Manufacturers share their outlook for 2020

The survey respondents, 60 per cent of them SMEs, were quizzed in January about their views and prospects for the coming year. The survey was split into five themes: Smart Factory, Cybersecurity, Business Transformation, Financing Investment, and People & Skills.

Smart Factory 

The drive towards Industry 4.0 is continuing apace, with 87 per cent of respondents now agreeing that companies need to adopt digital technologies in order to prosper - compared to 76 per cent in 2019. The majority agreed that digitalisation could improve supply chain relationships, allow workers to be more engaged, increase productivity, accelerate innovation in design and development, and open up new markets.

More than half of the manufacturers surveyed now use Internet of Things (IoT) connected devices, cloud computing and automation or robotics in their operations.

Business Transformation

Despite the developments of the last 12 months, a small majority (57 per cent) said their attitude to growth was unaffected by political and economic uncertainty. Most were also positive about export potential, with 68 per cent saying they were confident in overseas trade and that conditions were good for growth into new markets.

An even bigger majority said they were developing, or had already developed, a ‘servitized’ business model to add value to their customer relationships.

People & Skills

When asked about apprenticeships, three quarters of respondents agreed that apprenticeships were “coming into their own” as a valuable career path. However, over half (57 per cent) said they were unhappy with the Apprenticeship Levy, while a similar amount (59 per cent) believed that the current education system is failing to keep up with the pace of change in manufacturing.

Rather than pinning the responsibility on government for developing the future workforce, most respondents thought that manufacturers should be getting involved in schools and training themselves. The vast majority (86 per cent) said they believed in life-long learning and had a policy in place to upskill and retrain their workforce.

Cybersecurity

The awareness of cybersecurity threats was very high amongst respondents, with 85 per cent saying cybersecurity was embedded in their plans for digital transformation. A similar number (82 per cent) said they had a “clearly defined” cybersecurity strategy in place to protect themselves, while more than half (53 per cent) insist supply chain partners have their own cybersecurity defences in place.

Financing Investment

Although 86 per cent of respondents said they were ready to invest in new digital technologies to boost their competitive position, only a minority find it easy to raise money through mainstream banks. Instead, most businesses said they relied on their cash reserves when making investments. Two thirds also said they had been building up a ‘war chest’ to weather any negative impacts of EU Exit.