17 Issues for 2017

The newest member of the SEWN team, Deb Lutz, Erie Regional Director, recently attended a webinar sponsored by Industry Week entitled, "What Issues Will Challenge You in 2017?"

The following is Deb's synopsis of that webinar.

17 ISSUES FOR 2017

Are you ready for the challenges and changes that will be coming in 2017?

Will the skills gap continue to plague manufacturing and what can you do about it?

Is digitalization a means to improved productivity or the path to new revenue?

How do manufacturers translate data from sensors into automated actions and insights?

How can manufacturers overcome risks of commoditization and create differentiation?

Should B2B industries care about the customer experience too?

In a recent webinar hosted by Industry Week, three industry insiders have answered these questions and more and have provided their predictions on what to expect in 2017. All three insiders predict that 2017 will be another banner year for manufacturing and all signs point to tremendous opportunity!

First presenter:

Brian Raymond, Director, Innovation Policy for the National Association of Manufacturers (NAM)

NAM is the largest manufacturing association in the United States, representing small and large manufacturers in every industrial state in all 50 states.

1. 2017 is Manufacturers' Moment

• New Administration

• New Congress

• New Opportunities

Look for the white paper, "Competing to Win", on the NAM website at www.nam.org.

2. Technology will Continue to Disrupt Manufacturing (in this case, disruption is a positive)

• 67% of manufacturers will see an increase in shop floor productivity

• More than 1/3 will offer completely different markets/product lines

• 60% will speed up time to market and improve development

• 1 out of 2 will enable new business models and new revenue streams

• 2/3 will increase their long-term outlook

• 67% will differentiate products/service offerings

Look for the white paper, "Building to Win" on the NAM website at www.nam.org.

3. Innovative Infrastructure

• Major attention from Congress and President Trump

• Infrastructure is broader than just roads and bridges

• Innovation infrastructure is critical to growth

4. Cybersecurity will continue to dominate

• Connected technology is everywhere - security needs to keep up

• Expanded threat landscape

• Cybersecurity is now and issue Boards of Directors focus on

• Cyber espionage is a concern

For 2017:

• Regulatory clarity is needed

• Strengthen government outreach to smaller manufacturers

• Government funding for IoT (Internet of Things) security research

• Look at best practices to manage global supply chain cyber risk

5. Target on Intellectual Property (IP) Expands

• IP is manufacturing's most valued asset

• Envy of competitors

• IP theft is a major threat to the economic leadership of any industry

For 2017:

• Leverage new Trade Secrets Act passed in 2016

• IP Protections must be included in international agreements

• Reduce abusive patent lawsuits in the U.S.

6. Public-Private Partnerships (PPPs) Will Continue to Support Growth

• Public-Private Partnerships should remain a priority

• Industry-led is the key to success

• Manufacturing Extension Partnership (MEP)/Manufacturing USA Partnership is working and a great PPP example

• Long-term commitments needed for manufacturers' growth

For 2017:

PPPs Support:

• IoT growth

• Intellectual property protection

• R&D funding

• Cyber readiness

Second Presenter:

Lee Hopley, Chief Economist, EEF

EEF works to support and champion manufacturing and engineering in the UK and Europe.

7. Brexit Won't Trigger an Investment Collapse for Manufacturers

Manufacturers' investment plans will not be affected over the next year.

• Largely, business as usual

• Over 3/5 of manufacturers surveyed by the EEF are not delaying investments as a consequence of Brexit uncertainty

• UK manufacturers are focused on the here and now, and meeting the needs of their customers

8. Sterling (Exchange Rate) will Remain Competitive for UK Exporters

• 53% of manufacturers identified weaker Sterling as a business opportunity after the referendum (source: EEF EU referendum survey)

• Manufactured exports up 11% for the year up to November (source: Office for National Statistics)

• Net trade expected to make positive contribution to GDP growth in 2017

• 86% of manufacturers see potential business risks from exchange rate

9. Global Trade Growth will be Less Supportive

Over the last five years, results have been consistently disappointing.

Literature findings:

• Growth in world trade subdued in recent years, far below pre-crisis levels

• Trade/Income Relationship: elasticity of world trade to world GDP has been weakening in recent years

10. UK Manufacturers will Still Continue Their 4IR (4th Industrial Revolution) Journey

4IR will make manufacturing smarter.

• Smarter products

• Smarter production

• Smarter supply chain

• Starting with optimizing supply chains

• Only 11% of companies think that the UK is geared up to take advantage of 4IR

11. Manufacturing Growth Will Not be the Only Story for all UK Industry Sectors

EEF forecasts a modest 0.2% contraction in UK manufacturing output in 2017 after a 0.2% gain in 2016.

UK Top Performing Sectors in 2016

• Transport (aerospace)

• Food and drink

• Chemicals and pharmaceuticals

.....And the Laggards

• Basic metals

• Engineering

• Non-metallic minerals

Third Presenter:

Mark Humphlett, Senior Director, Industry and Product Strategy, Infor

Infor is an enterprise software provider and strategic technology partner for more than 90,000 organizations worldwide.

12. Manufacturers will Stop Incubating and Start Accelerating on Servitization - serving your existing business customers and making sure that they are happy versus recruiting new customers

• Every industry is being impacted by the digital services it provides

• Manufacturers must have a digital strategy in place by 2020

13. Cloud Adoption will Continue - it is not a question of if but when you are going to adopt Cloud technology

Of the four transformational shifts, Cloud is the engine of them all!

• Cloud

• Social

• Mobile

• Big data

14. Supply Chain Visibility Becomes Real

80% of data needed to effectively run a global supply chain resides with partners such as:

• Buyers

• Sellers

• Logistics providers

• Financial institutions

15. Manufacturing Talent will Become More Tech-Savvy - and More Sought After

• 78M people will retire in the US over the next 10 years

• Approximately 1 in 3 US workers was born into the Millennial Generation - Millennials expect customer-like experience

• 82% of manufacturing CEOs say the skills gap will affect their ability to meet customer demand (source: National Manufacturing Institute)

16. Digital Transformation for Differentiation will be More Important Than for Improving Operational Efficiency

• Automation - Digitizing a process or an experience to make it more effective and impactful for the connected business age

• Differentiation - Rethinking business and creating new data-driven ways to deliver an elevated experience, service or product.

• Customer engagement is where differentiation will emerge

17. Chief Information Officers (CIOs) will Become CEOs (Chief Experience Officers)

CIOs will re-focus activities from tasks to experiences.