Research reveals UK manufacturing productivity falling behind due to lack of digital maturity


iBASEt, supported by the MTC (The Manufacturing Technology Centre), has unveiled research revealing 94% of UK manufacturers believe the industry has fallen behind the US due to a lack of digital investment.

The Manufacturing Digital Productivity Report reveals that more than half (56%) of UK manufacturers are losing sales as a result, and more than nine in ten (93%) say underinvestment will lead to many UK manufacturers going out of business in the next decade.

The report, surveying 403 highly engineered industrial manufacturers in the US and UK, reveals a reluctance to invest in digital technology is the industry’s biggest productivity blocker, with more UK respondents saying legacy technologies are having a negative impact on the business (73%) than Brexit (67%). 

Dr Clive Hickman OBE, FREng, Chief Executive, The Manufacturing Technology Centre, said: “Manufacturing produces more than 18% of UK GDP, yet 96% of employees at major manufacturers think that UK businesses are not doing enough to reap the benefits of digitisation. This isn’t just a UK problem – companies all around the world have been sluggish to adopt these technologies; that means there is a prize available for the country that moves swiftly to embrace the new manufacturing economy.”

Paper processes remain

The report reveals that many manufacturers in the UK and US are still unable to let go of legacy processes and systems. Manufacturers still use paper for more than a third (35%) of processes on average, while manual spreadsheets are still used for almost half (49%) of processes. In fact, technology (37%) was cited as the biggest barrier to productivity, ahead of processes (32%) and people (31%).

Industry 4.0 data wasted 

More than four fifths (83%) of manufacturers said their business was negatively impacted by Covid-19 over the last 18 months. Many (67%) implemented Industry 4.0 and smart factory technologies in response to the pandemic and social distancing rules – with 30% doing so for the first time. More than two thirds (68%) said this made them more productive, and more than half (51%) said it made their business more agile. However, more than half (56%) aren’t effectively harnessing Industry 4.0 data, with almost two fifths (19%) not using any of the data at all. 

Naveen Poonian, CEO, iBASEt, said: “It’s alarming to see that major manufacturing operations are still being run by pen and paper or spreadsheets. This lack of digital maturity is slowing manufacturers down, leading to increased errors, and making it increasingly difficult to attract the next-generation of talent. All of this adds up to a loss of trade, a dip in company performance, and leadership positions coming under threat. It’s true the pandemic brought Industry 4.0 adoption plans forward, but manufacturers must make the move as part of a sound long-term digital strategy, using tools fit for the job. If not, this lack of digital maturity will continue to be the biggest barrier of industry productivity in the years to come.”


iBASEt’s independent research was conducted in March 2022 across the UK and US. In total, 403 manufacturers (from the aerospace & defence, medical device, industrial equipment, electronics and ship building sectors) provided feedback – 201 from the UK and 202 from the US. 

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