A new study on global growth has identified the top characteristics of manufacturing organizations poised for sustainable growth. These manufacturing “Grow Getters,” as the study referred to them, understand what it takes to get set for growth in today’s dynamic business environment.
One key characteristic of these Grow Getters is that they don’t just pay lip service to ideas such as new technology and innovation; they back them up with investment. According to the research, 88 percent of high-growth companies are planning significant investments in technology and innovation, compared with only 49 percent of slow-growth companies. Surprisingly, almost half of manufacturers are behaving like slow-growth companies in that they are not planning technology or innovation investments in 2017.
If you are a midsize manufacturer, chances are you’re in this boat. There is a perception that Industry 4.0/Industrial Internet of Things (IIoT) initiatives are too high-concept and too expensive for small to midsize manufacturers that are just trying to survive. But perception isn’t necessarily reality.
As anyone in manufacturing knows, the past few years have been no picnic. After struggling to stay alive amid some of the toughest conditions the manufacturing industry has seen in our lifetime, I believe many manufacturers are experiencing what’s akin to “battle fatigue”—a military term for a soldier’s reaction to the stress of battle commonly involving slowed reaction time and indecision.
Battle-weary manufacturers have been so conditioned to being in heads down survival mode that they haven’t yet adjusted their view to look ahead and prepare for what’s next. And the future looks bright. Case in point: A new report from Ernst & Young (EY) shows middle-market companies are flourishing despite global uncertainty stemming from Brexit, increasing populism, the rise of automation and artificial intelligence, and skilled talent shortages. The report states that 89 percent of executives see the current business landscape as being ripe with growth opportunities.
The report also says that 34 percent of middle-market companies plan to grow 6-10 percent this year, far outpacing the latest World Bank global GDP growth forecasts of 2.7 percent—while 14 percent of companies surveyed have current-year growth ambitions of more than 16 percent.
“Despite geopolitical risks and uncertainties, businesses being disrupted through new technologies and globalization rewriting the rules of supply and demand, middle market leaders are not only attuned to uncertainty but are seizing it to grow, disrupt other markets and drive their growth agendas,” says Annette Kimmitt, EY’s global growth markets leader.
A bold and motivating statement if ever there was one. So the question is: Are you seizing the day by putting in place a foundation for growth or are you seizing up? Not taking full advantage of the headwinds of change is like heading into the downhill portion of the race and locking up the brakes.
Manufacturers must do things differently to win market share in today’s environment because it is not enough to maintain the status quo. To survive and thrive, manufacturers must focus on growth.
For midsize manufacturers, leveraging Industry 4.0 approaches and new technologies can help even the playing field when competing against larger organizations. This doesn’t necessarily mean investing in expensive, time-intensive projects. Midsize manufacturers can test the waters with limited-scope, low-risk and inexpensive use cases (such as using sensors to monitor machine performance); other IIoT/Industry 4.0 initiatives can grow from there.
Midsize manufacturers are positioned exceptionally well for growth, but it’s up to you to take the necessary steps to ensure your technology is up to the task. Fortune favors the bold; now is the time to embrace the future.
For more information, visit Epicor at www.epicor.com.