Building resilience and agility for manufacturers

How the manufacturing industry stacks up

Compared to other industries, the self-perception of manufacturing companies’ capacity for resilience and agility is slightly above average. Fifty percent of executives and employees considered their businesses to be strong or very strong in terms of resilience and agility, while only 28% considered themselves to be weak or very weak.

Certain factors that distinguish the manufacturing industry could play a role in this. Manufacturers are inherently driven by the needs of their customers — so they naturally need to be prepared for changes. Additionally, the manufacturing industry has a history as a fertile ground for innovation.

Manufacturers should find this encouraging. More than anything else, though, it should be a motivator. If 50% of companies in manufacturing are strongly resilient and agile, that means that the other 50% of companies need to put all the resources at their command into developing resilience and agility. Without this, they find themselves at a competitive disadvantage beside their more resilient, agile peers.

This raises the question: What factors make a manufacturer resilient and agile?

Attributes driving resilience and agility in manufacturing

Our analysis showed 10 attributes that are particularly important for manufacturing.

1. A dedicated innovation unit, focused solely on developing new technologies, with fewer constraints than the rest of the organization.
2. A staff that understands and follows the vision provided by leadership.
3. Measures in place to mitigate cybersecurity risks.
4. Sufficient resources to try new methods or technologies with the goal of improving workflow.
5. Documented and shared risk tolerance.
6. A sufficiently autonomous workforce that can act on threats and opportunities without needing to get leadership involved.
7. Openness to change, allowing the organization to move faster than its competitors.
8. Voice-of-customer processes and tools to understand customer sentiments and their changing needs.
9. Voice-of-employee processes and tools to understand and adapt to the changing employee sentiment.
10. Regular training in new skills and capabilities.

We found that most of these attributes were well-leveraged, but there were some notable exceptions. Manufacturing companies have not done the most they can to leverage documented risk tolerance, voice-of-employee processes, governance or effective change management practices.

Risk tolerance is of particular importance in manufacturing, owing to the hazards to which employees find themselves exposed on the job. Workplace injuries are extremely common in manufacturing, and in addition to the pain and suffering experienced by the employee, they can have an impact on the productivity of the facility. Documenting how employees can safely conduct themselves on the job is one key area of focus for manufacturers.

More generally, a greater understanding of the human element —understanding the needs and concerns of their employees — can greatly benefit manufacturers. While they deal in material goods and not services, their workers remain an important part of their transition to a more resilient and agile stance.

Developing resilience and agility

As an industry on which other industries depend, manufacturing acts as a keystone, in much the same way as transportation and logistics. Resilience and agility are essential for the bottom line within the industry and for the sake of other connected industries. The analysis shows that many companies in manufacturing have already taken steps to make themselves resilient and agile, continuing a long and proud tradition of innovation.