As the challenges of the last 12 months have clearly demonstrated, business resilience must look beyond the confines of financial stability. It should also incorporate a strengthened supply chain, ongoing investment in the latest processes, equipment, and products; engineer new and more productive ways of working and focus on having a safe, highly trained, and motivated workforce.
The ability to withstand unplanned events that test the robustness of global supply chains such as generational weather occurrences, trade disputes or IT failures is one example of business resilience. Likewise, having the flexible infrastructure and appropriately skilled employees that can allow companies to pivot quickly towards new products and emerging market demand, are also key indicators as to whether a business can demonstrate all round resilience in the face of increasingly competitive local, regional, and global marketplaces.
Resilience is a key component of business competitiveness, encompassing critical factors such as investment, productivity, and employment. If the UK manufacturing sector is to successfully compete on a global stage and withstand multiple economic, social, and political challenges, it must seek to ensure that its resilience matches, if not exceeds, those of other nations.
But obtaining a better and more informed understanding of the current standing of UK manufacturing resilience is an important starting point if we are to position our manufacturing base to benefit from sustained business resilience improvements. Where do we currently stand? Which manufacturing sectors are performing best when critical resilience indicators are examined? What can companies do to ensure their resilience is enhanced and, with it, their commercial ambitions met?
Up until now, getting a handle on the insight that would help answer many of these questions was not easy. Important information has been available, but it has been deposited in disparate places without the means to connect what the data was collectively telling us to develop a clear and holistic view around the topic of UK manufacturing business resilience.
Acknowledging the significance of such landmark benchmarking is why RS Components committed to undertaking the task of bringing together six different datasets to tell today’s business resilience story. As a strategic supply partner for industry, we believe it is vital that the sector has an informed view on where it stands when it comes to the resilience that is vital in driving economic recovery and sustained growth.
The Resilience Index
The unique Resilience Index is a comprehensive examination of UK manufacturing resilience. Its exclusive insight is founded on a collection of 20 years of historical datasets that have up until now only resided in silos. But when brought together, they help to paint a picture that illuminates where the sector currently sits by focusing on three key areas: plant (business investment), process (productivity) and people.
What does the Resilience Index show us?
The Resilience Index highlights that, while many key areas of UK manufacturing are showing vital signs in key measures of business resilience, others are more fragile. Food production and manufacturing, metals and the textiles sectors are not only below the manufacturing average, but below the UK average too. While they were making small gains in the early 2000s, after the financial crash of 2008 these reversed and have never recovered.
The chemical industry is among the most resilient of the manufacturing categories. After suffering a dip, post-financial crisis, levels have continued to improve at a speed greater than the manufacturing average – and in line with their consistently higher than average rates of investment.
The oil and gas manufacturing industry also shows high levels of resilience, although this fluctuates wildly depending on the volatile price of oil. However, even when oil prices have been at their lowest, resilience has still been 50 per cent higher than the rest of the manufacturing sector.
Ultimately, the Index demonstrates that even though UK manufacturing’s resilience is higher than the UK average base, it needs to add 18 additional points - where one point of the Index is worth £1.4bn - to its score if it is to match Western Europe for productivity and add £26bn to the UK economic coffers.
The role of RS Components
With the findings of the Resilience Index now available to view and act upon, it is critical that UK manufacturing takes heed of what it is telling us and looks to work with strategic partners that can help build resilience.
RS Components is committed to assisting in this process; one that can help businesses enhance their operational efficiency to do more with less and at the same time future proof the business.
By moving from being a catalogue-based product supplier to a digitally-enabled technical solutions provider, we have become more strategic and a more important part of the customer supply chain. Our Inventory, Procurement and Maintenance solutions assist businesses across plant and process, through to supplier partnerships offering training for new products and solutions to keep updated with technological advancements, and PPE and safety products to keep the plants, products & workforce safe and productive.
Also, partnering with global MRO and protection suppliers with a robust local infrastructure such as RS Components, can ensure businesses have access to hundreds of thousands of product SKUs, from thousands of suppliers that can be accessed from an interconnected web of distribution centres and local branches. Where we found our strength over the past year, is reacting quickly to urgent demands. One such example was an NHS customer who urgently required a calibrated infrared thermometer to monitor patients for COVID-19. Within 24 hours, we sourced the product, sent it to our UKAS accredited calibration lab, couriered it to our Birmingham branch and then the manager personally delivered it to the customer.
What is next?
Whilst the economic shockwaves from the implications of the UK leaving the EU and the COVID-19 lockdowns remain largely unknown, it has placed business resilience - from supply chain, to technology, to skills and training – under the spotlight.
The Resilience Index has added informed insight to that scrutiny. It allows all manufacturing stakeholders to form a view about where they currently stand when it comes to the strength of their individual business resilience. And, critically, it illuminates what they need to do to address improvement ambitions to drive productivity, sustain competitiveness and secure commercial success.
Over the course of 2021 more data, expert commentary, and exclusive insight on the topic of resilience for industry will be unveiled around the key areas of plant, process, and people. The Resilience Index is the starting point, and we will be exploring resilience in greater detail as the months go by. We look forward to unearthing the truths of manufacturing and industrial resilience and hope senior engineers find our exploration of use.