Intensifying Competition Driving Rapid Progress Towards Automation and Sustainable Manufacturing finds Fujitsu Survey
- Automation to improve quality and efficiency is the manufacturing sector’s principal concern; sustainability now in the top rank for investment
- Competition intensifying from global players and new entrants; manufacturers responding with successful digital transformation projects
- Automation and IT/OT integration key to improving key investment priorities for the sector – product quality and manufacturing efficiency
London, June 08, 2021
Intensifying global competition is driving established manufacturers to make rapid changes to how they operate, according to a new survey of attitudes published by Fujitsu. The study into manufacturing technology used by ICT leaders in 17 countries1 confirms automation as the principal concern to improve quality and efficiency and notes that sustainability is also top-ranked for new ICT investments.
Manufacturers are putting a new focus on business resiliency and agility in response to the shock of COVID-19. Factory automation emerges as a critical pathway to achieve this. Manufacturers invest more in automation than anything else, with three-quarters (76.8%) planning projects in the next 12 months. Also, sustainability is increasingly capturing the consideration of manufacturing leaders – now ranked equal third in impact on ICT spending. Findings from the Fujitsu survey suggest manufacturers are responding to heightened consumer preference for brands that care about the planet.
Intensifying competition provoking continuing and successful digital transformation
Fujitsu’s findings show that manufacturers are experiencing high and increasing levels of competition and feeling competitive pressure, which is driving transformation. More than three-quarters (75.8%) report extremely or very competitive global forces, with just one in five (21.7%) not exposed to international players. This is intensifying, with nearly seven in ten (68.7%) manufacturers experiencing additional competition from new entrants and from disruptors intent on seising market share.
Manufacturers are responding with continuous innovation, increasingly propelled by successful digital transformation (DX) projects. Across the 17 DX outcomes investigated by Fujitsu, 80% of respondents said the results met or exceeded expectations. Notable successes include strengthened competitiveness alongside waste reduction and quality improvement, the enablement of new ecosystem business models, strengthened customer relationships, and enhanced agility. Stimulated by these successes, the pace of DX is accelerating and manufacturers intend to make further widespread DX investments over the next 12 months. At least 30% are making significant or major investments in DX across all 36 operational areas investigated by the report.
IT and OT integration is the crucial next step
Yuuki Yamamoto, Head of COLMINA Business Unit at Fujitsu, says: “Our global manufacturing survey highlights the importance of automation across multiple indicators, but with its impact on quality and efficiency highest on manufacturers’ priorities. As one of the world’s leading ICT integrators in manufacturing, Fujitsu’s perspective is that the crucial next step is integrating IT with OT. Today, they remain largely separated in many factories around the world. In particular, we see the integration of engineering design technology with factory shop floor operations as an opportunity for manufacturers to attain new levels of quality and efficiency, which our survey shows are key aspirations for the sector.”
More than two-thirds of respondents (69.3%) believe the highest priority is improving product quality in their manufacturing applications, followed by improving efficiency via utilisation rates (67.6%). Enhancing all aspects of security is the third-highest priority – a finding underscored by the fact that cyber-security is the number one priority for increased ICT spending.
In terms of specific technologies to achieve DX, the primary enterprise applications are seen as crucial. Today, the two most widely implemented applications, Enterprise Resource Planning (ERP) and Order Processing software, remain a vital part of the route map. However, change is on the way. Manufacturers are moving to build resilience and adaptability into their businesses, with two-thirds (67.4%) expecting to diversify their supply chains and manufacturing facilities due to COVID-19. This is reflected in manufacturers’ concrete application investment plans for the next 12 months, which are shifting noticeably to inventory and order management, customer service, Supply Chain Management (SCM) and Customer Relationship Management (CRM), in that order.
When it comes to point manufacturing applications, investment in production facility data was the priority over the last 12 months. Findings suggest this will give way to factory automation in the coming year, followed by predictive maintenance and plant maintenance, with production facility data dropping into fourth place. Investment in countermeasures against COVID-19 remains high but is now fifth in line for investment, suggesting many manufacturers believe the high-water mark of the pandemic may have passed.
1 Survey was carried out for Fujitsu in February and March 2021 by DataDriven among 208 ICT decision-makers in the manufacturing industry in 17 countries, representing major economies across Europe, UK, North America, Asia/Pacific and Japan. By revenue, most respondents came from organisations with between US$1.1 billion and $5 billion in revenue (29.5%). Nearly one in five (14.8%) were in organisations over $10.1 billion, with another 14.9% in organisations with revenue between $5.1 and $10 billion in revenue. The remaining 13.9% represented smaller manufacturing organisations ($250m to $500m).
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Date: June 08, 2021