Fourth industrial revolution can be UK Brexit lifeline
We speak to British manufacturers every day, with a full understanding of the opportunities offered by Industry 4.0, a fourth industrial revolution. Executive awareness is growing as our leaders get the message that technology and having a connected operation gives their businesses the ability to become more profitable, thrive, stay competitive and win globally.
It has long been recognised that manufacturing provides huge value to the UK economy. It has the potential to solve many of our future challenges: economic, societal and environmental. British manufacturers have the potential to provide solutions to wide-ranging, long-term challenges and reap the commercial benefits.
And British manufacturing is still a success story. According to recent statistics from the manufacturers’ organisation Make UK, the UK is the ninth largest manufacturing nation in the world, responsible for 10 per cent of total UK output. Manufacturing also makes up 45 per cent of UK exports, totalling £275 billion.
But there are various economic, political and social challenges at home and abroad. Brexit has been front of mind for many British manufacturers since people voted in favour of leaving the European Union in 2016. British manufacturers are understandably worried about a potential end to tariff-free trade, although others see opportunity to do more business in other markets including the United States and China.
However, any economic hit from Brexit must be taken into context when compared to the effect that digital disruption is having on manufacturing. Our businesses can navigate the uncertain world of tomorrow by innovating and evolving, exploring new customers and markets with unlimited potential when it comes to growth and profitability.
It’s why technology and innovation through digital transformation must be our main focus, as it’s the way British manufacturers can remain internationally competitive and relevant in a market that is rapidly being reshaped.
We must look at creating new value with their customers, whether that’s through new products, services or revenue streams. The benefits can be huge, whether it’s through increases in productivity and efficiency or providing better experiences.
A strong digital foundation enables a business to accelerate without wholesale disruption, as well as provide the ability to respond to new opportunities and threats, whatever they may be. It unlocks new opportunities for investment and even drive job creation.
We’re living in a time where constant connectivity is the norm, in the midst of Industry 4.0, when major innovations in technologies are coming into maturity at the same time. Powered by the cloud, British manufacturers can integrate both the physical and virtual worlds to enable powerful new ways of working. Examples include:
Big data and advanced analytics
It has always been important to manufacturers that they remove waste and variability in processes, increasing efficiency and productivity, and in turn increasing the quality of products. Advanced analytics enables manufacturers to look at historical data, identify patterns and relationships, and optimise processes.
Internet of things
Sensors and real-time analytics have revolutionised the consumer world, but it’s in heavy industries such as manufacturing where networked sensors and intelligence devices have already made a deep impact in transforming traditional supply chains into dynamic connected systems.
Artificial intelligence and automation
Automation is already widely used in manufacturing as many businesses incorporate industrial robots to assemble, test and package products. However, advances in artificial intelligence may revolutionise the way manufacturers do business, enhancing and extending the capabilities of humans.
Manufacturers see blockchain as a technology which can create smarter and more secure supply chains, tracking the journey of products through clear and solid audit trails and real-time visibility. This can help ease compliance, traceability and safety pressures, as well as address efficiency and customer-service issues.
What should British manufacturers do?
British manufacturers must get the basics right, ensuring people, processes and solutions have a proper foundation. This could mean identifying priorities, what’s driving them and how they’re approaching them, with a strategic end-to-end mindset. There are four specific areas we need to focus on:
Although many news headlines focus on the effect Brexit may have on the numbers of EU workers coming to the UK for work, the bigger long-term issue is what types of job will be needed in the future with Industry 4.0, particularly with an eye on automation and artificial intelligence. Traditional manufacturing will certainly need to be augmented with programming and analytical skills, for example.
Creation of software applications will drive Industry 4.0. This includes the use of modern enterprise resource planning systems, which can integrate all areas of a manufacturing business, such as inventory, sales and finance. With a single database, manufacturers can interpret data and provide insight in real time. This market is increasing, with cloud-based systems recognised as making manufacturers of all sizes agile, efficient and productive.
Software is nothing without hardware, particularly in manufacturing where the physical and virtual worlds must integrate to create products. In digital manufacturing, there are numerous examples of hardware and software working in harmony, but 3D printing is a particularly interesting example of how materials can be joined or solidified to create objects under computer control.
Without connectivity through the cloud, Industry 4.0 is simply not possible. There would be no internet of things, no interaction of devices and no power source to drive innovation, as steam and electricity did in the past. It offers manufacturers benefits such as short lead times, on-demand production and mass customisation. Connectivity gives all businesses the potential to become global players.
British manufacturers must not wait and see. They need to reach out and grab the opportunities that are there. Global competition will not stand still. Competitors worldwide will be forging their own path towards digital transformation and a new business landscape. We must prioritise our biggest challenges and explore how technology can keep us competitive in a changing world.
For more information please visit www.sage.com/en-gb/industry/manufacturing/