Digital crucial to supply chain resilience in advanced manufacturing

Date posted: August 10, 2021

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Adopting digital technologies and encouraging innovation are key factors in building resilient supply chains for some of our region’s most important advanced manufacturing sectors, finds a new report commissioned by the Midlands Engine Observatory.

Midlands Engine Supply Research Report: Advanced Manufacturing Including MedTech Supply Chains was written by a team from The Manufacturing Technology Centre (MTC), led by Dr Thorsten Kampmann.

The study aimed to understand and recommend improvements to the readiness and resilience of five critical supply chains in the Midlands: Rail, Construction, Healthcare, Automotive and Aerospace.

Key findings include:

Rail Sector succeeds in demand forecasting but struggles with customer relations
Aerospace succeeds in innovation and sustainability of supply
Construction succeeds in risk management and contract management
Healthcare succeeds in introducing new innovations
Automotive succeeds in digital competence and is the most digitally mature of all sectors

Across the five sectors, the weakest capabilities were innovation and technical mastery, and digital competence.

This is concerning as Industry 4.0 requires higher digital skill and manufacturing than is currently present.

As a result, only two of ten supply chains assessed were deemed to be operating at an advanced readiness level, considered the benchmark for the competitive operating performance of UK businesses.

To address some of these challenges, digital capabilities and innovation need to be improved across the region’s supply chains to incorporate cutting-edge technology.

Digital capabilities would also help improve our region’s productivity, enabling the use of data analytics to understand consumer needs and behaviours, and new technology such as dark warehouses.

Universities will play a vital role in developing digital capabilities by training the next generation of workers and will also help develop the technology that firms need in the future.

This research is just the latest in a series of reports our Observatory has commissioned looking specifically at supply chains.

Each provides useful insights into how prepared and resilient the supply chains are across the different sectors in focus including low carbon, food and industry.