Survey shows manufacturers reaping productivity rewards of investment in IT and lean

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Britains manufacturers have been supporting their drive to secure new markets, raise innovation performance and increase productivity by investing in IT and lean solutions. 

The breadth of investment by companies boosted the competitiveness of manufacturing when times were good and now leaves them in better stead as the economy enters a downturn according to a survey on productivity published by EEF, the manufacturers organisation and Infor.   
 
Commenting, EEF Chief Economist, Steve Radley said: The use of lean and IT to support companies efforts to improve productivity are clearly bearing fruit.  On going investment in new technology solutions and manufacturing processes will leave companies in a stronger position to face the current economic downturn.

Over three-fifths of manufacturers claim recent investments in lean initiatives to reduce waste, improve the supply chain, reduce delivery times and focus on continuous improvement have achieved their objectives, while a further 11% say they have exceeded them.  Overall the survey shows that manufacturers have been making significant progress in improving both productivity and profitability in recent years  
 
But there is clearly scope to do more. In a more difficult economic climate, continuing to invest where possible can only add to a companys competitive advantage. 
 
The survey shows that companies main focus on improving innovation, customer service and production efficiency has been underpinned by increased investment in IT, coupled with a greater focus on lean manufacturing.  This has contributed to tangible, bottom line benefits for UK manufacturers.

Responding to the challenges and opportunities of globalisation with strategies to deliver higher-value goods and services to customers has been a priority in recent years.  But a significant minority of companies have not yet considered implementing lean. 
 
Over the last two years more than half the companies asked had increased their investment in IT solutions with the aim of delivering better overall innovation performance to improve manufacturing operations, highlighting that physical production still remains the bedrock of modern industry. 

Top of the investment priority list is IT to improve planning operations (63%).  Better reporting and analysis (59%) ranks second, as does investment to support new product development (50%). 

Phil Burgess, Business Consulting Director, Infor, says: The benefits of lean have long been recognised, and it is no surprise that the research highlights that rewards are greatest for those companies that implement lean across the whole business.  However it is important to keep in mind that as we enter a period of negative growth and squeezed budgets, we are likely to see more examples of manufacturers making smaller, incremental investments in IT, the impact of which should not be underestimated.  These investments need to provide rapid and proven returns and be non-disruptive

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