New study looks at manufacturing in 2020

Nick Gill, global manufacturing sector leader at the consulting group Capgemini, which commissioned the work, says: “The manufacturing industry will change significantly over the next 10 to 12 years, but with careful planning and preparation, manufacturers around the world can position themselves for competitive advantage.” Based on responses from over 150 manufacturing companies in eight countries (China, France, Germany, India, Netherlands, Sweden, the UK and the US), the study suggests that by 2020, 80 % of manufacturers are likely to have multi-country operations, compared with just over half today. Supply chains will also increase in complexity and consolidate. Half the companies surveyed said they would be using fewer suppliers by 2020, but 40 % said they will be using more distributors as increased competition drives them to reach new markets. Manufacturers appear uncertain what actions to take about green issues, but as political and social pressure increases around emissions reduction, urgent action will be required to reach 2020 targets. The study also reveals that by 2020, manufacturers in developed nations will have moved away from mass-production towards greater specialisation as they seek to find more profitable ground higher up the supply chain. Conversely, companies from emerging market countries will have moved from low-profit localised manufacturing to a more standardised, high-volume approach. Chinese companies, for example, expect the proportion of standardised products they make to double by 2020, implying a significant increase in mass production capability whereas companies from Germany and the UK predict a trend away from localisation to more standardised international products by 2020. Gill concluded: “Closer collaboration with customers and suppliers and the systems put in place to manage this will be key to future success. In addition, manufacturers should be planning now for the upturn following the current recession and preparing for a more fluid movement of manufacturing between plants.”