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Manufacturing Transformation Overview
 

Manufacturing Transformation Overview

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Achieving competitive advantage in a changing global marketplace. ...

Achieving competitive advantage in a changing global marketplace.

PTC partnered with Oxford Economics to validate a hypothesis on manufacturing transformation. Together, we analyzed the market shifts that are driving transformation, measured the impact of prioritizing different business areas, and identified how firms will create competitive advantage in the future.

An overview of the top-level findings from our study is summarized in this eBook. Download the full report, Manufacturing Transformation: Achieving competitive advantage in a changing global marketplace, for the complete findings and analysis, including case studies of leading firms and the results of our economic model.

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    Manufacturing Transformation Overview Manufacturing Transformation Overview Presentation Transcript

    • Manufacturing Transformation Overview Manufacturing Transformation Achieving competitive advantage in a changing global marketplace Page: 1 2 3 4 5 6 7 8 9 10 11 PTC.com
    • Manufacturing Transformation Overview PTC partnered with Oxford Economics to validate a hypothesis on manufacturing transformation. Together, we analyzed the market shifts that are driving transformation, measured the impact of prioritizing different business areas, and identified how firms will create competitive advantage in the future. Oxford Economics Oxford Economics was founded in 1981 as a joint venture with Oxford University. Since then, they have become one of the world’s foremost independent global research firms. Headquartered in Oxford, England, with offices throughout the world, Oxford Economic employs more than 80 professional macroeconomic and industry economists—one of the largest teams of economists in the private sector. Get more information at oxfordeconomics.com An overview of the top-level findings from our study is summarized in this eBook. Download the full report, Manufacturing Transformation: Achieving competitive advantage in a changing global marketplace, for the complete findings and analysis, including case studies of leading firms and the results of our economic model. PTC PTC’s technology solutions help customers transform the way they create and service products across the entire product lifecycle – from conception and design to sourcing and service – to create sustained competitive advantage. Founded in 1985, PTC employs approximately 6,000 professionals, including 1,300 dedicated service professionals, serving more than 27,000 businesses in rapidly-evolving, globally distributed manufacturing industries worldwide. Get more information at PTC.com Page: 1 2 3 4 5 6 7 8 9 10 11 PTC.com
    • Manufacturing Transformation Overview Survey Profile In addition to the survey, we interviewed leading manufacturing executives and used the survey data to develop an economic model that quantified the business results manufacturers generated. Oxford Economics conducted a global online survey of 300 manufacturing executives across industries, business functions and company size to create a comprehensive view of the manufacturing landscape. The complete findings can be found in the report, Manufacturing Transformation, click here to download. The profile of those respondents depicts a balanced cross section of industries, broad global coverage including Europe and Asia, and a split between C-level executives and their direct reports across business functions. Half of all respondent’s firms generate greater than $1.25bn in revenue. What is your firm’s industry segment? Medical Devices China Japan Germany 16% 17 United States Aerospace and Defense 17% 16% % Industrial Equipment In which country is your company headquartered? South Korea Automotive Taiwan France 17% 17% Electronics / HighTech Denmark Norway Sweden Consumer / Retail / Apparel Finland 0 10% Which best describes your business function? What best describes your role? 59% 15% 20% 21% Product / Engineering Service Large: $1.26b – $5b Operations Finance 5% 0 2 35% 25% 29% 25% Small: $250m – $750m Strategy I report to a C-level executive 1 30% Annual Revenue IT I am a C-level executive 25% Very large: over $5b Supply Chain / Manufacturing 41% Page: 5% 3 4 5 6 7 10 15 % 20 % 8 9 Medium: $175m – $1.25b 25 % % 10 11 PTC.com
    • Manufacturing Transformation Overview External market shifts Top 3 external market shifts 66% Economic realignment (slump in world trade, rise of emerging markets and recessionary pressures) Technology (Internet of Things, Big Data, cloud, mobility and social) External market shifts are reshaping the global landscape for manufacturing firms, ushering in a new era of competitiveness. When asked “Which market trends do you expect to have the greatest impact on your firm over the next three years?” manufacturers identified the top 3 shifts as follows: • Economic realignment: Slump in world trade, rise of emerging markets and recessionary pressures are top of mind for manufacturers. 61% • Technology: Innovations like the Internet of Things, Big Data, mobility, social, and cloud—will have the second greatest impact. • Supplier and partner complexity: The increasing quantity and intricacies of supplier and partner relationships ranked third for manufacturing firms. More complex, deeper relationships with suppliers and partners 0% 10% 20% 30% 40% 60 % 50% For the complete list of external market shifts impacting manufacturers along with some significant regional, industry and business function. differences, download the full report. 60% 70% 80% 90% 100% The top 3 external market shifts that manufacturers expect will have the greatest impact on their firms over the next three years. Page: 1 2 3 4 5 6 7 8 9 10 11 PTC.com
    • Manufacturing Transformation Overview The need to transform As a result of these consumer, market and technology shifts, 68% of manufacturers agree or strongly agree that their firm will be undergoing significant business process transformation to prepare for future market demands in the next 3 years. Manufacturing firms will take a variety of approaches to transform their businesses, and adopt multiple strategies in response to market shifts. 68 % 68% of manufacturers agree or strongly agree that their firm will undergo significant business process transformation to prepare for future market demands in the next 3 years Page: 1 2 3 4 5 6 7 8 9 10 11 PTC.com
    • Manufacturing Transformation Overview Strategies to drive revenue and profitability Top 3 strategies When asked “Which strategies do you expect to use to drive revenue and profitability in three years?” manufacturers identified the following as their top 3 strategies: 100% 90% • Voice of the customer initiatives • Performance-based service contracts 80% • Ability to design, build, and service anywhere. 70 % Voice of the customer initatives 60% 40 Performance -based service contracts 68 % 50% % For the complete list of the strategies manufacturers will use to drive revenue and profitability along with some significant regional, industry and business function differences, download the report. Design, build, and service anywhere 65% Successful transformation initiatives Beyond discrete strategies, fresh thinking is needed to respond to global shifts and affect transformative change. We uncovered that successful transformation initiatives were grounded by three broad themes: rethinking strategy and planning, the service imperative and innovation everywhere. 58% 30% 20% 10% 0% Page: 1 2 3 4 5 6 7 8 9 10 11 PTC.com
    • Manufacturing Transformation Overview Rethinking strategy and planning Strategy and planning will eclipse pure operational excellence as the source of competitive differentiation. In order to become market leaders, firms will strive to improve their capabilities to coordinate strategy and planning by a number of methods. For example, in three years, global product development will almost double as a method for coordinating strategy and planning. Likewise, systems engineering will jump 59%, global portfolio management 50%, and global product platform 49%. For the complete list of the methods manufacturers will use to coordinate strategy and planning along with some significant regional, industry and business function differences, download the report. Growth in methods to coordinate strategy and planning over the next three years Global product development Systems engineering Global portfolio management Global product platform 0 Page: 20% 1 2 3 4 59% 50% 49% 40% 5 6 7 8 96% 60% 9 10 11 80% 100% PTC.com
    • Manufacturing Transformation Overview The service imperative Fresh new thinking around service means a lot more than fixing and maintaining products. The service imperative is a transformation that involves the rise of service as a strategic priority, creating new business models and driving revenue and profitability. When asked if their firm is enhancing services as a key way to differentiate their products, almost two thirds (64%) of manufacturers agreed today. While significant regional differences exist, by 2015, 71% of all manufacturers will use service as a key way to differentiate their products. So which service strategies are firms using now and plan to continue to use to drive revenue and profitability? Download the complete report. 100% 90% 80% 70% 71 % 60% 64 50% % 40 % 30% 3 years from now Today 20% 10% 0% By 2015, 71% of all manufacturers will use service as a key way to differentiate their products. Page: 1 2 3 4 5 6 7 8 9 10 11 PTC.com
    • Manufacturing Transformation Overview Growth of smart products enable innovation everywhere Innovation everywhere 100% Innovation involves more than just new products and services, although those things remain essential. Undergoing significant business process transformation to prepare for future market demands requires expanding innovation beyond traditional product R&D to encompass all parts of the enterprise ecosystem. 90% Strategies driven by “smart products” are one area that is growing more popular, as software-enabled and connected products see a 38% growth over three years, to 53%. 80% 70% Manufacturers are approaching innovation with a range of techniques, business models and strategies to drive transformation. For the complete list, download the report. 60% 53 % 50% 40% 38 30% % 20% 10% 0% Smart Products Software-enabled and connected products see a 38% growth over three years, to 53%. Page: 1 2 3 4 5 6 7 8 9 10 11 PTC.com
    • Manufacturing Transformation Overview Optimization of manufacturing operations becomes routine Over half (52%) of survey respondents report that they have wrung out almost all savings in their manufacturing operations today. While this figure indicates there is still work to be done, 65% of surveyed executives believe that optimizing operations has become the industry’s price of entry rather than a source of differentiation. That number rises to 71% in three years. One reason for increased emphasis on strategy and planning, service and innovation is that traditional means of creating advantage are running out of steam. However, manufacturers can’t execute on transformation without continuing to improve manufacturing operation prowess. Optimization and cost reduction trends Some opportunity for cost savings from optimizing manufacturing operations still exists 52% 65% Optimizing manufacturing operations has become the price of entry. 65% 71% 0% 10% 20% Today Page: 1 30% 40% 3 4 60% 70% 80% 90% 100% % of respondents 3 Years 2 50% 5 6 7 8 9 10 11 PTC.com
    • Manufacturing Transformation Overview Well-executed transformation efforts produce measurable business results, including quantifiable return on investment. The economic impact of business transformation however, varies according to the areas prioritized. © 2013, PTC Inc. (PTC). All rights reserved. Information described herein is furnished for informational use only, is subject to change without notice, and should not be taken as a guarantee, commitment, condition or offer by PTC. PTC, the PTC logo, Windchill, and all other PTC product names and logos are trademarks or registered trademarks of PTC and/or its subsidiaries in the United States and other countries. All other product or company names are property of their respective owners. The timing of any product release, including any features or functionality, is subject to change at PTC’s discretion. To see the results of our economic model along with a list of activities that manufacturers identified as creating the most value for firms today and in three years, download the report. Page: 1 2 3 4 5 6 7 8 9 J2171–Oxford_Economics_ebook–EN–0513 10 11 PTC.com