Managing cyber security risks, workforce changes and growing demands for supply chain security and sustainability are the standout priorities for UK manufacturers over the next two years according to PwC’s latest COO pulse survey.
The Reinventing Manufacturing survey reveals how dramatic shifts in the world marketplace, from advances in technology and rising cyber risks to evolving customer needs and employee behaviours are transforming how manufacturing organisations operate.
With its far-reaching impact on the economy, supply chains, consumer expectations, jobs, and work practices it has the power to further reorder the business world in fundamental ways.
According to the data, cyber security is an urgent priority for 63% of UK manufacturers with one in five having experienced a cyber attack. With these risks unlikely to disappear anytime soon, almost half of respondents (43%) are investing in application security, firewalls and antivirus precautions. Coordinating data security and privacy processes more closely remains an immediate priority for one in three firms with 38% focused on their cyber response and recovery plans over the next 12 to 24 months.
Despite this focus, upskilling staff in cyber security is less of a priority for UK manufacturers (35%) compared with the rest of the territories surveyed (43%) with two in five stating that conducting cyber-attacked response exercise training is more vital.
Competitiveness and the shift to digital is also playing on UK manufacturers’ minds, alongside supply chain planning. The UK Government’s Help to Grow scheme which was announced in last week’s Budget responds to these concerns, giving 130,000 businesses the chance to upskill their staff and invest in software and other tools to future proof them for an increasingly digital economy.
The survey analysis shows that:
- Productivity and efficiency is a priority for UK organisations compared to other territories such as Germany (65%), China (58%), Japan (57% ), and the US (52%).
- UK manufacturers are prioritising new systems and solutions such as internet of things (78%), public and private cloud (65%) and robotic process automation (47%) in a bid to better meet customers’ demands.
- Supply chain transparency and risk analysis is an immediate action point (45%) with vertical integration of the supply chain a longer-term area of focus (33%).
- COVID-19 and Brexit have shone a light on supply chain vulnerabilities and have caused many organisations to reconsider their approaches - whether this is making supply chains more local, or not. As a result, demand forecasting (48%) is among the top supply chain priorities in both the short- and mid-term.
- Track and trace solutions are another focal point (42%) - almost double that of other territories - with threat map dashboards (33%) projected to see considerable short-to-medium term growth.
- Despite a growing pressure for governments and businesses to develop and implement Environmental, Social and Governance (ESG) strategies, supply chain carbon footprint is the lowest priority for manufacturers - not just for the UK (13%) but across the rest of the territories (24%).
Cara Haffey, UK industrial manufacturing and automotive leader at PwC commented: “As the pandemic took hold, manufacturers faced unprecedented disruption revealing some weaknesses in end-to-end activities and an increasing prevalence in cyber attacks. When combined with the impact of Brexit, it’s clearly shown just how vital it is for UK manufacturers to embed agility and resilience into their business models - and that they need to act swiftly.
“As uncertainty in the world persists, organisations must also focus on creating cohesive and complementary digital, trade and green strategies if they are to increase productivity and efficiency, boost profitability and grow market share in an increasingly ESG focused commercial environment.
“UK manufacturers have shown their capacity to react swiftly to new market environments and challenges and forge new inter-sector partnerships during this pandemic and it’s critical they continue to do this as they look to the future. It’s rare for manufacturers to have the capacity, downtime, or headroom to make such significant changes and it’s vital they don’t waste this opportunity.”
