Thursday, January 16, 2014

Painting by the Numbers

Ken Voytek January 14, 2014 0
Painting by the Numbers
Plato suggested that a “good decision is based on knowledge and not on numbers.” To that end, I hope to impart some knowledge and not just numbers… although I am known for being a numbers person.
As part of the NIST MEP client survey process, MEP center clients are asked to identify the top 3 challenges their companies face over the next three years.  We’ve been asking this question for 5 years now and more than 35,000 clients have responded over that period.  The challenges they point to paint an interesting picture of what keeps manufacturers up at night. They cite a passel of issues that have changed in interesting ways over time.
Seven in ten clients continue to cite continuous improvement as their top single challenge, but the FY 2013 data include important shifts in other key issues worth highlighting.
  • Taken separately the challenge of growth and product development/innovation ranks them second and third respectively.  However, taken together over 79 percent of clients cited one or the other, which would rank it as the top challenge.
  • Over time, there has been a significant increase in the portion of clients saying that workforce needs as a key issue. In FY 2013, over 35 percent of clients reported employee recruitment and retention as an important challenge compared to 19 percent in FY 2009.
  • In addition, technology needs, supply chain needs, and product innovation/development are more important than they were five years ago. Over 49 percent of clients cited product innovation and development as an important challenge facing their company, up from 45 percent five years ago. The share of clients citing technology needs as a challenge rose by 3 percentage points – rising from roughly 10 percent in 2009 to over 13 percent in 2013.
  • On the other hand, fewer clients are now reporting that growth, sustainability, and financing are important challenges.  For instance, the share of clients identifying financing as a challenge fell from 18 percent in 2009 to roughly 11 percent in 2013. This probably reflects changes in credit becoming more available and the fact that many firms have cleaned up their balance sheets.
I suspect that these changes reflect underlying economic conditions and company needs as they identify and respond to new market and growth opportunities. As we begin a new year, it always useful to step back and see what clients say about their business, their companies, and their challenges. It is also interesting to note how these trends play out and what they may suggest for future work.  Ultimately, as we begin this New Year, knowing how the toughest tasks facing smaller manufacturers are evolving is more than just a numbers game.  It adds up to a useful view on trends that can help guide MEP’s work and priorities for the future.
Most Important Challenges Facing MEP

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