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Just 8% of UK manufacturers understand I 4.0

16 June, 2016

Only 8% of UK manufacturers have a significant understanding of Industry 4.0, despite 59% recognising that it will have a big impact on the sector, according to a new report published by the accountancy and business advisory firm BDO in association with the Institution of Mechanical Engineers (IMechE).

Of the 318 management- and director-level engineers in UK manufacturing that took part in the survey, 20% reported that their companies had some level of Industry 4.0 strategy in place, 48% said that they had no such strategy but needed to look into it, and 19% felt that they didn’t need an Industry 4.0 strategy at all.

According to the report, a third of UK manufacturers are at risk of falling behind global competition because they have not invested in Industry 4.0 technology or processes in the past two years. A quarter say they have no plans to invest in this area over the coming two years.

Of those that are planning to increase investment, 16% of companies expect to spend more than £500,000 by 2018, while 7% plan to invest more than £5m.

Almost two-thirds (64%) of those surveyed said that when investing in automation systems and Industry 4.0 related technology, their main focus would be on production, with 45% saying that r&d was a key area and 25% citing logistics.

The main reason given by respondents for not investing in Industry 4.0 is a lack of understanding, with 44% of them citing this factor. Only 5% blamed their limited investment on the lack of external finance or grants.

Of those surveyed, 73% believed that Industry 4.0 will increase the risk of cyber-security breaches in their business, and 48% of them felt they had an adequate IT infrastructure to prevent breaches.

Lawton: lack of strategy is a 'huge concern'

The IMechE’s head of manufacturing, Philippa Oldham, says that the survey findings “show that much more needs to be done to help our manufacturers understand how technologies such as automation can add value to their businesses. By embracing this new revolution, our factories will become much more intelligent, and be able to detect and even predict faults in our production lines before they happen. This will not only lead to increases in efficiency and productivity but also drive out waste improving our global competitiveness.

“It is now time for Government to set out a clear long-term strategy which empowers UK companies to invest in these technologies and UK manufacturing’s long-term future,” she adds.

“It is surprising to see such low awareness of Industry 4.0 amongst UK manufacturers and clearly more needs to be done to educate, support and assist the sector as we make strides into what is likely to become the fourth industrial revolution,” comments BDO’s head of manufacturing, Tom Lawton. “UK manufacturers need to push ahead or they will be left behind, especially when it is evident other countries are already moving ahead of the game with education and investment programmes being much more clearly supported by government than in the UK.

“The lack of a clear strategy on what could be the most important development in manufacturing for some years is of huge concern,” he adds. “We would like to see the Government doing more to match manufacturers’ long-term outlook by developing a 15-20 years industrial policy that avoids the disruptions of the political cycle.”

The term “Industry 4.0” was coined in Germany to refer to the digitisation of manufacturing. It is often referred to as the fourth industrial revolution.

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