a larger return to his business and ensuring quicker service that doesn’t rely on third parties.

To find out more about energy audits, see a blog I recently wrote on ‘going green’.

 

2.    Renewable heat

A woodworking company specialising in retail shop fit outs attended a Lombard seminar on energy savings. Their business obviously created a significant amount of wood waste, which required them to pay for hiring a skip, transporting the skip to the landfill, and leaving the waste there. At the seminar they heard about renewable energy technologies that work for manufacturers.

We worked with them to select a biomass boiler to heat their premises and generate hot water, while also mitigating the cost of dealing with wood waste. This positively impacted their cost margin, while also receiving a Renewable Heat Incentive from the government. The payback for their biomass system was just three years and they were able to pass savings onto their customers to keep competitive. 

Additionally, the owner was so happy with this improvement, he worked with Lombard to identify other energy opportunities, including retrofitting their facility with LED lighting and rooftop solar panels as well as installing a building management system to identify energy wastage going forward.

See our full infogaphic on sustainability in manufacturing here.

resource-efficiency-infographic

3.    Think small

Some manufacturers don’t even consider potential energy solutions because they are worried about the capital investment required. Part of my job at Lombard is to not only bring energy savings to life for my customers by showing them real life examples of what’s possible, but to show them how easy it can be.
One of these simple solutions is replacing lighting with LEDs. We have customers who have reduced their lighting bill by 85% and achieved a two year payback from this change alone.

The government also provides enhanced capital allowances where companies can offset 100% of the costs of their LED lights in taxable profits in the first year. Why spend your profit on taxes when you can invest for efficiency?

Another no-brainer is utilising manufacturers’ flat roofs and open spaces to install solar panels. Why buy energy at 10 pence/unit when you can generate your own power and even sell it back to the grid?

At Lombard, we don’t just want to be known as an asset funder for plants and machinery, but as an impartial expert resource for our clients across a range of sectors, including energy. When productivity and margins are so important to manufacturers today, they can’t risk falling behind by not making simple improvements that prevent energy costs from eating into their bottom line.

 

The EEF National Manufacturing Conference is on 20 February 2018 in London. In addition to the four themed workshops (which are booked first come, first served when purchasing a conference ticket), political and industry heavyweights will be speaking, including Labour Leader Jeremy Corbyn. Book your early bird discount for tickets today.

 

Author


Hiten Sonpal

Head of Specialist Sectors - Lombard

 

 

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EEF National Manufacturing Conference looks to the future

by Administrator 27. February 2017 09:06

The EEF National Manufacturing Conference and Dinner 2017 brought hundreds of UK leaders in manufacturing to London for a day of inspiring speeches, panels by peers and luminaries and industry networking. 

See the summary of the day's events as seen on Twitter:

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#EEF2017 Twitter Contest

by snetherwood@eef.org.uk 21. February 2017 14:16

Want to win a Ferrari goodie bag valued at £350 donated by Infor? Simply tweet about why you love UK manufacturing or tweet a photo capturing the conference day and you could win.

 ferrari

Rules

  • you must be at the conference to be eligible and accept your prize (presented at the conclusion of the day)
  • use the conference hashtag #EEF2017 in your tweet to submit an entry
  • tweets containing profanity or inappropriate language or imagery will be disqualified
  • EEF employees are not eligible to win
  • Contest runs between 7:30am and 2:30pm UTC on 22 February 2017

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The challenge for manufacturing

by Guest Blog 21. February 2017 14:14


Ian Isaac, Managing Director of Lombard

Like me, many of you are undoubtedly excited by the prospect of this year’s National Manufacturing Conference and Dinner. As an industry, we are looking to the opportunities and challenges ahead of us – from helping rebalance the economy to tooling up for the fourth industrial revolution. This event is the perfect opportunity to galvanise the collective will of industry and government.   

Lombard began its life just after the first industrial revolution, at the height of the Victorian age when steam and machines powered the country’s manufacturing capabilities. Looking back, we all have to admit that the landscape is more complicated today. While the UK still has a traditional manufacturing heartland, we are entering an era when data exchange and automation will be catalysts for speeding up the processes of manufacturing and allow manufacturers to develop new ways of organisation. Much as steam power allowed the Victorians to become leaders in manufacturing, we must harness today’s technologies too.

One problem we face is that many of the UK’s medium-sized manufacturers are slow to take up new technology, and they can be wedded to old business models that don’t suit new ways of streamlined production. Too often, the attitudes of manufacturers are shaped by a lack of awareness of the international competition. At the same time, they also face a conflict between planning ahead and being agile: being able to change course if circumstances dictate.

 

Addressing the needs of the UK’s manufacturers

This conference promises to address these major issues facing the industry. It will tackle how the UK positions itself globally, which is really a question of two parts: it’s not only about what we do, but how we perceive ourselves. In a recent report on the sector by NatWest, called Future Fit, the bank found that a number of the UK’s manufacturers are unsure of how well-positioned we are globally, and are aware that we need to step up to the challenge. As the 10th largest manufacturing country in the world we’re certainly not in a weak position; we should be confident and forge our ambitions.

I look forward to hearing from Alison Rose, our Ceo of Commercial and Private Banking, who will be tackling this topic in a panel debate. Alison joined the bank in 1992 and along the way has championed business start-ups throughout – Entrepreneurial Spark is the latest bank-led campaign to this end. It’s that kind of innovative attitude that we need to harness in the manufacturing sector. And I’m sure that, together with economist and CEBR board member Vicky Price, it will be an enlightening discussion.

We will also hear about how supply chains can be digitised. At the moment, many manufacturers feel isolated from the broader identity of their regional or national peers. Lacking a strong connection with your supply line can mean you’re not able to meet the needs of personalised manufacturing, sustainability or to anticipate future shocks. In short, it means fewer opportunities to grow.

All in all, there is a lot to contend with if we are to remain a competitive sector in the global economy. But the fact that we are addressing these issues is encouraging. In 1968 – a time before the UK joined the EEC – Lombard became a subsidiary of the National Westminster Bank and pioneered the leasing of machinery and assets to businesses. And after the UK leaves the EU, we will carry on. The uncertainty of exit will no doubt leave many of the UK’s manufacturers reflecting on what it means to participate in the global economy today. We will use this opportunity to make sure the sector moves forward.

 

This and other topics of business interest to UK manufacturers will be discussed at the National Manufacturing Conference on 22 February 2017. Tickets to the dinner are available now.

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Time to grow

by Guest Blog 21. February 2017 14:11


Ian Isaac, Managing Director of Lombard

When the government merged two departments last year to create the Department for Business, Energy and Industrial Strategy, it was a sign that it wanted to highlight the importance of industry to the UK economy. And its recently published green paper, ‘Building our Industrial Strategy does just that – placing industry and manufacturing at the heart of government’s priorities over the coming decade.  

One of the criticisms of the economy has long been that it is unbalanced and skewed towards London, in particular the financial services sector in the City. Although this is undeniably an important area for the UK, and one that gives much prominence to the country globally, our manufacturing prowess also deserves to be recognised.

In some areas of this we are considered to be global leaders. The aerospace industry, with its advanced manufacturing capabilities, has made the UK home to Airbus, Rolls Royce and BAE. The automotive sector is also performing very well.

The government has recognised the strengths and weaknesses of the manufacturing sector, and is supporting its growth. Last November, the Prime Minister announced the Industrial Strategy Fund to back leading-edge technologies such as robotics, advanced materials manufacturing and satellites.

The fund is run by UK Research and Innovation (UKRI), which took over from various existing research bodies last summer to create a more joined-up approach to innovation. It is not only concerned with new developments, but with creating the means to successfully commercialise them. Ensuring that British manufacturing capabilities remain successful long after their initial development must be a priority.

 

Solving the Productivity Puzzle

We’re all aware of this long-standing industrial conundrum. Regions outside London lag behind the national average and, as a country, our productivity overall is 20% behind that of both France and Germany. It is estimated that if rural economies were boosted, an additional £28bn a year could be added to output.

Various factors contribute to this slow economic growth, and EEF’s report, ‘Manufacturing a Solution to the Productivity Crisis’, points to a number of them. Long-term underinvestment and considerable growth in self-employment are two factors that are clear to see, as is the fact that we are still dealing with the fallout from the financial crisis.

The investment in manufacturing that has been laid out by the government promises to reverse these trends. Manufacturing has a good track record in productivity levels compared to the national average, and developments in manufacturing have a positive knock-on effect on the economy as a whole. The sector supports the development of new technologies, modern machinery and computer systems that are later taken up by other industries.

The split in growth across different areas of the country is well documented, and it’s not only about the South East versus the North. Cardiff, Aberdeen and Edinburgh are all in many senses thriving but the Scottish and Welsh economies are performing below the national average. And where many city centres across Britain are prospering, their outlying areas often lag behind.

An integrated strategy for stimulating the economy is needed, one that encourages companies, universities and regions to operate as local ecosystems. The government has introduced a number of ways to boost regional initiatives, including fostering expertise through Local Enterprise Partnerships, introducing City Deals and devolving power to mayors. These measures all enable the people who most understand the needs of different areas to make key decisions.


Investing in skills and training

The government is also investing in education, which is critical to boosting the country’s manufacturing capabilities. New institutes of technology will be established to deliver training in STEM subjects (science, technology, engineering and mathematics) and boost opportunities for young people who don’t go to university. The government also wants to link regional businesses, financial institutions and local authorities to provide the training, employment and funding needed to spearhead regional centres of manufacturing.

If the country succeeds with this integrated approach, we can look forward to the continued success of a robust manufacturing sector.

 

This and other topics of business interest to UK manufacturers will be discussed at the National Manufacturing Conference on 22 February 2017. Follow the events of the day on Twitter with #EEF2017.

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The technology investment required for a 21st century supply chain

by Guest Blog 31. January 2017 17:05

 

 Nick Harrison, Partner, KPMG in the UK

With the Fourth Industrial Revolution (4IR), the Internet of Things and industrial automation being the biggest buzzwords in 21st century manufacturing, how does the supply chain fit into this picture of disruptive technologies driving new productivity and growth?

While new technology can provide a solution for some, often it’s the processes and systems that prove the barrier to improvement. Technology isn’t a silver bullet to solve every challenge.

 In working with UK manufacturers, I know that 4IR and improving their supply chain are some of the biggest challenges they are wrestling with. However, many are confused about what 4IR actually means and where they should start.

The first step for organisations in this position is to take a detailed look at operations and how their systems and processes connect with their supply chain and customers. How visible is customer demand? How is that integrated into production schedules? How quickly can they predict and adjust based on new demand? How can downtime be minimised on machinery? How can shift patterns be optimised? What information can be drawn from the endless supply of data?

Often, the business growth isn’t hampered by internal operations, but by a lack of customer focus. This can come down to the wrong pricing strategy, too many customer touch points before the customer can make a purchase, or a complicated and inefficient website or ordering system. From back-office transformations to software upgrades, there are solutions available.

Getting buy-in for these types of changes is generally not the challenging part. Typically, the problem lies in the ‘stickiness’ of the solutions and the managing the change. How will these improvements continue over the long-term as people go back to focusing on their day jobs? As a strategic partner with manufacturers working on these challenges, we help our clients develop processes to embed a culture of change and improvement. 

Brexit’s impact

Brexit’s impact on the manufacturing supply chain is going to be bigger than imagined. Just look at the automotive industry. A typical vehicle takes approximately 3,000 parts, sourced from an integrated, international supply chain that took 20-30 years to build. A typical car takes seven years to develop and everyone in the supply chain is working towards that date (and has to be able to supply replacement parts for the life of that vehicle after that date). How will UK manufacturers adapt their supply chain given a new trade reality?

Brexit will also impact processes, raising compliance issues, such as requiring two separate systems for UK and EU supply chains. How do manufacturers ensure these systems are integrated, but hold separate product codes and data?

These are significant issues that very few people fully understand yet. 

Disruptors on the horizon

In every industry we’re seeing the rise of more disruptors, such as Tesla in the automotive industry.

While many people believe the technology-driven shop floor is the key one they should consider, the switch to the cloud may be an overlooked solution. Companies are moving away from investing in physical assets that need to be updated every two years. Instead, they are putting their data in the cloud. This type of storage also helps create one secure, master set of data rather than relying on separate spreadsheets and data stored on separate systems across the company.

No matter where a manufacturer is on their journey to adopt 4IR and grow their supply chain, there is no doubt change is happening faster than ever. The key is to take the first step to identify solutions that suit your business.

This and other topics of business interest to UK manufacturers will be discussed at the National Manufacturing Conference on 22 February 2017. KPMG’s own Stephen Cooper, Partner and Head of Industrial Manufacturing, will be presenting as part of a panel on ‘Making Britain the best place to do manufacturing – a global perspective’. Tickets are available now.

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