Digitalize to win
February 4, 2021
Driven by Brexit, Covid-19 and the green agenda, the U.K.’s industrial and manufacturing sectors are going through a period of profound change. If businesses in these sectors are to thrive, then they must accelerate the digital transformation of end-to-end operations.
By Maddie Walker and Stéphane Crosnier, Accenture
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UK is in a leadership position when it comes to the use of a number of advanced digital technologies in manufacturing operations. | Photo by Science in HD on Unsplash
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Recently, manufacturing and industrial businesses have been largely focused on managing the disruption to supply chains associated with Brexit and Covid-19. The delays to shipments caused by a spike in demand following lock down and Brexit-related stockpiling has already proved so disruptive that Honda was forced to shut down production for a few days in December. In the months and years ahead, businesses will be looking at how to make their supply chains more resilient. As they do so, the environment in which they operate will continue to change dramatically.
According to recent Accenture research, the U.K. currently only makes 62 percent of goods when measured by value—less than any other comparable European nation. The pandemic and Brexit are set to change this as businesses are increasingly looking at bringing manufacturing back onshore; a move that could be worth up to £4.8 billion in additional goods for U.K. factories in the year ahead—around the same amount as the U.K.’s total current manufacturing output. Growth on this scale would be welcome news for the exchequer and it will help offset possible declines in service sectors, which were not part of the end of year Brexit deal.
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only62%
of goods are currently made in U.K. when measured by value—less than any other comparable European nation.
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Opportunities in green
In addition to the growth of traditional areas such as food production and consumer goods manufacture, there will likely be new opportunities through the “Green Industrial Revolution”, part of the U.K.’s national strategy for eradicating the country’s contribution to climate change. U.K. manufacturing and industrial businesses will have a role to play in creating and distributing new renewables, carbon capture and energy efficiency products. They will also need to leverage IoT, AI and other smart technologies to create new green manufacturing and supply chain models that can help drive sustainable growth.
If U.K. organizations are to move fast to navigate the challenges of the new economy, while also making the most of increased demand for local manufacturing, then they increasingly need to be smart, resilient and agile. That in turn requires accelerating use of digital across operations to leverage manufacturing and supply chain benefits gained through automation, analytics and cloud-enabled flexibility, for example.
How is the U.K. currently doing when it comes to digital operations maturity?
The state of the nation’s digital operations
For a recent research report, Accenture indexed the digital operations maturity of major economies by assessing the extent to which manufacturers in the U.S., Europe, India, China, Taiwan, South Korean and Japan have deployed 40 critical digital capabilities across their engineering, manufacturing, and supply chain functions. Our analysis suggests that the U.K. is currently placed sixth of the surveyed countries, behind Germany, France, India, Singapore and the U.S..
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That is not to say that the U.K. has not made significant strides forward in important areas. According to our research, the country is in a leadership position when it comes to the use of a number of advanced digital technologies in manufacturing operations. These include analytics for the conditional maintenance of assets and advanced tools for workers such as digital workstations, instruction, and alerts.
However, if the opportunities of revitalized local manufacturing and industry are to be realized in full, businesses need to accelerate digital deployments in areas where they’re falling behind. These efforts should be focused on the areas where investment will lead to the biggest returns, such as rapid prototyping, AI-based design tools, robotics, asset optimization automation and the use of Mixed Reality technologies.
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Closing the gap
As U.K. businesses look to catch up with the global leaders in digital operations, there are a number of things they can do:
- Build on existing strengths. The U.K. is no stranger to innovation, and there are many examples of best practice and innovation that you can use as a source of inspiration. Take, for example, the way in which the VentilatorChallengeUK consortium used Augmented Reality to accelerate training processes and ramp up production of ventilators at pace. In just 12 weeks the consortium was able to set up full scale production capabilities.
- Experiment and test. You don’t need to take a leap into the unknown when it comes to digital. The U.K. is home to a number of facilities where companies can test the integration of the latest digital technologies in a real factory setting without interrupting their own operations. The University of Sheffield Advanced Manufacturing Research Center, which includes an Accenture Industry X Innovation Center, is one such test bed. The next-generation of digital factories also need to be able to help productize the U.K.’s leading scientific capability. The recent work of Oxford University and AstraZeneca in producing a Covid-19 vaccine shows the power of this approach, combining as it does Oxford University’s scientific knowledge and AstraZeneca’s industrial prowess. The right relationships combined with a spirit of invention will help U.K. manufacturers scale innovation in the years ahead.
- Learn from the best. Our index provides a useful capability-level breakdown of the relative strengths and weaknesses of a company’s digital operations by industry and location. This can help you identify digital best practice leaders and can form the basis of an investment template. Deploying innovations in the same plant are also much better suited to showcasing their impact than a piecemeal approach.
- Leverage the cloud. The factory of the future will need to have cloud at its heart. Whether to provide the agility required to meet new customer demand or to predict and manage supply chain challenges, only the cloud can provide the scale and flexibility needed for tomorrow’s manufacturing industry to leverage data across its end-to-end value chain. If you’ve not started investing in this core foundational technology, now’s the time to start.
- Augmenting your workforce. Digital operations transformation requires a focus on people, and that means training your workers in the next generation of factory technology. The focus should also be on how technology can augment, empower and connect your workers to help them unlock greater value. For instance, smart wearable devices and intelligent sensors can enable industrial companies to digitally connect with workers on-site and in remote locations, providing them with timely, relevant and rich media to assist them in their work. Meanwhile, the use of autonomous robots will help manufacturers in the U.K. create a “lights out” manufacturing capability that will improve cost to serve and enable the country to bring a broader range of resources back onshore.
- Think end-to-end. To realize the full benefits of digital operations, they must extend beyond the factory floor. Data and digital tools also have an important role to play in increasing visibility of goods to enable resilience across the supply chain—a benefit that the recent disruption around Covid-19 and Brexit have underscored the need for. As the U.K. looks to achieve its carbon net-zero goals, supply chain visibility will become even more important in enabling sustainable/responsible industry and circular manufacturing models.
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AMRC Smart Factory
Accenture's Industry X innovation center at the AMRC smart factory offers a collaborative hands on environment to solve complex manufacturing problems.
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There is every reason to think that U.K. companies will be more than capable of catching the current digital operations leaders. U.K. businesses are good at adopting technology and the country has a strong pool of talent and a powerful spirit of innovation. This is a strong base on which to take the lead on digital and help the U.K. create a new role for itself in manufacturing and production and help meet the government’s goals for the Green Industrial Revolution. All that remains is to use technology to supercharge the effort—and to do so quickly.
About the authors
Maddie Walker and Stéphane Crosnier
Maddie is Managing Director at Accenture. She is leading the Industry X practice in the UK and Ireland, helping our clients to embed intelligence in the way they make things and the things it makes to do more, using less, keep people safe and ensure a sustainable future. She is focused on digital manufacturing operations and intelligent product development. Get in touch with her via LinkedIn.
Stéphane is Managing Director at Accenture. He is leading the Supply Chain and Operations practice in the UK and Ireland, helping our clients transform current & shape tomorrow’s end-to-end value chains to positively impact business performance, society, and the planet. Please meet him via LinkedIn.
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