Phil Roberts is a director of POET Systems, a Bridgend company that provides cloud-based productivity improvement software for manufacturers
According to a recent report, it seems that Britain’s manufacturing firms are finally starting to embrace the digital revolution.
The report, published by manufacturers’ organisation Make UK and software company Infor, said more businesses in the sector are accelerating their investment in digital technologies in an effort to improve productivity and to counter the serious supply chain issues caused by Covid and Brexit.
It also revealed that four out of five manufacturing firms are planning to boost their digital investment over the next two years, partly due to the current financial situation, in particular rising energy costs.
For those of us who work in this area, this is music to our ears. It seems the message is finally starting to get through to firms that the best way to boost productivity, cut waste and future-proof their business is to invest in digital technology.
If this is indeed a sea-change in the UK manufacturing sector’s attitude to digital, then it might even help us close the productivity gap with our G7 peers, whom we’ve lagged behind for several years.
There are a few notes of caution in the Make UK report, however. One relates to the four stages of digital adoption, which the report characterises as pre-conception, conception, evolution and revolution.
The report says half of UK manufacturing firms surveyed are now in the ‘evolution’ stage, which means they are transforming their business by implementing changes to their processes using insight from data. That’s very positive.
However, around one in five (18%) are still in the ‘pre-conception’ stage, or, to put it another way, doing nothing. The report says these companies may be unaware of the advantages of investing in and adopting digital technologies.
To be unaware of the advantages of digital technology simply isn’t good enough in the third decade of the 21st century, especially for businesses in a sector worth £183 billion to the UK economy.
Another concern is that a third of companies say the biggest inhibitor to more rapid digital adoption is a lack of technical skills within the business.
This has long been a problem in manufacturing, and it is unfortunate that it remains a problem for so many firms.
It is not a problem that the sector can solve alone. It needs a concerted effort from all parties, including employers, government, schools and training providers, to equip young people with the skills they need for the future, and then to continue to improve their skills while they are in work.
While the report doesn’t break down what is happening in the regions, we can say with some degree of certainty that the picture in Wales is likely to be similar to, or slightly worse than, the UK as a whole.
This is because the manufacturing sector here lags behind the rest of the UK. Another Made UK report earlier this year found that Wales’ overall manufacturing productivity was the lowest in the UK, and it reported the weakest average performance for output and employment growth.
The good news is there are efforts underway to change things. Last year the Welsh Government launched its Manufacturing Action Plan for Wales, which aims to ‘future-proof’ this vital part of the Welsh economy. One of its main themes is technological change, including increased digitalisation and automation.
There’s also the SMART Digital Accelerator project, a team of industry expert advisers who work with manufacturers in Wales to help them identify the right technology to boost their bottom line.
The project is funded by the Welsh Government, delivered by the University of Wales Trinity Saint David (UWTSD) and supported by the Advanced Manufacturing Research Centre Cymru (AMRC Cymru).
We hope that manufacturers here in Wales are taking the initiative to go digital. Digitalisation can save money and time, reduce waste and drive efficiency, ultimately leading to increased productivity, profitability, competitiveness and stability.
With manufacturing seen as integral to the future wellbeing of Wales, we need to ensure our manufacturing firms are keeping up with the latest digital technology trends.