Here's why nearly half of APAC manufacturers lag behind competitors

A study found that these manufacturers face innovation and skilled workforce challenges.

Over 45% of Asia-Pacific manufacturers are struggling to keep up with competitors due to a lack of innovation, skilled workforce, and technology, according to the 2023 State of Smart Manufacturing Study by Rockwell Automation.

Globally, twice as many manufacturers believe their organisation lacks the technology needed to outpace the competition compared to 2022. 

Four out of five manufacturers still lack an end-to-end supply chain planning solution.

Close to half (44%) of APAC manufacturers plan to adopt smart manufacturing within the next year. Of this group, China, Australia, and India are already using some components of smart manufacturing.

Biggest barriers

APAC manufacturers face significant challenges in adopting smart manufacturing, including employee resistance to technology adoption and change, a lack of skill sets to manage smart manufacturing implementation, and a lack of a clear definition of the value/ROI of smart manufacturing.

Quality management systems are the smart manufacturing system that APAC respondents have seen the largest ROI, followed by manufacturing execution systems and enterprise resource planning.

Cybersecurity risks rank highest as the obstacle all respondents are looking to mitigate with smart manufacturing initiatives. 88% of APAC manufacturers plan to maintain or grow employment due to technology adoption.

The survey also found that of the 94% of APAC manufacturers who have formal or informal environmental, social, and governance (ESG) policies in place, almost half (48%) cite "a competitive differentiator" as the top driving factor for pursuing ESG initiatives.

“Manufacturers are continuing to seek opportunities for profitable growth but are realising that uncertainty in workforce availability is impacting quality, along with their ability to meet evolving customer needs,” said Veena Lakkundi, senior vice president, Strategy and Corporate Development, Rockwell Automation. 

The report surveyed over 1,350 manufacturers across 13 of the leading manufacturing countries, including Australia, China, India, Japan, and South Korea.