The Australian Industry Group recently published their National CEO Survey report.
The Australian Industry Group recently published their National CEO Survey report. This report identifies a number of key issues facing manufacturing CEOs today.
The report identifies the top impedents to growth for manufacturing industries as:
- Lack of customer demand
- High and/or variable exchange rate
- Flexibility of industrial relations
- Skills shortages
- Government regulatory burden
- Competition from imports / internet sellers
- Wage pressures / high wage costs
The report also identifies the most important business strategies and priorities for manufacturers as:
- Introducing new products and services
- Improving sales of current products and services
- Developing new domestic markets
- Developing new overseas markets
- Donwsizing / reducing operational costs
- Increasing online presence and capability
- Increasing advertising and marketing
Some of the key highlights from the report, specific to the manufacturing industry include:
- Manufacturing CEOs expect lack of customer demand (27%) to be the main challenge facing their business in 2016
- Wage cost pressures have risen in the past few years with 16% of respondents ranking it within their top three inhibitors of business growth for 2016
- Competition from imports remains a concern with 15% of CEOs believing it to constrain business
- Foreign exchange rates are a concern for 15% of CEOs in 2016
- In response to these risks, manufacturing CEOs plan to introduce new products and services (26%) and improve sales of current products and services (25%). These have been the main two strategies of manufacturing businesses for the past three years.
- Introducing new products and services has increased as a growth strategy for businesses from 20% in 2014 to 23% in 2015 and 26% in 2016. Improving sales of current products and services has seen a similar rise in popularity as a business strategy from 21% in 2014 to 23% in 2015 and 25% in 2016.
- Developing domestic markets (18%) has also increased as a growth strategy in consecutive years, as well as developing new export markets, in line with the lower Australian dollar.
- Downsizing and reducing operational costs has fallen in popularity as a growth strategy since 2014. In 2015, 57% of manufacturing CEOs adjusted their business plans in response to changing business conditions.
- Changes to plans included greater emphasis on exports, including finding and developing new markets, increased marketing efforts and further investment in machinery and equipment.
- Diversification was also a common theme in changes to business strategy, particularly for those manufacturers in the process of exiting the automotive industry.
- For those whose revised strategies included reducing costs, decreasing staff was the most common change stated.
- Several respondents mentioned the introduction, re-introduction or renewed interested in lean processes
How can Redstack help?
- What if you could win more bids to increase sales?
- What if you could increase innovation capacity to develop products faster to the market?
- What if you could reduce warranty issues and spend time developing new products instead?
- What if you could improve product performance to reduce operational costs?
Some of the technology and services we utilise to deliver these benefits includes:
- Data Management Services
- iLogic automation software and programming services
- Autodesk simulation software
- Engineer-To-Order technology
Redstack have a range of solutions to deliver these benefits by identifying and resolving root causes of problems and identifying opportunities for improvement. Our industry leading experts utilise ourTakeAIM process, a proven methodology to uncover solutions and opportunities. We partner with the world's leading technology providers to deliver high value solutions tailored to your unique situation.
Contact Redstack to discuss how we can assist in resolving your manufacturing challenges and improving your profitability today.
Australian Indusrty Group National CEO Survey, accessed online 2/6/16.