Ask the expert…
We speak to Capita TI’s manufacturing localisation expert, Chris Stypula, and ask him all of the questions that are on everyone’s lips right now…
What is the current state of the global manufacturing industry?
According to a study by the McKinsey Global Institute, “Manufacturing the future: The next era of global growth and innovation”, industrial production generates 16% of global GDP and employs about 45 million skilled workers in developed countries.
Operating in today’s fast paced business environment, combined with changing customer expectations, means that in order to stay on top, leading companies from the manufacturing sector are reassessing their business strategies and offers.
Leaders of the industrial manufacturing industry are competing by implementing innovative trading strategy in their products and services.
More and more companies use feedback from customers to adjust pricing strategy to match the value they deliver, contrary to the traditional model – cost-plus.
In addition, to achieve business excellence, manufacturers have started to explore and use the power of collected customer data, using all available digital, mobile and social tools and channels. For example, Automotive/Aeronautics/Heavy Machinery producers openly admit to collecting telematics (technology of sending, receiving and storing information via telecommunication devices, in conjunction with effecting control on remote objects data) for their own benefit – to improve their products, but also to maintain high post-sales customer satisfaction levels (responding to issues, chasing spare parts etc.)
Preventing downtime, outages and failures affecting customers lie at the heart of 21st century manufacturing businesses, and we will observe more companies following that trend in the future.
Where do you think the manufacturing industry will be by 2050?
We will observe proactive pressure on eco and environmentally friendly manufacturing. Products will be made from sustainable materials, while waste will be reduced through remanufacturing, reuse and recycling.
In 2050, waste processing technology will be so advanced that the products created from recycled materials will match the quality of the original product.
According to the German chemist Michael Braungart, and American architect William McDonough, the authors of the book ‘Cradle to Cradle’, “upcycling” will be available; recycling which will allow for the production of recycled materials of higher quality and integrity than the original product. Solar and wind will become the most important sources of energy.
In addition to this, experts suggest we are now just halfway through the era of high-speed, super computers.
Prediction states that over the next 25 years, computer processor speed, hard drive capacity, and the power and speed of data transmission will become 1,000 times faster/higher and all widely accessible for a fraction of today’s price.
All of the above will lead to further automation of intelligent/smart production process with Industry 4.0 becoming a widely spread standard.
How do you think the UK’s decision to leave the EU will affect UK manufacturing firms?
A couple of months ago I had the privilege to attend the Manufacturer MX Awards UK, where top manufacturing business leaders voiced concern after the UK government set a priority to reduce migration into Britain over guaranteeing trade access after leaving the European Union.
With regards to the EU exit process, based on conversations we had, British manufacturing leaders want only 3 things – access, access and access. Manufacturing firms want access to the negotiation table, so experts are available, and their expertise is taken into consideration by GOV decision makers. They want access to a skilled workforce, and finally, access to the EU single market.
If all of the above can be secured, Brexit Britain has a good chance for global manufacturing expansion, with positive premium connotation to the ‘Made in UK’ brand.
What 3 tips do you have for manufacturing firms looking to expand overseas?
- Be prepared to invest both time and money
- Be customer and market focused
- Understand that every market is unique
How do you think Industry 4.0 will affect global manufacturing businesses?
With progressive digitisation, we are on the verge of a fourth industrial revolution. However, the Industry 4.0 is not associated with the development of new technology or a new business model for manufacturers. Industry 4.0 is the new name for the desire for higher efficiency and cost reduction, using real-time data. It means lower costs and improved efficiency, greater speed and scale of production, and better products and services.
It’s already happening:
GE decided to implement the Internet of Things (an element of Industry 4.0 allowing uniquely identifiable objects to directly or indirectly collect, process and exchange data via a computer network) and since 2011, has employed 1,200 professionals, and has invested $1 billion to achieve the level of development available today.
For example, by using sensors to improve the productivity of GE wind turbines, their efficiency has increased by 5%.
This may seem a rather poor result in the eyes of the consumers, but this has a huge impact on global energy production.
Siemens, who first adopted Industry 4.0 in their applications, is operating a Smart Factory in Amberg, Germany. There, products already communicate with production machines, and IT systems control and optimise all processes to ensure the highest possible productivity level, and the lowest possible defect rate.
Accenture – leader in the outsourcing industry and consulting in the field of management and advanced technology – has published a report which stated that industry 4.0 can deliver a global economy of $14.2 trillion by 2030, and this is only in the UK.
According to a recent study by the US computer company Cisco, there is a chance that the IoT will bring about $19 trillion over the next decade.
What events would you recommend for people in the industry?
- Advanced Engineering UK
- Tekom and tcworld conference
- The Commercial Vehicle show
- Advanced manufacturing show
What is it about manufacturing that excites you?
Working with the world’s leading manufactures gives me the opportunity to understand and appreciate how complex, technical problems are solved. Having access to industry experts allows me to develop knowledge in all possible fields of engineering – through access to global production programs, with exposure, and to practical usage of advanced technology that improves products and processes. For me – It is all about knowledge!