the future of manufacturing - prof. sir michael gregory
DESCRIPTION
Presentation from https://storify.com/ONS/changing-shape-of-manufacturing-in-the-ukTRANSCRIPT
The Future of
Manufacturing: A new era of opportunity
and challenge
Professor Steve Evans, University of Cambridge
2
Scope
Foresight Future of Manufacturing Project
Objective has been to investigate changes and
uncertainties facing UK manufacturing activities,
to 2050 where possible, to inform how the UK can
create and capture future value.
Vince Cable is the sponsoring minister. Findings
available for BIS to use to inform development of
future policy.
3
• 10% of UK
economy
(1973: 29%)
• Employs under
3m people
(1966: 9m)
• Similar trends
elsewhere
Manufacturing share of GDP 1990-2010
A recent context of historical shifts…
Foresight Future of Manufacturing Project: 7th November 2013
4
With areas of weak
relative performance…
...and some areas of strong
relative performance
Share of manufacturing exports in manufacturing output
• Strong total factor
productivity
• Increasing proportion
of output exported
• Expenditure on
manufacturing R&D
• Levels of capital
investment
• Falling share of global
exports
Foresight Future of Manufacturing Project: 7th November 2013
5 Share of manufacturing exports in manufacturing output
• Absolute value: 10% of GDP (£139 bn in 2012)
• Exports: 53% of UK exports in 2012 (£256 billion)
• R&D: 72-79% UK business R&D spend 2000-11
• Productivity: growth 2.3% p.a. (1980-2009) UK 0.7%
• Jobs: high skilled and well paid
• Resilience: provides resilience in face of recession
The sector makes powerful
contributions to the UK economy
Foresight Future of Manufacturing Project: 7th November 2013
6
Timetable
Scoping Jan-Mar 2012
Research Apr 2012-Feb 2013
Synthesis Launch Feb-Jul 2013 28 October 2013
• 37 commissioned evidence papers, 2000+pages
• 3 international workshops
• Engagement with industry
• UK roundtable events
• Lead Expert Group
• Industry High Level
Stakeholder Group
• Drafting of chapters
• Engagement with
BIS & HMT
7
Changing nature of manufacturing
By 2050:
Manufacturing will
be a complex,
value creating
system. Emphasis
not on production
or services but on
flexing business
models and
offerings to create
value in new and
interesting ways.
8
Technological change and uncertainty
By 2050: technology will drive a revolution…
• Incremental leaps forward
(pervasive ICT; integration of
sensors = big data; application of
materials; sustainability)
• Radical developments (biological
& medical developments; additive)
• Disruptive breakthroughs (unknown)
…changing how products are designed, offered
and used by customers
9
Environmental change and uncertainty
By 2050: sustainability will no longer be optional…
• Resources (materials, water, energy, land)
• Population (3 billion more people) wealth / age
• Climate change (weather events)
• ‘Pricing the Environment’
• Standards
• Consumer pull
…business models
will have to shift to
reduce exposure to
commodity shocks &
exploit opportunities
10
Sociological change and uncertainty
By 2050: we will have seen jobless growth…
• 170k fewer roles by 2020, no return to mass cuts -
current employment levels just under 3 million
• 800k roles to fill by 2020 (ageing population a factor)
demand for professionals, ‘hybrid’ expertise, STEM
• Potential for cognitive / physical enhancement?
…with strong demand for workers with ‘hybrid’
expertise as countries compete on quality
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Employment
5 areas of long term shared interest emerged from
workshops in Berlin, Washington DC and Singapore:
• Sustainability (emphasis on resource efficiency)
• Education and skills
• Automation
• Big data
• New models of distributed manufacturing
Interests highlight fascinating balances:
(1) Investment in automation versus jobs
(2) Global versus local supply chains
(3) Distributed versus traditional manufacturing
11
International perspectives on
change and uncertainty
12 Share of manufacturing exports in manufacturing output
• Services with products e.g. Rolls Royce
• Selling of technological ‘know how’ e.g. ARM
• Remanufacturing of products e.g. JCB / Caterpillar
Manufacturers will increasingly make use of a wider
value chain to create revenue.
1. More than making a product and selling it
Foresight Future of Manufacturing Project: 7th November 2013
13 Share of manufacturing exports in manufacturing output
#FoMn #manufacturing
2. Faster, more responsive and closer to customers
• Mass personalisation of products on demand
• Distributed: big high-tech, modular, home, mobile
• Greater design freedom
• More digital connections along value chains
Foresight Future of Manufacturing Project: 7th November 2013
14 Share of manufacturing exports in manufacturing output
#FoMn #manufacturing
3. Exposed to new
market opportunities
• Changes to personal wealth / ageing populations
• BRICs and the ‘Next 11’
• Continued global ‘fragmentation’ of the value chain
• Some ‘onshoring’
Foresight Future of Manufacturing Project: 7th November 2013
15 Share of manufacturing exports in manufacturing output
#FoMn #manufacturing
4. Increasingly dependent
on highly skilled workers
• Strong demand for manufacturing workers
• A need to accommodate more older workers
• Importance of STEM qualifications
• Blending of technical & commercial ‘hybrid’ skills
• Potential for human enhancement
Foresight Future of Manufacturing Project: 7th November 2013
16 Share of manufacturing exports in manufacturing output
#FoMn #manufacturing
5. More sustainable
• Growing / urban populations raise resource demand
• Climate change and global supply chain vulnerability
• Volatility in price & availability of commodities
• Reuse, remanufacturing, recycling: circular economy
Foresight Future of Manufacturing Project: 7th November 2013
Foresight Future of Manufacturing Project: 30th October 2013
Future of manufacturing
• Lean & Clean: (eco)-efficiency
• Never can say goodbye: closed loop
• Make it anywhere: local making
• Keeping in touch, experiments, selling service
• Knowing me, knowing you: using big data
• Kissing frogs: new collaborations
• Slow making, provenance, high value
this is a personal (Steve Evans) picture