SME Manufacturers in Asia Pacific Need to Think Small to Grow Big

In contrast, almost three in 10 manufacturers with a company size of between 100 and 499 employees had plans to adopt Industry 4.0 approaches within 12 months, while 6.5 percent had already implemented smart connected manufacturing initiatives.

While the adoption of new technologies and capabilities could strain resources for smaller manufacturers, the opportunity cost of not doing so would be even greater.

Companies that are hesitant to spend all their funds on digital transformation can consider a ‘test the water’ approach of incrementally adding budget, reallocating funds, and devoting staff resources to specific initiatives that are expected to produce short term ROI. As they gather more experience in implementation and resources, longer-term initiatives can be considered.

To address the needs of the market, there will also have to be greater focus on talent development. This is a particularly important area of note in Asia-Pacific, where a fast-growing middle class and increasing access to education creates vast opportunity for the region to become a leader in emerging technologies such as additive manufacturing.

Siemens Digital Industries works closely with education partners in various markets to foster talent in science and technology. One example is our partnership with the Ho Chi Minh City University of Technology, which recently appointed Siemens as its technology partner in a collaboration to develop the university’s Industry 4.0 Lab.

What kinds of tools and technologies will smaller manufacturers need to succeed in the age of customizability?

One of the key technologies expected to make a larger impact in this field is additive manufacturing (AM), which is already seeing steady growth in the ASEAN region. Globally, the AM market is forecasted to grow at a compounded annual growth rate of 27 percent between 2018 and 2023, representing an increase of almost US$4 billion.

Asia-Pacific in particular, is expected to see the greatest growth in AM, being a hotspot for automotive production and printed electronics, two areas where AM adoption is set for exciting growth. The industry focus on modular manufacturing and high-volume custom production is also expected to be a key driver of AM, as demand for rapid prototyping solutions grow.

In a world of smart, connected products where the entire market landscape can drastically change with a single innovation, manufacturers must take a new approach to business. They need to closely watch how products are being used, and feed data back from product utilization into product ideation and development in order to anticipate trends.

The realization phase of innovation is vital in this new era.

It’s no longer enough to digitize—today’s manufacturers must weave a digital thread through ideation, realization, and utilization. With a fully optimized “Digital Enterprise,” manufacturers are better equipped to initiate or respond to disruptive innovation.

SME manufacturers that can be agile and quickly leverage the right technologies to act as innovation accelerators for design and product development will be in a much better position to compete against larger companies.

With the help of the right technology, SME manufacturers will not just have a key role to play in serving growing customer needs, but will drive the market forward across areas such as innovation, efficiency and talent development.

Check out: The Manufacturing Outlook