Research by Cranfield School of Management and Microsoft shows that in some key areas high performing manufacturers lag behind their peers in other sectors. While 85 per cent react rapidly to changing competitor strategies, they have not been as quick to collaborate with their supply chain and business partners by forming virtual teams.
Among those questioned, 86 per cent collaborated well through traditional, functional teams. Fifty nine per cent were good at collaborating within cross-functional teams, but none at all collaborated well through virtual teams formed with other companies. Figures for companies achieving easy access to integrated information from suppliers and business partners also indicated weak inter-company collaboration among manufacturers. Only 43 per cent were good in this area compared with 72 per cent that had easy access to integrated customer information.
"The results indicate manufacturers focus on the competition at the expense of their own supply chains, which should be the source of their competitive edge," said Dr Chris Hemingway, Research Fellow at Cranfield School of Management "Increasingly, competition is between supply chains, not just individual companies, so neglecting collaboration with suppliers and partners is a danger to survival in the longer term."
This lack of development in supply chain collaboration was evident among all manufacturing companies, including the most agile, high performing businesses identified by the research. These are companies that scored high on a workforce agility rating, based on speed of action, flexibility of response to change and realisation of benefits from B2E technologies and new working models. The latter include mobile working, flexible working hours and self managed teams. Typically, high performers in all sectors responded more quickly to external change. Their employees are also more able to move easily between projects and acquire new skills.
Agile, high performance companies also tend to continuously assess employees' effectiveness against that of competitors' and use technology to free them from routine work. Despite this, the lack of external virtual teams among manufacturers indicates a reluctance to commit to the Web-based technology that these require. This view is reinforced by a marked lack of community-based Websites for internal collaboration, with only 15 per cent making effective use of these.
"Manufactured products are increasingly varied and sophisticated and, as a result, manufacturing and its supply chains are also becoming more complex," said Paul Burgum, Industry Marketing Manager for Manufacturing at Microsoft in the UK. "Without collaborative systems using Web technology, virtual teams collaborating along the supply chain will find it difficult to operate efficiently." High performers in manufacturing were also notable for a lack of IT skills among the workforce compared with other sectors. Forty two per cent had highly skilled and IT literate staff, and nearly 100 per cent thought their workforce needed more training in technology. Despite this, only 42 per cent of the respondents were using on-line training to reduce costs and 58 per cent used it for flexibility in how and when employees learn.