The 2018 EY Industrial Products Survey was conducted among 500 Industrial Products (IP) executives whose businesses yield over $1B in annual revenue. These surveys are coming in with similar results. You can look at the results and say “Wow, almost half of executives at these companies see innovation as important, or see technology as important” or “How can half of all executives surveyed not see how important innovation is”.
I’ve had experience in manufacturing and marketing leadership and have studied it for many more years—and I lay most of the problems with manufacturing business squarely with (lack of) managerial leadership. I see these results and think that there will be many winners and just as many losers in the coming years.
The study surveyed executives from a variety of sectors including, aerospace and defense, industrial and mechanical components, machinery and electrical systems, chemicals and base materials, packaging and paper and wood. The survey was conducted between February 22, 2018 and March 22, 2018. The purpose of the study was to evaluate where IP companies fall on their journey towards continuous innovation.
Move over R&D: IP companies see digital technology and innovation as their path to success
- 48% Percentage of respondents who view innovation as quite/extremely important for company success
- 43% Percentage of businesses who are learning from and/or following the technology industry to influence innovation at their company
- 67% Percentage of companies who plan to make significant levels of investment in innovation past traditional R&D over the next three years
- 52% Percentage of businesses that say the adoption of emerging technologies will be quite important or critical to the success of their business in the next three years
Additional results from the survey include:
Facing a culture crisis: The perception of the IP industry is hindering the talent search
- 67% agree/strongly agree that the image of the industrial products industry hurts when recruiting for needed skills
- 38% that difficulty competing with tech-first companies for top talent is a leading barrier in filling the skills gap
- 25% say that attracting/retaining top talent is one of the biggest drivers of their company’s technology investment
- 64% agree/strongly agree that the IP industry needs to change their culture to thrive
IP is looking for outside inspiration. While the tech industry is the leading source, IP has a ways to go
- 43% of respondents are learning from and/or following the technology industry to influence innovation at their company
- Only 29% of business say they are extremely or quite innovative compared to close competitors
- 82% of respondents have made minimal or no investment in AI today
- 22% are learning from and/or following the automotive industry to influence innovation at their own company
- 21% are learning from and/or following the consumer products industry to influence innovation at their own company
Robotics, mobile and big data, oh my! What is getting the largest share of investment attention?
- 63% of respondents say that technology investments have driven measureable returns in agility to a significant/meaningful extent
- 46% are making substantial or major investments in robotics and 56% predict they will in the next three years
- 31% of businesses are increasing investment in emerging technologies in response to US tax reform
- 31% says that big data/analytics will be most influential on their business over the next three years
Not a matter of if but when disruption will hit. IP companies are staying nimble in order to prepare
- 49% of businesses say that preparation for disruption will be quite important or critical to the success of their business in the next three years
- 52% of businesses say that flexibility to adapt to trends will be quite important or critical to the success of their business in the next three years
- 53% of businesses say that access to specialized skills for emerging tech will be quite important or critical to the success of their business in the next three years