With input costs reducing, they are trying to get themselves on a positive footing - so it's no surprise to see cost controls topping the agenda. Growth plans have to prove margin enhancing and fit for the future. With this in mind, it's notable that 23% of manufacturing leaders see opportunities in net zero, digital tech, cloud and artificial intelligence (AI).
Take decarbonisation: while it's not top of the to-do list for most, going green can help tackle pressing cost concerns and labour shortages. Those leading the charge are tuned in to changing market demands, making purpose-driven investments.
This means getting to grips with the inner workings of supply chains to understand where inefficiencies lie, and where to make small, simple changes. The key is to look beyond energy saving measures, taking a big picture approach that seeks to transform the entire value chain, even if it's done in small steps.
Progress is easier too with digital tech - it helps create more innovative products, tap into new markets, reduce faults and costs. The survey shows manufacturers are well aware of this - the majority expect digital tech to play a serious role in increasing productivity, and are conscious workforces need to be trained to harness the tech. Despite this awareness, the survey also shows only 12.5% are making digital tech central to their strategies.
“There's a risk of a gulf opening between those who have seen the potential of digital tech, and taken decisive action, and those who are holding back.”
Manufacturers need to understand the strategic implications of digital tech to identify routes to value and prioritise opportunities. A good place to start would be to migrate/replatform operations to the cloud, or check the efficiencies of existing platforms. PwC research around the benefits of cloud tech across EMEA manufacturers found it increased productivity for 36% of respondents - the second most measurable value created after enhanced customer service at 37%. Overall, half expect increased productivity over the next year.
Businesses without a fit for purpose cloud and data strategy will be left behind, unable to grasp the benefits of new tech, such as AI and Generative AI, that depend on cloud. GenAI, for example, isn't the tech solution to every problem, but it can automate and enhance aspects of almost all business operations - increasing productivity. That's why it's important to have the right foundations in place, both technical and operational.
Reviving productivity is a key economic challenge for the UK, in which manufacturers play a central role. We are proud to support this year's Executive Survey - it shows manufacturers are increasingly embracing technology and digitisation to pave the way for a greener, smarter future - one that boosts competitiveness and unlocks sustainable growth. And they are prioritising increased investment in upskilling or retraining their people to get there. They're right to do so: human skills, such as judgement, creativity, critical thinking and subject matter expertise, are as critical as ever. Educating at all levels, including board members and executives, is key to managing costs and overcoming barriers to growth - particularly between technology and business.
