British manufacturers work in extremely challenging conditions. But as Maddie Walker, UK & Ireland Industry X Lead, Accenture explains, overcoming these challenges will lay a strong foundation for the future.
As if the past two years haven’t posed enough obstacles for UK manufacturing, companies are now having to grapple with skyrocketing energy prices. The problem is one of the biggest challenges in the industry, especially in energy-intensive industrial areas.
It makes for scary reading; For some businesses, energy costs currently account for around 40% of their spend. “For a lot of these companies, it’s been a huge win when it comes to thinking about how they’re going to operate efficiently,” Maddie said.
In addition, companies have to deal with delays in the supply chain and rapidly increasing prices for components and raw materials. “We see a shift. The ongoing impact of the pandemic and geopolitical disruptions mean many manufacturers are now focusing on operational efficiency programs.”
Of course, manufacturers must always ensure that their products and processes are sustainable. This is done both to meet the UK government’s net-zero targets and to meet customer demand, which is increasingly favoring green, circular and sustainable practices.
The manufacturers that will thrive in the years to come will be the ones that use mitigating energy, price, sustainability and supply chain challenges today as a platform to do things differently tomorrow.
An obvious example of this was the massive shift to digital platforms at the beginning of the pandemic, with some companies seizing the opportunity to revolutionize the way they work. On one such project, Accenture partnered with the NHS, moving thousands of employees to Microsoft Teams.
At the height of the COVID-19 outbreak, thousands of people were being admitted to hospitals for urgent medical care every day, placing significant demands on the NHS to provide excellent service while protecting its staff.
Within seven days, the combined team built and tested the Microsoft Teams integration and the platform was rolled out to all 1.2 million NHSmail users across 16,000 NHS organisations. Employees were able to securely send instant messages, make audio and video calls, and host virtual meetings across the country.
Maddie continued, “Companies that have the capability to fully digitize the way they work and can think in a very agile way will be more successful in streamlining and operating their manufacturing facilities and producing goods more cost-effectively. That will prove crucial given the opportunities that are presented to them.”
The impact on product design and construction
As a result of the current challenges, manufacturers not only have to rethink the way they work, but also take a closer look at how products are manufactured and built and what components and raw materials are used. Here, too, some exciting trends are emerging from the point of view of product design and product development.
Accenture recently acquired Dutch company Vanberlo, which focuses on sustainable, ethical product design and solutions. And the company played a key role in developing a refillable deodorant stick for Unilever.
In addition, the type of packaging used in the consumer goods sector is just as important from a sustainability perspective, and the convergence of smart and connected technologies is making simple packaging a real source of value for companies. The packaging is no longer what surrounds the product. It’s becoming more and more of an extension of the product itself.
“When we talk about product design and development, we think carefully about how we create, design and shape the types of products we build, optimizing them for a sustainable future and making them less dependent on materials, that need to be carried around the world,” Maddie continued. “If manufacturers get this right, they can really reduce waste and streamline the entire manufacturing process to run more efficiently.”
Let’s talk about technology
The list of technologies making this opportunity possible is clearly extensive, and there is no silver bullet. AI, automation, robotics, PLM toolsets, data science, etc. will all play a part. However, the utopian vision of automated factories around the clock is still a long way off for the vast majority of companies.
“When we look at the technologies that people are using, our starting point is where they are in their journey and we go from there,” Maddie said. “We are very focused on the benefits that the technology brings to the customer. For example, a large number of conversations we are currently having with customers are about digital twins and how you can use data analytics and data science to really make a difference.”
Maddie added, “In many manufacturing facilities, we’re using data and new technologies to really add value, and we’re having many similar conversations in the consumer goods market. The use of technology is very different in other environments such as aerospace or in more heavy industrial environments where the focus is more on quality and the predictability and safety that comes with it. So the requirements are quite different depending on the different industries we work with.”
The move to net zero
As mentioned, a key driver for manufacturers, especially since COP26, is the drive towards sustainability, and here too technology plays a key role. In terms of building a sustainable value chain, when a company can design a product with fewer materials that are closer to home; if it can be made closer to the source of the materials; when there is less waste because the manufacturer has greater control; and if reuse can be managed efficiently, the entire responsible value chain can have a massive impact not only on scope 1 and scope 2 emissions, but also on overall scope 3 emissions.
“What’s really important is transparency throughout the supply chain,” Maddie added. “It is very good to focus on your part of this supply chain as sustainable. But when you source goods from unsustainable areas and transport them around the world, then your sustainability is called into question. Rising energy prices will mean that change will be urgently needed, even if companies have not already considered the need to be more sustainable as part of the COP26 commitments.”
Apply transformation to manufacturers
Many of Accenture’s clients, who operate outside of engineering and manufacturing, tend to be more advanced down the digital path, and as such, the company sees a large wave of companies trying to catch up and transform their businesses, which it has matched through its Services serves practice of industry X.
“The focus of Industry X is how companies are digitizing what they make and revolutionizing the way they make it,” Maddie continued. “It’s about how we help our manufacturing customers establish a business strategy while simultaneously optimizing and digitizing their processes, and helping them ultimately track and deliver value and benefit. We can offer an end-to-end value chain; We can do everything from business strategy upfront to design and implementation, and that’s unique to our clients.”
To achieve this, Industry X is expanding its capabilities and capabilities, both in terms of hiring the most talented people from the industry, and through targeted acquisitions that increase capabilities and capabilities in this space.
Maddie added, “We acquired a company called Myrtle that is focused on achieving manufacturing transformation through Lean Six Sigma process improvements. Industry X acts as an umbrella for these deep digital design and manufacturing capabilities and capabilities, and we make a real difference to the customers we work with.”